Mr. Michael Strine
Assistant to the Secretary
Department of Finance
820 French Street
Wilmington, DE 19801 C1010
RE: ELDERLY PROPERTY TAX RELIEF AND
EDUCATION EXPENSE FUND
Dear Mr. Strine:
You have asked whether the Secretary of Finance ("the Secretary") may extend the time for filing applications for property tax credits for the initial tax year under 72 Del. Laws c.256, the Elderly Property Tax Relief and Education Fund ("the ETR Fund"). For the reasons expressed below, we conclude that he may.
In August of 1999, the General Assembly created the ETR Fund to provide property tax relief to the elderly. Persons 65 years of age or older at the beginning of the tax year were granted a maximum credit of up to 50 % of the local school tax after certain adjustments, or $500.00. No credit was allowed unless a written application was filed with the county receiver of taxes or county treasurer. The counties are charged with the duty to collect local school property taxes. The legislation stipulated that for the tax year beginning after May 1, 1999, and before May 1, 2000, the initial tax year, that applications were due in accordance with rules and deadlines established by the Secretary of Finance. For subsequent tax years the applications were required to be filed no later than the date of application for similar tax exemption programs for persons 65 and over offered by the county in which the qualified property exists. The act gave the Secretary the power to promulgate rules and regulations deemed necessary to implement the credit program. The Secretary proposed regulations adopting April 15, 2000 as the due date for applications for the credit. This date was subsequently extended to the match the end of the 1999-2000 tax year of each County. Each County's tax year begins on a different date. In New Castle County the date is July 1st, in Kent County it is June 1st, and in Sussex County it is May 1st.
There was no readily available data basis that could identify property owners who were 65 years of age and eligible for the new credit. The records of the Counties could not match property owners on the rolls with qualified seniors. While various attempts were made to publicize the availability of the program and to educate those eligible for the credit about the application requirements you estimate that approximately 2 to 5 % of eligible taxpayers have missed the filing deadline. You have represented that there was a great deal of confusion among the elderly about the credit program. You state that there were various processing delays in the Counties due to the volume of applications such that some applications were processed after the due date for filing for the credit and after bills for the tax year 2000-2001 were mailed out. The Secretary has continued to process applications for the credit throughout the summer. You now wish to extend the application dead line for the initial tax year until the end of the calendar year 2000, and make one more attempt to reach the elderly who are eligible for the credit.
We begin by making some observations about the General Assembly's intent as reflected in what they did and what they did not do in enacting the law.
The bill containing the new program was enacted in August of 1999, well after the tax year in each of the Counties had begun. To the extent that the counties would be put to substantial administrative trouble and expense in implementing the credit program during the current tax year, the General Assembly deemed that result preferable to delaying the program until the next tax year. The bill, recognizing the imposition that was necessarily being made upon the Counties, authorized an administrative payment to each County to offset the expense that they would be forced to incur. The General Assembly could easily have made the program effective for the following tax year, which was to begin on or after May 1, 2000, and thereby avoided the problems and expenses related to implementing a tax credit program in midstream. In this regard the General Assembly could have also set the application due date to coincide with the application due date for similar tax exemption programs offered by the Counties as it did for subsequent years in Section 4 of the Act. The legislative decision to make the new credits available right away displays a strong desire to benefit the elderly immediately despite the attendant difficulties. It also reflects the General Assembly's conclusion that there was no legal impediment to making the credit program effective in the Counties' current tax year. To the extent that implementing the credit in that fashion could be said to have changed tax rates that had already been fixed by the counties for the then current year, it was of no legal consequence.
As noted above the General Assembly, recognizing the problems incident to current year implementation, in addition to a broad general grant of regulatory authority, specifically decided to grant authority to the Secretary to fix "the rules and deadlines" for the filing of applications rather then to arbitrarily set a date certain. This seems to be designed to give the Secretary the flexibility necessary to identify problems and set deadlines so as to maximize the success of the program. The General Assembly could have, but chose not to, cap the discretion delegated to the Secretary by fixing a date certain beyond which applications could not be received. See, e.g. 9 Del. C. § 8133(b). The failure to limit or set an outside absolute date for the submission of applications again, in our minds, displays the strong desire to reach as many people with this remedial program as soon as possible.
We turn now to the real crux of the issue. Whether the delegation of the power in this statutory scheme to fix deadlines carries with it the inherent or implied power to extend those deadlines?
Delaware courts have long affirmed the
General Assembly's power to delegate regulatory authority to administrative
agencies. State v. Retowski, Del. Ct. Gen. Sess., 175 A.
Hoff v. State, Del. Super., 197 A. 75 (1938).
An administrative agency may be given discretion as to implementation of
legislative policy, but not as to the determination of legislative policy.
Carroll v. Tarburton, Del. Super., 209 A.2d 86 (1965). Chief
Justice Layton noted the following in Retowski about the delegation
of authority (citations omitted):
The General Assembly may enact a law exercising one or more of its legislative powers, declaring the policy of the law, fixing the principles which are to control in given cases, and, at the same time, delegate to an administrative body the power to ascertain the facts which will determine when the power exercised by the act shall take effect and be enforced. Opinion of the Justices, Del. Supr., 246 A.2d 90, 94 (1968).
Delegation can be either explicit or implicit. Justice Walsh, in an Order affirming the Superior Court wrote, "It has long been recognized that an administrative agency may exercise certain authority based upon an implied delegation from the General Assembly." Raley v. State, Del. Super., Cr. A. No. S90-07-0002, affirmed Del. Supr., 604 A.2d 418 (1991).
In the case of Atlantis I Condominium Ass. v. Bryson, Del. Supr., 403 A.2d 711,713 (1979), our Supreme Court considering the issue of implied delegated power identified this overriding concern:
In any event, the authority granted to
an administrative agency should be construed so as to permit the fullest
accomplishment of the legislative intent or policy. An expressed legislative
grant of power or authority to an administrative agency includes the grant
of power to do all that is reasonably necessary to execute that power or
In keeping with this canon the Delaware Courts have recognized an implied power in the Court itself to extend an execution date so that the Court could review the imposition of the death sentence, State v. Sullivan, Del. Super., IK92-01-0192 thru196, IK92-02-0001, IK92-02-0022, (Ridgely, P.J., June 14, 1994); in the Board of Podiatry to interpret the meaning of podiatry, Strauss v. Silverman, Del. Supr., 399 A.2d 192 (1979); and in the Workmen's Compensation Board to modify or set aside compensation agreements that do not conform to the statute, Ohrt v. Kentmere Home, Del. Super., C.A. No. 96A-01-005 RRC (1996).
Even without any clearly settled law upon which to rely, we believe that the courts would reach a similar conclusion if this question were presented as a case or controversy. The General Assembly was most insistent in requiring the credit plan to be immediately instituted. The General Assembly delegated to the Secretary the power to make rules and regulations in addition to the specific authority to set the due date in the first instance. This obviously was intended to give the Secretary the necessary flexibility to implement the credit program and to set a date that would provide a fair and adequate opportunity for all the intended beneficiaries to qualify. That it proved too difficult a task to accomplish before the beginning of the Counties' next tax year should not operate to not deny the elderly the remedial benefit sought to be extended and defeat the legislative will so obviously manifested. In such an instance the authority to extend the deadline must be implied in the authority delegated to the Secretary. Extending the deadline falls squarely within the task of determining outside of the legislative halls the facts and the limits under which legislative policy will be implemented and when that legislative power will take effect. This is precisely the function of delegation.
As you know, setting any deadline necessarily involves extinguishing the ability of a person to qualify for a right, benefit or exercise a power that is governed by the date fixed for taking the required action. Deadlines are necessary and should not be changed lightly. Deadlines for filing applications for this kind of credit are administrative necessities. But, in this case the application process was more then that, it was actually the only mechanism by which those intended to be benefitted by the program could be identified. So, in failing to fix any limit for applications in the original year of the credit program the General Assembly, in our view, was displaying little concern for the administration of the credit, or for cutting off the right to the credit. It was displaying a great deal of concern for actually reaching all the elderly beneficiaries through the application process. Under these facts and circumstances a final extension to the date chosen is both reasonable and within the Secretary's power.
Consistent with our conclusion we point out that in a related tax area, even where there is a fixed statutory deadline, the General Assembly has allowed the affected parties to extend the deadline. See for instance 30 Del. C. §§ 511, 531, 539, 553 and 560.
In closing we note that, in the specific
delegation to the Secretary, the General Assembly used the plural word
"deadlines." This may be an indication that the General Assembly believed
that more then one deadline would be needed to accomplish it's objective
or that an extension was contemplated. It may have simply reflected the
reality that each County has a different tax year and that the Secretary
might want to set a different date in each County. At any rate the use
of the plural form is not inconsistent with our conclusion.
Very truly yours,
Jos. Patrick Hurley, Jr.
Deputy Attorney General
Michael J. Rich
Cc: The Honorable M. Jane Brady, Attorney
Mr. Phillip G. Johnson Opinion Coordinator