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Home Rule VS Dillon's Law


Sample of the book, Public Private Relationships and The New Owners of the Means of Production,, from the chapter To Be or Not To Be Sovereign. To read more and to find out which Maine towns have been made indentured to a corporation by the Maine Legislature purchase the downloadable manuscript in the side bar on the right.

In 1993 The Maine Legislature chartered its first Maine town that would be governed as an “instrumentality of the state” The town was given the name, The Loring Development Authority. It occupied a former military base which had lost 1000 jobs. Why let a crisis go to waste? A chance to implement a new political system!

The story of the Loring Naval Base, The Cutler Navy Base and the Brunswick Navy Base are another chapter in the saga of what happens to when The United States withdraws its' military presence and a void is created into which hostile forces move. The United States Navy was protecting America and Maine from our communist and fascistic foes in more ways than anyone realized. Once the military moved out, communism and fascism moved in on the territories in Maine formerly occupied by the United States military. All three bases are now Maine Constitutional no-go zones transformed by the Maine Legislature as municipal corporations serving as instrumentalists of the state, not only an increase in power of central government over local government but a complete absorption of a legal structure of local government- the municipal corporation into the all encompassing corporate state.

Home Rule VS Dillon's Law

24 years earlier in 1969 Maine became a constitutional Home Rule state:

Maine Constitution: Municipal Home Rule.

Section 1. Power of municipalitiesto amend their charters. The inhabitants of any municipality shall have the power to alter and amend their charters on all matters, not prohibited by Constitution or general law, which are local and municipal in character. The Legislature shall prescribe the procedure by which the municipality may so act.

Section 2. Construction of buildings for industrial use. For the purposes of fostering, encouraging and assisting the physical location, settlement and resettlement of industrial and manufacturing enterprises within the physical boundaries of any municipality, the registered voters of that municipality may, by majority vote, authorize the issuance of notes or bonds in the name of the municipality for the purpose of purchasing land and interests therein or constructing buildings for industrial use, to be leased or sold by the municipality to any responsible industrial firm or corporation.

The Resources Page for the National League of Cities explains the four types of power which are authorized for municipal governments in the USA:

Types of Authority Given
Political power in a state can be divided into three spheres: the local government, the state government and the functions that the two governments share. Within the local sphere, there are four categories in which the state allows discretionary authority:

Structural – power to choose the form of government, charter and enact charter revisionsFunctional – power to exercise local self government in a broad or limited mannerFiscal – authority to determine revenue sources, set tax rates, borrow funds and other related financial activitiesPersonnel – authority to set employment rules, remuneration rates, employment conditions and collective bargaining

Narrow Government Authority: Dillon's Rule

“Dillon's Rule is derived from the two court decisions issued by Judge John F. Dillon of Iowa in 1868. It affirms the previously held, narrow interpretation of a local government's authority, in which a substrate government may engage in an activity only if it is specifically sanctioned by the state government….” 

A municipal corporation can exercise only the powers explicitly granted to themA municipal corporation can exercise only the powers explicitly granted to themThose necessarily or fairly implied in or incident to the powers expressly grantedThose essential to the declared objects and purposes of the corporation, not simply convenient, but indispensable2... Dillon's Rule states that if there is a reasonable doubt whether a power has been conferred to a local government, then the power has not been conferred National League of Cities
It is beyond reasonable doubt that the Maine Constitution through Municipal Home Rule confers structural, functional and fiscal power to local government. Municipal Home Rule authorizes the inhabitants of the municipalities to make amendments to their municipal charter and mandates that the Legislature shall “prescribe the procedure by which the municipality may so act“. Home Rule also authorizes municipalities to issue bonds provided approval by a majority vote through a public referendum.

In chartering the three municipal corporations deemed to be instrumentalities of the state, the Maine Legislature failed to preform its constitutional duty to prescribe the procedure by which the inhabitants of the municipalities may amend their own charter. Instead the Legislature prescribed the procedure by which a board appointed by the state would govern the three municipal corporations, all three municipal corporations are assigned names of regional development authorities. By declaring each corporation to be an “instrumentality of the state”, the Maine Legislature violated Article IV Part Third Section 14 of the Maine Constitution which provides an exception to the prohibition against the Legislature chartering corporations by special acts of legislation for municipal purposes. In so making an exception for municipal purposes, the Constitution precludes chartering corporations for private, state, or regional purpose. 

Section fourteen, relating to corporations is compressive and peremptory.. It relates to all corporations, except only those for municipal purposes. It clearly prohibits their creation by special acts if the objects desired can be secured under existing general laws.'  Governor Seldon Connor's Speech 1876 3

 In the state governed municipal corporations, the constitutional terms of issuing bonds in Municipal Home Rule are scrapped and replaced with statutory terms. Municipal corporations so chartered without establishing municipal procedures for amending their charters, have no method by which to form municipal governments and are left without municipal procedures for conducting a public referendum on the issuance of bonds: The charters for the three state governed towns, Loring Development Authority, Washington County Development Authority, and Midcoast Regional Redevelopment Authority, are in many respects identical. The authority granted for issuing bonds reads like thus: 

2. Authority.   The authority may issue bonds from time to time in its discretion to finance the undertaking of an authorized activity under this article, including but not limited to the payment of principal and interest upon advances for surveys and plans, and may issue refunding bonds for the payment or retirement of bonds previously issued.

A. The principal and interest of bonds must be made payable solely from the income, proceeds, revenues and funds of the authority derived from or held for activities under this article. Payment of the principal and interest of bonds may be further secured by a pledge of a loan, grant or contribution from the Federal Government or other source in aid of activities of the authority under this article and by a mortgage of an urban activity or a project or part of a project, title to which is in the authority. [2011, c. 136, §4 (NEW).]

B. Bonds issued under this section do not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction and are not subject to other laws or charters relating to the authorization, issuance or sale of bonds. Bonds issued under this article are declared to be issued for an essential public and governmental purpose and, together with interest on and income from the bonds, are exempt from all taxes. [2011, c. 136, §4 (NEW).]

The authority so granted is not the authority granted to municipalities by the Maine Constitution, that of a municipal bond authorized by a public referendum. 

Recall that the first thing the founding fathers of Maine's corporate state wanted to do was to eliminate public referendums on bonds. This was recommended by the corporate state founding fathers a mere eight years after Municipal Home Rule had been added to the Maine Constitution. Municipal Home Rule authorizes the use of municipal bonds and only municipal bonds for economic development requiring a majority vote by a public referendum. 

In 1977 the Report-Governor's Task Force For Economic Redevelopment, Recommended Legislation For An Economic Development Program -110th Congress, called for the elimination of local referendums on municipal bond issues 

2, eliminate the requirement for a local referendum on municipal bond issues.- Governors Task Force for Economic Redevelopment-1976

The Municipal Home Rule requirement for local referendum on bond issues is eliminated in the three municipalities designated to serve as instrumentalities of the state. These three municipalities can be likened to occupied territories existing as islands of an alternate system of government within the State of Maine. Their names imply that they are regional development authorities but the tax payer dollars they reel in are invested within their own geographical territory. 

Statistics in Maine places ranked by per capita income shows that the surrounding neighbors of the development authority towns have a per capital income that is on par with the rest of Maine, more or less. The region which the three regional development corporations develop is contained in the boundaries of their own municipal corporation. The names of the development corporation towns are not found in the statistics cited on .Maine places ranked by per capita income The Loring Air Base is found but not the town of Loring Development Authority. The towns of Washington are found but not the municipal corporation of the Washington Development Authority. There are no statistics to be found for the town of Midcoast Regional Redevelopment Authority and yet all three are chartered as municipal corporations. Are they just off the map of Maine? 

The terms of bond repayment are written to sound like standard business investments to the undiscerning ear. The language seems intentionally misleading when it states that municipal corporations must cover the principal and interest of bonds payable solely from the income, proceeds, revenues and funds of the authority derived from or held for activities under this article. The qualifier “derived from” is applicable to “income proceeds and revenues” the qualifier “held for” applies to loans and grants from the federal or state government, which means the federal and state taxpayers cover the cost of the municipal corporations bond's. Whether it is a federal loan taken to pay for the first loan or a grant or a refunding bond, or through the ubiquitous “gifts from any source”, the implication is that the intention to pay back the bond money through created wealth is not important. The bonds can be paid back by redistributed wealth acquired from the federal government, or any source. The main function of the corporate state is to accumulate and redistribute capital and to use capital to leverage more capital. Wealth creation is incidental to the goal of capital accumulation by any means. A continual stream of capital derived from loans and grants can create the illusion of economic development success while serving to increase inflation and reducing the purchasing power of our dollars, which is a hidden means of wealth redistribution.

THE MAINE DEVELOPMENT FOUNDATION 10 §915. LEGISLATIVE FINDINGS AND INTENTThere is a need to establish a new basis for a creative partnership of the private and public sectors for economic development, a partnership which can capitalize on the interests, resources and efforts of each sector, but which does not compromise the public interest or the profit motive. The state's solitary burden to provide for development should lessen through involving the private sector in a leadership role. In so stating that 1977, c. 548, §1 (NEW).

The statement made that the bonds issued do not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation and are not subject to other laws or charters relating to the authorization, issuance or sale of bonds, gives substance to the hypothesis of this book that Maine is no longer a state governed by its Constitution but is instead governed by the bylaws of development corporations. The next statement declares that the bonds issued are for an essential public and governmental purpose. If the bonds issued are for a government purpose, they are governed by the Constitution and statutes of Maine. The Legislature has no authority outside of that granted by the Maine Constitution. 

The following description of Home Rule states that  “although home rule powers are broad, in no event may a municipality enact a law that is specifically precluded by state law or that is contrary to state law.” The same relationship holds between the Legislature and the Constitution of Maine “although state legislative powers are broad, in no event may the Legislature enact a law that is specifically precluded by the Maine Constitution or that is contrary to the Maine Constitution: 

Home rule gives municipalities the power to determine their own goals without interference from the state Legislature or state agencies. It gives municipalities room to experiment with new approaches to government without first seeking approval from the state. It also allows municipalities to act more quickly on issues of local concern because they do not have to seek approval or their actions from the state Legislature.  although home rule powers are broad, in no event may a municipality enact a law that is specifically precluded by state law or that is contrary to state law. For example, a municipality may not vote to decriminalize narcotics that are illegal under state  law. It may, however, strengthen existing state laws. For instance, a municipality may act to restrict the sale of alcohol to a greater degree than is done in other municipalities.

Towns chartered by the Legislature to serve as instrumentalities of the state cannot collect property tax or provide municipal service using the general taxpayer funds. The state governed municipalities find other ways of providing the necessary services leaving one to wonder why the development authorities are chartered as municipal corporations as they are not governed by constitutional rule of law for municipal corporations and cannot perform the most essential functions of a municipal corporation.


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