Page:Edward B. Marks Music v. Charles K. Harris Music Publishing.pdf/1

 that the case was ripe for summary judgment, but argues that the government should have prevailed.

We think we do not come to the question whether the federal government could constitutionally tax the users of this state-owned ferry, because we agree with the learned district judge that Congress did not attempt to do so in the law now before us.

Much has been said in prior cases, Helvering v. Gerhardt, 304 U.S. 405, 58 S.Ct. 969, 82 L.Ed. 1427; Allen v. Regents of University, 304 U.S. 439, 58 S.Ct. 980, 82 L.Ed. 1448; Wilmette Park District v. Campbell, 338 U.S. 411, 70 S.Ct. 195, 94 L.Ed. 205; State of New York v. United States, 326 U.S. 572, 66 S.Ct. 310, 90 L.Ed. 326, and in the briefs in this case as to the extent to which the constitutional limitation on the power of the federal government to tax state instrumentalities still exists. However, we think the significance of drawing a distinction between a truly governmental function and a proprietary activity lies in its relevance to an effort to interpret the exemption section of this act rather than serving as a touchstone to constitutionality.

Here, it must be conceded that the building and maintenance of a system of state roads is essentially a governmental function. It being further conceded that this ferry is an integral part of the state road system (without it travellers on highway A1A would be required to travel 20 miles upriver to the nearest bridge and twenty miles back downriver to the continuation of this road across the river) it cannot be said, we think, that the Department of Roads in operating the ferry is “a person engaged in the business of transporting property for hire.” The Road Department is here not engaged (assuming it to be “a person” within the contemplation of the statute, which is quite doubtful), in any business. It is engaged in performing an essential governmental service of operating a system of state roads.

In light of the present day state of the cases, we do not doubt the power of Congress to tax non-discriminatorily many activities in which a state may engage. It is equally clear, however, that Congress can exempt the state from the burden of taxes that otherwise fall uniformly on others. Construing the language of this exemption section as best we can, we conclude that Congress recognized that there would be persons or entities that charged for transportation of property not “engaged in the business of transporting property for hire.” Otherwise there would be no need for Section 4272 at all. We think the State Road Department is such an entity.

The judgment is affirmed.