Kansas One-Call System v. State

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IN THE SUPREME COURT OF THE STATE OF KANSAS


No. 104,498


KANSAS ONE-CALL SYSTEM, INC.,
Appellant,

v.

STATE OF KANSAS,
Appellee.


SYLLABUS BY THE COURT

1.
When the pleadings, depositions, answers to interrogatories, and admissions on
file, together with the affidavits, show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as a matter of law, summary
judgment is appropriate. The trial court is required to resolve all facts and inferences
which may reasonably be drawn from the evidence in favor of the party against whom the
ruling is sought. When opposing a motion for summary judgment, an adverse party must
come forward with evidence to establish a dispute as to a material fact. To preclude
summary judgment, the facts subject to the dispute must be material to the conclusive
issues in the case. On appeal, the same rules apply; summary judgment must be denied if
reasonable minds could differ as to conclusions drawn from the evidence.

2.
Determining a statute's constitutionality is a question of law subject to unlimited
review. But under the separation of powers doctrine, courts are to presume that a statute
is constitutional and resolve all doubts in favor of the statute's validity. Courts must
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interpret a statute in a way that makes it constitutional if there is any reasonable
construction that would maintain the legislature's apparent intent.

3.
The purpose of the constitutional provision requiring every bill to contain but one
subject is to guard against "logrolling," combining subjects representing diverse interests
and presenting them as separate provisions of one bill. The bill then is able to pass by
virtue of the combined votes of the separate factions.

4.
A bill is valid under Article 2, § 16 of the Kansas Constitution so long as the
provisions of the bill are all germane to the subject expressed in the title and will be
invalidated only where an act embraces two or more dissimilar and discordant subjects
that cannot reasonably be considered as having any legitimate connection with or
relationship to each other. Moreover, a bill's subject can be as comprehensive as the
legislature chooses, as long as it constitutes a single subject and not several different
ones.

5.
The constitutional provision prohibiting a bill from containing more than one
subject will be liberally construed to effectuate the acts of the legislature.

6.
To violate the single subject rule, a bill must have two dissimilar subjects that
have no legitimate connection with each other. Invalidity must be manifest.

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7.
Administrative power is the power to administer or enforce laws, while legislative
power is the power to make laws rather than the power to enforce them. A legislature's
delegation of legislative power to make a law is improper, unless the Kansas Constitution
permits delegation of legislative power to a different branch of government. If the
constitution does not permit this type of delegation, the separation of powers doctrine is
violated because legislative power is vested in the legislature only. But the legislature can
delegate the power to fill in the details of an enacted statute. And standards to govern the
exercise of such authority may be implied from the statutory purpose.

8.
Under the general rules of statutory interpretation, various provisions of an act in
pari materia must be construed together in an effort to reconcile the provisions so as to
make them consistent, harmonious, and sensible. Additionally, legislative intent is to be
determined from a general consideration of the entire act. An appellate court's duty, as far
as practicable, is to harmonize different statutory provisions to make them sensible.

9.
The Fourteenth Amendment to the United States Constitution guarantees equal
protection under the law to any person, and the Kansas Constitution Bill of Rights § 1
provides practically lockstep protection.

10.
The United States Constitution does not require things which are different in fact
or opinion to be treated in law as though they were the same. The Equal Protection
Clause allows states to write into law differences that exist in those areas in which public
power is exerted.

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11.
The Takings Clause of the Fifth Amendment to the United States Constitution,
applicable to the states through the Fourteenth Amendment, provides that private
property shall not be taken for public use, without just compensation. In other words, the
Fifth Amendment's guarantee is designed to bar government from forcing some people
alone to bear public burdens which, in all fairness and justice, should be borne by the
public as a whole.

Appeal from Shawnee District Court; LARRY D. HENDRICKS, judge. Opinion filed April 12, 2012.
Affirmed.

Mark G. Ayesh, of Ayesh Law Offices, of Wichita, argued the cause, and Ray E. Simmons, of the
same firm, was with him on the briefs for appellant.

Christopher M. Grunewald, assistant attorney general, argued the cause and was on the brief for
appellee.

Vaden F. Bales, of Riggs, Abney, Neal, Turpen, Orbison & Lewis, P.C., of Tulsa, Oklahoma, was
on the brief for amicus curiae One Call Concepts, Inc.

The opinion of the court was delivered by

GREEN, J.: Kansas One-Call System, Inc. (One-Call) appeals from the summary
judgment of the trial court in favor of the State of Kansas in One-Call's suit challenging
the constitutionality of the 2008 amendments in House Bill 2637 to the Kansas
Underground Utility Damage Prevention Act (KUUDPA), K.S.A. 66-1801 et seq. On
appeal, One-Call raises four claims contending that the 2008 amendments to KUUDPA
violate: (1) the one-subject rule contained in the Kansas Constitution; (2) the separation
of powers doctrine; (3) the Fourteenth Amendment to the United States Constitution right
to equal protection; and (4) the Fifth and Fourteenth Amendments to the United States
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Constitution, which prohibit the taking of private property for public use without just
compensation. Because the challenged amendments are valid, we affirm.

FACTS

One-Call began as a voluntary association of utility companies in 1983. Now, it is
a nonprofit corporation that comprises the majority of utility companies in the State of
Kansas. Since its creation, One-Call has provided information to its members about
future planned excavation activities, and it gives its member utility companies an
opportunity to mark the location of their underground facilities before excavation work
starts. One-Call makes money by charging a referral fee for alerting its members of a
planned dig. In some years, One-Call nets revenue; in others, it incurrs a loss. In 1993,
the Kansas Legislature adopted One-Call's business model and enacted the KUUDPA.
K.S.A. 66-1801 et seq.; L. 1993, ch. 217; H.B. 2041 (1993).

The KUUDPA created a mandatory program designed to protect the State's
underground utility infrastructure from excavation damage and to protect the public from
harm. K.S.A. 66-1801 et seq. The KUUDPA requires diggers to inform a centralized
"notification center" of their intent to dig before they start excavating. See K.S.A. 66-
1803 ("An excavator shall not engage in excavation near the location of any underground
facility without first having ascertained, in the manner prescribed in this act, a location of
all underground facilities in the proposed area of the excavation."). The notification
center then passes along the dig information to the applicable utility operators. See
K.S.A. 66-1805. Upon receiving notification of the proposed dig, utility operators are
required to mark the locations of underground utilities to avoid accidental utility strikes.
K.S.A. 66-1806(a). The parties agree that "the notification center is the linchpin to the
program, ensuring that excavator's project information reaches utility operators, who then
identify the location of any potentially affected underground utilities."

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In 1993, One-Call began managing and operating the notification center for the
State. Utility membership became mandatory. The relationship between One-Call and the
notification center is in dispute. One-Call maintains that it is the notification center while
the attorney general argues on behalf of the State that it is simply the entity that runs the
notification center.

In 2008, the Kansas Legislature amended the KUUDPA. These amendments are
the cause for One-Call's lawsuit because both One-Call and its utility members will be
affected financially by the amendments. The 2008 amendments include the following
changes to the KUUDPA:

 mandated that potable water and sanitary sewage operators become
members of the notification system. K.S.A. 2011 Supp. 66-1802(e); K.S.A.
2011 Supp. 66-1805(a).
 trifurcated the utility members into different tiers creatively identified Tier
1, Tier 2, and Tier 3. K.S.A. 2011 Supp. 66-1802(p), (q), (r).
 regulated the membership fees that can be collected from Tier 2 and Tier 3
members. K.S.A. 2011 Supp. 66-1802(r); K.S.A. 2011 Supp. 66-1805(j);
 imposed several public accountability requirements on the State's
notification center, including deeming the notification center to be a public
agency making its business records subject to the Kansas Open Records
Act and the Kansas Open Meetings Act. K.S.A. 2011 Supp. 66-1805(l), (n).

Tier 1 members are the non-water utilities. K.S.A. 2011 Supp. 66-1802(p). There
are no restrictions on how the notification center may charge a Tier 1 member for each
referral. Tier 2 facilities are the water utilities. K.S.A. 2011 Supp. 66-1802(p). The
notification center may only charge Tier 2 utilities 50% of what Tier 1 facilities are
charged—K.S.A. 2011 Supp. 66-1805(i)—but some larger water utilities may become
Tier 3 facilities. To be a Tier 3 member, a larger (more than 20,000 customers) water
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utility must create its own in-house notification center and employ at least two people to
flag the location of its underground utilities. K.S.A. 2011 Supp. 66-1802(r). The
notification center may not charge a Tier 3 facility a referral fee; instead the Tier 3
member pays a flat fee of $500 dollars per year. K.S.A. 2011 Supp. 66-1802(r). Although
not entirely clear, it would seem that the notification center is not required to inform a
Tier 3 member of a proposed dig. Instead, the notification center must provide the
excavator with the Tier 3 member's contact information. K.A.R. 82-14-4(c).

One-Call sued to enjoin enforcement of the amendments of House Bill 2637 on
the grounds that the amendments violate the original purpose provision from Article 2, §
16 of the Kansas Constitution and the "one-subject" rule. In addition, One-Call contends
that the amendments violate the separation of powers doctrine by usurping the power of
the Kansas Corporation Commission (KCC); the Equal Protection Clause of the
Fourteenth Amendment to the United States Constitution by imposing new requirements
on the notification center; and the Takings Clause of the Fifth Amendment to the United
States Constitution by setting limits on the fees that may be charged to water and
wastewater utility operators. The trial court granted summary judgment in favor of the
State. One-Call appealed, and we transferred this case on our own motion under K.S.A.
20-3018(c).

ANALYSIS

Standard of Review

Here we are asked to review the trial court's grant of summary judgment and
review the constitutionality of the 2008 amendments to KUUDPA. Our standards of
review are familiar.

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When the pleadings, depositions, answers to interrogatories, and admissions on
file, together with the affidavits, show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as a matter of law, summary
judgment is appropriate. The trial court is required to resolve all facts and inferences
which may reasonably be drawn from the evidence in favor of the party against whom the
ruling is sought. When opposing a motion for summary judgment, an adverse party must
come forward with evidence to establish a dispute as to a material fact. In order to
preclude summary judgment, the facts subject to the dispute must be material to the
conclusive issues in the case. On appeal, the same rules apply; summary judgment must
be denied if reasonable minds could differ as to conclusions drawn from the evidence.
Osterhaus v. Toth, 291 Kan. 759, 768, 249 P.3d 888 (2011).

"Determining a statute's constitutionality is a question of law subject to unlimited review.
But under the separation of powers doctrine, this court presumes statutes are
constitutional and resolves all doubts in favor of a statute's validity. Courts must interpret
a statute in a way that makes it constitutional if there is any reasonable construction that
would maintain the legislature's apparent intent." Brennan v. Kansas Insurance Guaranty
Ass'n, 293 Kan. 446, 450, 264 P.3d 102 (2011) (citing State v. Laturner, 289 Kan. 727,
735, 218 P.3d 23 [2009]).

An agency's or board's statutory interpretation is not afforded any significant deference
on judicial review. Ft. Hays St. Univ. v. University Ch., Am. Ass'n of Univ. Profs, 290
Kan. 446, 457, 228 P.3d 403 (2010).

Do the Amendments to KUUDPA Violate the Kansas Constitution's One-subject Rule?

One-Call contends that the trial court erred in failing to enjoin the enforcement of
the 2008 amendments to KUUDPA on the grounds that the amendments violated Article
2, § 16 of the Kansas Constitution, also known as the one-subject rule. The one-subject
rule was adopted by convention and ratified by voters in 1859. It was later enacted in
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1861 and has been amended only once since then, in 1974. L. 1861, p. 53; L. 1974, ch.
458, sec. 1. It states:

"No bill shall contain more than one subject, except appropriation bills and bills
for revision or codification of statutes. The subject of each bill shall be expressed in its
title. No law shall be revived or amended, unless the new act contain the entire act
revived or the section or sections amended, and the section or sections so amended shall
be repealed. The provisions of this section shall be liberally construed to effectuate the
acts of the legislature."

The 1974 amendment made important changes in the one-subject rule. First, the
amendment added an exception for appropriation bills. Second, it added the liberal
interpretation clause. This clause states: "The provisions of the section shall be liberally
construed to effectuate the acts of the legislature." Under this statutory rule of
construction, courts construe the statute to effect the beneficial purpose of the statute.

The purpose of the one-subject rule is to prevent legislative abuses such as
"logrolling." "Logrolling" refers to a situation in which several legislators combine their
unrelated proposals and present them as separate provisions of one bill. The bill then is
able to pass by virtue of the combined votes of the separate factions. The perceived evil
of this practice is that a measure can pass which, standing alone, would have been
defeated. Garten Enterprises, Inc. v. City of Kansas City, 219 Kan. 620, 622, 549 P.2d
864 (1976).

The title of the House Bill 2637 is as follows:

"AN ACT concerning utilities; relating to telecommunications; relating to pricing
flexibility and the lifeline service program; concerning the citizens' utility ratepayer board
contracting for professional services; relating to the underground utility damage
prevention act; concerning local exchange carriers and carriers of last resort; amending
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K.S.A. 66-1802, 66-1804, 66-1805, 66-1806, 66-2006 and 66-2009 and K.S.A. 2007
Supp. 66-2005 and repealing the existing sections." L. 2008, ch. 122; H.B. 2637.

In 2008, the Kansas Legislature amended the KUUDPA to require the notification
center to comply with the Kansas Open Records Act (KORA) and the Kansas Open
Meetings Act (KOMA). The amendment states:

"The notification center established pursuant to this section shall be and is hereby
deemed to be a public agency and shall be subject to the provisions of the open records
act, K.S.A. 45-215 et seq., and amendments thereto, and the open meetings act, K.S.A.
75-4317 et seq., and amendments thereto . . . ." K.S.A. 2011 Supp. 66-1805(l).

One-Call asserts that House Bill 2637 contains two subjects: (1) the requirement
that One-Call comply with KORA and KOMA, and (2) the utilities themselves. It claims
that the two subjects are too dissimilar to have any relationship or connection between
them. The State argues that each component of House Bill 2637 is related to public
utilities and contends that One-Call's challenge is without merit.

We have determined that a statute does not violate the single-subject rule unless
"invalidity is manifest." KPERS v. Reimer & Koger Assocs., Inc., 262 Kan. 635, 676, 941
P.2d 1321 (1997). Legislation is valid under Article 2, § 16 of the Kansas Constitution, so
long as the provisions of the bill are "all germane to the subject expressed in the title,"
and will be invalidated only where "an act embraces two or more dissimilar and
discordant subjects that cannot reasonably be considered as having any legitimate
connection with or relationship to each other. [Citation omitted.]" KPERS, 262 Kan. at
676. A bill's subject can be as comprehensive as the legislature chooses, as long as it
constitutes a single subject and not several different ones. State v. Reves, 233 Kan. 972,
978, 666 P.2d 1190 (1983).

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The question then is whether the provisions of House Bill 2637 are germane to, or
connected to, House Bill 2637's subject title of utilities and reference to the KUUDPA.
The trial court determined that the subjects within the legislation were germane to the
broad subject of public utilities. In response to One-Call's argument that House Bill
2637's title should mention something about the notification center becoming a public
agency subject to new requirements (KOMA and KORA), the trial court determined that
neither KOMA nor KORA include a list of public agencies subject to their provisions.
And the trial court further determined that the KOMA and KORA requirements need not
be mentioned in the title. As for One-Call's contention that the title should include
reference to the Corporation Code under K.S.A. Chapter 17, Articles 63, 65, and 75, the
trial court determined that One-Call's contention was devoid of authority that the
legislature intended to make the statutory provisions of the Corporation Code, KOMA, or
KORA controlling. Moreover, the trial court determined that the Corporation Code does
not prohibit more specific statutory regulation for certain corporate entities.

As stated earlier, a title of a bill can be broad and comprehensive and can even
include minor subjects. Yet, those minor subjects must be capable of being combined to
form "one grand and comprehensive subject." KPERS, 262 Kan. at 677. The broad topic
of utilities is listed in the title of House Bill 2637 and serves as the larger umbrella
category under which the KUUDPA falls. And House Bill 2637's multiple and diverse
subjects are related and germane to one another under the all-encompassing category of
utilities.

For example, KOMA and KORA relate to and have a connection with the broad
term "utilities" because the notification center is under the purview of the KUUDPA,
which is contained in House Bill 2637. In addition, the KUUDPA clearly relates to and
has a logical connection with utilities through its work to protect the State's underground
utility infrastructure from excavation damage and to protect the public from harm.

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Moreover, to violate the single subject rule, a bill must have two dissimilar
subjects that have no legitimate connection with each other. Reves, 233 Kan. at 978.
Here, there is a legitimate connection because KORA and KOMA are related to
KUUDPA, which is related to utilities in general, and we have held that Article 2, § 16
should be "liberally construed." Moreover, we have declared that a statute is legitimate
under that provision unless "invalidity is manifest." KPERS, 262 Kan. at 676. While the
Kansas Legislature cannot disobey constitutional limitations in the enactment of laws,
there is a strong presumption in favor of the validity of any bill passed by the legislature.
State, ex rel., v. Shanahan, 178 Kan. 400, 403-04, 286 P.2d 742 (1955).

We reject One-Call's contention that House Bill 2637 contained two subjects. As a
result, we determine that the 2008 amendments to KUUDPA did not violate the one-
subject rule.

Separation of Powers Doctrine

Next, One-Call contends that the 2008 legislative amendments to KUUDPA
violate the separation of powers doctrine because that legislation was adopted after the
Kansas Legislature had delegated legislative authority to the KCC under the 2006
amendment to the KUUDPA. In other words, One-Call maintains in its brief that the
KUUDPA cannot be amended by the legislature without a revocation or amendment of
"the powers previously delegated to the KCC by the legislature as set forth in K.S.A. 66-
1813 and 66-1815." But before we consider if there was a separation of powers violation,
we first must determine what type of power was delegated to the KCC under the 2006
amendment.

One-Call's argument about what type of power was delegated to the KCC is
startlingly inconsistent. In its reply brief to the trial court, One-Call stated that the
original version of KUUDPA in 1993 granted an administrative and a police function.
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One-Call then stated that when KUUDPA was amended to create K.S.A. 2011 Supp. 66-
1815, the delegation of power became "as broad a delegation of power possible" without
defining what type of power that was.

In its brief, One-Call first makes reference to the legislative branch by stating that
the legislature delegated legislative power to the KCC. One-Call then makes reference to
the executive branch by citing State ex rel. Tomasic v. Unified Gov. of Wyandotte
Co./Kansas City, 264 Kan. 293, Syl. ¶ 10, 955 P.2d 1136 (1998), where we stated that
once the legislature delegates a function to the executive branch, it may only revoke that
authority by enacting another law. One-Call does not otherwise reference executive
power in its brief other than this quote from caselaw in arguing that the legislature needed
to first revoke or amend the previously delegated power to the KCC before enacting the
2008 amendments. Later, in its brief, One-Call states that the provisions come under
"administrative, rule making or regulatory exercises," indicating administrative power
was delegated to the KCC.

On the other hand, the State maintains that the power delegated to the KCC was
administrative only. And the State further contends that the KCC's power still depends
entirely on the legislature.

The trial court rejected One-Call's argument. Although the trial court determined
the delegated power to be legislative, the trial court held that the legislature did not intend
to divest itself of legislative authority over the KCC.

Administrative power is the power to administer or enforce laws, while legislative
power is the power to make laws rather than the power to enforce them. State ex rel.
Tomasic, 264 Kan. at 303. A legislature's delegation of legislative power to make a law is
improper, unless the Kansas Constitution permits delegation of legislative power to a
different branch of government. If the constitution does not permit that type of
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delegation, the separation of powers doctrine is violated because legislative power is
vested in the legislature only. But the legislature can delegate the power to fill in the
details of an enacted statute. And standards to govern the exercise of such authority may
be implied from the statutory purpose. State ex rel. Tomasic, 264 Kan. at 303-04, Syl. ¶ 6.

To distinguish whether the legislature has delegated legislative power or
administrative power, the specific standards set out in the delegation must be considered.
If the standards are specific, meaning they contain sufficient policies and standards to
guide the nonlegislative body, the legislature has delegated administrative power. The
legislature can delegate to administrative bodies discretion to "'"fill in the details,"'"
provided there are definite standards to guide the exercise of authority. 264 Kan. at 304.

The power delegated to the KCC was administrative because the power to adopt
rules and regulations is administrative in nature. See State, ex rel., v. Columbia Pictures
Corporation, 197 Kan. 448, Syl. ¶ 4, 417 P.2d 255 (1966). The language in K.S.A. 2011
Supp. 66-1815 is identical to that definition of administrative law: it gives the state
corporation commission "full power and authority to adopt all necessary rules and
regulations for carrying out the provisions." (Emphasis added.)

We have previously identified the KCC as an administrative body, requiring the
legislature to provide a clear standard of governing the exercise of delegated authority.
See Citizens' Utility Ratepayer Bd. v. Kansas Corporation Comm'n, 264 Kan. 363, 395,
956 P.2d 685 (1998); Kansas Gas & Electric Co. v. Kansas Corporation Comm'n, 239
Kan. 483, 491, 495, 720 P.2d 1063 (1986). The power delegated meets this requirement.

The delegation here was specific because K.S.A. 2011 Supp. 66-1815 limited the
KCC's power to adopting necessary rules for carrying out provisions K.S.A. 2011 Supp.
66-1801 through K.S.A. 66-1814. The KCC was not given free rein to create new rules
unrelated to those specified provisions. One-Call has cited no authority in support of its
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position that the legislature ever delegated legislative power to the KCC. And our
research has revealed no case in which our appellate courts have ever held that the
legislature has delegated legislative power to the KCC.

We further note that K.S.A. 2011-Supp. 66-1815 is not much more expansive than
the earlier unchallenged provision, K.S.A. 66-1813, which states that KUUDPA "shall be
administered and enforced by the state corporation commission." The only added power
the KCC received from the legislature in 2006 was the power to adopt rules and
regulations to carry out KUUDPA, which it was already required to do when KUUDPA
was created in 1993.

The separation of powers doctrine was not violated by a delegation of
administrative power to the KCC. Because there was no usurpation of powers, the trial
court properly granted summary judgment to the State on this claim.

What is the Relationship Between One-Call and the Legislatively Created "Notification
Center"?

Before we can address One-Call's last two issues, we must determine the
relationship between the notification center and One-Call. One-Call's brief routinely
refers to the 2008 amendments as legislative interference with a private business.
According to One-Call's brief, One-Call is the notification center. Yet, the State refers to
the amendments as legislation that regulates a creature of statute—the notification
center—and not a private business—One-Call. The trial court went to some lengths to
draw a distinction between the notification center and One-Call.

The original bill in 1993 defined notification center as "a center operated by an
organization which has a minimum of five underground operators participating . . . ."
H.B. 2041 (1993) (Before House Committee Revision). Now, a notification center is
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defined as a "statewide communication system operated by an organization." K.S.A.
2011 Supp. 66-1802(i). Similar to K.S.A. 2011 Supp. 66-1805(a), the definition was
changed to reflect the intent that there be only one notification center. See L. 1993, ch.
217, sec. 2(g).

K.S.A. 2011 Supp. 66-1805(a) currently states: "This act recognizes the
establishment of a single notification center for the state of Kansas." The legislature
apparently believed that K.S.A. 2011 Supp. 66-1805(a) created a notification center. For
example, K.S.A. 2011 Supp. 66-1805(l) reads: "The notification center established
pursuant to this section . . . ." (Emphasis added.) If the notification center is established
by statute—K.S.A. 2011 Supp. 66-1805(a)—it is not One-Call. And K.S.A. 2011 Supp.
66-1805(o) creates the process under which operation of the notification center is
determined. For example, every 5 years the notification center must determine who will
operate it. Even the definition of the notification center supports the argument that it is an
entity separate from One-Call. See K.S.A. 2011 Supp. 66-1802(i) (a "communication
system operated by an organization"). Finally, while not indicative of legislative intent,
the KCC regulations define the notification center as the "underground utility notification
center operated by Kansas one call, inc." K.A.R. 82-14-1(k) (2011 Supp.).

Under the general rules of statutory interpretation, "[v]arious provisions of an act
in pari materia must be construed together in an effort to reconcile the provisions so as to
make them consistent, harmonious and sensible." (Emphasis added.) Southwestern Bell
Tel. Co. v. Beachner Constr. Co., 289 Kan. 1262, Syl. ¶ 4, 221 P.3d 588 (2009).
"Additionally, legislative intent is to be determined from a general consideration of the
entire act. An appellate court's duty, as far as practicable, is to harmonize different
statutory provisions to make them sensible." Dillon Real Estate Co. v. City of Topeka,
284 Kan. 662, Syl. ¶ 9, 163 P.3d 298 (2007).

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Despite the lack of crystal clear language, the statutory scheme does not support
the heart of One-Call's argument that One-Call is the notification center. Instead, it is
readily apparent that the notification center is a governmental contractor that is currently
operated by One-Call. Otherwise, under K.S.A. 2011 Supp. 66-1805(o), it would require
One-Call to solicit proposals to run One-Call. Dillon Real Estate Co., 284 Kan. 662, Syl.
¶ 8 ("The legislature is presumed to not enact useless or meaningless legislation, and an
appellate court's interpretation of a statute should avoid absurd or unreasonable results.").
A more logical reading of the entire KUUDPA would require the notification center to
solicit proposals from companies like One-Call to determine its operator. The trial court
correctly concluded that One-Call is an entity distinct from the notification center.

Equal Protection Claim

One-Call next argues that the trial court erred in rejecting its equal protection
claim because some of the 2008 amendments to KUUDPA caused it to be treated
differently from other private and nonprofit corporations without any rational basis.

The Fourteenth Amendment to the United States Constitution guarantees equal
protection under the law "to any person," and the Kansas Constitution Bill of Rights § 1
uses similar language. Here we are asked to determine whether some of the 2008
amendments to KUUDPA impermissibility violate One-Call's right to equal protection
under the law.

In Board of Miami County Comm'rs v. Kanza Rail-Trails Conservancy, Inc., 292
Kan. 285, 255 P.3d 1186 (2011), we reiterated the steps in analyzing an equal protection
claim:

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"The first step of an equal protection analysis is to determine the nature of the
legislative classifications and whether the classifications result in arguably
indistinguishable classes of individuals being treated differently. . . .
"After determining the nature of the legislative classifications, a court examines
the rights which are affected by the classifications. The nature of the rights dictates the
level of scrutiny to be applied. . . .
"The final step of the analysis requires determining whether the relationship
between the classifications and the object desired to be obtained withstands the applicable
level of scrutiny." 292 Kan. at 315-16.

Do the 2008 Amendments to the KUUDPA Treat Indistinguishable Classes of
Organizations Differently?

One-Call claims that it is being treated differently than every other private not-for-
profit corporation in Kansas. Most of One-Call's argument focuses on the application of
KOMA and KORA to it. In support of its argument, One-Call relies on our caselaw in
Memorial Hospital Ass'n, Inc. v. Knutson, 239 Kan. 663, 722 P.2d 1093 (1986), In re
Arbitration between Johns Constr. Co. & U.S.D. No. 210, 233 Kan. 527, 664 P.2d 821
(1983), and the Court of Appeals opinion in Southwestern Bell Tel. Co. v. Kansas
Corporation Commission, 6 Kan. App. 2d 444, 629 P.2d 1174, rev. denied 230 Kan.819
(1981), for support. One-Call also relies on several attorney general opinions.

The State responds with two arguments. First, it contends that One-Call fails the
first step of equal protection analysis because it is not similarly situated to any other
company. The State is correct. Second, it argues that KOMA and KORA apply to the
notification center under our prior caselaw.

In 2008, the Kansas Legislature amended K.S.A. 66-1805(l) and deemed the
notification center to be a public agency subject to KOMA and KORA. The statute states:

19

"(l) The notification center established pursuant to this section shall be and is
hereby deemed to be a public agency and shall be subject to the provisions of the open
records act, K.S.A. 45-215 et seq., and amendments thereto, and the open meetings act,
K.S.A. 75-4317 et seq., and amendments thereto, except that the notification center or
board of directors, or successor managing organization shall not disseminate, make
available or otherwise distribute data or information provided by an operator of a tier 1, 2
or 3 facility unless such dissemination, making available or distributing is necessary for
the state corporation commission or the notification center to carry out legal duties or
specific statutory duties prescribed under this chapter." K.S.A. 2011 Supp. 66-1805(l).

One-Call contends that the Kansas Legislature performed a "frontal lobotomy" on
the traditional rules governing the application of KOMA and KORA. See State ex rel.
Murray v. Palmgren, 231 Kan. 524, 535, 646 P.2d 1091 (1982) (discussing the five-part
test for determining if an organization is a public agency subject to KOMA). But the
legislature is not required to follow our prior five-part test in determining whether to
designate the notification center a public agency.

One-Call asks us to ignore K.S.A. 2011 Supp. 66-1805(l) and use its caselaw to
determine if the notification center is a public agency under KOMA and KORA statutes.
One-Call's argument might have merit if it were not for K.S.A. 2011 Supp. 66-1805(l),
which specifically designates the notification center as a public agency subject to KOMA
and KORA. The caselaw and attorney general opinions cited by One-Call are simply
irrelevant. Likewise, the State's response that the notification center is a public agency
under previous caselaw is immaterial.

Political or taxing subdivisions of the state are subject to KORA and KOMA. See
K.S.A. 75-4318(a) (KOMA); K.S.A. 45-217(f) (KORA). K.S.A. 2011 Supp. 66-1805(l)
states that the notification center is a public agency subject to KORA and KOMA. Every
case cited by the parties involved a question of whether an organization is subject to
KORA and KOMA absent a statutory provision that states the entity is subject to KORA
20

and KOMA. Here, the question is not whether the notification center is a public agency
under K.S.A. 75-4318(a) or K.S.A. 45-217(f). To the contrary, the legislature has already
answered that question in the affirmative by enacting K.S.A. 2011 Supp. 66-1805(l).

One-Call does not cite a single Kansas authority in making its argument. As the
State points out, by law One-Call cannot be similarly situated to any other Kansas
company because it operates the "single notification center for the state of Kansas."
K.S.A. 2011 Supp. 66-1805(a). Consequently, One-Call fails the first step of equal
protection analysis. See Rails-Trails, 292 Kan. at 315 ("indistinguishable classes of
individuals being treated differently").

Nevertheless, according to One-Call, the notification center's public accountability
statutes are unconstitutional. "The Constitution does not require things which are
different in fact or opinion to be treated in law as though they were the same." Tigner v.
Texas, 310 U.S. 141, 147, 60 S. Ct. 879, 84 L. Ed. 1124 (1940). The Equal Protection
Clause allows states to write into law differences that exist in those areas which public
power is exerted. Tigner, 310 U.S. at 147 ("And so we conclude that to write into law
differences between agriculture and other economic pursuits was within the power of the
Texas legislature.").

For example, in explaining that the Kansas Legislature has the constitutional
authority to impose a burden on a party that may not be contractually waived or assumed
by another party, we stated:

"The Kansas Legislature has the constitutional authority to impose a burden on a
party that may not be contractually waived or assumed by another party. [State v.
Mwaura,] 4 Kan. App. 2d [738,] 470-41[, 610 P.2d 662, rev. denied 228 Kan. 807
(1980)]. For example, the legislature may constitutionally impose on the seller of a used
car a nondelegable duty to see that the car meets minimum safety standards. 4 Kan. App.
2d at 741. The legislature similarly has the constitutional authority to protect the lives and
21

property around underground utilities." Double M Constr. v. Kansas Corporation
Comm'n, 288 Kan. 268, 277, 202 P.3d 7 (2009).

The notification center furnishes an important public service. Double M Constr.,
288 Kan. at 272 (The KUUDPA "creates a statutory duty to the public to ensure the
safety and integrity of underground utilities."). And "[t]he legislature similarly has the
constitutional authority to protect the lives and property around underground utilities."
288 Kan. at 277. As a result, the Kansas Legislature has the authority to write into law
differences that exist in those areas in which public power is exerted. Thus, One-Call's
equal protection claim fails.

Fifth Amendment Violation

Finally, One-Call, in its taking claim, contends that the trial court improperly
rejected its assertion that the fee provisions of the amendments "fix rates which are so
low as to be confiscatory."

Under the 2008 amendments, One-Call may charge Tier 2 facilities (water
utilities) only 50% of what it charges Tier 1 facilities (other utilities). K.S.A. 2011 Supp.
66-1805(j). Additionally, a Tier 3 facility (large water utilities with their own separate
"one-call system") owes the notification center only $500 annually. K.S.A. 2011 Supp.
66-1802(r). One-Call contends that the fee structure is a taking without just
compensation.

First, One-Call contends that the legislature lacked any authority "to implement
the rates to be charged by [One-Call]" because it delegated that authority to the KCC.
That line of reasoning is totally unrelated to a taking analysis, and it apparently makes
reference to One-Call's second issue. Second, One-Call relies on a 1921 federal district
court opinion from Louisiana and argues that the setting of the rates for Tier 2 and Tier 3
22

facilities is "clearly a taking of property." See O'Keefe v. City of New Orleans, 273 F. 560
(D.C. La. 1921). On the other hand, the State argues that One-Call has not suffered a
taking because it may charge Tier 1 members whatever it desires.

The Takings Clause of the Fifth Amendment to the United States Constitution,
applicable to the states through the Fourteenth Amendment, provides that private
property shall not be "'taken for public use, without just compensation.'" Lingle v.
Chevron U.S.A., Inc. 544 U.S. 528, 536, 125 S. Ct. 2074, 161 L. Ed. 2d 876 (2005). As
we recently stated in Zimmerman, "[t]he Fifth Amendment's guarantee 'is designed to bar
Government from forcing some people alone to bear public burdens which, in all fairness
and justice, should be borne by the public as a whole.'" Zimmerman v. Board of
Wabaunsee County Commr's, 293 Kan. 332, 345, 264 P.3d 989 (2011) (citing Armstrong
v. United States, 364 U.S. 40, 49, 80 S. Ct. 1563, 4 L. Ed. 2d 1554 [1960]).

In this case, One-Call is required to comply with extensive government regulation,
and there is little debate that the government may regulate private property. See Penn
Central Transp. Co. v. New York City, 438 U.S. 104, 124-26, 98 S. Ct. 2646, 57 L. Ed. 2d
631 (1978) (discussing types of property regulation that the Court held did not constitute
a taking). But as we recognized in Zimmerman, the difficulty rests in determining when
the government has gone so far in its regulations to effectuate a taking:

"'[G]overnment regulation of private property may, in some instances, be so onerous that
its effect is tantamount to a direct appropriation or ouster—and that such "regulatory
takings" may be compensable under the Fifth Amendment. In Justice Holmes' storied but
cryptic formulation, "while property may be regulated to a certain extent, if regulation
goes too far it will be recognized as a taking." 260 U.S. at 415. The rub, of course, has
been—and remains—how to discern how far is "too far." In answering that question, we
must remain cognizant that "government regulation—by definition—involves the
adjustment of rights for the public good" [citation omitted] and that "Government hardly
could go on if to some extent values incident to property could not be diminished without
23

paying for every such change in the general law." [Citations omitted.]'" Zimmerman, 293
Kan. at 345.

Determining when the government has gone too far is, as the Kansas Supreme
Court states, "the rub." There are two types of regulations that the United States Supreme
Court considers per se takings. "'First, where government requires an owner to suffer a
permanent physical invasion of her property—however minor—it must provide just
compensation.'" Frick v. City of Salina, 290 Kan. 869, 885, 235 P.3d 1211 (2010) (citing
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538, 125 S. Ct. 2074, 161 L. Ed. 2d 876
[2005]). The second rule applies to "regulations that completely deprive an owner of 'all
economically beneficial us[e]' of his or her property." Frick, 290 Kan. at 885 (citing
Lingle, 544 U.S. at 538).

Did the Kansas Legislature Take One-Call's Private Property by Establishing the Tier
System for Referral Fees?

Kansas statutes require that all utilities in Kansas become a member of the
notification center. K.S.A. 2011 Supp. 66-1805(a). And the notification center is required
to notify its member utilities of any proposed excavation, assuming the member utility
has underground facilities near the excavation site. K.S.A. 2011 Supp. 66-1805(b), (c);
K.A.R. 82-14-4. While an excavator is not explicitly required to call the notification
center to ascertain the location of underground utilities, no excavation near underground
facilities may proceed in Kansas unless the excavator has ascertained the "location of all
underground facilities in the proposed area of the excavation." K.S.A. 66-1803; K.A.R.
82-14-2. But see K.S.A. 2011 Supp. 66-1804 (making an exception for emergency
excavations). The parties agree that the notification center is the linchpin to the
notification program as it handles most of the notification center requests in the State.

24

As previously discussed, One-Call, a private company, operates the notification
center and is required to notify utilities of proposed excavations. So long as One-Call
operates the notification center, the government appears to be requiring a private
company (One-Call) to engage in the production of services. Traditionally, in utility rate
regulation takings cases, there is a statute that requires the utilities to provide efficient
and sufficient service to the public. See K.S.A. 66-101b. But in stark contrast to the
traditional cases, there is no statute that requires One-Call to run the notification center.
There is no taking because no private property is being used for a public purpose. This
case, therefore, is analogous to Yee v. Escondido, 503 U.S. 519, 112 S. Ct. 1522, 118 L.
Ed. 2d 153 (1992).

In Yee, the City of Escondido in 1988 enacted rent control ordinances that set
mobile home rents back to their 1986 levels and prohibited rent increases without the
approval of the city board. The petitioners, mobile home park owners, sued arguing that
the rent control law deprived them of "all use and occupancy of [their] real property" to
the extent it constituted a taking. 503 U.S. at 525. The Supreme Court disagreed. The rent
control ordinances regulated the relationship between the landlord and the tenant, but
they did not require the petitioners to rent their mobile homes. The petitioners voluntarily
rented their land to mobile home owners and were not required to continue to do so. As a
result, the rent control ordinances did not authorize an unwanted physical occupation of
the petitioners' land and was not a per se taking. Yee, 503 U.S. at 531; see also Bowles v.
Willingham, 321 U.S. 503, 517, 64 S. Ct. 641, 88 L. Ed. 892 (1944) (rent control
ordinance not a taking because it did not require that the property owners to rent their
property); Garelick v. Sullivan, 987 F.2d 913, 916 (2d Cir. 1993) ("By contrast, where a
service provider voluntarily participates in a price-regulated program or activity, there is
no legal compulsion to provide service and thus there can be no taking."). Likewise, One-
Call has voluntarily agreed to participate in a price-regulated program or activity, and
there is no legal requirement that it must operate the notification center. Thus, there is no
taking.
25

One-Call's takings claim is also foreclosed by the fact that the fee structure
attacked by One-Call does not prohibit the operator of the state's notification center from
recovering the costs of providing notification services. The legislation places no cap on
fees imposed on Tier 1 utility members while limiting fees on water and wastewater
utility operators. As applied to One-Call, this limitation imposes no increased costs on
One-Call because it is undisputed that One-Call must raise member fees to cover those
increased expenses. Under these circumstances, One-Call has not suffered a taking. The
ability to pass along all expenses to members of the notification center ensures that One-
Call will always be able to recoup its costs. Even assuming that the new fee structure
deprives One-Call of any money in the short-term while it adjusts its fees, One-Call
retains the ability to cover its expenses, which means that just compensation is available
to it.

Where an entity can pass along costs to others, such as customers or members, just
compensation is available for any taking that may have occurred, negating any Fifth
Amendment claim. See Kansas City Power & Light Co. v. Kansas Corporation Comm'n,
238 Kan. 842, 715 P.2d 19 (1986). In Kansas City Power & Light Co., the KCC had
entered an order implementing a portion of a federal statute concerning the
encouragement of entities to cogenerate electricity, and the order required electric utility
companies to allow cogenerators of electricity to connect to the utilities' systems, to
purchase electricity from cogenerators, and to pay cogenerators the avoided energy cost
saved by the utility by not producing the energy received. 238 Kan. at 843, 846. Kansas
City Power & Light Company (KCP&L) challenged the KCC order on several grounds,
including that the requirement to pay cogenerators the avoided energy cost was an
unconstitutional taking. The court noted that the function of requiring compensation for a
taking is "to put the owner in as good a position pecuniarily as he would have occupied if
his property has not been taken." 238 Kan. at 848 (quoting Olson v. United States, 292
U.S. 246, 54 S. Ct. 704, 78 L. Ed. 1236 [1927]). Accordingly, the court rejected the
takings claim because KCP&L "is allowed to charge its ratepayers its avoided cost paid
26

to the cogenerators, plus a profit." 238 Kan at 848. Because the utility company was
made whole through recouping any additional costs, it received just compensation.

One-Call's situation is analogous to KCP&L. Whenever One-Call's expenses
exceed revenues, it can increase fees to cover those increased costs. Under the
amendments, any increased costs may be passed along to Tier 1 utilities and, in part, to
Tier 2 utilities, whose rates are capped at 50% of Tier 1 utilities. Thus, One-Call retains
the ability to pass through costs and has not been deprived of any money. For that reason,
no taking has occurred as a result of the amendments. Consequently, One-Call's takings
argument fails.
Affirmed.

MORITZ, J., not participating.

GREEN, J., assigned.
1


1
REPORTER'S NOTE: Judge Henry Green W. Green, Jr., of the Kansas Court of Appeals, was
appointed to hear case No. 104,498 vice Justice Moritz pursuant to the authority vested in the Supreme
Court by K.S.A. 20-3002(c).