Where, however, municipalities or other subordinate political corporations have, in the exercise of their charter powers, entered into contracts, those contracts are protected from subsequent impairment by state law.13 Such corporations, as holders of state securities and other contract obligations, are secured against their impairment.14

Generally speaking, also, franchises granted by municipal corporations, if authorized by their charters, are contracts which, under the authority of the Dartmouth College case, presently to be considered, are protected against impairment.

So also, a state law limiting the powers of taxation of a munici-pal corporation, whereby its ability to pay its debts is materially lessened, is void as to debts created prior thereto, the creditors relying upon the taxing powers of the corporation to provide the funds for the payment of their claims.15

Louisiana v. New Orleans16 the court declare it to be settled law that "where a municipal corporation is authorized to contract. and to exercise the power of local taxation to meet its contractual engagements, this power must continue until the contracts are satisfied; and that it is an impairment of an obligation of the contract to destroy or lessen the means by which it can be enforced."

So also, generally, it is held to be an impairment of the obligation of contracts entered into by municipal corporations to deprive them by subsequent state legislation of any authority whatsoever, whereby they may be rendered less able to perform their agreements, or whereby the enforcement of their claims by creditors is rendered more difficult or less certain. "That obligation is impaired, in the sense of the Constitution, when the means by which a contract, at the time of its execution, could be enforced, that is, by which the parties could be obliged to perform it, are rendered less efficacious by legislation operating directly upon those means." 17

13 New Orleans v. New Orleans Waterworks Co., 142 U. S. 79; 12 Sup. Ct. Rep. 142; 35 L. ed. 943.

14 Mobile v. Watson, 116 U. S. 289; 6 Sup. Ct. Rep. 39S; 29 L. ed. 620-. Louisiana v. Pillsbury, 105 U. S. 278; 26 L. ed. 1090.

15 United States v. Port of Mobile, 12 Fed. 768; Seibert v. Lewis, 122 U. S. 284; 7 Sup. Ct. Rep. 1190; 30 L. ed. 1161: Sawyer v. Concordia. 12 Fed. 754; Wolff v. New Orleans, 103 U. S. 358: 26 L. ed. 395; Ralls Co. v. United States, 105 U. S. 733; 26 L. ed. 1220.

16 30 Sup. Ct. Rep. 40.

"A by-law or ordinance of a municipal corporation may be such an exercise of legislative power delegated by the legislature to the corporation as a political subdivision of the State, having all the force of law within the limits of the municipality, that it may properly be considered as a law, within the meaning of this article of the Constitution of the United States." 18