ERIC P. LIGHT, ETC., ET AL. V. CITY OF LOUISVILLE, KENTUCKY, ET AL.
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2005-SC-000759-DG
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2006-SC-000371-DG
ERIC P. LIGHT, ETC., ET AL.
V.
APPELLANTS/CROSS-APPELLEES
ON REVIEW FROM COURT OF APPEALS
CASE NUMBERS 2004-CA-000101 AND 2004-CA-000177
JEFFERSON CIRCUIT COURT NO. 00-CI-001660
CITY OF LOUISVILLE,
KENTUCKY, ET AL.
APPELLEES/CROSS-APPELLANTS
OPINION OF THE COURT BY SPECIAL JUSTICE JAMES E . PARSONS
AFFIRMING
The Appellants/Cross-AppeI lees, Eric P. Light and Connie Light, hereinafter
referred to as the "Lights", on behalf of themselves and as representatives of a class of
taxpayers within the City of Louisville, have appealed from an adverse decision of the
Court of Appeals, which affirmed the judgment of the Jefferson Circuit Court, dismissing
their claims that the Appellee/Cross Appellant, City of Louisville, Kentucky, hereinafter
referred to as the "City", set ad valorem tax rates for the years 1998 and 1999 in excess
of the amount permitted by law.
The salient facts that gave rise to this action are not in dispute . The City has
elected to use the Jefferson County property assessment for purposes of establishing
the City's ad valorem tax rates pursuant to the provisions of KRS 132.285. In 1998 and
1999, the City established its ad valorem tax rates at the four percent (4%) increase rate
permitted by KRS 132.027, which rates were in excess of the compensating tax rates as
defined by KRS 132 .010(6). It is not disputed that the City published the public notices
required by KRS 132.027 to establish the four percent (4%) increase tax rate for each
year in question . However, the ordinances adopting the tax rates for 1998 and 1999
were each adopted more than forty-five (45) days after the Kentucky Department of
Revenue had certified the property tax rolls for Jefferson County, Kentucky, for those
years.'
The Lights filed suit claiming that because the City adopted its rates for 1998 and
1999 more than forty-five (45) days after the property tax rolls were certified, the City
was limited to the compensating tax rate for those years based on the provisions of
KRS 132 .0225 .2 They sought a declaration that the tax rates in 1998 and 1999 were
set higher than permitted and for class refunds for the taxes they and others similarly
situated, paid in excess of the compensating tax rate for each year.
In response, the City argued that KRS 132.0225 did not apply to it, because
cities that adopt the county's assessment, pursuant to KRS 132.285 are granted the
authority to set the time for establishing their ad valorem property tax rates
notwithstanding the provisions of any other statute.
In its ruling on cross motions for summary judgment, the Jefferson Circuit Court
held that while the City is a local taxing district, within the meaning of KRS 132 .0225,
' The county property tax roll for 1998 was certified on August 11, 1998, and the
ordinance setting the tax rate for that year was signed October 19, 1998 . In 1999 the
county's tax roll was certified on August 13, 1999, and the city ordinance setting the tax
rates was signed October 4, 1999 .
2 KRS 132 .0225 provides in part that all local taxing districts must set their tax rates
within 45 days of the property tax rolls for the county being certified by the Revenue
Cabinet or be limited to the compensating tax rate for that year .
2
KRS 132.285, which granted to the City the authority to "fix the time for levying the city
tax rate," was the more specific statute of the two statutes and its provisions controlled,
based upon a primary rule of statutory construction that when two statutes are in
conflict, the more specific statute controls the general . The trial court dismissed the
Lights' complaint and held that the City did not set its rates in 1998 and 1999 in excess
of the rates permitted by law.
The Court of Appeals affirmed the decision of the Jefferson Circuit Court, but for
slightly different reasons . The Court of Appeals found KRS 132.0225 to be ambiguous
and based upon consideration of the legislative history of the statute and the provisions
of KRS 132.285, concluded that KRS 132.0225 did not apply to those cities that mailed
their own tax bills, separate from the county bills. The Court reasoned that based on
the legislative history and other evidence in the record, the purpose of KRS 132 .0225
was to ensure that taxing districts using the county tax bill did not delay the issuance of
the county tax bill by failing to set their rates timely. Since the City mailed its tax bill
separate from the county bill, the setting of the City rate could not impact or delay the
preparation of the county tax bill. Accordingly, the Court of Appeals ruled that KRS
132 .0225 did not apply to cities that prepared their own tax bills, including the City,
separate from the county tax bill .
The Lights in their appeal from the Court of Appeals make several arguments,
including that the City is a taxing district pursuant to KRS 132.0225 ; that KRS 132 .0225
is clear and unambiguous and, therefore, it was improper for the Court of Appeals to
consider legislative history and other evidence to interpret the statute; that there is no
conflict between KRS 132 .0225 and KRS 132.285, since KRS 132.285 simply allows a
city to adopt the county assessment; that the statutory interpretation given KRS 132.285
by the Court of Appeals would invalidate the "rollback" requirements applicable to the
establishment of property tax rates; and that the taxpayers in Louisville are entitled to
class refunds, based upon statutory and/or common law, for the taxes paid in 1998 and
1999 in excess of the compensating tax rates.
We agree with the Lights and with the position adopted by the trial court, that the
provisions of KRS 132.0225 are clear and there is no need to consider legislative
history to determine its meaning . Lincoln County Fiscal Court v. Department of Public
Advocacy, 794 S .W.2d 162 (Ky. 1990) . In Lincoln County we wrote :
Where the words of the statute are clear and unambiguous and express
the legislative intent, there is no room for construction or interpretation and
the statute must be given effect as written . Griffin v. City of Bowling
Green, Ky., 458 S .W.2d 456 (1970) . An unambiguous statute must be
applied without resort to any outside aids. Delta Airlines v.
Commonwealth of Kentucky, Revenue Cabinet, Ky., 689 S.W.2d 14
(1985).
Id. at 164.
In the case at hand, the pertinent provisions of KRS 132.0225(1) provide :
A taxing district that does not elect to attempt to set a rate that will
produce more than four percent (4%) in additional revenue, exclusive of
revenue from new property as defined in KRS 132.010, over the amount
of revenue produced by the compensating rate as defined in KRS 132.010
shall establish a final rate within forty-five (45) days of the department's
certification of the county's property tax roll . Any taxing district that fails to
meet this deadline shall be required to use the compensating tax rate for
that year .
The statute establishes no exceptions to the term taxing district ; nor does it provide that
the statute only applies to taxing districts that utilize the county tax bill . Thus, we agree
with the Lights that interpreting the statute to not apply to cities that mail their tax bills
separate from the county tax bill, as was done by the Court of Appeals, was
inappropriate . City of Covington v. Kenton County, 149 S .W.3d 358 (Ky. 2004). Such
an interpretation adds an exception to the statute that the General Assembly did not
4
create . As we noted in the Citv of Covington case at 362, quoting from Beckham v.
Board of Education of Jefferson County , 873 S .W.2d 575, 577 (Ky. 1994), when
interpreting a statute, "Our duty is to ascertain and give effect to the intent of the
General Assembly . We are not at liberty to add or subtract from the legislative
enactment nor to discover a meaning not reasonably ascertainable from the language
used ." Based on this established standard for judicial review of a statute, under the
plain reading of KRS 132.0225, the City is a taxing district within the meaning of the
statute .
However, that does not end our inquiry. Pursuant to the provisions of KRS
132.285, a city that has elected to adopt the county assessment for purposes of setting
its ad valorem tax rates is granted broad powers regarding the procedures for setting
applicable tax rates, notwithstanding any other statutory procedures to the contrary .
Price v. City of Louisville , 237 S .W.2d 840 (Ky. 1951) . KRS 132 .285 provides in
pertinent part that "[T]he legislative body of any city adopting the county assessment
may fix the time for levying the city tax rate, fiscal year, due and delinquency dates for
taxes and any other dates that will enable it effectively to adopt the county assessment,
notwithstanding any statutory provisions to the contrary" [emphasis added].
Therefore, even though KRS 132.0225 requires all taxing districts to levy their tax
rates within forty-five (45) days, cities that have elected to adopt the county's
assessment, which include the City of Louisville, are empowered to fix the time for
levying their tax rates, notwithstanding any other statutory provisions to the contrary by
KRS 132.285 . The Lights argue that there is no conflict between the two statutes,
contending that KRS 132 .285 only allows a city to fix only those dates necessary to
adopt the county assessment. We disagree . The authority granted to cities by KRS
132 .285, including the right to "fix the time for levying the city tax rate" would be
seriously undercut by the mandate imposed by KRS 132.0225 requiring the tax rate be
set within forty-five (45) days of the certification of the county tax roll.
Since we have two statutes whose provisions are in conflict, the conflict must be
resolved under the doctrine of in paria materia . Economy Optical Co. v. Kentucky
Board of Optometric Examiners, 310 S.W.2d 783 (Ky. 1958) . It is incumbent upon
courts to resolve the conflict between the two statutes so as to give effect to both . Id .
In harmonizing the conflict between two statutes that relate to the same subject,
Kentucky follows the rule of statutory construction that the more specific statute controls
over the more general statute . Withers v. University of Kentucky, 939 S .W. 2d 340 (Ky.
1997); City of Bowling Green v. Board of Education of Bowling Green Independent
School District. 443 S .W.2d 243 (Ky. 1969) .
Applying this principle to the case at hand, we agree with the opinion of the trial
court and note that KRS 132 .0225 applies generally to all taxing districts, while KRS
132.285 applies specifically to cities that have elected to adopt the county assessment
for purposes of levying their ad valorem tax rates. We find KRS 132.285 to be the more
specific of the two statutes and, under the rule of statutory construction articulated
above, controls over KRS 132 .0225 . KRS 132 .285 specifically grants to cities that
adopt the county assessment broad powers regarding the procedures for setting the tax
rates and implementing the county assessment, including the authority to set the time
for establishment of the applicable tax rate. The specific wording of KRS 132 .285
provides that the grant of authority to cities electing to adopt the county assessment is
granted notwithstanding any other statutory provision to the contrary, which includes the
mandate of KRS 132.0225 to set the tax rate with forty-five (45) days of the certification
of the county tax roll . Since we are of the opinion that KRS 132.285 controls over the
more general provision of KRS 132 .0225, we agree with the result reached by the Court
of Appeals and the Jefferson Circuit Court that the City did not set its 1998 and 1999 ad
valorem tax rates in excess of that allowed by statute .
Further, we disagree with the assertions of the Lights that interpreting KRS
132 .285 to control over the provisions of KRS 132 .0225, for cities that adopt the county
assessment, negates the provisions of the "rollback" provisions set forth in other
sections of KRS Chapter 132. While we find KRS 132.285 to be a broad grant of
authority to establish procedures for the collection of ad valorem taxes and the adoption
of the county assessment, nothing in that statute can be construed to exempt cities that
use the county assessment from the provisions of KRS Chapter 132 on calculating and
setting the actual rates of taxation . Indeed, in this case, the record shows that the City
complied with the public notice requirements provided by KRS 132.027 when it set rates
for 1998 and 1999 in excess of the compensating tax rates for those years .
Since we hold that the City did not set its 1998 and 1999 ad valorem tax rates in
excess of the rates permitted by statute, there is no need to consider the Lights' other
arguments regarding their right to statutory and/or common law class refunds for excess
taxes paid .
For the foregoing reasons, we affirm the decisions of the Courts below.
Lambert, C.J., Cunningham, Minton, Noble and Scott, JJ . and Special Justice Victor B .
Maddox, sitting . All concur. Abramson and Schroder, JJ ., not sitting .
COUNSEL FOR APPELLANTS/CROSS-APPELLEES :
Honorable Timothy J . Eifler
Honorable Deborah T. Eversole
Honorable Walter L . Sales
Stoll Keenon Ogden, PLLC
2000 PNC Plaza
500 West Jefferson Street
Louisville, KY. 40202-2828
COUNSEL FOR APPELLEES/CROSS-APPELLANTS :
Honorable Thomas J. Luber
Honorable Sara Christine Veeneman
Honorable Mitzi D. Wyrick
Wyatt,Tarrant & Combs, LLP .
500 West Jefferson Street
Suite 2800
Louisville, KY. 40202-2898
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