Request By:
Michael A. Hendricks
Assistant County Attorney
1129 Kentucky Home Life Building
Louisville, Kentucky 40202
Opinion
Opinion By: Robert F. Stephens, Attorney General; By William S. Riley, Assistant Attorney General
In your recent letter several questions have been asked concerning the collection of delinquent real estate taxes. They will be answered in the order in which they are raised.
(1) The City of Louisville and Jefferson County on behalf of the Commissioner of Revenue have been jointly bringing actions for delinquent real estate taxes on property in the City of Louisiville. On several occasions the only state and county taxes delinquent on property are within the three year ban on foreclosures set out in KRS 134.470. Is it proper for the county and state to join the city as a plaintiff on foreclosures?
Answer: Such joint action on the part of the City of Louisville, Jefferson County and the Commonwealth is of doubtful validity. Under KRS 91.480 cities of the first class may sell real property for delinquent taxes and use all remedies available to collect such taxes under KRS 91.570. The city receiver may sell the real property after advertising. None of these statutes provide for joinder of the county, state and city to collect delinquent taxes.
(2) Is there a distinction when the county is a defendant in a foreclosure action? It is pointed out that KRS 134.470 bars the county from pursuing the collection of certain tax bills as a plaintiff but not as a defendant.
Answer: No. KRS 134.470 is a statutory bar to the collection of tax bills until certain time limitations have passed. KRS 134.490(2) contains the same statutory bar for certificates of delinquency if owned by the state, county or a taxing district. Cities are not mentioned in either statute. Any action to collect certificates of delinquency on the part of the county, state or other taxing district should be brought as a plaintiff action.
(3) Whenever the County Attorney seeks a judgment in a real estate tax foreclosure, tax, interest, costs and a 20% penalty is due. The 20% penalty is found in KRS 132.240(2). That provision states in part, "except where the property was duly listed and the taxes paid thereon within the time prescribed by law. . . ." This exception appears to have little place in discussion of delinquent real estate tax foreclosures, since if the taxes had been paid, the action would never have been initiated. Is there any meaning to that exception?
Answer: KRS 132.340 deals with the collection of delinquent taxes where the county court issued a judgment assessing omitted property. Since the statute deals with omitted property, the exception has some validity. If the property was omitted, it was never listed for taxes and no taxes were ever paid within the time prescribed by law.
(3)(b) What time frame can be used invoking the 20% penalty?
Answer: We are enclosing a copy of Revenue Form 62A390. This Complaint form is self-explanatory.
(4) The County Attorney initiates a foreclosure action pursuant to KRS 134.500 on a parcel of real estate subject to numerous tax liens, some more than three years old and some less than three years old as provided for in KRS 134.470. The taxpayer pays only those tax liens older than three years old and challenges a County Attorney's authority to foreclose on tax liens less than three years old. Does KRS 134.470 bar the County Attorney from bringing an action on tax liens less than three years old?
Answer: The County Attorney or any other owner of a delinquent tax bill must wait three years to sue under the terms of the statute. In other words, there must be a delinquent tax bill three years old before suit can be filed. At that time all delinquent bills may be included in the suit up to eight years old. See KRS 134.470.