Request By:
Mr. Walter Dunlevy
Executive Vice President
Northern Kentucky Chamber of Commerce
223 Scott Street
Covington, Kentucky 41011
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Walter C. Herdman, Assistant Attorney General
In your letter of April 19 you pointed out that KRS 102.060, which granted specific approval for the appropriation of city funds through the Chamber of Commerce for purposes of industrial development, was repealed in the recently concluded session of the General Assembly. This was done by House Bill 152, § 17. Your question was whether there is anything in the statutes to prevent a city or cities from so investing their tax money notwithstanding the repeal of KRS 102.060.
It is our opinion that the repeal of KRS 102.060 removed the authority for the appropriation of such funds, and that the tax monies may not be applied for such purposes. Furthermore, should the cities volunteer their tax monies for such purposes, the action would be illegal under Kentucky Constitution § 179.
It is a fundamental principle that a city has only those powers that are expressly or impliedly given to it by the Legislature and that any doubts concerning the existence of the municipal power is to be resolved against its existence. City of Horse Cave v. Pierce, Ky., 437 S.W.2d 185 (1969); Juett v. Town of Williamstown, 248 Ky. 235, 58 S.W.2d 411 (1933).
Furthermore, in McQuillen, Mun. Corps., § 39.19 it is stated in part:
"All appropriations or expenditures of public money by municipalities and indebtedness created by them, must be for a public and corporate purpose, at least, unless the powers of the particular municipality in regard thereto have been enlarged by the legislature. . .
. . . a municipality has no power, unless expressly conferred by constitutional provision, charter or statute, to donate municipal monies for private uses to any individual or company, not under the control of the city and having no connection in it. . .
Thus, it is clear that a city may not authorize appropriations or expenditures to corporations or individuals, even though the corporation is a non-stock, non-profit organization without specific legislative authorization. In Ezelle v. City of Paducah, Ky., 441 S.W.2d 162 (1969) the court upheld a city donation of public funds to the local chamber of commerce. However, that decision was based on the fact that in KRS 102.060 the Legislature had specifically authorized such a donation. It is clear from the opinion that the donation would have been illegal had it not been for the specific authorization of KRS 102.060.
The court, in Ezelle, raised, but left unresolved, the question of the constitutionality of KRS 102.060 in light of § 179 of the Kentucky Constitution which reads in part as follows:
"The General Assembly shall not authorize any . . . city . . . to become a stockholder in any company, association or corporation, or to obtain or appropriate money for, or loan its credit to, any corporation, association . . . except for the purposes of constructing . . . bridges or roads."
Thus, even though the donation of public funds to the local chamber of commerce was upheld under KRS 102.060 it is apparent that any similar donations without such specific legislative authorization would violate § 179 and therefore be unconstitutional.
For these reasons it is our opinion that any donations of city tax monies under the plan discussed in your letter would be illegal and unconstitutional since KRS 102.060 has been repealed.