Request By:
Mr. Philip A. Thompson, President
Kentucky Chamber of Commerce
P.O. Box 817
Versailles Road
Frankfort, Kentucky 40602
Opinion
Opinion By: Steven L. Beshear, Attorney General; By Alex W. Rose, Assistant Attorney General
In your letter to the Attorney General, you ask for an interpretation of House Bill 809. That bill amends various statutes to do effectively the same thing for various taxing authorities: allow a separate rate on personal property that will provide a particular percentage increase in revenue from personal property. The bill also provides for an additional tax rate for personal property for 1982-83 only.
You cite Sections 1 and 2 of the bill as examples of what the bill does for all taxing authorities. For purposes of illustration, we will continue to address Sections 1 and 2 with the understanding that our determination refers to all sections of the bill.
Section 1 provides for the general tax rate on personal property. It states that such tax rate may not exceed that of the prior year tax rate applicable to personal property.
Section 2 provides for the additional tax rate on personal property for 1982-83 only. Subsection (2) of Section 2 contains the language about which you wish our opinion. It states as follows:
(2) The tax rate levied under the provisions of Section 1 and subsection (1) of this section shall not exceed the tax rate applicable to personal property levied by the respective county fiscal court in 1981-82.
It is our opinion that subsection (2) of Section 2 means that the tax rate levied under Section 1 for 1982-83 cannot exceed the tax rate levied in 1981-82. Additionally, the tax rate levied under subsection (1) of Section 2 cannot exceed the tax rate levied in 1981-82.
The purpose of Section 2 appears to be to allow taxing districts in 1982-83 to make up revenues lost from the three preceding years. Section 1 contains a "cap" - that is, a maximum rate. Section 2 refers to 1982-83 only. The "cap" referred to in subsection (2) of Section 2 in reference to the Section 1 tax rate would correspond to the "cap" as set forth in Section 1 for that rate in general. It also follows logically that in setting a "cap" of the tax rate of the previous year, such a "cap" would be applied, in and of itself, to the Section 2 tax rate.
To hold otherwise would, in certain sets of circumstances, make the provisions of subsection (2) of Section 2 absurd and hold the intention of the legislature for naught. A taxing district that found it necessary to levy a combined rate for 1982-83 in excess of the 1981-82 rate, where such rates individually did not exceed the 1981-82 rate, would be precluded from doing so under an opposite interpretation. Such a taxing district would not be able to receive the revenues that Section 2 intends to allow. It is a cardinal rule of statutory construction that the intention of the legislature should be given effect. See Fiscal Court Commissioners of Jefferson County v. Jefferson County Judge/Executive, Ky.App., 614 S.W.2d 954 (1981). Furthermore, statutes will not be given a reading that would lead to an absurd conclusion. See Wesley v. Board of Education of Nicholas County, Ky., 403 S.W.2d 28 (1966).
As pointed out above, House Bill 809 creates two rates for 1982-83: a rate under Section 1 and a rate under subsection (1) of Section 2. Since the word "rate" in subsection (2) of Section 2 is in the singular, the proper grammatical analysis of the sentence supports the interpretation set out herein. If the interpretation were to be otherwise the word "rate" should be in the plural.
It is, therefore, our opinion that subsection (2) of Section 2 of House Bill 809 means that, in 1982-83, neither of the two rates set out in the bill may separately exceed the 1981-82 rate, but that the two rates collectively may exceed such rate.