Request By:
Kenneth Jones, Esq., Spencer County Attorney
Ron SchWoeppe, Esq., Counsel to the Spencer County Sheriff
Opinion
Opinion By: ANDY BESHEAR,ATTORNEY GENERAL;Marc G. Farris,Assistant Attorney General
Opinion of the Attorney General
Kenneth Jones, Spencer County Attorney, requested the opinion of this Office regarding the appropriation of funds from the sale of vehicles that the Spencer County Sheriffs Office obtained from the Department of Defense through the DLA/LESO 1033 Program. Separately; Ron Schwoeppe, counsel for the 'Spencer County Sheriff's Office, requested an opinion on the same issue -- namely, the use of proceeds from the sale of a particular vehicle, a Fuel Tanker Truck, obtained through the 1033 Program. Because the underlying issue is the same in both requests, we have consolidated the requests in this opinion. For the reasons set forth below, we believe that the proceeds from the sale of the equipment must be returned to the Spencer county general fund.
The 1033 Program
The 1033 Program allows the Department of Defense to transfer excess military equipment to civilian law enforcement agencies if the property is "suitable for use by the agencies in law enforcement activities." See 10 U.S.C. § 2576a(a)(1)(A). The 1033 Program requires that states participating in the 1033 Program enter into a Memorandum of Understanding with the Department of Defense, pursuant to which the state officials ensure that local law enforcement agencies receiving property comply with certain requirements.
Separately, the Commonwealth of Kentucky has entered into a Plan of Operation with the. Spencer County Sheriff's Office, pursuant to which the Sheriff's Office agreed to certain terms and conditions in exchange for the opportunity to participate in the 1033 Program. Among other things, the Plan of Operation provides that the Sheriff's Office may dispose of certain property if it receives approval from the Department of Defense and the Commonwealth of Kentucky, and that the disposal of the property must be "in accordance with applicable Federal, State, and local laws." See State Plan of Operation Between the State of Kentucky and the Spencer County Sheriff's Department, P III. B.3.
We understand from the letters that, pursuant to the Plan of Operation, the Spencer County Sheriff's Office has acquired multiple vehicles (the "Vehicles"), and that it has received approval to dispose of the Vehicles. 1 We now turn to the ownership of the Vehicles.
County Property
This Office has repeatedly opined that property purchased using the County's General Fund, including purchases of property for the use and/ or benefit of the sheriff's office, are the property of the County. See OAG 65-881; OAG 83-249. Thus, in 1965, we found that furnishings and other equipment purchased for a sheriff's office were the property of the county. See OAG 65-881 ("[I]t is our opinion that when [the sheriff] purchased the subject furnishings and equipment for the sheriff's office from the fees of that office, the property became the property of Campbell County."). Relying on this opinion, we found that "the title to the vehicles" purchased by the sheriff "should remain in the urban county government." OAG 83-249.
The facts set forth in the letters confirm that the Vehicles are the property of Spencer County. Specifically, we understand from the letters that the County has paid for fuel, repairs, and insurance for the Vehicles using its general fund. In light of our prior decisions, and the facts set forth in the letters, the Vehicles belong to the County.
Proceeds From the Disposition of the Property
The remaining issue concerns the proceeds from the disposition of the Vehicles. KRS 67.0802(5) specifically addresses this issue: "Any compensation resulting from the disposal of this real or personal property shall be transferred to the general fund of the county." Thus, Kentucky law is clear that the funds from the disposition of the Vehicles, which are the personal property 2 of the county, must be transferred to Spencer County's general fund.
The Sheriff's Office raises two arguments for why it should be permitted to retain the proceeds from the sale of the Vehicles. First, it contends that Spencer County's Fee Pooling Ordinance, which requires the Sheriff's Office to turn over "net income" and net fees" to the Spencer County Treasurer, exempts "approved transmittals to governmental agencies. " Specifically, it defines "net income" and "net fees" to "mean all income and all fees collected less only approved transmittals to governmental agencies and/ or applicable refunds to customers." It is apparent from the language of the Ordinance that the transmittals described are those from the Sheriff's Office to other governmental agencies. There is nothing in the letters, however, that would suggest that the proceeds from the sale of the Vehicles will be transferred to governmental agencies, much less that such a transfer was "approved" by the Spencer County Fiscal Court, as contemplated by the Fee. Pooling Ordinance. In any event, the Fee Pooling Ordinance cannot supplant dispositive state statute, including KRS 67.0802(5).
Second, the Sheriff's Office contends that the Plan of Operation "requires" that the Vehicles "be used for Law Enforcement Purposes only," and that it follows that "the proceeds of the sale which were approved by the 1033 Program must be used for Law Enforcement Purposes only." We disagree. The Plan of Operation requires only that the Vehicles be used by the Sheriff's Office. That restriction is sensible given that the 1033 Program concerns potentially dangerous military surplus equipment. By its own terms, the restriction does not apply to the proceeds from the disposition. Moreover, the Plan of Operation expressly incorporates state law concerning the disposition of property. As set forth above, state law provides that the proceeds from the sale of personal property must be transferred to the Spencer County general fund.
Sincerely,
ANDY BESHEAR
ATTORNEY GENERAL
Marc G. Farris
Assistant Attorney General
Footnotes
Footnotes
1 Pursuant to the Plan of Operation, property acquired through the 1033 Program may only be disposed of with the approval of both the State and Department of Defense. We understand from the Letters that the Sheriff's Office received all necessary approvals before disposing of the Vehicles.
2 Personal property" is not defined in KRS Chapter 68. Pursuant to KRS 446.080(4), we therefore apply the generally accepted definition of the term, which is "[a]ny movable or intangible thing that is subject to ownership and not classified as real property." Property, Black's Law Dictionary (10th ed. 2014); see also KRS 132.010(4) (defining "personal property" as "every species and character of property, tangible and intangible, other than real property"). The Vehicles are therefore "personal property" for purposes of the statute.