Can a Kentucky city or tax commission publish a list of businesses that are behind on occupational taxes, including how much they owe?

Plain-English summary

The Georgetown-Scott County Revenue Commission collects occupational and net-profit license taxes for the city, county, and school board, and it wanted to publish a list of businesses behind on those taxes to nudge people into compliance. Its general counsel asked the Attorney General three things: does KRS 424.330 authorize publishing delinquent occupational taxpayers, is there some other statute that lets the county and school board do the same, and if publication is allowed, does KRS 424.130 govern how.

On the first question, the opinion says no. KRS 424.330 lets cities publish a list of "taxes levied under Section 181," and although occupational taxes trace to Section 181, the Constitution calls those a "license fee," not a "tax." Reading the statute's history (the now-repealed companion provisions about property taxes collected by sheriffs) and the canon that listing one thing implies excluding another, the opinion concludes the General Assembly meant KRS 424.330 to reach city ad valorem property taxes, not occupational taxes. Crucially, occupational-tax amounts are made confidential by KRS 67.790(8)(a), so reading KRS 424.330 to allow publishing those amounts would clash with that confidentiality statute.

On the second and third questions, the opinion finds no statute that governs publishing occupational-tax delinquencies. But it points to the Open Records Act: the Office's open-records decisions hold that the names of businesses delinquent on occupational taxes are public and can be disclosed, as long as the amount owed is withheld. So a public agency may voluntarily publish a delinquent-name list. Because KRS 424.330 does not apply, KRS 424.130's publication schedule does not apply either. The repeated bottom line: names yes, amounts no.

What this means for you

Revenue commissions, city and county tax officials

Under this opinion, you may voluntarily publish the names of occupational-tax delinquents (those names are open records), but you may not publish the amount any taxpayer owes, which the opinion treats as confidential under KRS 67.790(8)(a) and KRS 131.190. The formal publication rules in KRS 424.330 and KRS 424.130 do not apply to occupational taxes.

School board finance officers

The opinion treats the school board the same way as the city and county here: there is no statute specifically governing publication of occupational-tax delinquencies, but the name-disclosure-allowed, amount-confidential rule from the Open Records Act applies.

Open records officers

The opinion restates the line its open-records decisions (22-ORD-179, 10-ORD-183, 08-ORD-143) have drawn: the public is entitled to know whether a taxpayer is delinquent, but not the amount of occupational tax owed.

Business owners

If you are behind on local occupational taxes, this opinion says your name can lawfully be published, but the dollar figure cannot.

Common questions

Q: Can my city legally print a "delinquent taxpayers" list in the newspaper?
A: For occupational taxes, the opinion says there is no statute requiring or formally governing it, but a public agency may voluntarily publish the names because they are open records. It cannot publish the amounts owed.

Q: Why are the amounts off-limits?
A: Because KRS 67.790(8)(a) makes information about a taxpayer's business affairs, including the amount of occupational tax owed, confidential. The opinion says publishing the amount would conflict with that statute.

Q: Doesn't KRS 424.330 say cities can publish delinquent taxes?
A: It says cities may publish "taxes levied under Section 181," but the opinion reads that as ad valorem property taxes, not occupational taxes, partly because Section 181 calls occupational charges a "license fee," not a "tax," and partly to avoid conflicting with the confidentiality statute.

Q: Do the timing rules in KRS 424.130 apply?
A: No. Because the opinion concludes KRS 424.330 does not cover occupational taxes, the publication-schedule requirements of KRS 424.130 do not apply to an occupational-tax delinquency list.

Background and statutory framework

KRS Chapter 424 sets uniform rules for publishing legal notices (Lyon v. Warren Cnty., 325 S.W.2d 302 (Ky. 1959)), some of which serve as constructive notice (City of Jeffersontown v. City of Hurstbourne, 684 S.W.2d 23 (Ky. Ct. App. 1984); KRS 91.4883), with noncompliant actions voidable under KRS 424.380. KRS 424.330 lets cities publish a list of "uncollected delinquent taxes levied under Section 181," and KRS 424.130(c) sets the schedule for delinquent-tax advertisements. Section 181 of the Kentucky Constitution authorizes "license fees" on occupations, which case law (City of Louisville v. Sebree, 214 S.W.2d 248 (Ky. 1948); Driver v. Sawyer, 392 S.W.2d 52 (Ky. 1965)) distinguishes from ad valorem "taxes." Applying plain-language and context canons (Univ. of Louisville v. Rothstein, 532 S.W.3d 644 (Ky. 2017); Palmer v. Commonwealth, 3 S.W.3d 763 (Ky. App. 1999); Jefferson Cnty. Bd. of Ed. v. Fell, 391 S.W.3d 713 (Ky. 2012); Lewis v. Jackson Energy Co-op. Corp., 189 S.W.3d 87 (Ky. 2005)), and the duty to harmonize conflicting statutes (Williams v. Commonwealth, 829 S.W.2d 942 (Ky. Ct. App. 1992)), the opinion limits KRS 424.330 to property taxes. The confidentiality of occupational-tax amounts rests on KRS 67.790(8)(a) (tax districts defined in KRS 67.750(10)) and KRS 131.190, as applied in the Office's open-records decisions.

Citations and references

Constitution and statutes:
- Ky. Const. § 181 (license fees on occupations and professions)
- KRS 424.330, KRS 424.130, KRS 424.130(c), KRS 424.380, KRS 91.4883 (publication of legal notices)
- KRS 67.790, KRS 67.790(8)(a), KRS 67.750(10), KRS 131.190 (taxpayer confidentiality)
- KRS 91A.070, KRS 67.083 (city/county tax collection authority)

Cases:
- Lyon v. Warren Cnty., 325 S.W.2d 302 (Ky. 1959); City of Jeffersontown v. City of Hurstbourne, 684 S.W.2d 23 (Ky. Ct. App. 1984)
- City of Louisville v. Sebree, 214 S.W.2d 248 (Ky. 1948); Driver v. Sawyer, 392 S.W.2d 52 (Ky. 1965) (occupational charge is a license fee)
- Univ. of Louisville v. Rothstein, 532 S.W.3d 644 (Ky. 2017); Palmer v. Commonwealth, 3 S.W.3d 763 (Ky. App. 1999); Jefferson Cnty. Bd. of Ed. v. Fell, 391 S.W.3d 713 (Ky. 2012); Lewis v. Jackson Energy Co-op. Corp., 189 S.W.3d 87 (Ky. 2005); Williams v. Commonwealth, 829 S.W.2d 942 (Ky. Ct. App. 1992)

Open records decisions: 22-ORD-179; 10-ORD-183; 08-ORD-143

Source

• Landing page: https://www.ag.ky.gov/Opinions/Pages/default.aspx
• Original PDF: https://www.ag.ky.gov/Resources/Opinions/Opinions/Opinion%20of%20the%20Attorney%20General%2024-7%20Final.pdf

Original opinion text

The full opinion as issued by the Office of the Kentucky Attorney General:

July 11, 2024
OAG 24-07
Subjects: (1) Whether KRS 424.330 and KRS 424.130 governs the publication of delinquent occupational tax account holders. (2) Whether the Georgetown-Scott County Revenue Commission may publish a list of delinquent occupational tax account holders on behalf the City of Georgetown, the Scott County Fiscal Court, and the Scott County Board of Education.
Requested by: Jessica Brown, General Counsel, Georgetown-Scott County Revenue Commission
Written by: Jeremy J. Sylvester, Assistant Attorney General
Syllabus: (1) KRS 424.330 and KRS 424.130 do not govern the publication of delinquent occupational tax account holders. (2) The Georgetown-Scott County Revenue Commission may publish a list of delinquent occupational tax account holders on behalf of the City of the Georgetown, the Scott County Fiscal Court, and the Scott County Board of Education. However, that list must not disclose the amount of taxed owed by any taxpayer.

Opinion of the Attorney General

In 1958, the General Assembly enacted KRS Chapter 424 to create uniform statutory requirements for the publication of legal notices in newspapers. See Lyon v. Warren Cnt'y, 325 S.W.2d 302, 304 (Ky. 1959) (discussing 1958 Ky. Acts Ch. 42). Some of the notices required by Chapter 424 "are a form of constructive service of process and unless the statutory form is strictly complied with the service is void." City of Jeffersontown v. City of Hurstbourne, 684 S.W.2d 23, 25 (Ky. Ct. App. 1984). For example, a city seeking to enforce a property tax lien must provide constructive notice to property owners by newspaper publication that complies with applicable provisions of KRS Chapter 424. KRS 91.4883. If an agency takes an action for which publication is required and does not comply with Chapter 424, its action shall be voidable by a court. KRS 424.380.

KRS 424.330 grants cities the discretion to publish a list of uncollected delinquent taxes in a newspaper:

Cities may publish a list of uncollected delinquent taxes levied under Section 181 of the Kentucky Constitution, showing the name of and the amount due from each delinquent taxpayer, to be advertised by newspaper publication. A fee equal to the prorated cost of publication per taxpayer per publication may be added to the amount of each tax claim published as publication costs.

KRS 424.130 governs the "times and periods of publications of advertisements required by law to be made in a newspaper." [Footnote: Cities are not required by law to publish a list of delinquent taxpayers in the newspaper under the plain terms of KRS 424.330. However, the Legislative Research Commission states in an informational bulletin that if a city elects to publish a list of delinquent taxpayers, the publication must contain the name of each delinquent taxpayer and the amount owed and must comply with the provisions of KRS 424.130. Legis. Res. Commission, KY. MUN. STAT. LAW, Info. Bull. No. 145, p. 76 (Sept. 2023).] This statute provides the following concerning notice of delinquent taxes:

When an advertisement is for the purpose of informing the public and the advertisement is a notice of delinquent taxes, or notice of the sale of tax claims, the advertisement shall be published either:
1. Once a week for three (3) consecutive weeks; or
2. One (1) time, preceded by a one-half (1/2) page notice of advertisement the preceding week. The one-half (1/2) page advertisement shall include notice that a list of uncollectible delinquent taxes is also available for public inspection in accordance with KRS 424.330 during normal business hours at the business address of the city or county and on an identified Internet Web site. The advertisement shall include the business address of the city or county and the Uniform Resource Locator (URL) for the Internet Web site where the document can be viewed. The Internet Web site shall be affiliated with the city or county and contain other information about the city or county government. The delinquent tax list shall be posted on the Internet Web site for a minimum of thirty (30) days and shall be updated weekly.

KRS 424.130(c).

The Georgetown-Scott County Revenue Commission (GSCRC) was formed through an interlocal agreement between the City of Georgetown, the Scott County Fiscal Court, and the Scott Count Board of Education. The GSCRC serves as a central body to collect occupational and net profit license taxes imposed by the city, county, and school board. This agency is considering publishing a list of persons or business with delinquent taxes owed to these taxing authorities as a strategy to inform consumers and boost compliance with tax laws.

The GSCRC presented this Office with the following questions about KRS Chapter 424 and the publication of delinquent occupational tax account holders:

(1) Does KRS 424.330 allow for the publication of delinquent occupational tax account holders as it is a tax/fee set forth in the Kentucky Constitution, Section 181?

It is the opinion of the Office that the General Assembly did not intend KRS 424.330 to apply to the publication of delinquent occupational tax account holders. This conclusion is the based on historical context. Moreover, this interpretation is necessary to harmonize KRS 424.330 with KRS 67.790(8)(a), which makes confidential certain business information obtained by public officials in the collection of business taxes.

Section 181 of the Kentucky Constitution states:

The General Assembly shall not impose taxes for the purposes of any county, city, town or other municipal corporation, but may, by general laws, confer on the proper authorities thereof, respectively, the power to assess and collect such taxes. The General Assembly may, by general laws only, provide for the payment of license fees on franchises, stock used for breeding purposes, the various trades, occupations and professions, or a special or excise tax; and may, by general laws, delegate the power to counties, towns, cities and other municipal corporations, to impose and collect license fees on stock used for breeding purposes, on franchises, trades, occupations and professions. And the General Assembly may, by general laws only, authorize cities or towns of any class to provide for taxation for municipal purposes on personal property, tangible and intangible, based on income, licenses or franchises, in lieu of an ad valorem tax thereon: Provided, Cities of the first class shall not be authorized to omit the imposition of an ad valorem tax on such property of any steam railroad, street railway, ferry, bridge, gas, water, heating, telephone, telegraph, electric light or electric power company.

Section 181 allows the General Assembly to enact general laws granting cities and counties the power to assess and collect ad valorem property taxes and impose specified license fees. Driver v. Sawyer, 392 S.W.2d 52, 53 (Ky. 1965). The General Assembly has granted this authority to cities and counties. See KRS 91.260 (cities of the first class shall raise revenue from ad valorem taxes and license fees); KRS 92.280 (proving similar grant for cities of home rule class and urban-county governments); KRS 67.083 (granting broad taxing authority to county fiscal courts).

The occupational tax at issue here is authorized under Section 181's provision stating that the General Assembly may allow cities and counties to impose "license fees on franchises, stock used for breeding purposes, the various trades, occupations and professions." An occupational tax, as it now commonly referred, is a constitutional "license fee" under Section 181 of the Kentucky Constitution. City of Louisville v. Sebree, 214 S.W.2d 248, 253-54 (Ky. 1948). Moreover, the General Assembly, by statute, has granted cities and counties the authority to impose this type of license fee. See KRS 91.200 (cities of the first class); KRS 92.281 (cities of the home rule class); KRS 67.083 (counties). Even though Section 181 authorizes the imposition of occupational taxes, the Office does not believe that the General Assembly intended KRS 424.330 to apply to the publication of delinquent occupational taxes.

The statutory provision granting cities the discretion to publish a list of delinquent taxpayers and the amount they owe came into existence in 1992. 1992 Ky. Acts ch. 73, § 1. In that year, the General Assembly enacted House Bill 339 adding this subject provision to KRS 424.330. Before the enactment of this bill, KRS 424.330 only addressed publication of delinquent property taxes collected by a sheriff on behalf of the fiscal court. Id. After enactment, KRS 424.330 stated:

(1) When the sheriff of any county files with the fiscal court a list of uncollectible delinquent taxes, in accordance with KRS 134.360 and 134.370, the fiscal court shall promptly cause a list, showing the name of and amount due from each delinquent taxpayer, to be advertised by newspaper publication. A fee of three dollars ($3) per name per publication shall be added to the amount of each tax claim published as publication costs.
(2) Cities may publish a list of uncollected taxes levied under Section 181 of the Kentucky Constitution, showing the name of and the amount due from each delinquent taxpayer, to be advertised by newspaper publication. A fee of three dollars ($3) per name per publication may be added to the amount of each tax claim published as publication costs.

Id. The General Assembly later repealed the first subsection relating to collection of county ad valorem property taxes in 2009, and, in doing so, erased necessary context for the statutory provision that remains. 2009 Ky. Acts. ch. 10, § 69. [Footnote: House Bill 262 also made numerous changes to KRS Chapter 134, including how certificates of delinquency for unpaid property taxes are sold. 2009 Ky. Acts. ch. 10. One such change required the county clerk to advertise the purchase of certificates of delinquency under Chapter 424. Id. at § 10 (codified into KRS 134.128). This change obviated the need for the provision in KRS 424.330 requiring the fiscal court to publish of a list of delinquent taxpayers provided by the sheriff.] Nonetheless, this historic statutory context and other factors lead this Office to believe that the General Assembly only meant KRS 424.330 to apply to the publication of delinquent ad valorem property taxes.

First, KRS 424.330 uses the phrase "taxes levied under Section 181" when describing the type of tax delinquencies that a city may publish. Section 181 uses the word "tax" when referring to ad valorem property taxes. Section 181's grant of authority for what is colloquially referred to as an occupational "tax," does not use the word tax at all. Rather, Section 181 refers to this revenue raising mechanism as a "license fee. Sebree, 214 S.W.2d at 253-54. Thus, by using the phrase "taxes levied under Section 181," and omitting the term "license fees," the General Assembly expressed an intent to limit KRS 424.330's applicability to ad valorem property taxes levied by a city. See Univ. of Louisville v. Rothstein, 532 S.W.3d 644, 648 (Ky. 2017) (holding courts "must look first the plain language of a statute" and assume that the General Assembly "meant exactly what it said, and said exactly what it meant") (citations omitted); see also Palmer v. Commonwealth, 3 S.W.3d 763, 764 (Ky. App. 1999) ("[A]n enumeration of a particular thing demonstrates that the omission of another thing is an intentional exclusion.").

Second, the 1992 version of KRS 424.330 lends context to the subject provision concerning cities. When read in this context, the subject statutory provision appears to relate to delinquent ad valorem property taxes that a city may impose. See Jefferson Cnty. Bd. of Ed. v. Fell, 391 S.W.3d 713, 719 (Ky. 2012) ("The particular word, sentence or subsection under review must also be viewed in context rather than in a vacuum; other relevant parts of the legislative act must be considered in determining the legislative intent."); Lewis v. Jackson Energy Co-op. Corp., 189 S.W.3d 87, 92 (Ky. 2005) ("The statute must be read as a whole and in context with other parts of the law."). Before 1992, KRS 424.330 only related to the publication of delinquent ad valorem property taxes for which the sheriff is charged to collect under KRS Chapter 134. In fact, the statute cross-referenced two now-repealed provisions of that chapter dealing with the sheriff's collection of ad valorem property taxes. [Footnote: Moreover, this subsection used the term "tax claim," which is defined under KRS 134.010 as the "tax due on a tax bill, the penalties, costs, fees, interests, commission, the lien provided in KRS 134.420 and any other expenses that have become or are by reason of the delinquent tax bills proper legal charges." KRS 134.010(15). The lien mentioned is placed on property for unpaid property tax. KRS 134.420.] A city, however, may contract with the sheriff to collect its property tax under the procedures stated in Chapter 134 or it may collect those taxes on its own in accordance with procedures set forth in a duly enacted ordinance. KRS 91A.070. It is the opinion of the Office that the text added to KRS 424.330 in 1992 was meant to apply to cities electing to collect their own property taxes, giving them the explicit authority to publish a list of taxpayers who were delinquent on paying their city ad valorem taxes just like the fiscal court was required to do for delinquent county taxpayers. [Footnote: This position is consistent with the Legislative Research Commission's informational bulletin discussing statutory municipal statutory law, which only mentions KRS 424.330 in connection with its discussion of the collection of city property tax. KY. MUN. STAT. LAW, at 76. There is no direct reference to KRS 424.330 under the section of the information bulletin addressing city occupational taxes. Id. at 78-80.]

Last, our Office believes that KRS 424.330 conflicts with another statute if it was interpreted to permit the publication of the amount of occupational tax owed by taxpayer. In 2003, the General Assembly enacted KRS 67.790. 2003 Ky. Acts Ch. 117, § 17. KRS 67.790(8)(a) states:

No present or former employee of any tax district shall intentionally and without authorization inspect or divulge any information acquired by him or her of the affairs of any person, or information regarding the tax schedules, returns, or reports required to be filed with the tax district or other proper officer, or any information produced by a hearing or investigation, insofar as the information may have to do with the affairs of the person's business.

Id. KRS 67.790 applies to cities, counties, urban county governments, school districts, and any other statutorily created entity authorized to impose occupational taxes. KRS 67.750(10) (defining tax district). The Office has consistently held in its open records decisions that the amount of occupational tax owed by a taxpayer is confidential under KRS 67.790 and another analogous statute, KRS 131.190, and may not be disclosed to the public. See 22-ORD-179 (KRS 131.190(1) prohibits a local government from disclosing the amount of occupational tax paid or owed by a business); 10-ORD-183, p. 4 (the public is entitled to know whether a taxpayer is delinquent, but the amount of delinquent occupational tax owed is confidential under KRS 67.790(8)(a)); 08-ORD-143, p. 4 (concluding the same because the amount taxes owed reveals the private details of the taxpayer's business). In our Office's view, KRS 424.300 should not be interpreted in way that authorizes cities, and only cities, to publish confidential tax information in a newspaper notwithstanding KRS 67.790(8)(a). See Williams v. Commonwealth, 829 S.W.2d 942, 944 (Ky. Ct. App. 1992) (when statutes conflict the one enacted later generally applies, but a court should also "harmonize the interpretation" to give effect to both).

In sum, it is the opinion of the Office that KRS 424.330 does not apply to occupational taxes levied by a city. That statute is only intended to allow cities to publish delinquent city ad valorem property taxes in newspapers.

(2) Is there an equivalent statute or precedent to KRS 424.330 that would allow the Scott County Fiscal Court and the Scott County Board of Education to publish the list of non-compliant taxpayers for each respective jurisdiction?

The Office cannot identify any statute governing the publication of occupational tax delinquencies in newspapers. This Office has held in its open records decisions, however, that the Kentucky Open Records Act requires local governments to make records available for inspection that disclose names of business or individuals who are delinquent on their payment of city occupational taxes, so long the amount owed by each business or person is withheld or redacted. 22-ORD-179; 10-ORD-183, p. 4; 08-ORD-143, p. 4. The amount a taxpayer owes for occupational tax is confidential under KRS 67.790(8)(a) and may not be disclosed. In the opinion of the Office, a public agency or local government may voluntarily publish or disclose any record subject to public inspection under the Kentucky Open Records Act, including a list of the names of persons or businesses with delinquent occupational taxes.

(3) If publication is permitted under Kentucky law, is KRS 424.130 the applicable guide for publication?

KRS 424.130 governs the publication of delinquent taxes and other matters required by law to be published in a newspaper. As stated above, the Office does not believe that KRS 424.330 applies to occupational taxes. Thus, the publication requirements of KRS 424.130 are also inapplicable to any plan by the GSCRC, the City of Georgetown, the Scott County Fiscal Court, or the Scott County Board of Education to publish a list of delinquent occupational taxpayers. The Office reiterates that the amount occupational tax owed by each taxpayer is confidential and may not be disclosed or published.

Russell Coleman
ATTORNEY GENERAL
Jeremy J. Sylvester