Request By:
Mr. Joseph L. Moore
County Fee Systems
Executive Department for Finance and Administration
Capitol Annex
Frankfort, Kentucky
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
Your questions were presented as follows:
"KRS 24A.190 provides the method by which revenues should be returned to local units of government with the implementation of the district court system on January 1, 1978. If any unit of local government believes that unusual circumstances have adversely affected the computation of the number of dollars to be returned then they have the right to appeal to the Secretary of the Executive Department for Finance and Administration. See KRS 24A.191. Two questions arise in relation to this appeal procedure.
"1. What is the definition of 'unusual circumstances'?
"2. If an individual is dissatisfied with the administrative appeal procedure, should they file their next appeal in the Franklin Circuit Court or in their local circuit court?"
KRS 24A.190 reads:
"(1) 'Local court' means any police, justices', or quarterly court or county court sitting as a judicial body.
"(2) 'Net court revenue' means the amount of money collected by a court from fees, fines, and forfeitures less the amount expended for court-related costs.
"(3) 'Court-related costs' means the average costs incurred by a city or county, as computed from the 1973-74, 1974-75, 1975-76 fiscal years, in the operation and maintenance of a court for:
(a) Personnel,
(b) Equipment,
(c) Office supplies,
(d) Operating expenses, and
(e) Any other expense previously borne by a city or county or paid from fines, fees, and forfeitures of a local court, which is assumed by the state in connection with the operation of the courts.
"(4) 'Base court revenue' means the average net court revenue from any local court or any combination of local courts in a city or county as computed from the 1973-74, 1974-75, 1975-76 fiscal years as adjusted pursuant to KRS 24A.191."
Thus "net court revenue" is the amount of money collected by a court from fines, fees, and forfeitures less the amount expended for "court-related costs." The "court-related costs" means the average costs incurred by a city or county, as computed from the 1973-74, 1974-75, 1975-76 fiscal years in the operation and maintenance of a court for certain enumerated categories. Since all the local courts mentioned in KRS 24A.190 [police, justices', quarterly or county court] will be out of existence on January 2, 1978, it follows that the total court revenue must be that received during the base fiscal years for which the average costs are computed [court-related costs]. Thus the computation of "net court revenue" before considering "base court revenue" is schematically as follows:
Fiscal Year 1973-74 Fees, fines, forfeitures - average costs = net court revenue1974-75 Fees, fines, forfeitures - average costs = net court revenue1975-76 Fees, fines, forfeitures - average costs = net court revenue
Under the above formula, note that average costs is derived from getting the average of costs for the fiscal years of 1973-74, 1974-75, 1975-76.
Once the net court revenue is computed under the above table for the three fiscal years shown, the average net court revenue for the three fiscal years is the "base court revenue" mentioned in KRS 24A.190. However, in determining the net court revenue to be returned to a county, for example, in 1978, and thereafter, we must "adjust" the "base court revenue" as provided in KRS 24A.191. The Department for Finance and Administration must determine from certified audits provided by each city and county the "base court revenue", as described above for each city and county which has a local court or courts as of June 30, 1976. KRS 24A.191. The latter statute provides in part:
". . . In the event that any city or county believes that unusual circumstances have adversely affected the resulting computation of base court revenues, then the county or city may appeal to the executive department for finance and administration and the executive department for finance and administration may adjust such computation accordingly."
Now turning to your question as to what constitutes "unusual circumstances. " The statute provides no express clue. It is our opinion that the phrase "unusual circumstances" would embrace the situation in which the normal flow of such court revenue is impeded, interrupted, or modified for any reason during one or more of the base fiscal years [1973-74, 1974-75, 1975-76], resulting in a substantial departure from what would otherwise be a pattern cash flow for the base period. We believe this construction of "unusual circumstances" takes into consideration the policy and purpose of the statute, which is to return an equitable portion of court generated revenue to cities and counties, that portion being basically the excess over and above court-related costs as computed under a normative base period. Kentucky Region Eight v. Commonwealth, Ky., 507 S.W.2d 489 (1974) 491.
Next you ask whether a city or county, which is dissatisfied upon an appeal to the Department for Finance and Administration under KRS 24A.191 as to the operative "base court revenue", may then take an appeal to the Franklin Circuit Court.
If the city or county is not satisfied with the administrative ruling of the Department for Finance and Administration concerning the claimed "unusual circumstances" , then, although the statutes do not provide for such, it may take an appeal to the Franklin Circuit Court, provided that it can show that the Department acted arbitrarily. See Pritchett v. Marshall, Ky., 375 S.W.2d 253 (1964). Section 2 of the Kentucky Constitution prohibits the use of arbitrary power. In Pritchett, above, the court recognized § 2 as a concept broad enough to embrace both due process and equal protection of the law, both fundamental fairness and impartiality.
Since, the appeal would ultimately involve a dispute as to the county's or city's net revenue to come out of the state treasury, the special venue statute, KRS 23.020, would be applicable. See Greene v. Wolf, 175 Ky. 58, 193 S.W. 1048 (1917) 1049.