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Request By:

Mr. Wade F. Richardson
Meade County Attorney
Courthouse
Brandenburg, Kentucky 40108

Opinion

Opinion By: Steven L. Beshear, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General

The Meade County Fiscal Court is contemplating forming an agricultural extension district under KRS 164.605 through 164.675.

Your question is whether under the terms of KRS 67.715 the county judge/executive may, with approval of the fiscal court, abolish an extension district so established. KRS 67.715(2) reads:

* * *

"(2) The county judge/executive or county judges/executive of multi-county districts may, with approval of the fiscal court or fiscal courts, create, any special district or abolish or combine any special district, provided such district was created solely by one or more such fiscal courts."

An agricultural extension district is a political subdivision of the state and a separate taxing district under Section 157 of the Kentucky Constitution, a public body corporate. See KRS 164.620. It is important to note that 60 counties have established the extension district. The purpose of the district is to aid in the dissemination of agricultural practices and education throughout the state. KRS 164.610. Specifically the district is designed to provide aid and assistance to the people of the district, which is co-extensive with the county, in the fields of agriculture, economics, and rural and community life, through extension work to be carried on in conjunction and cooperation with the College of Agriculture of the University of Kentucky and the U.S. Department of Agriculture. The extension district thus performs a unique governmental service in the field of education, which could not otherwise be performed properly by the county or other political subdivision.

The district is basically autonomous and the district board has authority to levy a district tax, which is entirely separate from the county's tax, budget, and accounting procedures. KRS 164.670. See OAG 79-273, copy enclosed, treating the autonomous and constitutional nature of an extension district.

While KRS 164.620 expressly authorizes a fiscal court to create an extension district, there is nothing in KRS 164.605 through 164.675 expressly treating the matter of dissolution of such districts.

There is no constitutional treatment of extension district dissolution. Thus the dissolution of such districts is left to the discretion of the General Assembly, provided no constitutional section is violated. For example, no separate taxing district can be dissolved until and unless it settles and pays its contractual obligations. See Section 19, Kentucky Constitution [prohibiting impairment of obligation of contracts]; and Padgett v. Sensing, Ky., 438 S.W.2d 501 (1969) 503.

The purpose of an extension district is set forth in KRS 164.610:

"In enacting KRS 164.605 to 164.675, it is the intention of the general assembly to provide for aid in disseminating among the people of Kentucky useful and practical information on subjects relating to agriculture, home economics and rural and community life and to encourage the application of the same in the several counties of the commonwealth through extension work to be carried on in cooperation with the University of Kentucky College of Agriculture and Home Economics, and the United States department of agriculture as provided in the Act of Congress May 8, 1914, as amended by Public Law 83 of the 83rd Congress."

In OAG 79-456, copy enclosed, we gave the opinion to the Interim Joint Committee on Counties and Special Districts that the constitution would permit, under a proposed bill, the fiscal court, after a public hearing, to dissolve such districts. Dissolution under that bill would be subject to a referendum if 25% of the registered voters of the district petition for it. The bill also contained a plan for satisfaction of liabilities, fulfillment of contracts and distribution of remaining assets.

Returning to KRS 67.715(2), that statute authorizes the county judge/executive and the entire fiscal court to create special districts and in the same breath to destroy or dissolve such creation. But there is notably absent from this district burial procedure any guidelines providing for preserving constitutional principles. First, there is no guideline relating to the proper satisfaction of liabilities and contractual obligations. The constitution [Sec. 19] does not permit impairment of such obligations. Secondly, there is no due process and fundamental fairness guidelines given in terms of Sec. 2, Kentucky Constitution. Pritchett v. Marshall, Ky., 375 S.W.2d 253 (1963) 258. Specifically there are no statutory provisions for the fiscal court's ordering dissolution of a special district upon a public hearing. Note that in Padgett v. Sensing, above, KRS 173.800 provides for dissolution, where a petition of 51% of the number of qualified voters is filed with fiscal court, and where all contractual obligations have been satisfied. There are no statutory provisions for a referendum on dissolution. The people of a county containing an extension district have something at stake in connection with their education and economic welfare. The purpose of the extension district law and concomitant stake of the people of the district cannot be constitutionally obfuscated by the mere act of the county judge/executive and fiscal court in dissolving an extension district under KRS 67.715(2). As we have said before, if such a political subdivision is to be put to death, it must have a constitutional burial. In addition, suppose the county judge/executive and fiscal court of your county decide to dissolve the extension district and cannot satisfactorily liquidate and pay off its contractual obligations, we have pointed out that the contractual obligations cannot be impaired by such action. Further, Sec. 157 of the Constitution would otherwise prohibit, without a vote of the people, the fiscal court's assuming such obligations where the obligations could not be liquidated out of current revenues of the county. Payne v. Covington, 276 Ky. 380, 123 S.W.2d 1045 (1938).

In conclusion, while the courts might hold that KRS 67.715(2) is unconstitutional for lack of constitutional guidelines as suggested above, but in the absence of the court's decision to the contrary, it is our opinion that the county judge/executive, with approval of fiscal court as a body, could dissolve an extension district under KRS 67.715(2), provided it meets certain minimal constitutional requirements [Sec. 2, Const.]: (1) The fiscal court would hold a public hearing on the matter of dissolution; (2) All liabilities and contractual obligations of the district would have to be settled completely prior to dissolution.

Actually, it is possible that a statutory provision calling for a vote of the people on dissolution might be necessary to save this statute from constitutional infirmity. But the courts have never dealt with this precise question.

The extension district is created for the people, not for the fiscal court; and the people must have a voice in a district's orderly dissolution.

Disclaimer:
The Sunshine Law Library is not exhaustive and may contain errors from source documents or the import process. Nothing on this website should be taken as legal advice. It is always best to consult with primary sources and appropriate counsel before taking any action.
Type:
Opinion
Lexis Citation:
1980 Ky. AG LEXIS 583
Forward Citations:
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