Request By:
Mr. Brian Paulsen
Land Use/Transportation Planner
Lincoln Trail Area Development District
702 College Street Road
Elizabethtown, Kentucky 42701
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Thomas R. Emerson, Assistant Attorney General
This is in reply to your letter presenting two questions concerning local government, the first of which asks whether a city may require a renter to furnish a larger deposit in connection with water service than would be required of a property owner.
It is a generally recognized principle that a public utility may require a deposit from its customers provided it is reasonable and is not discriminatory. See OAG 79-418 and OAG 80-25, copies enclosed.
In 64 Am.Jur.2d Public Utilities § 40, the following appears:
"The generally recognized right of a public utility to require that its patrons furnish a reasonable deposit or guaranty as security for payment of future service is subject to the limitation that no such deposit may be required where it would result in an unjust discrimination against the customer, as where it is enforced against some, but not against all, of its patrons. "
In McQuillin Mun. Corp. (3rd Ed.), Vol. 12, § 35.35 f it is stated that a municipality is under a duty to supply the services which it offers to all persons who apply, without discrimination and at reasonable rates, insofar as it may reasonably do so. While illegal, arbitrary or discriminatory conditions may not be imposed, the city's duty not to discriminate between users does not necessarily require that all of the terms and conditions must be the same for all users. Reasonable differentiation of treatment among users in different situations is not unjust discrimination.
An annotation in 43 ALR2d 1262, 1269-1272, concerning "Deposit required by public utility" deals in part with discrimination and sets forth some examples of both discriminatory and nondiscriminatory procedures relative to deposit requirements of public utilities. While there is no case mentioned which deals with your specific fact situation there is a statement contained in an Iowa case that is worth considering. It is to the effect a utility company may not base a rule relating to deposits on the theory that the people as a whole are dishonest, but it has the right to adopt a rule which, while giving the honest citizen what he pays for, will prevent the dishonest citizen from getting that which he will never pay for.
In Dawes v. Philadelphia Gas Commission, 421 F.Supp. 806 (E.D. Pa. 1976), the Court said that although there is no "fundamental" constitutional right to gas service in the first instance, the plaintiffs stated a cause of action which alleged invidious and arbitrary discrimination against members of the public with low and fixed incomes who could not afford to obtain gas service in view of the company's security deposit policies and practices.
In conclusion, a municipal utility may not adopt a deposit policy resulting in unjust discrimination against its customers. However, the terms and conditions need not necessarily be the same for all customers and the utility would not be practicing unjust discrimination if it can demonstrate "reasonable" differentiation of treatment among users in different situations.
Your second question asks whether a city or county may require a resident or commercial establishment to use the garbage pickup service provided and, if so, whether the requirement should be contained in an ordinance or resolution.
In Cassidy v. City of Bowling Green, Ky., 368 S.W.2d 318 (1963), the Court said in part that a city may properly forbid the use of private garbage facilities and require all its inhabitants to use the public system. Since the city may require those owning or occupying property to accept its services, it may likewise require them to share the expenses thereof by the payment of reasonable fees. Furthermore, the city may enforce collection of its garbage disposal charges by discontinuance of its water services. The city's right to regulate in this area is within its police powers. See also OAG 79-144, copy enclosed.
KRS 83A.060 sets forth the form and procedure for enacting municipal ordinances and KRS 83A.060(12) deals with municipal orders. An "ordinance" is defined in KRS 83A.010(10) as "an official action of a city legislative body, which is a regulation of a general and permanent nature and enforceable as a local law or is an appropriation of money." A "municipal order" is defined in KRS 83A.010(8) as "an official act of the legislative body of a municipality which is binding upon the officers and employees of the municipality and any governmental agency over which the municipality has jurisdiction."
KRS 67.083(3)(c), (o) and (r) provide in part that the fiscal court may enact ordinances and issue regulations in connection with public sanitation, management of solid wastes and sewage and garbage disposal services. In OAG 78-480, copy enclosed, we dealt with garbage collection and disposal in a county and the various methods available to a fiscal court to handle such problems. A county, like a city, may utilize its police powers to require inhabitants to utilize its garbage disposal system.
An ordinance has been defined in part as an enactment of the legislative body of a municipal corporation and implies a certain degree of permanence. A resolution, generally, is something less than a statute or law, such as a mere expression of opinion, and only has a temporary effect on some particular thing. See Black's Law Dictionary (4th Edition), pp. 1248 and 1474.
Thus, a city or county government may, by a properly enacted ordinance, require that residential and commercial inhabitants within its jurisdiction utilize its garbage pickup and disposal services and require them to pay reasonable fees for such services.