Request By:
Mr. Charles R. Simpson III
Attorney at Law
Suite 601 Legal Arts Building
200 South Seventh Street
Louisville, Kentucky 40202
Opinion
Opinion By: Steven L. Beshear, Attorney General; By Alex W. Rose, Assistant Attorney General
In your letter of June 18, 1982, you stated that you represent a sixth class city which has elected not to use the county assessment in levying its ad valorem taxes. The city has assessed all lots within its jurisdictional limits at $12,500.00, including improvements thereon, without regard to the transfer prices reflected on recent deeds. You have requested an opinion from this office as to whether this procedure violates any laws of the State of Kentucky.
The Kentucky Constitution provides, in Section 172, as follows:
"All property, not exempted from taxation by this Constitution, shall be assessed for taxation at its fair cash value, estimated at the price it would bring at a fair voluntary sale; and any officer, or other person authorized to assess values for taxation, who shall commit any wilful error in the performance of his duty, shall be deemed guilty of misfeasance, and upon conviction thereof shall forfeit his office, and be otherwise punished as may be provided by law. "
It is obvious that assessing every lot within the city at $12,500.00 without regard to actual transfer prices reflected in recent deeds violates the "fair cash value" mandate contained in Section 172 of the Kentucky Constitution.
A sixth class city which has not elected to adopt the county assessment must comply with the assessment procedures contained in KRS 92.520 and KRS 92.540. While those statutes allow the city a great deal of discretion in the manner of assessment, levy and collection of its ad valorem taxes, the city must operate within the limits of the Constitution.