Opinion
Opinion By: Jack Conway, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Records Decision
The question presented in these consolidated appeals is whether the Office of the Property Valuation Administrator for Oldham and Clark Counties subverted the intent of the Open Records Act, short of denial of inspection, by imposing an allegedly excessive fee on attorney David Emerson's client, Custom Solutions, Inc., for copies of their 2013 property tax rolls to be used for a commercial purpose. 1 Those fees were based on the "PVA Open Records Commercial Fee Schedule" developed by the Department of Revenue under authority of KRS 133.047(4) and promulgated into administrative regulation at 103 KAR 3:030 Section 1(174). Pursuant to KRS 13A.140(1), that regulation is statutorily presumed to be valid. Given Mr. Emerson's challenge to its validity, we believe it is incumbent on the Department of Revenue to show that the regulation is consistent with KRS 133.047(4) and that "the laws and regulations relating to the promulgation of the regulation were faithfully followed." KRS 134.140(1)(b) and (f). 2 If properly promulgated and consistent with enabling legislation, 103 KAR 3:030 Section 1(174) constitutes a specific enactment of the General Assembly governing the imposition of copying fees for PVA records that overrides the general fee provision of the Open Records Act, and the PVAs cannot be said to have subverted the intent of the Act by the imposition of those fees. 3
In their responses to Custom Solutions' requests, the Office of the Oldham County PVA agreed to provide a copy of the Oldham County tax roll at a cost of $ 3,971.60 and the Office of the Clark County PVA agreed to provide a copy of the Clark County tax roll at a cost of $ 3,017. On appeal, Mr. Emerson challenges these fees as excessive. He acknowledges the existence of Form 62F015, the "PVA Open Records Commercial Fee Guidelines, " asserting that "the provisions of Chapter 13A . . . apply to the actions of the Department of Revenue in adopting this 'form' . . . [and] there is no evidence that the Department of Revenue complied with the mandates of KRS 13A.220 through KRS 13A.224." In addition, he asserts that Revenue "must demonstrate that the 'guidelines' are reasonable' in compensating for the costs of personnel time expended in providing information and assistance to persons seeking information to be used for commercial or business purposes. '" With reference to the latter issue, he emphasizes:
It is the duty and responsibility of each county property valuation administrator to assess all real property in their county, to retain that information in accordance with the Department of Revenue's directions, and to provide that information to the county clerk and/or county sheriff to generate the bills. The request of Custom Solutions for the data does not require any property valuation administrator to create anything more than what it has already produced.
It is his position that the fee imposed is not reasonable, as required by KRS 133.047(4), because the PVA is already obligated to prepare the tax rolls pursuant to KRS 132.420 and therefore incurs no cost for "personnel time expended in providing information and assistance to persons seeking information to be used for commercial or business purposes. " KRS 133.047(4).
In correspondence directed to this office following receipt of notification of Mr. Emerson's appeals, both the Oldham County PVA and the Clark County PVA cited the "PVA Open Records Commercial Fee Guidelines" as authority for the fees imposed on Custom Solutions. They noted the existence of 103 KAR 3:030 Section 174, "creating and authorizing Revenue Form 62F015 . . . which mandates that [the schedule] 'shall be used by the PVA to establish fees to be charged for the cost of reproduction, creation, or other acquisition of records.'" Although the Department of Revenue was notified of both of Mr. Emerson's appeals, it responded to neither.
In 02-ORD-89, this office considered the reasonableness of fees imposed by the Jefferson County PVA for production of her records to be used for a noncommercial purpose. Analyzing the language of KRS 133.074(4), 4 we observed:
[T]he reasonable fee schedule the Cabinet is empowered to develop for property valuation administrators is "to be used in compensating for the cost of personnel time expended in providing information and assistance to persons seeking information to be used for commercial or business purposes, " and not for noncommercial purposes. No other additional cost factor is identified in the statute, and the "personnel time" cost factor cannot be included in copying charges when the request is made by a person seeking information on his own property, or by any other person seeking information directly related to property tax assessments, etc." Further, we question whether in order to have legal effect, these fees, as they relate to requests made for commercial or business purposes, should be promulgated into administrative regulation pursuant to KRS 13A.100(3), requiring administrative bodies empowered to promulgate administrative regulations to prescribe fees by administration regulation. If the fees were promulgated into administration regulation, we would be bound to follow that line of decisions recognizing that a specific enactment of the General Assembly relating to copying fees, such as the fee schedule for county clerks codified at KRS 64.012, overrides the general fee provisions of the Open Records Act, at least insofar as fee guidelines relate to requests made for a commercial purpose. See 00-ORD-110 and authorities cited therein.
02-ORD-89, p. 11 (emphasis in original). Because the fees imposed on the requester, whose intended use of the records was noncommercial, were "not based on a commercial purpose, and because the fees [did] not, in any event, exist in administrative regulation, we analyze[d] the propriety of those fees under the reasonable fee provision of the Open Records Act. " Id.
Contrary to Mr. Emerson's belief, the Department of Revenue promulgated Form 62F015 into administrative regulation in 2002. 5 That regulation is presumed valid "unless declared otherwise by a court" pursuant to KRS 13A.140(1). As a specific enactment of the General Assembly governing the imposition of fees for PVA records, it overrides the general fee provisions of the Open Records Act. To the extent this office's analysis in 03-ORD-025 and 10-ORD-192 suggests otherwise, they are hereby modified. 6 Permissible fees for PVA records requested for commercial use must only "compensat[e] for the cost of personnel time expended in providing information and assistance to persons." KRS 133.047(4). Noncommercial requesters, "including the press, seeking information directly related to property tax assessment, appeals, equalization, request for refunds, or similar matters shall not be subject to fees for personnel time." Id.
Mr. Emerson acknowledges that his client intends to use the Oldham and Clark County tax rolls for a commercial purpose, and may be charged accordingly, but argues that Revenue did not "faithfully follow" the laws and regulations relating to promulgation of Form 62F015 7 and that the regulation is inconsistent with KRS 133.047(4) because it compensates for other than "personnel time expended in providing information and assistance" to commercial requesters. He thus seeks to rebut the presumptive validity of the regulation. Although afforded the opportunity to do so on two occasions, Revenue did not respond to his objections. KRS 13A.140(1) requires the promulgating administrative body to show and bear the burden of proof relative to these challenges. We remand this matter to the Department of Revenue, Office of Property Valuation, to respond to Mr. Emerson's challenges. If, after receiving Revenue's response Mr. Emerson remains unconvinced, he may challenge the regulation in the appropriate circuit court.
A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.880(5) and KRS 61.882. Pursuant to KRS 61.880(3), the Attorney General should be notified of any action in circuit court, but should not be named as a party in that action or in any subsequent proceeding.
Distributed to:
C. David EmersonRon WintersBrian N. ThomasGreg JenningsDouglas Dowell
Footnotes
Footnotes
1 Our analysis proceeds from the recognition that "the reasonable fee schedule the [Department of Revenue] is empowered to develop for property valuation administrators is 'to be used in compensating for the cost of personnel time expended in providing information and assistance to persons seeking information to be used for commercial or business purposes' and not for noncommercial purposes." 02-ORD-89, p. 11 (emphasis in original) citing KRS 133.047(4). As noted, Mr. Emerson acknowledges that his client's intended use of the tax rolls is a commercial one.
2 KRS 61.880(2)(c) and KRS 13A.140(1) assign the burden of proof to the Department of Revenue as the public agency and promulgating administrative body, respectively.
3 In addition to his open records complaint, Mr. Emerson alleges that the Department of Revenue, Office of Property Valuation, convened an illegal meeting of "selected Property Valuation Administrators" in mid-2012 for the purpose of revising the "PVA Open Records Commercial Fees Guidelines," and that the "promulgation of the Commercial Fee Guidelines is in violation of the Open Meetings Act." He gives no indication, however, that he filed a complaint containing these allegations with Revenue, or the committee, as required by KRS 61.846(1). We are therefore foreclosed from considering the open meetings questions he raises.
4 KRS 133.047(4) provides:
Real property tax returns and accompanying documents submitted by a taxpayer shall be considered confidential under the provisions of KRS 131.190. Other real property records in the office of the property valuation administrator shall be subject to the provisions of KRS 61.870 to KRS 61.884. However, notwithstanding the provisions of KRS 61.874 the Department of Revenue shall develop and provide to each property valuation administrator a reasonable fee schedule to be used in compensating for the cost of personnel time expended in providing information and assistance to persons seeking information to be used for commercial or business purposes. Any person seeking information on his own property, or any other person, including the press, seeking information directly related to property tax assessment, appeals, equalization, requests for refunds, or similar matters shall not be subject to fees for personnel time.
5 Our review of the 2001 Kentucky Administrative Regulations confirms that Form 62FO15 had not yet been promulgated into regulation in 2001. A review of the 2002 Kentucky Administrative Regulations confirms that Form 62F015 was promulgated into regulation in that year at 103 KAR 1:050 Section 14(136), approximately three months after 02-ORD-89 was issued. It directs PVAs to use the guidelines "to establish fees to be charged for the cost of reproduction, creation, or other acquisition of records."
6 03-ORD-025 and 10-ORD-192 applied the KRS 61.874(4) cost factors rather than the KRS 133.047(4) cost factors in resolving the reasonable fee dispute.
7 For example, the fee schedule is incorporated by reference into 103 KAR 3:030 as a "form" under general statutory authority of KRS 131.130(3) but does not indicate that it "Relates to" KRS 133.047(4). KRS 13A.220(4)(e); KRS 13A.222(4)(m)1; KRS 13A.2251(3)(a). Because it is a "fee" schedule, KRS 13A.255 imposes additional requirements on the promulgating administrative agency relative to notice to affected persons or entities. And, because the fee schedule is incorporated by reference, KRS 13A.221(2) states that the promulgating administrative agency "shall not incorporate all material relating to a general subject in one administrative regulation" but must instead incorporate by reference material "governing the specific topic to which the material relates." See also, KRS 13A.224 ("No material shall be incorporated by reference unless: (1) The material incorporated by reference relates only to the specific subject matter governed by an administrative regulation").