Collier v. Bourbon Fiscal Court

• Decision Date: 18 June 1920
• Citation: 188 Ky. 491,223 S.W. 149
• Parties: COLLIER ET AL. v. BOURBON FISCAL COURT.
• Court: Kentucky Court of Appeals

223 S.W. 149

188 Ky. 491

COLLIER ET AL. v. BOURBON FISCAL COURT.

Court of Appeals of Kentucky.

June 18, 1920

Proceeding by M. Peale Collier and others to enjoin the Bourbon Fiscal Court from issuing bonds and levying taxes. Injunction refused.

John J Williams, of Paris, for petitioners.

David D. Cline, of Paris, for respondent.

CARROLL C.J.

There was submitted to the voters of Bourbon county on September 6 1919, at an election regularly called and held, the question:

"Are you in favor of issuing five hundred thousand ($500,000.00) dollars in bonds for the purpose of building roads and bridges?"

At another election regularly called and held on the same day there was submitted to the voters the further question:

"Are you for a property tax of 20 cents on each $100.00 worth of property in the county to be levied each year for ten years, for the purpose of improving or constructing, either or both, roads and bridges of the county?"

Both of these propositions were adopted by more than a majority of those voting on the questions, and after this the fiscal court of Bourbon county, deeming it advisable to issue the bonds voted in series from time to time as the needs of the roads and bridges of the county might require, made and entered an order that the amount of the first series should be $100,000, the amount of the remaining series to be determined by future action of the court.

In April, 1920, the fiscal court met for the purpose of levying taxes to be collected in the year 1920, and, pursuant to the authority conferred by the voters at the election held in September, 1919, it levied the special road tax of 20 cents, and in addition to this tax it levied without authority so to do a tax of 4 cents for the purpose of paying the interest on and creating a sinking fund to liquidate the $100,000 in bonds that the court directed should be issued. This 4-cent additional tax was levied without authority because the fiscal court has no power to levy under section 157a of the Constitution or under Ky. St. § 4307, or Ky. St. Supp. 1918, § 4307b1, or both, a tax exceeding 20 cents.

But in June, 1920, the court again assembled and made and entered the following order:

"It is ordered that a tax of 4 cents on each $100 worth of all property situated in Bourbon county and assessed for county purposes be levied for the purpose of paying interest on the first series of road and bridge bonds and creating a sinking fund for the purpose of paying off said bonds as they mature. And it is further ordered that a special tax of 16 cents be levied upon all property situated in Bourbon county and assessed for county purposes, for the purpose of improving and constructing the public roads and bridges of the county, either or both, as this court may direct, and the sheriff of Bourbon county is directed to collect said taxes for the year 1920." It will be noticed that in this order 4 cents of the 20 cents the fiscal court was authorized to levy for road and bridge purposes by the vote of the people was set apart to pay the interest on and create a sinking fund for the purpose of paying the bonds proposed to be issued, and that the remaining 16 cents levied was directed to be used in improving and constructing the roads and bridges of the county.

After this order was made, the petitioners herein brought this suit in the Bourbon circuit court seeking to enjoin the issual of the $100,000 in bonds proposed to be issued, and the collection of the 4 cents and the 16 cents under the levy made by the fiscal court in June. The judge of the Bourbon circuit court refused to grant the injunction prayed for, and the petitioners have applied to me to grant the injunction.

Section 157a of the Constitution provides that:

"The credit of the commonwealth may be given, pledged or loaned to any county of the commonwealth for public road purposes, and any county may be permitted to incur an indebtedness in any amount fixed by the county, not in excess of five per centum of the value of the taxable property therein, for public road purposes in said county, provided said additional indebtedness is submitted to the voters of the county for their ratification or rejection at a special election held for said purpose, in such manner as may be provided by law and when any such indebtedness is incurred by any county said county may levy, in addition to the tax rate allowed under section 157 of the Constitution of Kentucky, an amount not exceeding twenty cents on the one hundred dollars of the assessed valuation of said county for the purpose of paying the interest on said indebtedness and providing a sinking fund for the payment of said indebtedness."

Pursuant to this constitutional provision, the Legislature in 1914 (Laws 1914, c. 80) adopted an act relating to public roads (now section 4307, Kentucky Statutes), section 21 of which provides that the fiscal court shall have the power and the authority to issue and sell bonds from time to time for the purpose of building, constructing, and reconstructing roads and bridges, provided the authority to do so is confirmed by the people at an election held for that purpose, the question to be submitted to the voters being:

"Are you in favor of issuing ...... in bonds for the purpose of building roads and bridges?"

The section further provides that--

"All the money raised by the sale of bonds shall be used solely and alone for the building, constructing or reconstructing of roads."

And it was under section 157a of the Constitution, and pursuant to the section of the statute referred to, that the bond issue here in question was authorized by the people of Bourbon county.

In 1917 the Legislature, under the authority of section 157a of the Constitution, further enacted (see section 4307b1, vol. 3, Ky. Statutes) that the fiscal court of any county of the state may submit to the voters at a special election to be held for that purpose the question of voting a tax in any sum not exceeding 20 cents on the $100 for the improvement or construction of the public roads and bridges of the county, and it was pursuant to this section that the voters of Bourbon county voted the 20-cent road tax mentioned in the orders of the fiscal court.

On this motion the validity of the bond issue and power of the fiscal court to levy the 4-cent and 16-cent tax is challenged on three grounds: (1) That there was no authority for calling to be held on the same day the election respecting the 20-cent special road tax, and the bond issue; (2) that the fiscal court should have set aside the whole of the 20-cent special road tax or so much thereof as was necessary for the purpose of paying the interest on and creating a sinking fund for the purpose of taking care of the bonds proposed to be issued (3) that section 4307b1...