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Injunction filed against airport tax

McCreary County PVA Bruce Lominac filed an injunction in McCreary County Circuit Court Wednesday in an effort to stop a tax imposed by the Airport Board last month.

The petition for injunctive relief requests the Court issue an order staying the McCreary County Airport Board from levying any tax in McCreary County.

The document claims the Board had no legal authority to levy the tax without the approval of the Fiscal Court and thus their proposed tax is invalid.

Additionally, it states since the PVA is charged with compiling the county tax roll, if the tax were to appear on the tax roll and later found to be illegal or improper, the PVA could be held liable and subject to lawsuits.

Lominac’s move conceivably halts the implementation of the tax, which the Board intended to begin on August 1. The defendants have 20 days from the date of filing to challenge the requested stay.

Lominac says the Fiscal Court could ask for quick relief from the Court – asking a judge for an immediate ruling on the question of the legality of the proposed law.

Lominac stated he took the measure due to the time constraints his office faces in getting the tax rolls certified by the state and getting the tax bills printed prior to distribution.

“I have consulted with County Attorney Conley Chaney, and both of our research shows the Airport Board had no authority to impose this tax without the Fiscal Court’s approval,” Lominac said. “The Fiscal Court has yet to take any definitive action, and I am under a time crunch to get the bills printed. I couldn’t just sit here and wait. Someone had to pull the trigger.”

The question of the Board’s authority to levy the tax rests on the interpretation of Kentucky Revised Statute 183.134 (and 183.012), which defines the ability for Airport Boards to impose a tax.

The statute establishes just who can levy a tax to pay for upgrades to an airport, but it appears both sides in the local issue disagree on an interpretation of the language, specifically the definition of “Governmental Unit” in the statute.

Last month the Airport Board voted to impose an ad valorem tax of one cent per $100 of property value in order to raise about $17,000 needed for a runway resurfacing project, and to meet operating expenses.

The tax received criticism from the Fiscal Court who questioned the Board’s authority to impose the tax without their approval during the July meeting.

Airport Board Chairman Bruce Murphy contended they had followed the correct procedures provided to them by the Department of Local Government.

Later in the meeting Lominac pointed out that three members of the Board, Murphy, Clifton Redden and Bill Smith, had expired terms on the board and asked the Court to declare those posts vacant. Murphy’s term expired in 2014, while Smith and Redden’s terms expired on June 30 of this year.

The Magistrates voted to do so, but did not name anyone to fill those positions. A KRS statute states the Board members serve until a replacement has been named.

Last week Judge Executive Doug Stephens, with the support of the magistrates, reappointed Redden and Smith to their posts, and appointed Tim Freels to the spot previously held by Murphy.

During their regular monthly meeting last week, the Airport Board met to discuss the Court’s actions, and explore their options for keeping the airport open.

In the meeting Murphy questioned the Fiscal Court’s move to appoint a replacement for his position, citing a KRS statute that states if a Board member is not reappointed, but no replacement is named, he/she were considered to be reappointed for another 4-year term.

When asked for comment this week on the status of Murphy’s position, McCreary County Judge Executive Doug Stephens said he and County Attorney Conley Chaney had read the statute and noted a clause preceding the one Murphy cited, requiring a Board notify the Fiscal Court of an expired term 60 days in advance of the end of the term.

The Airport Board did not notify the Court of Murphy’s end of term last year, Stephens said, and that would supersede the automatic reappointment clause.

Murphy, who is listed as Chairman of the Board, temporarily removed himself from the Chair for last weeks meeting to avoid any possible conflicts over his status.

Concerns were raised over the Court’s actions and the possibility of the Fiscal Court dissolving the Board and a possible injunction filed against them.

The Board considered the possibility of rescinding their vote over the tax, but ultimately opted to wait until a special session called for July 30 to make any final decision.

The Board discussed possible cost-cutting measures, such as returning to day-use only status and cutting electricity. That move could save upwards of $1,000 per year.

The Board also voted to approach the Scott County Tennessee Airport to sell the remaining fuel they have and drop their agreement with Shell Oil, who supplied their fuel.

In dropping the agreement, the airport would not have to keep an expensive insurance policy for the fuel, and could also drop the phone line associated with the system.

Those measures will allow the airport to accrue capital to pay utility bills for the next several months, but would not be enough to cover the approximately $17,000 needed to complete the resurfacing project.

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