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PO Box 1070, Frankfort, KY 40602  Phone 502.875.2428, Fax 502.875.2845

KRC Seeks Assurances Of Community Facility Reviews For Proposed MSD and Louisville Water Co. Facilities  Posted: August 12, 2013

Friday, August 9, 2013

Jim Mims, Director
Department of Codes and Regulations
444 S. 5th Street
Louisville, KY 40202
By email James.Mims@louisvilleky.gov

Ms. Emily Liu, Acting Director
Planning and Design Services
444 Fifth Street
Louisville, Kentucky 40202
By email: Emily.Liu@louisvilleky.gov

Greg Heitzman, Executive Director
Metropolitan Sewer District
700 W Liberty St.
Louisville, KY 40203
By email greg.heitzman@louisvillemsd.org

Jim Brammell, President and CEO
Louisville Water Company
550 South Third Street
Louisville, KY 40202
By email jbrammell@lwcky.com

Re: Applicability of KRS 100.324 and 100.361 to
Public Facilities of Louisville Water Company
And Metropolitan Sewer District

Dear Jim, Emily, Greg, and Jim:

It has come to my attention that there may be some disagreement concerning whether the Louisville Water Company and the Metropolitan Sewer District are required to undergo a Community Facility Review before the Planning Commission pursuant to KRS 100.324(4) for new or relocated facilities. I’m writing to respectfully request a commitment from the Department of Planning and Design Services, Louisville Water Company, and Metropolitan Sewer District, that all public facilities proposed by either the water company or MSD will henceforth undergo a Community Facility Review, since neither of the entities are exempt from the requirements of that statute.
KRS 100.324(4) provides that:

"(4) Any proposal for acquisition or disposition of land for public facilities, or changes in the character, location, or extent of structures or land for public facilities, excluding state and federal highways and public utilities and common carriers by rail mentioned in this section, shall be referred to the commission to be reviewed in light of its agreement with the comprehensive plan, and the commission shall, within sixty (60) days from the date of its receipt, review the project and advise the referring body whether the project is in accordance with the comprehensive plan. If it disapproves of the project, it shall state the reasons for disapproval in writing and make suggestions for changes which will, in its opinion, better accomplish the objectives of the comprehensive plan. No permit required for construction or occupancy of such public facilities shall be issued until the expiration of the sixty (60) day period or until the planning commission issues its report, whichever occurs first."

The Louisville Water Company was incorporated pursuant to Chapter 507 of the Acts of the General Assembly of 1854 and operated as a private corporation until 1906 when the General Assembly adopted an act, now codified as KRS 96.230-.310, which changed its status to an agency of the City of Louisville. It is exempt from the jurisdiction of the Public Service Commission as to rates and service.

The Metropolitan Sewer District, also chartered by the General Assembly, is “an independent body politic charged with administration of designated affairs. It was created by the sovereign power of the state as "a public body corporate, and political subdivision." Rash v. Louisville & Jefferson County Metropolitan Sewer District, 309 Ky. 442, 449, 217 S.W.2d 232, 236 (1949). It is also exempt from the jurisdiction of the Public Service Commission with respect to rates and service.

By its terms, KRS 100.324(4) applies to “any proposal for acquisition or disposition of land for public facilities, or changes in the character, location, or extent of structures or land for public facilities.]” “Public facility” is defined in KRS 100.111(19) to mean “any use of land whether publicly or privately owned for transportation, utilities, or communications, or for the benefit of the general public, including but not limited to libraries, streets, schools, fire or police stations, county buildings, municipal buildings, recreational centers including parks, and cemeteries[.]”

The only entities excluded from the obligation to undergo the public facility review outlined in KRS 100.324(4) are “state and federal highways and public utilities and common carriers by rail mentioned in this section.” (Italics added). The reference to highways, utilities and common carriers “mentioned in this section” is a reference to KRS 100.324(1), which exempts service facilities of certain entities from the requirement to seek planning unit approval for location or relocation of such facilities. Those entities “mentioned in this section” are:

"public utilities operating under the jurisdiction of the Public Service Commission, except as specified in KRS 100.987, or the Department of Vehicle Regulation or Federal Energy Regulatory Commission, any municipally owned electric system, and common carriers by rail[.]"

KRS 100.324(1) (Emphasis added).

The reference “mentioned in this section” limits the exclusion from the applicability of KRS 100.324(4) to public utilities that are “operating under the jurisdiction of the Public Service Commission,” so that neither the LWC nor MSD are exempt from the obligations of KRS 100.324(4) with respect to their facilities. To construe KRS 100.324(4) otherwise would make the phrase “mentioned in this section” mere surplusage, in violation of a cardinal rule of statutory construction.

As to whether either the Louisville Water Company or MSD are exempt from complying with KRS 100.324(4) by virtue of KRS 100.361, the case law provides a clear answer – both the Louisville Water Company and MSD must submit to community facility reviews.

The case of City of Worthington Hills, Kentucky v. Worthington Fire Protection District, et al., 140 S.W.3d 584 (Ky. App. 2004) held that the Worthington Hills, a sixth-class city, was an “instrumentality of the state” under KRS 100.361, and as such,

"[b]ased upon our reading of Hopkinsville-Christian County Planning Commission, we conclude that Worthington Hills, as an instrumentality of the state, must seek a "mandatory review" by the planning commission under KRS 100.324(4) but is not required to comply with the planning commission's ultimate decision."

The case of Hopkinsville-Christian County Planning Commission v. Christian County Board of Education, 903 S.W.2d 531, referred to by the Worthington Hills court, analyzed the relationship of KRS 100.361 and 100.324(4) in the context of whether a county board of education was required to seek planning commission approval for an athletic field pursuant to KRS 100.324(4). The Court reasoned that:

"It is an established rule of statutory construction that seemingly conflicting statutes are to be construed so as to give meaning to both. See Ledford v. Faulkner, Ky., 661 S.W.2d 475 (1983), and City of Bowling Green v. Board of Educ., Ky., 443 S.W.2d 243 (1969). It is further an established rule of statutory construction that statutes in derogation of state sovereignty will be strictly construed in favor of the state. See Lexington-Fayette Urban County Board of Health v. Board of Trustees of the University of Kentucky, Ky., 879 S.W.2d 485 (1994). Recognizing these rules we construe the two statutes as mandating that the school board furnish adequate information concerning proposed public facilities to the planning commission for its review and opinion. Following the clear wording of KRS 100.361(2), we are not inclined to believe the legislature in enacting KRS 100.324(4) intended to mandate that a school board--an obvious agency of the state--be required to obtain approval of a local planning unit before erecting a public facility. In the final analysis, the school board may disregard the opinion of the planning commission. We, therefore, harmonize these statutes by construing them as requiring "mandatory review" by the planning commission (KRS 100.324(4)), but "voluntary compliance" by the school board. KRS 100.361(2). This construction renders neither statute illusory. Informed of the local planning unit's opinion and the state agency's response thereto, the citizenry may appropriately react. Such is the rationale underlying the two enactments."

As an agency of the Metro Louisville, the Louisville Water Company would likely be considered by a reviewing court to be within the ambit of KRS 100.361 under the Worthington Hills analysis. With respect to MSD, the case of Calvert Investment, Inc. v. Louisville & Jefferson County Metropolitan Sewer District, 805 S.W.2d 133 (1991) instructs that MSD is not a state agency, but rather is a municipal corporation created by the state. Even if it were the case that MSD could be viewed as an “instrumentality” of the state, it would likewise not be exempt from the obligation to undergo a KRS 100.324(4) community facility review.

For the above-stated reasons, I request a commitment from the Louisville Water Company, Metropolitan Sewer District, and Department for Planning and Design Services, that all public facilities proposed by either agency will be subject to a community facility review.

Cordially,

/s/

Tom FitzGerald
Director

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