Opinion ID: 2449412
Heading Depth: 1
Heading Rank: 3

Heading: may a city council, by ordinance, limit the ad valorem tax rate beyond its term of office?

Text: As stated, one of the key provisions of the agreement between the City and Oxmoor bound the City to set specified ad valorem tax rates in the future. The trial court, in ruling the agreement invalid, declared that a municipality does not have the power to bind future city administrations in matters which are governmental in nature. The Court of Appeals failed to discuss this issue. The law is clear that a legislative body may not limit its power to act one way or another in the future in governmental, as opposed to proprietary, functions. Thus, Where the contract involved relates to governmental or legislative functions of the council, or involves a matter of discretion to be exercised by the council, unless the statute conferring power to contract clearly authorizes the council to make a contract extending beyond its own terms, no power of the council so to do exists, the council presently holding such powers is vested with no discretion to circumscribe or limit or diminish their efficiency, but must transmit them unimpaired to their successors. . . . 56 Am. Jur.2d Municipal Corporations, § 154, at 206. See, Plant Food v. City of Charlotte, 214 N.C. 518, 199 S.E. 712 (1938). Kentucky adopts this position. White v. Glasgow, 148 Ky. 13, 146 S.W. 19 (1912). See also, Wabash Ry. Co. v. City of Defiance, 167 U.S. 88, 17 S.Ct. 748, 42 L.Ed. 87 (1897). It is beyond cavil that the power to tax and to set tax rates is a governmental function. It is the right and duty of the legislative body of the City of Louisville to set the tax rate. KRS 91.260. We have no difficulty in declaring that the provision of the agreement which sets tax rates for twenty years is void as being against public policy.