Governor Commonwealth of Kentucky Rodney Brewer

Steven L. Beshear Kentucky State Police Commissioner

919 Versailles Road
Frankfort, KY 40601

MEMORANDUM

FROM: Commander - Human Resources Branch

TO: Melinda L. Thompson
DATE: February 19, 2009

SUBJECT: Coal Run Village Local Withholding Stopped for 2009

You are receiving this message because you were previously set up for Coal Run Village license fee/tax withholding.

Starting in January 2009, the local tax deduction which was previously made from the salaries of employees working
in Coal Run Village ceased. Those employees are now responsible for paying the license fee established for their
employment classification directly to the City of Coal Run Village.

The Commonwealth’s payroll system does not accommodate the type of occupational license fee by employment
class required by the Coal Run Village ordinance. The problems with administering this license fee by payroll
deduction became apparent last year when the City of Coal Run Village realized that some employees had not paid
the license fee in full for the last two years. Coal Run Village then attempted to collect outstanding fees from the
employees who had not had the full amount come out by means of payroll deduction.

The Commonwealth’s payroll system collects local taxes but cannot accommodate the unique deduction called for in
the City of Coal Run Village’s license fee ordinance. This license fee based on employment class is not found in any
other Kentucky municipality with a local tax in our system. Unlike other local ordinances, it is a flat fee, not a tax.
Efforts to handle this fee by payroll deduction in the payroll system have met with limited success.

Beginning with tax year 2009, the Commonwealth will no longer collect the Coal Run Village Occupational License
Fee by means of payroll deduction. Employees will be responsible for paying this fee directly to the City of Coal Run
Village. The address to which employees may remit their license fees and the telephone number they may call with
questions regarding the license fees are:

City of Coal Run Village

#1 Church Street
Pikeville, KY 41501
(606) 437-6032
s/Michelle Starkweather
Michelle Starkweather
Human Resources Branch