Court Opinion

ID: 7826662
Source: CourtListenerOpinion
Date Created: 2022-09-07 18:08:38.934661+00
Date Added: 2024-06-11T16:30:52.974910
License: Public Domain

Annabelle Clinton Imber, Justice, dissenting. I must dis agree with the majority’s conclusion that property acquired under Act 9 of 1960 keeps its tax exempt status after the retirement of Act 9 bonds used to finance the acquisition of the property. The majority relies solely upon our language in Wayland v. Snapp, 232 Ark. 57, 334 S.W.2d 633 (1960), concerning the tax exempt status of Act 9 property. I am not persuaded, however, that Wayland supports the majority’s conclusions. The majority correctly acknowledges the numerous decisions in which we have held that public property is not used exclusively for a public purpose under Article 16, § 5(b) of the Arkansas Constitution when that property has been used for a private purpose. See Crittenden Hosp. Assoc. v. Board of Equalization, 330 Ark. 767, 958 S.W.2d 512 (1997); City of Little Rock v. McIntosh, 319 Ark. 423, 892 S.W.2d 462 (1995); City of Fayetteville v. Phillips, 306 Ark. 87, 811 S.W.2d 308 (1991); Holiday Island Suburban Improvement Dist. #1 v. Williams, 295 Ark. 442, 749 S.W.2d 314 (1988); B.D.T. v. Moore, 260 Ark. 581, 543 S.W.2d 220 (1976); Hilger v. Harding College, 231 Ark. 686, 331 S.W.2d 851 (1960); School Dist. of Ft. Smith v. Howe, 62 Ark. 481, 37 S.W. 717 (1896). The majority is also correct when it notes that the particular property in this case is tax exempt solely because of its unique status as property financed under Act 9. This court, in Wayland, carved out a specialized exception to our traditional Article 16, § 5(b) tax exemption analysis when we stated that “only where the title of property is acquired and the property itself is used by a city or county (or by both) pursuant to Act No. 9 and/or Amendment No. 49” is the property used exclusively for a public purpose. See Wayland, supra (emphasis added). It is the property’s unique characterization as Act 9 property that allows it to remain off the county tax rolls. The majority now seeks to expand the exemption perpetually. I cannot subscribe to such an outcome. We noted in City of Fayetteville v. Phillips, supra, that Act 9 was intended to facilitate procurement of industry, and that Amendment 49 made the act of “securing or developing industry” a public purpose. In Wayland, we indicated that, together, Act 9 and Amendment 49 were designed for the purpose of developing and securing industry. Both of these goals have been accomplished. The bonds were issued, the land procured and leased out to private enterprises, and industry was secured. The bonds have now been retired. The property is no longer being “used by a city or county (or by both) pursuant to Act No. 9 and/or Amendment No. 49.” See Wayland, supra (emphasis added). Therefore, the property loses its tax exempt status under the limited exception carved out in Wayland for property financed under Act 9. The property in this case has been leased to private industrial enterprises. The mere fact that the use of the property still alleviates unemployment, alone, is insufficient to grant tax exempt status. See Crittenden Hosp. Assn. v. Board of Equalization, supra; Holiday Island Suburban Improvement Dist. # 1 v. Williams, supra. In the Holiday Island case, concerning recreational property only open to property owners within an improvement district, we explained: The District submits that “retirement” is an industry and Holiday Island promotes employment and other economic benefits to northern Arkansas. No doubt that is true, and if the issue here were tax exemption for the income from improvement district bonds, the public purpose might well be satisfied. But this is not the issue and it is clear the phrase “public purpose” is not an exact term .... [0]ur decision here deals only with a public purpose within the context of article 16 § 5(b). Just as it is clear that ad valorem taxes could not be lawfully imposed upon the general public to maintain the cost of construction or maintenance of facilities used for private purposes, we can conceive of no valid reason why facilities restricted to private use should be exempted from payment of taxes assessed against other properties of a similar character. I see no reason why property leased by Jacuzzi Bros., Smith Fiberglass, and Merico Inc. should be exempted perpetually from payment of ad valorem taxes. Once the benefit of Act 9 financing has been realized and the bonds have been fully retired, the property has ceased to be used by the City of Little Rock pursuant to Act 9 and Amendment 49. The property in question is now no different than any public property leased to a private enterprise that has not been financed under Act 9. Under these circumstances, we should follow our traditional analysis in determining the property’s tax exempt status and hold that the property is not exempt from taxation. For the above reasons, I respectfully dissent. Newbern, J., joins in this dissent.