Opinion No. ( 2002 )

The Honorable Boyd Hickinbotham State Representative P.O. Box 326 Salem, Arkansas 72576-0326

Dear Representative Hickinbotham:

I am writing in response to your request, on behalf of the Mayor of Hardy, for an opinion on the legality or constitutionality of a ninety-nine-year lease agreement entered into by the City of Hardy and the Sharp County Library Board in May of 1999. Specifically, you note that "[t]he Municipal League believes that [this lease] is unconstitutional" and that "[t]he lease has the City of Hardy paying all of the utilities, including free rent, for the library." You also note that the "city has since passed an Ordinance 2001-06, removing rights of free utilities at the City's expense for all entities occupying city properties and structures, rent free."

RESPONSE

I cannot come to a conclusive determination as to the constitutionality of a particular lease agreement, the construction of which may involve factual issues beyond the scope of an Attorney General's opinion. The City of Hardy and the Sharp County Library Board presumably each have legal counsel and it is that counsel to whom the parties should look for guidance on the question. I have, however, in an effort to be helpful, enclosed some relevant previously issued Attorney General opinions on the topic of municipal leases. See Ops. Att'y. Gen. 95-199; 93-211 and 93-070.

As noted in Op. Att'y. Gen. 94-058, cities have the general authority to purchase land and to lease such land. See A.C.A. 14-54-302 (1987). The adequacy of the consideration for such a lease is a question of fact, but it has been held that "public advantage" can constitute consideration.See Op. Att'y Gen. 93-070 and City of Blytheville v. Parks,221 Ark. 734, 255 S.W.2d 962 (1953). See also Little Rock Chamber ofCommerce v. Pulaski County, 113 Ark. 439, 168 S.W. 848 (1914). Pertinent constitutional proscriptions are also discussed in the Opinions and cases cited above.

Senior Assistant Attorney General Elana C. Wills prepared the foregoing opinion, which I hereby approve.

Sincerely,

MARK PRYOR Attorney General

MP:ECW/cyh

Enclosures