Judges: DUSTIN McDANIEL, Attorney General
Filed Date: 10/22/2010
Status: Precedential
Modified Date: 7/5/2016
The Honorable Jerry R. Brown State Representative
1001 Oakwood Drive Wynne, Arkansas 72396-1801
Dear Representative Brown:
You have asked my opinion about the types of projects to which cities may appropriate moneys pursuant to A.C.A. §
Section
14-174-101 states that revenue obtained under the authority of Title 14 Chapter 1741 can only be expended after meeting a two-pronged test: (1) Will the revenue be used to stimulate the local economy and to support private sector job creation; and (2) none of the revenue can be used for general operating expenses.
With this "two-pronged test" in mind, you ask several questions:
*Page 21. Did the legislature intend for cities and counties, or their agents as defined in A.C.A. §
14-174-107 , to use revenue generated from this authority to fund only those programs and projects mentioned in A.C.A. §§14-174-105 and-106, that have a direct impact on attracting, retaining, and expanding new jobs and economic activity? [Emphasis added.]
2. Did the legislature intend cities and counties, or their agents as defined in A.C.A. §
14-174-107 , to use revenue generated from this authority to fund programs and projects mentioned in A.C.A. §§14-174-105 and-106 that have only an indirect impact on creating an expanding new jobs and economic activity? [Emphasis added.]3. At what point can a city or county be classified as using the funds for general operating revenue?
4. Do all expenses have to meet the purposes in A.C.A. §
14-174-101 ?5. Considering the wording of the Emergency Clause, can revenue generated from the sales tax be used for performance-based incentives for private-sector job creation?
Now that this presupposition has been addressed, I can briefly respond to each of your questions. I cannot answer your first two questions because they introduce a distinction into the statute that is not found there. The statute does not explicitly address the question of how close the nexus must be between an actual expenditure, on the one hand, and accomplishing the purposes of economic development, on the other. Instead, the statute identifies certain expenditures that the legislature has determined will stimulate the local economy, in principle. So the legal question under the statute is whether any particular expenditure meets at least one item on the list of the pre-approved expenditures. Your third question is a question of fact that cannot be answered in the abstract. Your fourth question mistakenly presupposes that subsection
Question 1: Did the legislature intend for cities andcounties, or their agents as defined in A.C.A. §
Question 2: Did the legislature intend cities and counties, ortheir agents as defined in A.C.A. §
To know what the "legislature intended," we have to evaluate the statute as a whole and read each word according to its common-sense meaning.3 The distinction your questions raise — "direct impact" versus "indirect impact" — is alien to the statute. Neither phrase appears in the statute. Whether a particular expenditure is properly related to one of the approved items in subsections-105,-106,-107, or-109 is a question of fact. Accordingly, if your questions are asking about howrelated the actual expenditure must be to the approved list of expenditures, that is a question of fact that I cannot address in an official opinion. *Page 4
Question 3: At what point can a city or county be classifiedas using the funds for general operating revenue?
This presents a question of fact that must be evaluated in each specific circumstance. You have, however, specifically referenced the city's use of its economic-development taxes to supplement its street budget. The legislature has permitted such a practice in subsection
Question 4: Do all expenses have to meet the purposesin A.C.A. §
The answer to this question was mostly dealt with in the introductory paragraph to this opinion. Subsection
Question 5: Considering the wording of the Emergency Clause,can revenue generated from the sales tax be used forperformance-based incentives for private-sector job creation?
The answer to your question, as worded, is "no." Strictly speaking, a statute's emergency clause, standing alone, does not authorize or prohibit certain actions; the statute itself does the authorizing or prohibiting. Instead, the emergency clause sometimes gives some insight into the legislature's intent for certain provisions of the statute.4
But before I can read the statute in light of the emergency clause to determine whether "performance-based incentives for private-sector job creation" are permitted, I must be clear on what you mean by that phrase. I am not entirely sure what all you contemplate by that term, but you do reference a "cash payment" from the city or county to the private company. One must always consult art.
Without more detailed facts and a more detailed definition of "performance-based incentives for private-sector job creation," I cannot further address the possible applicability of art. 12, § 5 in connection with such "incentives."
Assistant Attorney General Ryan Owsley prepared this opinion, which I hereby approve.
Sincerely,
DUSTIN MCDANIEL Attorney General