Judges: WINSTON BRYANT, Attorney General
Filed Date: 10/7/1996
Status: Precedential
Modified Date: 7/5/2016
The Honorable Ed Wilkinson State Representative P.O. Box 610 Greenwood, Arkansas 72936
Dear Representative Wilkinson:
This opinion is being issued in response to your recent question regarding the application of the "rollback provision" of Amendment
The scenario that gave rise to your question was a two-year reappraisal that took place in Franklin County as a result of an unacceptable ratio level. Only half of the county was reappraised in 1995. The properties that had been reappraised were taxed on the basis of the newly appraised values.1 The resulting tax increases were in excess of 10% over taxes for the previous year. Nevertheless, the rollback provision of Amendment 59 was not invoked. The remainder of the properties in the county have now been reappraised. Franklin County would like to invoke the rollback provision now, and to apply the rollback to the entire county.
On the basis of that scenario, you have presented the following question:
Can a county apply the rollback provision of Amendment 59 to the entire county, even though it failed to apply the rollback at the time of the completion of the first half of the reappraisal?
It is my opinion (assuming that the reappraisal was one that can trigger the rollback provision of Amendment 59, see A.C.A. §
As explained more fully below, my conclusion regarding this matter is based upon my determination that in instances where a reappraisal has been conducted under one of the circumstances that can trigger the rollback provision, and where the taxes calculated upon the basis of the reappraisal would result in a tax increase of 10% or more, the rollback and its intended steps toward equalization are mandatory.
Amendment
Whenever a countywide reappraisal or reassessment of property subject to ad valorem taxes made in accordance with procedures established by the General Assembly shall result in an increase in the aggregate value of taxable real and personal property in any taxing unit in this State of ten percent (10%) or more over the previous year the rate of city or town, county, school district, and community college district taxes levied against the taxable real and personal property of each such taxing unit shall, upon completion of such reappraisal or reassessment, be adjusted or rolled back, by the governing body of the taxing unit, for the year for which levied as provided below.
ARK. CONST., art
Both the language of Amendment 59 [Article 16, § 14] and the language of the implementing legislation (A.C.A. §
It is therefore my opinion that if the reappraisal in question is one that can trigger the rollback provision of Amendment 59, and if the taxes calculated upon the basis of the reappraisal would, in fact, result in a tax increase of 10% or more over the previous year, both the rollback and its intended steps toward equalization are mandatory.
In interpreting Amendment 59, the Arkansas Supreme Court has indicated that the purpose of the amendment was to proceed toward an equalization of assessments and millage rates with respect to real and personal property in a manner that would prevent taxing units from receiving more than a ten percent increase in tax collections at one time. See Crane v.Newark Sch. Dist. No. 33,
It necessarily follows that in instances where a mandatory rollback is not invoked, the tax increase that is implemented as a result of the reappraisal violates Amendment 59 both by creating inappropriate tax proportions (i.e., by failing to take the required step toward equalization) and by allowing taxing units to collect a tax increase of 10% or more.3 Although I do not express an opinion on the issue of how a tax levy that is found to be inappropriate may, in itself, be corrected, I do opine that if a rollback should have been, but was not, applied after a particular reappraisal, the violation of Amendment 59 will be compounded by a continuing failure to apply the rollback. That is, even if tax monies are refunded to the taxpayers for the year in which the rollback should have been invoked, tax rates for later years will nevertheless continue to be out of proportion.4 Applying the rollback later would return rates to their appropriate proportions. That is, it would restore the degree of equalization that the rollback was intended to achieve.
Presumably, the argument that would be adduced in favor of not applying the rollback in a subsequent year would be the fact that taxes had not increased 10% over the previous year, as literally required by Amendment 59. This argument is without foundation. First, a previous failure to comply with Amendment 59 cannot serve as a legitimate route around compliance. Otherwise, Amendment 59 would never be complied with, and would, in effect, be a nullity. As the Arkansas Supreme Court has pointed out, the law favors statutory interpretations that avoid opportunities to evade the act in question. Carter v. Bush,
Both the spirit and the purpose of Amendment 59 and its implementing legislation would be defeated by an approach that created erroneous proportions through allowing a tax increase of 10% or more, and that would then allow the error to go uncorrected simply because the correction would necessarily take place in a subsequent year.
I therefore conclude that in instances that can trigger the rollback provision of Amendment 59, the rollback and its intended steps toward equalization are mandatory. I further conclude that if the rollback is not invoked in those mandatory instances, the failure is a violation of Amendment 59 that must be corrected by a subsequent application of the rollback provision.
The foregoing opinion, which I hereby approve, was prepared by Assistant Attorney General Suzanne Antley.
Sincerely,
WINSTON BRYANT Attorney General
WB:SBA/cyh
The provisions of this subchapter relative to the adjustment or rollback of millage levied for ad valorem tax purposes shall be applicable only where there is a countywide or statewide reappraisal of property:
(1) Pursuant to court order; or
(2) Pursuant to directive of law enacted by the General Assembly; or
(3) When the reappraisal is initiated by the assessor, the county equalization board, by directive of the quorum court or upon request of one (1) or more taxing units of a county, and is determined and certified by the Assessment Coordination Division of the Arkansas Public Service Commission as constituting a comprehensive county-wide reappraisal; or
(4) When ordered by or implemented by a county pursuant to a directive of the division or its successor agency.
A.C.A. §