November 26, 2002
Posted at: 6:05 p.m. CDT
BRROKLAND, Ark. -- Thanks to the November 21 ruling by the Arkansas Supreme Court that said the state's education funding program is unconstitutional, patrons of local school districts may see an increase in property taxes if changes to district millage rates don't occur.
As part of the 70-page ruling issued by the high court, a small four-word section of Arkansas code was declared unconstitutional. That section was a portion of Arkansas Code 26-80-204(18), the legislation that enabled Amendment 74, passed in 1996 by voters to require a minimum 25 mill property tax for school maintenance and operation. Section C, which allowed excess debt service mills to be applied to maintenance and operation service minimum, was the portion of code declared to be in violation of the state constitution.
Because school districts can no longer designate the debt service millage to the required 25 mills for maintenance and operation, 244 districts across the state, including many in Northeast Arkansas will have to offer up plans to meet the state requirements by either redesignating existing mills to maintenance and operation, or possibly raise taxes.
"Amendment 74 says all schools must have 25 mills for maintenance and operation," Brookland Superintendent Gene Goza said. "Up to this point, schools have been able to use part of that 25 mills for debt service. What the Supreme Court ruled was that you can no longer do that."
Brookland schools, due to the court ruling, are now facing a deficit of 11.70 mills to become compliant with Amendment 74. Other Region 8 districts are facing millage shortfalls as well:
What districts could face in light of the ruling is that whatever portion of the 25 mills each school uses for debt service, they now have to make up. For example, in Brookland's case: The district collects a total 33.5 total mills. It uses 11.7 mills for debt service. If the Supreme Court ruling stands, Brookland patrons may see their millage increase an additional 11.7 mills.
"It means a huge tax increase," Goza said. "For the people of Brookland with our current millage rate, a person who has a $100,000 house, it would raise their millage $234."
Goza said, however, there will most likely be multiple appeals to this ruling, especially since there are so many unanswered questions, especially if residents will get the chance to vote on any increase. Currently, Attorney General-elect Mike Beebe has asked Attorney General Mark Pryor to file a motion to reconsider before the state's high court.
"My understanding is that it's unconstitutional to raise taxes without the approval of the voters," Goza said.
State law says that voters will have to approve any changes to their taxes. But, if they don't pass an increase, or an alternative plan presented by the district, The county quorum court will have to step in to ensure that Amendment 74 is being followed.
Many residents of the Brookland district, who did not wish to be identified told KAIT that they did not favor a mill increase and definitely not at such a large amount.
"I don't think any group of patrons in the state of Arkansas would approve an 11.7 mill increase," Goza said.
KAIT's Ryan James contributed to this report.