How does an Arkansas county close out a leftover school district account decades after the district was dissolved, and how is the money divided among successor districts?
Apply this to your situation
This page answers the general question as of 2018. Ezel answers yours: what it means for your facts, under current Arkansas law, with citations.
Plain-English summary
Prosecuting Attorney C.A. Blake Batson asked the AG how Clark County could close out a small ($8,715.63) interest-bearing account that the County Treasurer had been holding for the Okolona School District since the district dissolved in 1987. Students from the old Okolona territory were now attending Gurdon, Arkadelphia, Centerpoint, or South Pike County schools. The two practical questions were: how to calculate each successor district's share, and how to actually move the money out.
The AG said the substantive question (who gets how much) is governed by the school-district-dissolution statutes that were in effect in 1987, namely Ark. Stat. Ann. §§ 80-422 and 80-423 (codifications of Act 169 of 1931, repealed in 1993 but still controlling for districts that dissolved before then). Those statutes set a fixed formula: each successor district takes a share equal to the assessed value of the real estate annexed from the old district, divided by the assessed value of all real estate in the old district. The Arkansas Supreme Court applied that formula in School Dist. No. 5 of Independence County v. School Dist. No. 3, 214 Ark. 514 (1949), and the AG said it controls here.
For the procedural question (how to physically move the money), the AG identified two routes: (a) the county-claims process under Ark. Code Ann. § 14-23-101 et seq., where each successor district files a claim, the county court reviews supporting documentation, and the county clerk issues a warrant; or (b) an interpleader action under Ark. R. Civ. P. 22, where the County Treasurer deposits the funds with the circuit court, names the successor districts as defendants, and is discharged from liability. The AG declined to recommend one over the other. Picking between strategies is a job for private counsel, not the AG. There were also fact issues the AG could not resolve from his desk: precise district boundaries, whether the dissolution involved court supervision or a formal agreement, and the original source of the $8,715.63.
Currency note
This opinion was issued in 2018. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Why the 1987 statutes still control
The substantive-procedural distinction is important. The current school-district consolidation framework (Ark. Code Ann. § 6-13-1401 et seq. and § 6-13-1601 et seq.) cannot be applied retroactively to a 1987 dissolution. Two reasons: (1) those statutes confer substantive rights (the successor districts inherit specific property interests), and substantive statutes do not apply retroactively when doing so would divest previously vested rights, citing Gillioz v. Kincannon and English v. Robbins; and (2) the current statutes do not include language signaling retroactive application, and Arkansas presumes statutes apply only prospectively unless the legislature clearly says otherwise.
The 1987 statutes (§§ 80-422 and 80-423) made the rule concrete. When less than an entire district's territory is annexed elsewhere, "the district to which such territory is annexed shall be entitled to the proportionate part of the personal property . . . ascertained on the basis [ratio] that the tax assessed valuation of the real estate in that part of the territory so taken bears to the tax assessed valuation of the real estate in the entire district from which such property was taken." That language is mechanical: assessed-value ratio in, percentage share out.
How to compute each successor district's share
The AG laid out the math:
- Numerator: the 1987 assessed value of all real estate within the part of the old Okolona territory that ended up in the successor district.
- Denominator: the 1987 assessed value of all real estate in the entire Okolona School District.
- Quotient: that successor's percentage share of the $8,715.63.
The 1987 valuation date was January 1, 1987, the assessment date under Ark. Stat. Ann. § 84-426 ("All property in this State shall be assessed by the duly authorized authorities according to its value on the first day of January"). The AG flagged that even though the assessed-value rule controls, several facts had to be confirmed before the calculation could be finalized: precise pre-1987 boundaries of the Okolona district, precise pre-1987 boundaries of each successor district within the old Okolona footprint, and whether the dissolution was governed by a specific written agreement or a county court order that may have addressed property division separately.
There is also a constitutional dimension. Article 14, § 3 of the Arkansas Constitution prohibits school-district funds from being "appropriated to any other district than that for which the tax is levied." That arguably reinforces the assessed-valuation-ratio rule: by tying each successor's share to the old territory now within its boundaries, the formula keeps the money flowing to the same physical area that paid for it. The AG cited Op. Att'y Gen. 94-087 for that point.
How to actually distribute the money
Two procedural paths, both currently available because they are procedural rules and procedural law can apply retroactively:
Path 1, county-claims process (Ark. Code Ann. § 14-23-101 et seq.). Each successor district files a claim with the county court, attaches itemized supporting documentation, and asks the court to order payment. The county court "may examine all the parties and witnesses" and compel production of relevant records under § 14-23-103. If the court is satisfied, the county clerk issues a warrant and the County Treasurer pays. There is an appeal right under § 14-23-206(c). The County Treasurer's general authority to disburse on county-court order comes from § 14-15-805(a). The AG noted that the parties would have to negotiate among themselves who files which claim before approaching the court.
Path 2, interpleader (Ark. R. Civ. P. 22). The County Treasurer files a civil action in circuit court, deposits the $8,715.63 with the court registry, names the four successor districts as defendants, and is discharged from further liability. The successor districts then litigate their respective claims among themselves under the assessed-value ratio. Because the case is "exposed to double or multiple liability" (each successor could potentially sue the Treasurer for its share), interpleader is structurally well-suited.
The AG declined to recommend one path over the other. Both are legally available; the choice is a matter of legal strategy that depends on whether the parties expect agreement or contest, and on the County Treasurer's preference for shedding liability through interpleader versus working through the county-claims structure.
Common questions
Why does this matter for an $8,715.63 account?
Two reasons: (1) the same legal logic governs much larger orphaned accounts in Arkansas counties, and (2) county treasurers cannot simply close stale accounts. The funds are held in trust for whoever has the legal interest. Without a court order or a clear statutory authorization, distributing the money creates personal liability exposure for the treasurer.
Can the county just give the money to the local school where most former Okolona students now attend?
No. Article 14, § 3 of the Arkansas Constitution and the assessed-value ratio rule both forbid that. The funds belong to the successor districts in proportion to the 1987 territory and assessed value, not to wherever the students are today.
What if a successor district has since dissolved or consolidated again?
The opinion does not address chained dissolutions. Practically, the same logic would extend: the share owed to a now-dissolved successor would have to be apportioned to its own successors, again by the assessed-value ratio that applied at the time of the second dissolution. That is a fact-intensive analysis the AG flagged for private counsel.
Does the County Treasurer earn interest on these stale accounts?
The opinion says the Okolona account is interest-bearing. Interest accrues to the underlying funds and is distributed in the same proportion as principal under the assessed-value rule.
Is there a statute of limitations on a successor district claiming its share?
The opinion does not address that. As a practical matter, the funds are held in trust; the longer they sit, the harder it becomes to reconstruct the 1987 records needed to calculate the ratios precisely.
Background and statutory framework
School-district consolidation in Arkansas runs on a long arc. Act 169 of 1931 (the source of §§ 80-422 and 80-423) governed dissolutions for over 60 years. It was repealed in 1993 and replaced with the current chapter at Title 6, but accounts left over from older dissolutions are still being closed under the older law. The successor-district approach is rooted in equity: the territory of the old district paid the taxes that funded the account, so the territory's current districts inherit the proceeds.
The county-claims process at § 14-23-101 is older still and serves as Arkansas's general mechanism for paying out claims against the county. Interpleader is procedural and uniform across all civil disputes where a stakeholder faces multiple claimants; it has been recognized in Arkansas under Rule 22 since the modern Rules of Civil Procedure took effect.
Citations
- Ark. Stat. Ann. § 80-422 (1980 Repl.) (division of property of dissolved districts)
- Ark. Stat. Ann. § 80-423 (1980 Repl.) (assumption of property of dissolved districts)
- Ark. Stat. Ann. § 84-426 (1980 Repl.) (assessment date)
- Ark. Code Ann. § 6-13-1401 et seq. (current consolidation statutes, prospective only)
- Ark. Code Ann. § 14-23-101 et seq. (county-claims process)
- Ark. Code Ann. § 14-15-805(a) (county treasurer disbursement on court order)
- Ark. Code Ann. § 25-16-706 (AG opinion authority limited to legal questions, not fact-finding)
- Ark. Const. art. 14, § 3 (school district funds restriction)
- Ark. R. Civ. P. 22 (interpleader)
- School Dist. No. 5 of Independence Cnty. v. School Dist. No. 3, 214 Ark. 514, 216 S.W.2d 882 (1949) (assessed-value ratio applied)
- English v. Robbins, 2014 Ark. 511, 452 S.W.3d 566 (substantive statutes apply prospectively)
- Gillioz v. Kincannon, 213 Ark. 1010, 214 S.W.2d 212 (1948) (procedural statutes can apply retroactively)
- Summerville v. Thrower, 369 Ark. 231, 253 S.W.3d 415 (2007) (substantive vs. procedural)
Source
Original opinion text
Opinion No. 2017-107
January 17, 2018
STATE OF ARKANSAS
ATTORNEY GENERAL
LESLI E RUTLEDGE
The Honorable C.A. Blake Batson
Prosecuting Attorney
Ninth-East Judicial District
414 Court Street
Arkadelphia, AR 71923
Dear Mr. Batson:
I am responding to your request for an opinion as to what steps may be taken to
close an account maintained by the Clark County Treasurer on behalf of the
Okolona School District, which was dissolved in 1987. You explain that students
in the area formerly assigned to the Okolona School District now attend schools in
the Gurdon, Arkadelphia, Centerpoint, and South Pike County School Districts.
Since dissolution of the Okolona School District in 1987 (and presumably prior to
that time), the Clark County Treasurer has held an interest-bearing account for the
Okolona School District. The current account balance is approximately $8,715.63.
In light of this background, you ask two questions, which I will address in reverse
order:
- How should the County calculate the amount of money to
transfer from this account to various school districts which now
serve the area formerly within the Okolona School District? - What is the procedure for the County to close this account?
RESPONSE
Factual variations (any one of which could be outcome-determinative) prevent me
from definitively answering your questions. However, I can identify the
controlling law and describe what I believe to be its most likely application.
Electing how then to proceed is beyond the scope of my authority when providing
323 CENTER STREET. Sum: 200 . LITTLE ROCK. ARKANSAS 72201
TELEPHONE (501) 682-2007 · FAX (501) 682-8084
ARKANSASAG.GOV Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 2
an opinion. 1 Rather, that is a matter to be weighed by the interested stakeholders
in consultation with legal counsel. 2
The substantive statutes that governed school-district dissolution in 1987 will, in
my opinion, determine the property interests of the Gurdon, Arkadelphia,
Centerpoint, and South Pike County School Districts ("successor districts") in the
Okolona School District account. And those statutes create property interests in
proportion to the tax bases that were annexed from the Okolona School District.
Specifically, the successor districts will have shares in the Okolona School District
account equal to the "assessed valuation of the real estate in that part of the
territory" annexed to each district, divided by the "assessed valuation of the real
estate in the entire district from which such property was taken. "3
Once these shares have been calculated, one procedural option for distributing the
funds held by the Clark County Treasurer is the county-claims process.4 If the
Clark County Court determined claims for the funds were properly supported, the
court could order the county treasurer to remit payment to each successor district. 5
Another procedure for distributing the funds is an interpleader action in which the
successor districts, "having claims against the [Clark County Treasurer,] may be
joined as defendants"6 in circuit court. But again, I cannot opine as to which of
these options should be pursued as a matter of legal strategy.
1 See Ark. Code Ann. § 25-16-706(a)(l) (Repl. 2014) (The Attorney General "shall give his or
her opinion to the prosecuting attorney of any district upon any legal question that concerns the
financial interests of ... any county .... ") (emphasis added).
2 Cf id. at § 25-16-701 (Supp. 2015) ("During his or her term of office, the Attorney General
shall not engage in the private practice of Jaw .... ").
3 Ark. Stat. Ann. § 80-423 ("Assumption of property, debts, and contracts of dissolved or annexed
districts.") (Repl. 1980).
4 See Ark. Code Ann.§ 14-23-101 et seq.
5 See id. at §§ 14-23-103 ("Investigation") (Rep I. 2013), 105 ("Supporting Documentation,
Requirements, Preservation") (Repl. 2013).
6 Ark. R. Civ. P. 22(a). Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 3
DISCUSSION
Question 1: How should the County calculate the amount of money to transfer
from this account to various school districts which now serve the area formerly
within the Okolona School District?
The threshold question with respect to how the Okolona School District's funds
should be divided is which body of law governs the district's dissolution. It has
long been held that the "power of the Legislature in enacting laws for the
formation or dissolution of school districts is plenary,"7 so the relevant law will be
statutory. But which statutes apply? To be sure, there is a current framework of
statutes pertaining to the consolidation and dissolution of school districts. 8 These
statutes must be applied prospectively, however, and not to the decades-old
dissolution of entities like the Okolona School District.
First, the current statutes confer substantive rights on the districts that are formed,
consolidated, and dissolved under their authority.9 And because later legislation
cannot "divest ... rights previously vested"10 by a substantive statute, the current
statutes "cannot be constitutionally applied retroactively." 11 Second, the current
consolidation statutes do not indicate they should be applied retrospectively.12 As
a result, the property rights of the successors to the Okolona School District will
be "determined according to statutes which were in force when the rights accrued
"13
7 Special Sch. Dist. No. 60 v. Special Sch. Dist. No. 2, 181 Ark. 253, 25 S. W.2d 443, 445 ( 1930).
8 See Ark. Code Ann. §§ 6-13-1401 et seq. ("District Formation, Consolidation, and
Annexation"), 1601 et seq. ("Administrative Consolidation").
9 English, 2014 Ark. at 7-8, 452 S.W.3d at 571-72 ("A law is substantive when it ... creates,
defines, and regulates the rights, duties, and powers of parties.") (internal quotation omitted).
10 Gillioz v. Kincannon, 213 Ark. 1010, 1018, 214 S.W.2d 212, 216 (1948) (quoting Coco v.
Miller, 193 Ark. 999, 104 S.W.2d 209, 211 (1937)).
11 English, 2014 Ark. at 7, 452 S.W.3d at 571.
12 See English v. Robbins, 2014 Ark. 511 at 7, 452 S.W.3d 566, 571 ("Unless it expressly states
otherwise, this court presumes the legislature intends for its laws to apply only prospectively.")
(internal quotations omitted).
13 Gillioz, 213 Ark. at 1018, 214 S.W.2d at 216 (internal quotation omitted). Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 4
According to the background information you provided, the Okolona School
District was consolidated in 1987. Thus, the consolidation statutes "in force" in
1987 will govern the division of the Okolona School District account among the
successor districts. In my opinion, these consolidation statutes are found primarily
at Ark. Stat. Ann. §§ 80-422 ("Division of property, debts, and contracts of
dissolved districts") and 80-423 ("Assumption of property, debts, and contracts of
dissolved or annexed districts").14
The substantive property right recognized in sections 80-422 and 80-423 is that
"[a]ny new district that is created, or district to which new property is annexed,
shall succeed to the property of the district dissolved .... "15 And if a district
annexes less than all of the dissolved district's territory, then the dissolved
district's property is divided according to the following ratio:
[T]he district to which such property is annexed shall
be entitled to the proportionate part of the personal
property . . . ascertained on the basis . . . that the tax
assessed valuation of the real estate in that part of the
territory so taken bears to the tax assessed valuation of
the real estate in the entire district from which such
k 16 property was ta en . . . .
In a case applying the act later codified at section 80-423, the Arkansas Supreme
Court upheld the division of a defunct school district's cash in proportion to the
"assessed valuation" of its real estate.17 A local board of education had "voted to
14 See Arkansas Statutes Annotated (Rep!. 1980). Sections 80-422 and 80-423 were repealed in - They are codifications of Act 169 of 193 1, which remained the operative law for school-
district consolidation and dissolution in 1987. Copies of sections 80-422 and 80-423, as well as
other sections of the Arkansas Statutes Annotated discussed in this opinion, are enclosed for your
reference.
15 Section 80-423 is materially identical to section 80-422, including the provision that surviving
districts "shall succeed to all of the property of the district or districts dissolved .... " Ark. Stat.
Ann. § 80-423.
16 Id. at § 80-423.
17 School Dist. No. 5 of Independence Cnty. v. School Dist. No. 3 of Independence Cnty., 214 Ark.
514, 216 S.W.2d 882 (1949). Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 5
dissolve [a] district and to divide its territory into two new districts."18 The Court
reviewed on appeal the board's order that assets of the dissolved district "be
apportioned according to the ratio of the assessed value of real estate in each new
district."19 Noting that the "disagreement involve[ d] the division of moneys on
hand" once the district dissolved, the Court found the governing statute compelled
"division according to assessed values when part of a district is annexed .... "20
Consequently, the board was correct to assign the defunct district's funds to the
successor districts according to a tax-assessment ratio.21
I believe the successors to the Okolona School District are entitled to similar
proportionate shares of the Okolona account. That is, each of the four successor
districts will have a percentage-interest in the account equal to the "tax assessed
valuation of the real estate" annexed to a given successor district, divided by "tax
assessed valuation of the real estate in the entire [Okolona] district .... "22 And in
my opinion, the "assessed valuation" setting the ratio for each successor district
derives from the real-estate tax basis as it existed in 1987, when the Okolona
School District dissolved. Like school-district dissolution, taxation is a matter of
statute23 and generally governed by legislation "in force when the rights accrued
•••• " 24 Moreover, the relevant assessment statutes provide that taxable value is
18 Id. at 515, 216 S.W.2d at 883.
19 Id.
20 Id.
21 Id. Assigning prope11y interests to successor districts according to an assessed-valuation ratio
also ensures compliance with the constitutional mandate that school-district funds not be
"appropriated to any other district than that for which [the tax] is levied." Ark. Const. ai1. 14, § 3.
See, e.g., Op. Att'y Gen. 94-087 (considering the proper method of dividing a defunct district's
tax revenues "among ... five annexing districts," and opining that "a significant constitutional
issue would be raised ... if the distribution would result in monies from one district's annexed
territory being transferred to a district from which the monies did not arise.").
22 Ark. Stat. Ann. § 80-423 (emphasis added).
23 See Ark. Const. ai1. 16 § 5(a) ("All real ... prope11y subject to taxation shall be taxed according
to its value, that value to be ascertained in such manner as the General Assembly shall direct,
making the same equal and uniform throughout the State.").
24 Gillioz, 213 Ark. at 1018, 214 S.W.2d at 216 (internal quotation omitted). Although the
"power of the General Assembly to pass a tax act retroactive in character is not questioned," a tax
statute is applied prospectively "unless its terms show clearly a legislative intention that it should Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 6
fixed on the first day of the year of assessment.25 Interests in the Okolona account
must therefore be calculated based on the assessed value of the real property
annexed to each successor district (as of January 1, 1987) compared to the
assessed value of all real property in the former Okolona School District (as of
January 1, 1987).
It is my opinion that the statutes governing property succession for dissolved
school districts in 1987, together with the rules of real-estate assessment then in
effect, are the substantive law applicable to your question about how the Okolona
account should be divided. But there are a number of outstanding factual issues
that prevent a more detailed answer. For example, it is unknown whether the
Okolona School District was annexed according to a specific agreement among
the successor districts, and unknown whether the process involved court
supervision. 26 The precise physical boundaries of the successor districts relative to
the footprint of the Okolona School District are unclear. And I am not aware of
the original source, or sources, of the funds comprising the $8, 715 .63 in question.
Investigating these fact-intensive issues (all potentially important to the
disposition of the account) is outside the scope of an opinion from my office.27
operate retrospectively." Du Laney v. Cont'! Life Ins. Co., 185 Ark. 517, 47 S.W.2d 1082, 1083
( 1932). There is no such intent evidenced in the present-day assessment statutes. See, e.g., Ark.
Code Ann. § 26-26-1101 (Rep I. 2012) ("Each year the county assessor shall, between the first
Monday in January and July 1, appraise and assess all real property situated within the boundaries
of the county.").
25 See Ark. Stat. Ann. § 84-426 (Rep!. 1980) ("All property in this State shall be assessed by the
duly authorized authorities according to its value on the first day of January."); Ark. Stat. Ann. §
84-103( c) (Repl. 1980) (obligating the Public Service Commission to "file with the county judge
... not later than ten ( 10) days before the time for the beginning of the assessment of property ...
a certificate showing the per centum of full and true market or actual value that it ... will use in
valuing for taxation for that year .... ").
26 Cf Op. Att'y Gen. 2000-141 ("I have not been provided with any of the documentation
reflecting the consolidation agreement between the . . . school districts, or any court order
concerning the consolidation.").
27 See Op. Att'y Gen. 2017-028 ("I am unable to opine ... , as the level of fact-finding ... is
beyond the scope of an Attorney General's opinion. A county's attorney or other local counsel
should be consulted in such cases."). Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 7
Question 2: What is the procedure for the County to close this account?
You state in your opinion request that the Clark County Treasurer maintains the
Okolona account. I take the reference to a count~ treasurer to mean there is no
school-district treasurer responsible for the funds.2 Thus, the question is how the
Clark County Treasurer can disburse the shares (determined according to each
successor district's assessed-valuation ratio) of the Okolona account.29
This question focuses not on substantive rights, but on procedure. 30 And current
procedural law regarding division of property at the municipal level may be
applied retroactively to the Okolona account, which has existed since at least - 31 In my opinion, the procedure most directly applicable is either the county-
claims process32 or a circuit-court interpleader of funds.33 But as noted above,
there are a number of unknown and possibly determinative facts. Gathering those
facts and deciding how best to proceed are beyond the scope of my statutory
authority. 34
The county-claims process allows "[a ]ll persons having demands against any
county [to] present them ... to the county court of the county for allowance or
rejection."35 The county court may "examine all the parties and witnesses" having
an interest in the claim, and may "compel the production of all books, accounts,
28 Cf Ark. Code Ann. § 6-13-70l(a) (Repl. 2013) ("The board of directors of any school district
in Arkansas is authorized to appoint a treasurer to handle the funds of the school district.").
29 See Op. Att'y Gen. 86-350 ("If the school does not have a district treasurer, the funds are
retained by the County Treasurer, who disburses the funds in accordance with State law.").
30 See Summerville v. Thrower, 369 Ark. 231, 237, 253 S.W.3d 415, 420 (2007) ("Procedural law
... prescribe[s] the steps for having a right or duty judicially enforced, as opposed to the law that
defines the specific rights or duties themselves.").
31 Gillioz, 213 Ark. at 1018, 214 S.W.2d at 216 ("The rule appears to be well settled generally
that retrospective laws ... are valid only when they affect remedies or procedure.").
32 See Ark. Code Ann. § 14-23-101 et seq. ("Claims Against Counties").
33 See Ark. R. Civ. P. 22.
34 See Op. Att'y Gen. 2010-113 at 1 ("[P]roviding an answer may be tantamount to giving private
legal advice, which I am specifically prohibited by statute from doing.").
35 Ark. Code Ann.§ 14-23-lOl(a). Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 8
papers, or documents which may be necessary in [its] investigation .... "36 If the
county court is satisfied that a claim should be paid, the court is authorized to
order payment by the county clerk. 37 And there is an option for appeal "from the
order ... concerning any claim ... in the manner provided by law for appeals from
orders of the county court. "38
Pursuant to these statutes, a claim could be asserted against the $8, 715 .63 held by
the Clark County Treasurer on behalf of the defunct Okolona School District. A
county treasurer is certainly authorized as a general matter to release funds in
response to an order from the county court to pay a valid debt. 39 I cannot opine on
the county-claims process as it would apply to the Okolona account in practice,
however. The interested parties would first have to determine who should assert
the claims established under the substantive law.40 And once demands are made to
the Clark County Court, it will be incumbent on the parties to off er what "books,
accounts, papers, or documents ... may be necessary"41 to justify their particular
claim. These and similar matters must be explored in consultation with private
legal counsel.
An interpleader in circuit court is also a viable option for distributing the Okolona
account, but it too involves contingencies that are beyond my authority to address.
Interpleaders are governed by Rule 22 of the Arkansas Rules of Civil Procedure,
which authorizes a party "who disclaims any interest in the money or property that
is the subject of the interpleader" to deposit the funds in the court registry and
36 Id. at§ 14-23-103; see also Ark. Code Ann.§ 14-23-lOS(a)(l)(A) (Repl. 2013) (stating that the
claimant must "attach to the county claim for payment an itemized listing or numbered invoice
which may be designated as suppo11ing documentation.").
37 See Ark. Code Ann. § 14-23-207(b) (Rep!. 2013) (providing for "warrants or checks issued by
the county clerk ... on order of the county court for the payment of any claim.").
38 Ark. Code Ann.§ 14-23-206(c) (Rep!. 2013).
39 See Ark. Code Ann.§ 14-15-805(a) (Rep!. 2013) ("It shall be the duty of each county treasurer
to receive and give receipt for all moneys payable into the county treasury and to pay and
disburse the moneys on warrants or checks drawn by order of the county court.").
40 Based on the background information provided, it appears the interested parties are the Clark
County Treasurer along with the Gurdon, Arkadelphia, Centerpoint, and South Pike County
School Districts.
41 See note 36 and accompanying text, supra. Hon. C.A. Blake Batson
Pros. Att'y, Ninth-East Jud. Dist.
Opinion No. 2017-107
Page 9
thereafter be "discharged from all liability. "42 Essentially, an interpleader is a civil
action by which "[p ]ersons having claims ... may be joined as defendants ... when
their claims are such that the plaintiff is or may be exposed to double or multiple
liability."43 With respect to the Okolona account, the interpleader plaintiff would
likely be the Clark County Treasurer, given that the treasurer's office maintains
the account funds. And the defendants would likely be the successor districts,
each of which may claim a share of the account. But the real parties in interest (as
well as the claims or defenses they might assert) are matters for the stakeholders,
and ultimately the circuit court, to consider.
Sincerely,
___:;;; ·=> ~
LESLIE RUTLEDGE
Attorney General
Enclosures
42 Ark. R. Civ. P. 22(b).
43 Id. at 22(a). i I
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olve school
' § 80-415.
CountyBd.
l 64 (1942).
-On all
with the
.ion must
is denied
l petitionpeal the
loriginal
is act being
1ervation of
',Shall be in
· its passage
28, 1947.
83 SCHOOL DISTRICTS 80-423
NOTES TO DECISIONS
Appeal from Refusal to Act .
County board of education has 60 days after
filing of petition for consolidation to act on
petition and after expiration of such period
there is a 30 day period under§ 80-236 within
which an appeal from such refusal to act may
be taken. County Bd. of Educ. v. Norfork
School Dist. No. 61, 216 Ark. 934, 228 S.W.2d
468 (1950).
Where petitions for consolidation were
published under § 80-408 and county board of
education failed to act on such petitions, but
thereafter acted under the provisions of
§ 80-428 annexing certain territory to
another district, ·appeal from such order
within the 30 day period provided in § 80-428
but after time for appeal from refusal to act on
original petitions (as required by this section)
had expired, was unavailing, where the
evidence and argument on appeal related to
the adequacy of the original petitions, and
purpose of appeal was to require action on
original petition. County Bd. of El:luc. v.
Norfork School Dist. No. 61, 216 Ark. 934, 228
S.W.2d 468 (1950).
80-422. Division of property, debts and contracts of dissolved districts.
- Any new district which is created, or district to which new territory is
annexed shall succeed to the property of the district dissolved, and become
liable for its contracts and debts, and may sue and be sued therefor, and
where territory less than the entire district is annexed to a district, the
district to which territory is annexed shall take such property of the district
from which such territory was taken as the county board of education shall
deem proper, and shall be liable for that part of all indebtedness of the
district from which such territory was taken as shall be assigned to them by
the county board of education. The part to be assigned to the new district
shall be determined by the ratio that the assessed valuation of the real estate
in that part of the territory so taken is to the assessed valuation of real estate
in the entire district from which the territory was taken. All taxes voted in
such districts from which territory is taken, together with any that may be
voted in the district to which it was attached, shall be used to discharge such
indebtedness, and the district to which such territory is added, shall be
subject to suit for such indebtedness. [Acts 1931, No. 169, § 46, p. 476; Pope's
Dig., § 11479.]
Compiler's Notes. Sections 45, 47 of Acts
1931, No. 169 are compiled as §§ 80-406,
80-407, respectively.
80-423. Assumption of property, debts and contracts of dissolved or
annexed districts. - Any school district to which there is annexed hereafter
all the territory of an entire district, or created by a consolidation of
districts, or created out of the same territory of a preexisting district, shall
succeed to all of the property of the district or districts dissolved, and become
liable for all its or their contracts and debts, and may sue and be sued
therefor. Where territory less than an entire district is brought into a
district, the district to which such territory is annexed shall be entitled to
the proportionate part of the personal property, and shall be liable for the
proportionate part of the indebtedness of the district from which such
territory was taken, ascertained on the basis [ratio] that the tax assessed
valuation of the real estate in that part of the territory so taken bears to the 80-424 EDUCATION 84
tax assessed valuation of the real estate in the entire district from which
such territory was taken, and all school taxes previously voted in such
district from which such territory is taken applicable to the land
constituting such annexed territory and the personal property thereon,
together with any that may be :voted on that territory in the district to which
it is attached, and the proportionate part of allotments from State funds and
all other resources of the new district, such proportion to be ascertained on
the basis [ratio] that the assessed value of the land in the annexed territory
bears to such assessed value of all the land in the new district', ~hall be used
to discharge such indebtedness, and the district to which such territory is.
added shall be subject to suit for such indebtedness. [Acts 1931, No. 169,
§ 80, p. 476; Pope's Dig., § 11516.]
Compiler's Notes. The bracketed word
"ratio" in the second sentence was inserted by
the compiler in both instances.
Sections 79, 83 of Acts 1931, No. 169 are
compiled as §§ 80-313, 80-314, respectively.
NOTES TO DECISIONS
ANALYSIS
Division of district.
Liability of consolidated district.
Parties to actions.
Division of District.
Where consolidated district was divided
into two districts, action of the board in
dividing funds of district on basis of assessed
values was proper. School Dist. No. 5 v. School
Dist. No. 3, 214 Ark. 514, 216 S.W.2d 882
(1949).
Liability of Consolidated District.
This section does not mean that the new
district must pay every outstanding warrant
issued by its predecessors, regardless of
validity. Heskett v. McRee, 215 Ark. 328, 220
S.W.2d 422 (1949).
Parties to Actions.
Court could not by mandamus proceeding
compel county . treasurer to pay warrant
issued by school district which was thereafter
consolidated, since the consolidated district
was a necessary party to the action. Heskett
v. McRee, 215 Ark. 328, 220 S.W.2d 422 (1949).
80-424. Defects of previous consolidation or changes validated. - The
formation, consolidation, change of boundary lines, and any other alteration
of school districts by the action of the county board of education of any
county prior to the passage and approval of this act [March 26, 1951] are
hereby made valid and any error, omission or defect in the procedure of
creating, consolidating or altering school districts is hereby cured, and the
action heretofore taken in creating, consolidating or altering school districts
is hereby ratified. Provided this act shall not be construed as validating any
action of a county board of education concerning which a suit in a court of
competent jurisdiction is now pending, nor in a ca8e where a court of
competent jurisdiction has determined that a district was illegally formed
or consolidated with another district. [Acts 1951, No. 403, § 6, p. 965.]
Compiler's Notes. Sections 5, 7 of Acts 1951,
No. 403 are compiled as a note to§ 80-320 and
as§ 80-607, respectively. 6
every suc;:h
.i.m oflegal
such debts
11y mutual
tock of any
scientific,
t of any
~eived, and
be a full
de for the
x:ation; nor
the person
:h surety is
(salaries or
meaning of
792; Pope's
02, 84-1405 -
-1444, 84-1501
&-1615.
14 is compiled
s, § 76-701 et
J-606.
· public school
licensing fees,
l - Property
ll or Personal
'exarkana, 182
DJ; Baldwin v.
7 S.W.2d 668
s.
ies in another
.terest in real
s state. Greene
' 228 s.w. 738
dures situated
o the lessee are
i Compress Co.
52 (1897).
this act the
ies or towns
7 PROPERTY AND PRIVILEGE TAX LAWS 84-103
incorporated or not incorporated, also to all blocks, or lots, or parts thereof,
assessed for taxation as such, whether the same is situated in an
incorporated city or town, or not. [Act Mar. 31, 1883, No. 114, § 75, p. 199;
C. & M. Dig., § 9939; Pope's Dig., § 13723.)
Compiler's Notes. For sections in which
"this act" is compiled, see compiler's notes to
§ 84-101.
Section 74 of Acts 1883, No. 114 is compiled
as § 84-811. Sections 76-84 have been
superseded. Section 85 is compiled as
§§ 84-402 - 84-404.
NOTES TO DECISIONS
Incorporation.
Whether a community is incorporated or
not is not the test as to whether it is town or
city under this act. Southeast Ark. Levee Dist.
v. Turner, 184 Ark. 1147, 45 S.W.2d 512
(1932).
84-103. Administration of tax laws - Authority of public service
commission. - The [Arkansas Public Service] Commission shall have full
power and authority in the administration of the tax laws of this State now
in force or such as may hereafter be enacted:
· {a) General supervision. To have and exercise general and complete
supervision and control over the valuation, assessment and equalization of
all property, privileges and franchises; the collection of taxes and
enforcement of the tax laws of the State, and over the several county
assessors, county boards ofreview and equalization, tax collectors and other
officers charged with the assessment or equalization of property or the
collection of taxes throughout the State, to the end that all assessments on
property, privileges and franchises in this State shall be made in relative
proportion to the just and true value thereof, in substantial compliance with
law.
(b) Assessment of utility property. To have the exclusive power oforiginal
assessment of the property, both real and personal, used in the operating of
carrier pipeline, railroad, street railroad, express, sleeping car and
intercounty bus line companies, and all telegraph, telephone, electric power,
cable television, heating, gas, water, water transportation, toll bridge or
ferry, interurban or other similar companies, associations or corporations
commonly known as utilities doing business or owning property in this
State. ..
{c) Basis of valuation. To file with the county judge, county clerk and
county assessor of each county not later than ten [10) days b~fore the time
for the beginning of the assessment of property by the tax assessors a
certificate showing the per centum of true and full market or actual value
that it has used, or will use, in valuing for taxation for that year the property
the Commission is required to assess; and it shall be the duty of the assessors
and boards of review or equalization and county judges to adopt the same
basis of valuation of property in their county for the purpose of taxation as
that so certified by the Commission. 62
lOnds or other
l shall hold or
is property, he
other property
of said person,
bonds or other
in making up
Mar. 28, 1887,
4.]
ond or warrant of
as subject of
5 A.L.R. 547; 44
ro person shall
elieves will be
ligation given
tat shall have
time oflisting;
iS a part of the
:ks, joint stock
are or portion
.tion, which is
l in this State.
2; Pope's Dig.,
tk v. Board of
!28.W. 988(1909);
•. Bodcaw Lumber
92 (1917); Pulaski
on v. American
3 Ark. 124, 342
mestic insurance
ist such stock for
mks, 87 Ark. 484,
sed by another
. the hands of the
the capital stock
vested in another
s County v. Home
' 133 s.w. 1113
63 ASSESSMENT OF TAXES 84-426
Corporations, in returning capital stock for
taxation, cannot deduct investments of
surplus in shares of stock ofother corporation.
State ex rel. Attorney Gen. v. Ft. Smith
Lumber Co., 131Ark.40, 198 S.W. 702 (1917).
Rental Note.
Notes under contract in the form of a lease·
with option to purchase are r.ental notes and
not taxable until maturity. McConnell v.
Sebastian County, 144 Ark. 394, 222 S.W. 707
(1920).
Collateral References. Shares owned by a
resident in a foreign corporation as subject of
property tax. 43 A.L.R. 686.
Margin tax on stock or securities or
commodities purchased on. 71 A.L.R. 1225.
84-425. Information required by assessor. - The Tax Commission
[Arkansas Public Service Commission], the Tax Assessor, or any one of them
who may be required under the law to make assessment rolls, shall in
addition to their duties as now required by law, specifically inquire of the
maker of each list, the following:
(a) The number, kind and value of each automobile they own.
(b) The cash or funds on hand, and money on time deposit or otherwise
in any depository, in or out of the State.
(c) The taxable securities of every kind, and their value, in or out of the
State, they may own.
(d) What stock, bonds or mortgages owned, and their value, in or out of
the State.
(e) What leases, or mineral deeds are owned, and the value of same that
are contemplated in section 9856, C. & M. Digest [§ 84-203].
(f) What timber, deeds or contracts contemplated by section 9855, C. & M.
Digest [§ 84-204], they own, and the value of same .
(g) Any other property of any kind whatsoever that has a value about
which questions have not been asked.
The taxpayer shall then be required to assess the properties disclosed by
investigation. [Acts 1929, No. 111, § 2, p. 557; Pope's Dig., § 13626.]
Compiler's Notes. The bracketed words
"Arkansas Public Service Commission" were
inserted by the compiler. See compiler's note
to§ 84-103.
Sections 1, 3 of Acts 1929, No. 111 are
compiled as §§ 84-419, 84-405 respectively.
Legal Periodicals. Acts Affecting Property
Taxation, 5 Ark. L. Rev. 365.
84-426. Date of valuation. - All property in this State shall be assessed
by the duly authorized authorities according to its value on the first day of
January. Proviqed, stocks of merchants and manufacturers shall be assessed
at the value of the average stock in possession or under control during the
year immediately preceding the first day of January of the yel:lr in which
assessment is required. [Acts 1929, No. 172, § 1, p. 841; Pope's Dig.,§ 13680.]
Section to Section References. This section Cited: Arkansas Tax Comm'n v. Ashby, 217
is referred to in § 84-438. Ark. 759, 233 S.W.2d 361 (1950).
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