Does a public-trust redevelopment authority created by Arkansas counties and cities get the same tort immunity that political subdivisions enjoy under Ark. Code Ann. 21-9-301?

Plain-English summary

Senator Mathew Pitsch asked AG Leslie Rutledge whether the Fort Chaffee Redevelopment Authority Public Trust (FCRA), the public trust set up by Sebastian County and the cities of Barling, Greenwood, and Fort Smith to handle redevelopment of the former Fort Chaffee Army installation, was covered by Arkansas's local-government tort-immunity statute, Ark. Code Ann. § 21-9-301. He also asked whether FCRA employees and agents shared that immunity for negligence on the job.

The AG said yes to both, with one important caveat: she could not point at a controlling Arkansas appellate decision that had directly classified a public trust like FCRA. Her conclusion was a prediction of how a court would likely rule.

Section 21-9-301 immunizes counties, municipalities, school districts, charter schools, special improvement districts, and "all other political subdivisions of the state and any of their boards, commissions, agencies, authorities, or other governing bodies" from tort suits "except to the extent that they may be covered by liability insurance." So the operative question was whether FCRA fit that list. The legislature had not defined "political subdivision" specifically for tort-immunity purposes, but it had defined the term elsewhere in different ways, and the Arkansas Supreme Court had its own test from Dermott Special School District v. Johnson, 343 Ark. 90, 32 S.W.3d 477 (2000): an entity "embraces a certain territory and its inhabitants, organized for the public advantage… for the exercise of governmental functions."

Applying that framework, the AG noted that FCRA covers a defined territory, was created in the public interest under Ark. Code Ann. § 12-63-103, exercises governmental functions (including land use and zoning, per City of Barling v. Fort Chaffee Redevelopment Authority, 347 Ark. 105, 60 S.W.3d 443 (2001)), and was created by political subdivisions (Sebastian County and three cities). Even if a court did not call FCRA itself a political subdivision, it would likely call FCRA an "authority" or "governing body" of those subdivisions, which is enough under the statute. Either way the immunity attached.

For employees and agents, the AG relied on Autry v. Lawrence, 286 Ark. 501, 696 S.W.2d 315 (1985), and Matthews v. Martin, 280 Ark. 345, 658 S.W.2d 374 (1983), which had already extended § 21-9-301 immunity to municipal officers and employees acting in their official capacities. If FCRA itself was covered, its agents were covered.

Two limits the AG flagged: the immunity does not reach intentional torts (Deitsch v. Tillery, 309 Ark. 401, 833 S.W.2d 760 (1992); Battle v. Harris, 298 Ark. 241, 766 S.W.2d 431 (1989)), and it does not bar suit "to the extent that they may be covered by liability insurance" (City of Caddo Valley v. George, 340 Ark. 203, 9 S.W.3d 481 (2000)). A claimant injured by FCRA negligence could still recover up to the amount of any FCRA liability insurance.

Currency note

This opinion was issued in 2020. 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.

Common questions

What is the Fort Chaffee Redevelopment Authority?
A public trust formed by Sebastian County (settlor and trustor) along with the cities of Barling, Greenwood, and Fort Smith (collective beneficiaries) to redevelop the former Fort Chaffee Army installation. The state legislature acknowledged its existence in Ark. Code Ann. § 12-63-103.

Did the AG say definitively that FCRA had immunity?
No. She predicted a court would likely find that FCRA qualifies, and gave the reasons. Until an Arkansas appellate court actually decided the question, the immunity defense remained a likely-but-not-certain outcome.

What torts could still be brought against FCRA notwithstanding immunity?
Two routes survived. First, intentional torts were never within § 21-9-301's protection, so claims like assault, battery, false arrest, or other deliberate wrongs could go forward. Second, claims for negligence could go forward "to the extent that they may be covered by liability insurance." If FCRA carried a $1 million policy, a plaintiff could recover up to that limit on a negligence claim.

What about FCRA's individual board members, staff, and agents?
The AG concluded they would share FCRA's immunity for negligent acts committed in their official capacities. The reasoning rested on Autry v. Lawrence (Ark. 1985) and Matthews v. Martin (Ark. 1983), both of which had read § 21-9-301 to extend immunity from the entity to its agents. Acts outside official capacity, or intentional acts, still fall outside that protective umbrella.

Why did the AG mention so many statutory definitions of 'political subdivision'?
The Arkansas Code uses the same phrase in many statutes with different definitions: § 12-9-102(3) (general government units), § 12-50-103(8) (cities, towns, counties), § 14-77-102(4) (counties, cities, school districts), § 15-5-103(19) (cities, counties, improvement districts, public corporations), and others. Two of those definitions, § 15-5-103(19) and § 21-1-303(4), expressly include public corporations. The AG cited the variety to show that Arkansas law had no single definition controlling, and that public-trust-like entities were sometimes expressly covered.

Background and statutory framework

Ark. Code Ann. § 21-9-301 is Arkansas's principal local-government tort-immunity statute. It declares the public policy of the state that "all counties, municipal corporations, school districts, public charter schools, special improvement districts, and all other political subdivisions of the state and any of their boards, commissions, agencies, authorities, or other governing bodies" are immune from tort liability except to the extent of liability insurance.

Two judicially crafted limits applied. First, City of Caddo Valley v. George, 340 Ark. 203, 9 S.W.3d 481 (2000), held that liability insurance creates a coverage-limited exception to the immunity. Second, Deitsch v. Tillery and Battle v. Harris held that intentional torts are outside the statute entirely.

For purposes of qualifying as a "political subdivision," the Arkansas Supreme Court had given a working definition in Dermott Special School District v. Johnson, focused on territoriality and governmental functions. In Masterson v. Stambuck, 321 Ark. 391, 902 S.W.2d 803 (1995), the court had distinguished a not-for-profit benevolent entity from utility "creatures of statute" that were treated as agents of their creating municipalities.

Ark. Code Ann. § 12-63-103 specifically authorized the establishment of the FCRA as a public trust to redevelop the Fort Chaffee installation. In City of Barling v. Fort Chaffee Redevelopment Authority, 347 Ark. 105, 60 S.W.3d 443 (2001), the Arkansas Supreme Court held that the City of Barling, by signing the FCRA Indenture of Trust, had conveyed to the FCRA the city's powers regarding land use and zoning over the former installation. That holding reinforced the view that FCRA exercises governmental functions and operates over a defined territory.

The extension of § 21-9-301 immunity from the entity to its agents was settled by Autry v. Lawrence and Matthews v. Martin, both of which read the statute to protect officers and employees of political subdivisions when they negligently committed acts in their official capacities.

Citations

Statutes:

• Ark. Code Ann. § 21-9-301 (Repl. 2016) (local-government tort immunity)
• Ark. Code Ann. § 12-9-102(3); § 12-9-401(6) (Supp. 2019) ("political subdivision" defined for emergency-services purposes)
• Ark. Code Ann. § 12-50-103(8) (Repl. 2016)
• Ark. Code Ann. § 14-77-102(4) (Supp. 2019)
• Ark. Code Ann. § 15-5-103(19) (Supp. 2019) (includes public corporations)
• Ark. Code Ann. § 15-6-103(5) (Supp. 2019)
• Ark. Code Ann. § 19-7-901(5) (Repl. 2016)
• Ark. Code Ann. § 21-1-303(4) (Repl. 2016) (includes public corporations and entities)
• Ark. Code Ann. § 12-63-103 (statutory authorization for FCRA)

Cases:

• City of Caddo Valley v. George, 340 Ark. 203, 9 S.W.3d 481 (2000) (liability-insurance exception)
• Deitsch v. Tillery, 309 Ark. 401, 833 S.W.2d 760 (1992); Battle v. Harris, 298 Ark. 241, 766 S.W.2d 431 (1989) (no immunity for intentional torts)
• Dermott Special School District v. Johnson, 343 Ark. 90, 32 S.W.3d 477 (2000) (definition of political subdivision)
• Masterson v. Stambuck, 321 Ark. 391, 902 S.W.2d 803 (1995) (creature-of-statute test)
• City of Barling v. Fort Chaffee Redevelopment Authority, 347 Ark. 105, 60 S.W.3d 443 (2001) (city conveyed land-use and zoning powers to FCRA)
• Autry v. Lawrence, 286 Ark. 501, 696 S.W.2d 315 (1985); Matthews v. Martin, 280 Ark. 345, 658 S.W.2d 374 (1983) (immunity extends to municipal employees in official capacity)

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

Opinion No. 2020-016
October 16, 2020
STATE OF ARKANSAS
THE ATTORNEY GENERAL
LESLIE RUTLEDGE
The Honorable Mathew Pitsch
State Senator
11215 Vista Ridge Court
Fort Smith, AR 72916

Dear Senator Pitsch:

This is in response to your request for an opinion regarding the following questions:

1) Is the Fort Chaffee Redevelopment Authority Public Trust immunized from tort liability in accordance with Ark. Code Ann. § 21-9-301?
2) Relatedly, are the Fort Chaffee Redevelopment Authority's employees and agents granted immunity for acts of negligence committed in their official capacities?

RESPONSE

The answer to both your questions is "yes." The Fort Chaffee Redevelopment Authority Public Trust (the "FCRA") likely enjoys the limited immunity established by Ark. Code Ann. § 21-9-301. And if the FCRA is determined to be either a political subdivision or an extension thereof for purposes of Ark. Code Ann. § 21-9-301, its employees and agents would enjoy immunity for acts of negligence committed in their official capacities.

DISCUSSION

Question 1: Is the Fort Chaffee Redevelopment Authority Public Trust immunized from tort liability in accordance with Ark. Code Ann. § 21-9-301?

The Fort Chaffee Redevelopment Authority Public Trust (the "FCRA") likely qualifies for tort immunity pursuant to Ark. Code Ann. § 21-9-301. That statute provides:

(a) It is declared to be the public policy of the State of Arkansas that all counties, municipal corporations, school districts, public charter schools, special improvement districts, and all other political subdivisions of the state and any of their boards, commissions, agencies, authorities, or other governing bodies shall be immune from liability and from suit for damages except to the extent that they may be covered by liability insurance.

(b) No tort action shall lie against any such political subdivision because of the acts of its agents and employees.

Thus, the question at issue is whether the FCRA is a "political subdivision of the state" or an extension of a political subdivision (i.e., one of its "boards, commissions, agencies, authorities, or other governing bodies"). The legislature has not defined "political subdivision" in the context of tort immunity, but it has defined the term elsewhere in a number of ways. These definitions usually make reference to local units of government, sometimes including school districts or improvement districts. In at least two instances, the term also includes public corporations.

Additionally, the Arkansas Supreme Court has offered the following definition of "political subdivision" in the context of section 21-9-301:

[P]olitical subdivisions have been defined as that they embrace a certain territory and its inhabitants, organized for the public advantage, and not in the interest of particular individuals or classes; that their chief design is the exercise of governmental functions; and that to the electors residing within each is, to some extent, committed the power of local government, to be wielded either mediately or immediately within their territory for the peculiar benefit of the people there residing.

In determining whether an entity constitutes a political subdivision, a court might also consider whether the entity was created by statute. In Masterson v. Stambuck, for example, the court held that a not-for-profit entity formed for benevolent purposes could not be considered an agent of the creating municipality. It distinguished the not-for-profit entity from utilities previously held to be agents of their creating municipalities, reasoning that those utilities were "creatures of statute."

Arkansas courts have not explicitly addressed whether public trusts, such as the FCRA, are political subdivisions (or extensions thereof) under section 21-9-301. However, based on the aforementioned criteria, I believe that a court would likely find the FCRA to be an entity covered by that statute.

The FCRA encompasses specific territory, was created in the public interest and to serve a public purpose, and exercises governmental functions. Moreover, the State of Arkansas has statutorily acknowledged and endorsed the establishment of the FCRA. All of these factors weigh in favor of the FCRA being considered a political subdivision.

Furthermore, the FCRA was created by Sebastian County, as settlor, grantor, and trustor, and by the cities of Barling, Greenwood, and Fort Smith, which, together with Sebastian County, are the collective beneficiaries of the trust. Each of these entities is, in and of itself, a political subdivision. Therefore, it is also possible that a court would find the FCRA to be an "authority" or a "governing body" of a political subdivision.

But regardless of whether the FCRA is itself a political subdivision or an extension of a political subdivision, the answer to your question is, in my opinion, "yes." The FCRA likely enjoys the limited tort immunity provided by section 21-9-301.

Question 2: Relatedly, are the Fort Chaffee Redevelopment Authority's employees and agents granted immunity for acts of negligence committed in their official capacities?

Although section 21-9-301 speaks only in terms of the immunity of the political subdivision itself (and its "boards, commissions, agencies, authorities, or other governing bodies"), the Arkansas Supreme Court has held that this statute also extends immunity to officers and employees of political subdivisions when they negligently commit acts or omissions in their official capacities. Consequently, I believe the answer to your question is "yes." If a court were to find that the FCRA is a political subdivision or an extension of a political subdivision, such that it enjoys limited tort immunity under section 21-9-301, it would probably also find that such immunity extends to FCRA employees and agents who act negligently in their official capacities. A party injured as a result of the negligent actions of an FCRA employee or agent would only be able to recover to the extent that the FCRA carries liability insurance.

Sincerely,

LESLIE RUTLEDGE
Attorney General