Does the Arkansas Unclaimed Property Act treat a public water authority's customer deposits the same as a regulated utility's?

Plain-English summary

Representative Stu Smith asked whether the Arkansas Unclaimed Property Act (UPA) applies to a public water authority as it does to a public utility. The AG understood the question to concern an authority formed under the Water Authority Act. She answered no for the UPA provision covering a deposit or refund owed to a subscriber by a "utility."

The UPA's definition of "utility" refers to facilities described in Ark. Code Ann. § 23-1-101, the statute defining public utilities subject to Arkansas Public Service Commission jurisdiction. Although the water-supply language in that definition might otherwise encompass a water authority, the AG cited the Water Authority Act's exemption from PSC jurisdiction. She concluded that such an authority is not a utility under the UPA definition applied in the opinion.

Footnote 6 expressly leaves open whether other UPA provisions might apply to property held by a water authority. The AG noted that an authority is a governmental entity and may hold property within the Act's separate property definition. The opinion reaches no conclusion about any other statutory regime.

Currency note

This opinion addresses the cited statutes as they stood in December 2021. Check their current text before applying the analysis to a present-day authority or account.

What this means for you

If you manage a water authority

The AG found that an authority formed under the Water Authority Act is outside the UPA's "utility" definition used for subscriber deposits and refunds. The opinion does not decide whether another UPA provision reaches property the authority holds.

If you advise a holder of unclaimed property

Determine what kind of entity holds the property and which UPA provision might apply. This opinion addresses a Water Authority Act entity and the Act's utility-deposit provision. Footnote 6 reserves the broader property question.

Common questions

Did the AG find a water authority wholly exempt from the UPA?
No. Footnote 6 says the AG had not considered at length whether the UPA might otherwise apply to property held by a water authority.

Why did PSC jurisdiction matter?
The UPA's utility definition cross-references § 23-1-101. The AG read that provision with the Water Authority Act's PSC-jurisdiction exemption and concluded that a water authority is not a utility for the question asked.

Does this opinion decide how another law defines "utility"?
No. It construes the UPA definition and makes no finding about the scope of any other statute.

Background and statutory framework

The opinion quotes the UPA provision for a "[d]eposit or refund owed to a subscriber by a utility" and its definition of "utility" in § 18-28-201(16). It also cites § 23-1-101, § 23-2-301, and the Water Authority Act's PSC exemption. Footnote 6 points to a separate UPA definition of "property" in § 18-28-201(13), without deciding its application.

Citations

• Ark. Code Ann. § 18-28-201(16) (UPA definition of utility)
• Ark. Code Ann. § 18-28-202(a)(12) (subscriber deposit or refund provision)
• Ark. Code Ann. § 23-1-101 (public-utility definition)
• Ark. Code Ann. § 23-2-301 (PSC jurisdiction)
• Ark. Code Ann. § 4-34-109 (PSC exemption cited by the opinion)
• Ark. Code Ann. § 18-28-201(13) (property definition noted in footnote 6)

Source

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

Original opinion text

Opinion No. 2021-064
December 28, 2021

The Honorable Stu Smith
State Representative
2605 Franklin Street
Batesville, AR 72501-7738

Dear Representative Smith:

This is in response to your request for my opinion on the following question concerning the Arkansas Unclaimed Property Act (Ark. Code Ann. § 18-28-201 et seq. (Repl. 2015 and Supp. 2019)):

Would the Arkansas Unclaimed Property Act apply to a "public water authority" as it would a "public utility"?

RESPONSE

I take it your question pertains to a water authority formed under the Water Authority Act (Ark. Code Ann. § 4-35-101 et seq. (Repl. 2016 and Supp. 2021)). With that understanding, the answer is "no" because a water authority is not a "utility" for purposes of the controlling definition of that term under the Arkansas Unclaimed Property Act (UPA).

DISCUSSION

The UPA applies to a "[d]eposit or refund owed to a subscriber by a utility . . . ." "Utility" is defined as "persons and corporations, or their lessees, trustees, and receivers, owning or operating in this state equipment or facilities as provided in § 23-1-101."

The referenced Code section 23-1-101 defines public utilities that are subject to the regulatory authority of the Arkansas Public Service Commission (PSC). "Public utility" as defined therein includes "persons and corporations . . . owning or operating in this state equipment or facilities for . . . furnishing water to or for the public for compensation." While this definition, standing alone, might include a water authority, the Water Authority Act specifically exempts water authorities from the jurisdiction of the PSC. Thus, a water authority is not a "public utility" as defined in Ark. Code Ann. § 23-1-101, which is the controlling definition according to the UPA.

It necessarily follows that the answer to your specific question is "no." The UPA would not apply to a water authority formed under the Water Authority Act.

Sincerely,

LESLIE RUTLEDGE
Attorney General

PDF footnote 1: Ark. Code Ann. § 18-28-202(a)(12) (Supp. 2021). The deposit or refund is presumed abandoned if it is unclaimed by the apparent owner for one year after it becomes payable. Id.

PDF footnote 2: Ark. Code Ann. § 18-28-201(16) (Repl. 2015) (emphasis added).

PDF footnote 3: See Ark. Code Ann. § 23-2-301 ("The [Arkansas Public Service] commission is vested with the power and jurisdiction, and it is made its duty, to supervise and regulate every public utility defined in § 23-1-101...." (Repl. 2015)).

PDF footnote 4: Ark. Code Ann. § 23-1-101(9)(A)(ii) (Supp. 2021).

PDF footnote 5: Ark. Code Ann. § 4-34-109 (Repl. 2016) ("Water authorities organized under this chapter shall be exempt in any and all respects from the jurisdiction and control of the Arkansas Public Service Commission.").

PDF footnote 6: You have not asked, and accordingly I have not considered at length, whether the UPA might otherwise apply to property held by a water authority. A water authority is a "public body politic and governmental entity of the State of Arkansas." Ark. Code Ann. § 4-35-203(a)(1) (Repl. 2016). As such, it might hold "property" as separately defined in the UPA, which includes tangible and intangible property held by a governmental agency or instrumentality. See Ark. Code Ann. § 18-28-201(13).