Can a county use a sales tax dedicated to 'emergency services' to pay 911 dispatcher salaries?

Plain-English summary

Representative Mary Bentley asked whether Perry County could use the proceeds of a November 2020 sales and use tax to pay and retain its 911 dispatchers. She told the AG that the tax's net collections were to be used for “emergency services” and that dispatchers were leaving after the county trained them. The AG did not decide whether paying the dispatchers is legal. She had no authority in this opinion to interpret the local levying ordinance or the ballot title presented to voters.

Arkansas Constitution art. 16, § 11 says money raised by a tax levied for one purpose cannot be used for another. The AG explained that the tax's purpose comes from the ordinance and ballot title. The ballot title's ordinary meaning generally matters, but it must be read with the levying ordinance. If the ordinance is ambiguous, a court may consider historical context, conditions when it was enacted, consequences of an interpretation, and other common-knowledge matters to determine what voters intended.

The local governing body generally decides in the first instance whether an expense falls within the ballot-designated purpose. The opinion says a court will not disturb that legislative finding unless it is “demonstrably arbitrary and unwarranted.” The AG still declined to say how Perry County's documents apply to 911 dispatcher salaries. She said the question should be resolved locally, ideally with local counsel.

What this means for you

If you serve on the Perry County Quorum Court

Get the actual levying ordinance and ballot title before deciding how to spend this tax. Compare their stated purpose with the proposed dispatcher salaries. If the ordinance's wording is ambiguous, ask local counsel to examine the context the AG identifies. This opinion supplies an interpretation method, not approval of the proposed expense.

If you manage 911 dispatch

The phrase “emergency services” was reported to the AG as background; she did not rule that it includes dispatch salaries. Give the quorum court and its counsel the proposed expenditure and the relevant tax documents so they can assess the fit under the language voters approved.

If you are a county voter or taxpayer

Read the ballot title together with the levying ordinance when assessing how this tax may be spent. The AG said those documents determine the purpose and left Perry County's proposed use unresolved. The opinion alone does not establish that the county may, or may not, pay dispatchers from the tax.

If you advise a county on a dedicated tax

Start with the purpose stated in the ordinance and ballot title. The AG says the ballot title's ordinary meaning generally controls, while the ballot must be read with the ordinance. Historical evidence may matter when the ordinance is ambiguous. The local body's initial decision receives the review standard the opinion quotes; that standard does not supply the missing local documents or decide their meaning.

Common questions

Q: Did the AG approve paying 911 dispatcher salaries from Perry County's tax?
A: No. She expressly declined to interpret the county's ordinance or ballot title and therefore declined to decide whether this use is legal.

Q: Is “emergency services” enough by itself to settle the question?
A: The opinion does not say. It treats that phrase as part of the representative's description and directs readers to the actual levying ordinance and ballot title.

Q: What rule limits spending from a dedicated tax?
A: Article 16, § 11 of the Arkansas Constitution prohibits using money from a tax levied for one purpose for another purpose. The ordinance and ballot title define the relevant purpose for this tax.

Q: Does only the ballot title matter?
A: No. The AG quotes the Arkansas Supreme Court: the ballot title is the voters' final information before voting, but it must be read with the levying ordinance.

Q: What if the ordinance's wording is ambiguous?
A: A court may look at historical context, conditions at enactment, consequences of interpretation, and other relevant common-knowledge matters to determine voter intent.

Q: Who initially determines whether an expense fits the ballot-designated purpose?
A: Generally the local governing body. The AG said a court will not disturb that legislative finding unless it is “demonstrably arbitrary and unwarranted.” She did not apply that standard to Perry County's proposed expense.

Background and statutory framework

The opinion quotes Arkansas Constitution art. 16, § 11: “no moneys arising from a tax levied for one purpose shall be used for any other purpose.” It cites Daniel v. Jones and Arkansas-Missouri Power Corp. v. City of Rector on the ballot title's role, and Maas v. City of Mountain Home for reading the ballot with the levying ordinance.

For ambiguity, the opinion cites Mears v. Ark. State Hosp. and Ark. State Highway Comm'n v. Mabry. It cites McAdams v. Henley for review of the local body's legislative finding. Those citations appear in the official PDF's footnotes, now included below.

The opinion ends by saying the county's documents “must be reviewed to determine whether the purpose of the tax is stated in a way that encompasses the proposed use(s).” The AG did not interpret those documents in this opinion.

Citations

• Ark. Const. art. 16, § 11 (no diversion of dedicated tax)
• Hartwick v. Thorne, 300 Ark. 502, 708 S.W.2d 531 (1989)
• Daniel v. Jones, 332 Ark. 489, 966 S.W.2d 226 (1998)
• Arkansas-Missouri Power Corp. v. City of Rector, 214 Ark. 649, 217 S.W.2d 335 (1949)
• Maas v. City of Mountain Home, 338 Ark. 202, 992 S.W.2d 105 (1999)
• Mears v. Ark. State Hosp., 265 Ark. 844, 581 S.W.2d 339 (1979)
• Ark. State Highway Comm'n v. Mabry, 229 Ark. 261, 315 S.W.2d 900 (1958)
• McAdams v. Henley, 169 Ark. 97, 213 S.W. 355 (1925)
• Ark. Att'y Gen. Ops. 2004-121, 97-260

Source

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

Original opinion text

Opinion No. 2022-034
November 22, 2022
The Honorable Mary Bentley
State Representative
142 Shady Lane
Perryville, AR 72126-8103

Dear Representative Bentley:

This is in response to your request for an opinion concerning a particular sales and use tax in Perry County. As background for your question, you state:

[A] certain sales and use tax [was] passed by Perry County citizens in the November 2020, election. The net collections from this sales and use tax are to be used for emergency services in Perry County. The Perry County Quorum Court would prefer to utilize these funds to pay and retain its 911 dispatchers as they struggle to keep qualified personnel that transfer to other jurisdictions once they have been properly trained in Perry County.

Your question in this regard is as follows:

Can the Perry County Quorum Court access and utilize the funds from this sales and use tax to pay its 911 dispatchers?

RESPONSE

The answer to your question depends upon the language of the ordinance by which the sales and use tax was levied and the ballot title by which it was presented to the electorate. These matters are local in nature and must be resolved on the local level. I cannot construe or interpret such documents and I consequently cannot opine on the legality of the proposed use of the tax proceeds. I will, however, briefly address the basic legal framework that guides the review.

DISCUSSION

Your question most directly implicates Article 16, Section 11 of the Arkansas Constitution, which provides in pertinent part that "no moneys arising from a tax levied for one purpose shall be used for any other purpose." In determining the purpose of a tax, the Arkansas Supreme Court has stated that "it is to the title of the ordinance and the ballot title 'that the electors had the right to look to ascertain what they were asked to approve[.]'"

Thus, the purpose of the sales and use tax, as stated in the levying ordinance and the ballot title, will be determinative of the manner in which the proceeds may be used. The Court in Daniel v. Jones went on to state that "[t]he ballot title is the final word of information and warning to which the electors had the right to look as to just what authority they were asked to confer[.]" The "implication and ordinary meaning" of the ballot title will, generally, be controlling. The Court has further noted that "[t]he ballot is the 'final word' to the voters only in the sense that it is the last source of information, not in the sense that it is conclusive of the measure's effects. It must be read in conjunction with the levying ordinance."

If the ordinance's language is ambiguous, a court might resort to extrinsic evidence to determine whether a particular use of tax revenues is authorized. A court might look at such factors as evidence of the historical context of the measure, contemporaneous conditions at the time of its enactment, consequences of interpretation, and other matters of common knowledge within the limits of its jurisdiction in order to determine whether the voters intended to approve use of the sales tax revenues for the particular projects in question.

Additionally, generally speaking, it is the responsibility of the local governing body to determine legislatively whether a particular expenditure is within the ballot-designated purpose(s) of a local sales tax, and a court will not disturb its finding unless it is "demonstrably arbitrary and unwarranted."

In sum, the language of the ordinance and the ballot title must be reviewed to determine whether the purpose of the tax is stated in a way that encompasses the proposed use(s). I cannot construe or interpret those documents. Consideration of extrinsic factors may also be necessary in the case of ambiguity. The questions are local in nature and must be answered on the local level, ideally with the assistance of local counsel.

For these reasons, I must decline to opine on your question. I hope, however, that the foregoing will be of some assistance in addressing the underlying issues.

Sincerely,

LESLIE RUTLEDGE
Attorney General

1 See Hartwick v. Thorne, 300 Ark. 502, 506, 708 S.W.2d 531, 533 (1989).

2 Daniel v. Jones, 332 Ark. 489, 501, 966 S.W.2d 226, 232 (1998) (quoting Arkansas-Missouri Power Corp. v. City of Rector, 214 Ark. 649, 654, 217 S.W.2d 335, 337 (1949)).

3 332 Ark. at 501, 966 S.W.2d at 232.

4 Arkansas-Missouri Power Corp., 214 Ark. at 654, 217 S.W.2d at 337.

5 Maas v. City of Mountain Home, 338 Ark. 202, 208, 992 S.W.2d 105, 108 (1999).

6 See Mears v. Ark. State Hosp., 265 Ark. 844, 581 S.W.2d 339 (1979); Ark. State Highway Comm'n v. Mabry, 229 Ark. 261, 315 S.W.2d 900 (1958); Ops. Att'y Gen. 2004-121, 97-260.

7 Supra n.6.

8 McAdams v. Henley, 169 Ark. 97, 114, 213 S.W. 355, 361 (1925).