Posted 12/17/2012 11:48 am
Updated 12 months ago
LITTLE ROCK - Attorney General Dustin McDaniel asked the Arkansas Supreme Court on Monday to reconsider its ruling allowing school districts that collect more in property tax revenues than state-mandated school funding levels to keep the money.
McDaniel filed a petition to rehear the case in which justices ruled last month that state education officials cannot withhold excess money from the Eureka Springs and Fountain Lake school districts, where higher property tax collections pushed the districts above total school funding levels set by state law. The court said current law doesn't allow the Arkansas Department of Education to redistribute excess money from a state-mandated minimum property tax to other school districts.
McDaniel said the ruling throws into question past rulings directing the state to provide a substantially equal and adequate education for its students, and could create huge disparities among the state's districts.
"The court's opinions strongly suggests that equity no longer constitutes an independent limit on school funding, but that so long as adequacy is provided then equity will be satisfied as well," McDaniel wrote in the petition.
Gov. Mike Beebe and other officials have said the November ruling threatened years of reforms aimed at providing equal education across the state's school districts, reforms that stemmed from a school funding case that ended in 2007.
The Fountain Lake and Eureka Springs districts sued after the Education Department billed them $1.4 million and $825,000 respectively, saying they'd received too much money from levying the state-mandated minimum property tax.
State education officials say the financial impact of the high court's ruling would be relatively small, with only six of Arkansas' 239 districts collecting more in property taxes than the state school funding amount this year.
A 1996 constitutional amendment approved by voters requires each school district to levy no less than 25 mills of property tax for maintenance and operation of schools. A mill produces $1 for every $1,000 of assessed property value.
The state argued before the court earlier this year it had the authority to withhold the excess money because it would have given the districts more than the per-student funding it receives from the state. The four-justice majority said there was no law that allowed the state to redistribute the funds.
McDaniel asked the court in Monday's filing whether it was overruling past decisions and saying that differences in local wealth are a rational basis for different school funding levels. If they're not overruling past school funding decisions, he asked for clarification on how much property tax revenue in excess of the state funding amount is too much for the districts to keep.
"These questions and the others raised by the court's decision are too big for vague answers," he wrote.
He also questioned the court's ruling that the 25-mill mandate is not state revenue, and noted that Arkansas residents voted on it and the money goes to the state.
"Until this court's opinion, a tax having these characteristics would have been understood as a state tax producing state revenue that is restricted to one purpose (i.e maintenance and operation of school districts)," McDaniel wrote.
The state Supreme Court rarely grants petitions for rehearing, and the school districts will have seven days to respond. The court won't act on the filing until January, when two new justices will be sworn in.
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