Pulaski County Circuit Judge Tim Fox approved a plan Friday to redress $3.2 million in illegally collected property-tax revenue, ending almost seven years of litigation over a tax increase that benefited the Central Arkansas Library System.
So far there have been 11,218 refund applications to claim $459,582 of the money, County Attorney Amanda Mitchell told the judge at Friday's hearing.
Refund checks will be sent out this summer.
Applicants have until May 4 to make their claim on the fund, which represents the first year of collection of a 1.5-mill property tax increase approved by voters in 2007 to fund library improvements.
The increase added $1.50 in taxes for each $1,000 of taxable property valuation.The money was set aside years ago in response to the lawsuit, which accused tax collectors of applying the tax too soon.
Per the terms of the disbursement order that was agreed to by the parties and signed by the judge, the plaintiff attorneys -- Gene Sayre, who died in March, and Christopher Brockett -- will receive $480,024 in fees, which is 15 percent of the total fund that stood Friday at $3,200,161, including interest. The lawyers also will receive an additional $6,109 for their costs to bring the lawsuit.
Another $34,998 from the fund will go to Pulaski County to pay for sending out refund notices and advertising to inform potential applicants about the money's availability.
Whatever's left over after all of the refunds are paid out will go back to the library.
Brockett and Sayre represented four property owners who sued the city of Little Rock, Pulaski County and the Central Arkansas Library System in Circuit Court, arguing that county tax collectors had started assessing the tax a year too early.
The Arkansas Supreme Court agreed in December 2009, which led to further litigation as the sides worked out a plan to refund the money. A tentative agreement was reached in December and finalized for Friday's hearing.
Eligible refund recipients are taxpayers who owned property in the city and paid the library tax between May 15, 2008, the date the suit was filed, and Dec. 31 of that year, unless they received a homestead tax credit.
Owners of about 70,000 pieces of property were eligible for the refund, which start at $5.
Mitchell told the judge that 1,035 applications have been received for business personal property for $122,128 in refunds; 5,228 applications for real estate, worth $305,452 in refunds; and 4,955 personal property accounts for $32,002.
She said about 10,000 notices were returned for lack of a current address.
Metro on 04/18/2015