A long-running legal squabble between Washington County and the University of Arkansas is apparently over.
The university has prevailed.
The Arkansas Supreme Court ruled last week that the county may not tax certain UA-owned property, including an on-campus retail outlet.
There is still a long-shot opportunity for the county to seek a rehearing or even review by the U.S. Supreme Court. Barring such, the state Supreme Court decision last week resolved the issue.
Steve Zega, county attorney, has suggested the effect of the opinion may be far reaching.
It could be read to apply, he said, "to every piece of property the University of Arkansas owns."
That could mean that nothing the university owns, for whatever purpose, may be taxed by the county or by other political subdivisions.
The county had tried unsuccessfully to distinguish certain UA property based on how they're used. Most of the UA holdings, the county acknowledged, have a purely public purpose. The county didn't try to tax classrooms or libraries, for example.
"We weren't trying to tax those things that were purely public purpose," Zega said.
It did want to tax property like that housing a retail business that looks a lot like competitive businesses off campus that do have to pay property taxes.
But the legal issue isn't fairness for competitors. It is about constitutional law and sovereignty.
The UA owns a lot of property in Washington County. Actually, it owns property all over the state, but Washington County is where this issue arose because the county tried to tax some campus property.
For the record, when UA property is exempt from property tax, the county government is just one of the taxing entities affected locally. Tax dollars the county collects also go to the cities in which the affected property is located and, most significantly, to local school districts.
For three years, from 2011 through 2013, the county taxed a few UA properties. The UA paid the taxes under protest as the issue was litigated.
The payments stopped after a December 2014 ruling by Circuit Judge William Storey in favor of the university. He ordered the county to refund taxes the UA had paid. The county appealed and, finally, the Supreme Court weighed in last week.
The taxes still haven't been paid back to the UA, but that will likely be resolved soon.
The university's argument, from the beginning, has been that the institution is an extension of the state and is entitled, under the state Constitution, to sovereign immunity from taxation of its properties.
That was the sole issue before the Supreme Court.
Associate Justice Karen Baker wrote the majority opinion. Drawing from precedent, she pretty easily dismantled the county's arguments and upheld Storey's original conclusions that the university is an instrument of the state government and is entitled to sovereign immunity.
Period. Case closed.
Well, maybe.
It probably won't be the last time the issue gets litigated. In the meantime, the matter is settled. You, the taxpayer, won. And you might have lost, too.
This was one of those odd situations in which some of the state's taxpayers effectively sued themselves.
If you're a taxpayer in, say, Fayetteville, you have an interest in the Fayetteville School District getting all the tax money to which it is entitled. You also might care that the city collects its due.
But, as a taxpayer in the state of Arkansas, you don't want to see the UA taxed inappropriately.
So the local taxpayer in you lost, but the state taxpayer won.
Commentary on 02/07/2016