FAYETTEVILLE -- School districts in Washington County will get about $250,000 less in tax revenue this year from the owners of the Northwest Arkansas Mall.
Mall owners and County Assessor Russell Hill settled a multimillion-dollar dispute by compromising on the mall's property value, according to a Washington County circuit judge's order issued June 7. The case was officially closed July 6.
The mall's owners -- Northwest Arkansas Mall Realty, Northwest Arkansas CH and Northwest Arkansas Nassim -- filed three lawsuits Dec. 7 involving three parcels that cover 111 acres of prime real estate. The suit was to force the assessor to lower the property's value to $39.5 million, down from the county's appraised value of $64 million.
The settlement puts the property value at $56 million for 2017 and $45 million for 2018. The compromise also ends a potentially costly lawsuit against the county, Hill said.
"My goal is: I just want to be fair and equitable," Hill said. "We feel we have a fair market value on it, and I think they have a range of value that they can live with."
An attorney representing the mall owners did not return multiple phone messages left at his office.
The settlement means the property owners will pay about $733,863 in taxes for 2017 and about $614,619 for 2018, according to Collector Angela Wood's calculations. The $64 million value equals roughly $815,500 in taxes, she said.
Taxes are paid a year behind. The county uses 20 percent of property market value to calculate property taxes, which are divided between the county and school districts.
County officials have persistently said they are worried about the county's finances. This year's roughly $68 million budget shows the county spending $5 million more than expected revenue.
Last year, the county refused to lower the mall's value further than $64 million. The mall's property is in a central location, surrounded by box stores, apartments and restaurants, and is worth more than the owners wanted it appraised for, Hill said.
The companies bought the property and another property in Colorado under duress in 2016. The total sales price for the deal was $60 million, county records show.
The assessor's office agreed to lower the property value to $66 million last year, down from $150 million in 2007. The lower value for 2018 reflects the departure of Sears, which left roughly 17 percent of the mall vacant when the store closed earlier this year.
The value of the mall could increase, however, if another company occupies the roughly 137,000-square-foot space Sears left, Hill said.
Metro on 07/26/2018