AR Supreme Court Finds Watershed Protection Agreement was an Agreement for Administrative Services Authorized by the Interlocal Agreement Act and not an Illegal Exaction

Taxpayers Bryan Sullins, Kerri Sullins, and Charles Williams filed suit against Pulaski County, Central Arkansas Water, and Buddy Villines in his capacity as Pulaski County Judge (appellees), claiming that appellees had entered into an agreement which necessitated Central Arkansas Water to expend public funds illegally. Specifically, appellants alleged that they and other similarly situated taxpayers had paid the watershed fee imposed by Central Arkansas Water and that it constituted an illegal exaction because the Watershed Protection Agreement between Central Arkansas Water and Pulaski County was illegal. The circuit court ruled that the agreement was a proper contract for administrative services and entered summary judgment in favor of appellees.

Illegal-exaction lawsuits in Arkansas are authorized under article 16, section 13, of the Arkansas Constitution, which provides, “Any citizen of any county, city, or town may institute suit in behalf of himself and all others interested, to protect the inhabitants thereof against the enforcement of any illegal exactions whatever.” Section 3.03 states that Central Arkansas Water will, “assist Pulaski County with the implementation and enforcement of Chapter 8 and the Stormwater Management Ordinance as contemplated hereby” does not enact new policy, but simply provides for the enforcement of the existing ordinance. The court found that the circuit court did not err in ruling that the agreement was administrative, because the provisions of the contract do not delegate rulemaking or policy-making powers to Central Arkansas Water but instead related only to administrative actions, such as implementation and enforcement of the ordinance previously passed by Pulaski County.

The Interlocal Agreement Act expressly authorizes counties to “cooperate in the exercise of any function, power, or responsibility; share the services of any officer, department, board, employee, or facility; and transfer or delegate any function, power, responsibility, or duty.” Because the contract between Pulaski County and Central Arkansas Water was authorized by the Interlocal Agreement Act, the expenditure of funds under the contract was found by the court to not be an illegal exaction, and therefore the circuit court properly granted summary judgment against appellants.

Sullins v Central Arkansas Water, 2015 Ark. 29 (Ark. 1/29/2015)

The opinion can be accessed at: http://law.justia.com/cases/arkansas/supreme-court/2015/cv-14-581.html