Arkansas Teacher Retirement System v. Short
381 S.W.3d 834
| Ark. | 2011Background
- ATRS owns the Southcenter Shopping Center in Hot Springs, a privately leased, retail property held to fund its pension trust,
- Property has been listed and taxed in Garland County since acquisition in 2000,
- ATRS sought an ad valorem tax exemption under Ark. Const. art. XVI, §5 and related statutes in 2009,
- Circuit Court ruled the property was not used exclusively for a public purpose and thus not exempt, denying refunds for 2005–2007 and denying relief for 2008 and mandamus
- ATRS appeals challenging the circuit court’s interpretation of the constitutional exemption and related statutory exemptions, arguing the property serves a public purpose under state law
- Court affirms circuit court’s exemption denial; remaining relief requests deemed moot due to the ruling
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Exemption under art. XVI, §5 requires exclusive public use. | ATRS asserts the shopping center is public property used exclusively for public purposes. | Garland County and appellees contend the property is privately leased and not exclusively for public use. | Not exempt; use not exclusive. |
| Do exemptions in 24-2-703 and 24-7-204 trump constitutional use requirement? | ATRS says assets are exempt by statute despite use. | Constitution controls; statute cannot override exclusive public-use requirement. | Statutes yield to constitution; not exempt. |
| Do Snapp and Jacuzzi apply to grant exemption here? | ATRS relies on Snapp/Jacuzzi to argue public-benefit program exemptions apply. | Those cases involve bond programs under Amendment 49/Act 9; not applicable to ATRS property here. | Inapplicable absence of bond/Amendment 49 framework. |
| Are refunds and mandamus moot given the ruling? | Requests for 2005–2007 refunds, 2008 relief, and mandamus should be granted. | Relief rests on exemption and use, which court denied; issues moot. | Moot as to remaining relief. |
Key Cases Cited
- Brodie v. Fitzgerald, 57 Ark. 445 (1893) (exemption based on exclusive public use; use must be direct)
- School District of Fort Smith v. Howe, 62 Ark. 481 (1896) (exemption limited to property used exclusively for public purposes)
- Robinson v. Indiana & Arkansas Lumber & Mfg. Co., 128 Ark. 550 (1917) (land not exempt when used for income-producing purposes not directly for public use)
- Hilger v. Harding College, Inc., 231 Ark. 686 (1960) (lands not exempt where use not direct and exclusive for public purpose)
- McIntosh, 319 Ark. 423 (1995) (proceeds from public property rented for private use do not immunize property from taxation)
- Crittenden Hosp. Ass’n v. Bd. of Equalization of Crittenden Cnty., 330 Ark. 767 (1997) (exemption hinges on actual use of building, not just proceeds or public-benefit)
- Snapp, 232 Ark. 57 (1969) (public-exemption tied to bond program under Amendment 49 and Act 9; limited applicability)
- Jacuzzi Brothers Division, 332 Ark. 91 (1998) (exemption tied to bond framework; not controlling here)
- Weiss v. Bryce Co., LLC, 2009 Ark. 412 (2009) (tax exemptions strictly construed against exemption; burden on taxpayer)