Two judges rule $18 fee in north Arkansas is illegal

Published: Mar. 12, 2020 at 4:09 PM CDT
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Two decisions in the last two weeks make Matt Bishop, a lawyer, feel like he's on the right track.

"I'm just happy that the courts so far have said, 'Look, you made a bad investment.,'" Bishop said. Bishop represents people in six counties who are suing Ozark Mountain Solid Waste District over a fee they're forced to pay.

This week, Searcy County followed Carroll County's lead: ruling that $18 fee to pay back debt is actually an illegal tax.

The Ozark Mountain Solid Waste District borrowed $12 million to buy a landfill in 2005. The District defaulted and closed the landfill seven years later. A judge ordered the district pay $30 million to repay the loans and clean up the landfill.

"Now it's going to the public to pay Ozark Mountain Solid Waste debt," said Marshall Mayor Kevin Elliott.

That led to the $18-per-parcel yearly fee and a lot of upset property owners.

"The fact that they can take my house away if I don't pay it, certainly makes it a tax," said Terry Ahart back in 2018, from Lead Hill.

The man in charge of getting the money back, Geoffrey Treece, doesn't see it that way.

"The service fee is not a tax. It's not a trash tax. It's not an assessment," Treece told people back in 2018.

But this month, the Searcy and Carroll County rulings say otherwise. Searcy County's goes beyond stopping the collection, it also orders the money go back to taxpayers.

It's a small win for Bishop and the people in two counties, with work in four others left to go.

"A governmental entity can call it a fee all they want, but if it walks like a tax, and talks like a tax, the court's going to call it a tax," Bishop said.

According to Bishop, in Carroll County, the judge said they can continue collecting pending the appeal, but they have to hold it in an account pending a final ruling by the Arkansas Court of Appeals or Arkansas Supreme Court.

In Searcy County, the judge said they have to stop collecting, but it's still unclear how that will work out. Bills have already gone out.

All the judges have told the Receiver for OMSWD that he cannot release the money to ADEQ or the bondholders, so the funds collected to date are sitting in an account at Bank of the Ozarks.

Bishop said even if the appeals all started today, we'd still be looking at likely six months or more before they were finalized.