HomeMy WebLinkAbout122-00 RESOLUTION0 0
RESOLUTION NO. 122-00
1VIICROFILNiED
A RESOLUTION APPROVING A BUDGET ADJUSTMENT TO
APPROPRIATE FUNDS FOR THE ROLLBACK OF AD
VALOREM TAXES LAWSUIT (HICKS, et al vs. CITY OF
FAYETTEVILLE, et all FOR THE YEARS 1994 THROUGH 1999
SETTLEMENT APPROVED AT THE CITY COUNCIL MEETING
ON AUGUST 1, 2000.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE,
ARKANSAS:
Section 1. That the City Council hereby approves a budget adjustment to appropriate
funds for the rollback of ad valorem funds for the rollback of ad valorem taxes lawsuit for the years
1994 through 1999 settlement approved at the City Council meeting on August 1, 2000. A copy
of the budget adjustment is attached hereto marked Exhibit "A" and made a part hereof.
PASSED AND APPROVED this 5h day of September , 2000.
0=6
APPROVE
By:
NO
red Hanna, Mayor
NAME OF FILE:
CROSS REFERENCE:
to
Contents of File
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City of Fayetteville, Arkansas
Budget Adjustment Form
Budget Year
2000
Project or Item Requested:
$213,470 is requested for the settlement of the rollback of ad
valorem taxes.
Justification of this Increase:
Approved by City Council on August 1, 2000.
Account Name
Settlements
Account Name
Use of Fund Balance
Approval Signatures
Reiniested By
Date Requested
09/05/00
FXHOT A
Adjustment #
Project or Item Deleted:
None. Use of Fund Balance is proposed for this adjustment.
Justification of this Decrease:
Sufficient funds exist in cash and investments to fund this
request and comply with City policy.
Increase Expense (Decrease Revenue)
Amount Account Number
213,470 5311
LIM
Project Number
Decrease Expense (Increase Revenue)
Amount Account Number Project Number
213,470 4999 99
Date
$-2 -oo
Date
Budget Office Use Only
Type: A B C Q E
Date of Approval
Posted to General Ledger
Posted to Project Accounting
Entered in Category Log
Blue Copy: Budget & Research / Yellow Copy: Requester
H:\BUDGET\PROJECTS\BUD_ADJ\BA_2000\ROLLBACK.W K4
FAYETTEALLE
THE CITY OF FAYETTEVILLE, ARKANSAS
DEPARTMENTAL CORRESPONDENCE
TO: Mayor Hanna and City Council
THRU: John Maguire, Administrative Services Director
FROM: Budget & ResearL%Z::,,
DATE: August 24, 2000
SUBJECT: Property Tax Millage Lawsuit Settlement
City Council approved a settlement on August 1 for the Hicks, et al. V. City of Fayetteville et al.
litigation regarding ad valorem taxes for the years 1994 through 1999.
The ad valorem taxes collected by the City that were litigated and subject to the approved
settlement were for the Policemen's Pension and Relief Fund and the Firemen's Pension and
Relief Fund (pension funds). Each fund collected the same amount of ad valorem taxes. The
cash and investments at December 31, 1999 were $11.6 million for the Policemen's Pension and
Relief Fund and $12.7 million for the Firemen's Pension and Relief Fund.
The settlement agreement calls for any undistributed or unclaimed funds to be remitted to the
City's General fund. If City Council chooses to pay the claim from the pension funds, staff
recommends City Council authorize any undistributed or unclaimed funds remaining be remitted
back to the pension funds from General Fund.
F ��t TT.VIILF'o, ,.
LEGAL DEPARTMENT
CITY ATTORNEY DIVISION
CORRESPONDENCE
To: Fred Hanna, Mayor
Fayetteville City Council
From: Jerry E. Rose, City Attorney l . 1A�
Date: July 25, 2000
Jv yE AosR Cm'ATWo
LAGAnP DMCCNtrv, Assn. Crt ATIOR
Re: Proposed settlement of litigation regarding the rollback of ad
valorem taxes for the years 1994 through 1999.
Attached please find a copy of a draft of an agreement between the City of Fayetteville and
a class ofplaintiffs settling the litigation regarding the rollback of millage required by Amendment
59 of the Arkansas Constitution. The basic conditions of settlement are as follows:
1. The City agrees to pay an agreed total amount of $213,469.50 to all
class members who file a claim on a pro rata basis (less court
approved attorney fees).
2. The attorneys for the class members will request an attorney fee from
the court of 33 1/3% of the $213,469.50 and the City will not object
to that request.
3. The refund process will follow the county's procedure and the City
will pay for their share of the refund costs (not out of the $213,469.50
but as an additional expense).
4. The refund process will require the presentation of a claim form
except for out of county and those physically unable to present the
form.
5. Millage will be rolled back from 1.0 mills to 0.8 mills.
6. Two lawsuits will be dismissed encompassing all litigation regarding
ad valorem property tax for the years 1994 through 1999.
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C. 6, Page 2 • •
Mayor and City Council
July 25, 2000
Once the dust settles the City Council will be requested to consider paying to the county all
or part of the monies the City received from the the county's 1.3 road millage since 1994 (a potential
liability of $214,200. I will bring the county's request to you as soon as possible, but this settlement
is independent of that request and would be before the Council even if the City did not settle.
I ask you for resolution to enter into a settlement agreement in substantially the same form
as the one attached since some changes may be necessary before it is finalized. Any changes in the
basic conditions will, of course, be brought before the City Council.
If I can provide you with any further information you have only to ask.
/cbp
Attachment
cc: John Maguire, Administrative Services Director
Charlie Venable, Public Works Director
Nancy Hendricks, Asst, to the Mayor
Don Bunn, Asst. Public Works Director
Steve Davis, Budget & Research Coodinator
0
xx AGENDA REQUEST
CONTRACT REVIEW
GRANT REVIEW
STAFF REVIEW FORM
E
For the Fayetteville City Council meeting of September 5. 2000
FROM:
Stephen Davis Budget & Research Admin. Services
Name Division Department
ACTION REQUIRED: Request a budget adjustment to appropriate funds for the rollback
of ad valorem taxes lawsuit for the years 1994 through 1999 settlement approved at
the City Council meeting on August 1,2000,
COST TO CITY:
$213,470.00
Cost of this Request
Account Number
Project Number
Category/Project Budget Category/Project Name
Funds Used To Date
Remaining Balance
Program Name
Fund
Purchasing Officer
STAFF RECOMMENDATION:
GRANTING AGENCY:
Date Internal uditor Date
Date
ADA Coordinator Date
Date Grant Coordinator Date
Division Head Date
4De 2 inistritVZeff��Eceg
. -
Mayor Date
Cross Reference
New Item: Yes No
Prev Ord/Res #
Orig Contract Date:
Orig Contract
BUD
ET REVIEW:
Budgeted Item
Budget
Adjustment Attached
Administrative
Director
Services
u
et Manager
Purchasing Officer
STAFF RECOMMENDATION:
GRANTING AGENCY:
Date Internal uditor Date
Date
ADA Coordinator Date
Date Grant Coordinator Date
Division Head Date
4De 2 inistritVZeff��Eceg
. -
Mayor Date
Cross Reference
New Item: Yes No
Prev Ord/Res #
Orig Contract Date:
Orig Contract
•
MARSHALL DALE EVANS, J.D., P -A.
del -nano
•
THE EVANS LAW FIRM
APmfessiona/ Association
POST OFFICE BOX 1986
2333 NORTH GREEN ACRES
FAYETTEVILLE, ARKANSAS 72702-1996
TELEPHONE (501) 521-9998
TELEFAX (501) 521-9995
STEPHANIE BRODACZ, J.D., LLM., P.A.
ROBERT D. BRANDON, J.D., P.A.
RoB W. WRIGHT, MRSA., P.D., J.D.
MONICA K. ROBERTS, J.D.•
aLmemed in OkLhaw
July 24, 2000
Jerry Rose
Fayetteville City Attorney
113 W. Mountain
Fayetteville, AR 72701
VIA FACSIMILE
Re: Hicks, et al. v. City of Fayetteville, et al.;
Wasbington County Circuit Consolidated No. CIV 97-500
Dear Jerry:
Following is a Stipulation of Settlement.
With kindest regards,
Sincerely yours,
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CHARLES N. WILLIAMS?
OF COUNSEL,
t Fcrmerry C must/C hanccry judge
P.01
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C. 6. Page 4
EVENS LOW FIRM
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IN THE CIRCUIT COURT WASHINGTON COUNTY, ARKANSAS
JEANNE M. HICKS, et al,
Vs.
Consolidated No. CIV 97-500
CITY OF FAYETTEVILLE, et al,.
STIPULATION OF SETTLEMENT
SUBJECT TO COURT APPROVAL
OF CITY OF FAYETTEVILLE. ARKANSAS
PLAINTIFFS
DEFENDANTS
WI-JEREAS, Jeanne M. Hicks and Tammy Lewis, for themselves and all others similarly
situated, are the Class Plaintiff for the City of Fayetteville ad valorem property taxpayers in the
captioned civil action; and,
WHEREAS, this litigation was, certified as a Class Action pursuant to Rule 23 of the
A.R.C.P. by order of this court; and,
WHEREAS, Plaintiff (as hereinafter defined) and the Defendant City of. Fayetteville.
Arkansas, desire to terminate all complex and protracted litigation regarding the issues of millage
rollbacks damages and attorneys' fees between themselves as parties to this litigation; and
WHEREAS, Plaintiff (as hereinafter defined) and the City of Fayetteville desire to ter -
urinate all complex and protracted litigation regarding the rollback of millage, amount and
method of refund to taxpayers (as hereinafter defined) of the amounts found to have been ille-
gally exacted in violation of ARK. CoNsT. art. XIV §14 (Amendment 59), and attorneys' fees,
.,.
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C. 6, Page 5
WHEREAS, the Plaintiff (as hereinafter defined) and the Defendant City of Fayetteville
have agreed to settle, resolve and compromise their several claims and disputes on the terms and
conditions set forth herein.
NOW, THEREFORE, it is hereby stipulated and agreed as follows:
1. DEFINITIONS.
As used herein, the following terms shall have the following meanings unless the context
otherwise requires:
1.1 "Class" shall mean all ad valorem taxpayers for which Jeanne M. Hicks and
Tammy Lewis were certified to represent as Class Action Representatives pursu-
ant to Rule 23 of the A.R.C.P. by order of this court, i.e., the ad valorem taxpayers
of the City of Fayetteville, Arkansas.
1.2 "City of Fayetteville" (hereinafter referred to as the "City') shall mean the City of
Fayetteville as a municipal corporation existing under the laws of the State of
Arkansas and its past, present, or future directors, aldermen, council members,
officers, controlling persons, employees, agents, representatives, attorneys of
record in this litigation, assigns, beneficiaries, predecessors and/or successors in
interest.
1.3 "Plaintiff' shall mean Jeanne M. Hicks and Tammy Lewis, individually and on
behalf of the Class and Class Members they represent.
IA "Person" shall mean an individual, corporation, partnership, association or other
entity.
2
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,. 6. Page 6
1,5 "Taxpayers" shall mean any
person who
paid real or personal property taxes for
property within the City of
Fayetteville
for any of
the tax years 1994 through
1999.
1.6 "Illegally Exacted Ad Valorem Property Taxes" shall mean all real and personal
property taxes from the taxpayers in excess of the amount allowed by ARK.
CONST. art. XIV, § 14 (Amendment 59).
2. ORDER AND RMOMENT.
The Plaintiff and the City stipulate and agree to be bound by and will jointly request that '
the court enter an order and judgment that will contain the following substance and matter:
2.1 Illegally Exacted Ad Valorem Property Tax Refunds.
a. Taxpayers who file a claim shall have the opportunity to receive a pro -
rata refund of all illegally exacted ad valorem taxes paid less the award of a= -
treys' fees set forth below.
b. The court shall appoint Special Master frame or other person mutu-
ally agreed upon by the Plaintiff and the City to serve as special master to super-
vise, as approved by the court, the method and procedure of the refund process.
c. The expenses of administering the refund, including notice, and the
Special Master shall be bome by the City.
d. The refund process shall be administered by the County with a claims
process whereby Class Members may personally present a claim form. Out -of -
county taxpayers and those taxpayers that are physically unable to present the
form may have another person present the claim form. The Court shall appoint
3
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2.2
2.3
2.4
EVAMS LAW FIRM
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C. 6. Page 7
George B. Morton, P.O. Box 399, Fayetteville, Arkansas, 72702, to so act if
necessary.
Attorneys' Fees of Plaintiffs Attorneys.
a. Attorneys for the Plaintiff shall request an award of attorneys' fees and
costs for representing the Class an amount of 33-1/3% of the illegally exacted ad
valorem property taxes, subject to court approval, which shall be payable directly
to The Evans Law Firm, P.A., and Hirsch Law Firm, P.A., within 14 days of entry
of Order Approving Settlement. Defendant shall not object to the requested attor-
neys' fee of 33-1/3% of the fund. Attorneys for Plaintiff waive any claim for
attorney's fees from the refunds to be paid to Intervenors, William Jackson Butt,
II, Butt -n -Butt Hardwood Plantation, L.L.C., and John R Hudson.
Undistributed or Unclaimed Funds Paid Into General Fund of City.
a. All illegally exacted ad valorem property taxes which remain after rea-
souable effort, approved by the court, have been made to refund such monies to
the taxpayers shall be paid into the general fund of the City and may be used by
the City in any manner as its council may approve, including but not limited to,
any payments made by the City pursuant to this Stipulation or any order of this
court.
Simulated and Agreed Amounts.
a. The Plaintiff and the City stipulate and agree that $213,469.50 is the
agreed total amount to be paid by the City; which amount is to be to the Class of
taxpayers (less court -approved legal fees) to all Class Members who file a claim
for refund. Refunds are to be paid %2 in June 2001 and i4 in June 2002.
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C. 6. Page 8
2.5 Rollback of Millan. s
a. The millage rate of the City has been 1.Orfor both real and personal
property taxes.pon court approval of this settlement, the City's millage shall
5
rollback to 0.8Afor both real and personal property subject to lawful adjustment.
2.6 Full and Comvlete Discharge of all Class Claims Against the Citv.
a. Any claims, demands, and causes of action of the Class, and each and
every member thereof, and/or their attorneys of any kind or nature in connection
with, directly or indirectly, any subject matter decided in this litigation concerning
ad valorem property tax for the years 1994 through 1999. A separate claim filed
in the Circuit Court of Washington County by the same Plaintiff against the City
for refund of property taxes for the tax year 1998 and thereafter shall be dismissed
as to the City with prejudice immediately after entry of the order approving the
settlement.
b. Washington County claims certain monies from the City for reim-
bursement from road tax millage. Plaintiff assigns whatever rights they have
thereto to Washington County and are not settling that claim which the County
may now have against the City.
3. PROCEDURES AND CONDiTIQNS TO EF�CT STIPULATION OF SETI'I.Eblaa-
3.1 The Plaintiff, Plaintiff's counsel and the City will jointly request that the court
take the following actions and order the following events:
a. Conduct a telephone conference on July 25, 2000 for the purposes of:
i. Preliminary approval of this Stipulation and Settlement.
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ii. Appointment of a special master with instructions to present to
the court a proposal for the method and procedure of the refund process.
iii. Approving a Notice of Stipulation of Settlement and Hearing.
iv. Find that notice by publication is the best notice practicable
under the circumstances and that Notice of Settlement should be published
twice in the Legal Notices Section of the Northwest Arkansas Times.
v. Set the date of August 31, 2000 as the cutoff date by which
any and all objections to this Stipulation of Settlement must be filed with
the Circuit Clerk, Washington County; and
vi. Set and conduct a hearing on September 5, 2000, at 9:30 a.m,
in the Washington County Courthouse to consider final approval of the
Stipulation of Settlement
b. At the final approval hearing, consider and approve the amount of the
refund, the method and procedure of the refund proem, approve the attorneys'
fees and expense award; and enter the court's Order Approving Settlement.
4, Mt4(`FT LANEOUS.
4.1 The undersigned attorneys of record for Jeanne M. Hicks and Tammy Lewis, for
themselves and all others similarly situated, warrant to the City that they have the
authority to settle the issue of attorneys' fees for all attorneys who represent or
represented said Plaintiff during the course of said litigation and that any and all
claims or liens of any nature regarding the payment of attorneys' fees, costs
and/or expenses are the sole responsibility of the undersigned attorneys of record
for Jeanne M. Hicks and Tammy Lewis, for themselves and all others similarly
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C. 6. Page 10
4.2
4.3
EVRMS 'LOW FIRM
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situated, and said attorneys agree to indemnify and hold harmless the City from
any such claims, including but not limited to, the attorneys' fees, if any required
in the City's defense of any action seeking additional attorneys' fees other than as
stipulated and agreed herein.
This Stipulation of Settlement shall be governed by and interpreted in accordance
with the laws of the State of Arkansas.
This Stipulation of Settlement constitutes the whole agreement between the
Plaintiff. Plaintiffs counsel and the City and supersedes all earlier agreements,
oral or written, if any. The parties hereto state and acknowledge that they have
not given or relied upon any representations, warranties, or promises that are not
set forth herein.
4.4 This Stipulation of Settlement may be modified, but such modification must be in
writing and approved by the parties hereto, or may be modified by court order.
IN WITNESS WHEREOF, this Stipulation of Settlement has been executed and entered
into as of this day of July, 2000 by the undersigned parties and counsel of record for the
parties hereto.
Parties:
Jeanne M. Hicks, for herself and all others
similarly situated taxpayers within the
City of Fayetteville, Arkansas
Tammy Lewis, for herself and all others
Similarly situated taxpayers within the
City of Fayetteville, Arkansas
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Attorneys at Law of Record:
LMW riKM
Marshall Dale Evans, Attorney for
Jeanne M. Hicks and Tammy. Lewis,
for themselves and all others similarly situated
E. Kent Hirsch, Attomey for
Jeanne M. Hicks and Tammy Lewis,
for themselves and all others similarly situated
OL1 JJJJ
•
Fred H a MaYor.
City of Fayetteville, Arkansas
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C. 6. Page 12
CERTIFICATE OF SERVICE
I, E. Kent Hirsch, hereby certify that a true and correct copy of the foregoing pleading
was deposited in the U.S. Mail, postage prepaid, addressed to: .
Mr. Rudy Moore, Jr.
Mr. Thomas Olmstead
P.O. Box 290
Fayetteville, AR. 72702-0290
Mr. Charles Harwell
Mr. Marcus Van Pelt
Cypert, Crouch, Clark & Harwell
P.O. Box 1400
Springdale, AR 72764
Mr. Boyce R. Davis
Prairie Grove City Attorney
P.O. Box 999
Lincoln, AR 72744
Mr. David G. Nixon
The Nixon Law Firm
2340 Omen Acres Road, Suite 12
Fayetteville, AR 72701
Mr. William Jackson Butt, II
Davis, Cox & Wright, PLC
P.O. Drawer 1688
Fayetteville, Arkansas 72702-1688
Brian Brooks, Deputy Attorney General
200 Catlett-Prien Tower Bldg.
323 Center Street
Little Rock, AR 72201-2610
this day of July, 2000.
CMmeNor+f AHkL4l.waM�ot - uhf^^ • fif�+�bdos
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Mr. Jeff Harper
City Attorney of Springdale
P.O. Box 1208
Springdale, AR 72765-1208
Mr. George Butler
Attomey at Law
280 N. College Ave., Suite. 145
Fayetteville, AR 72701
Mr. Jerry Rose
City of Fayetteville Admin. Building
113 W. Mountain
Fayetteville, AR 72701
Mr. Danny Wright .
Elkins City Attorney
130-C North College
Fayetteville, AR 72701
Mr. John R. Hudson
Attorney at Law
16 E. Spring
Fayetteville, AR 72701
Honorable Paul Danielson
Circuit Judge
P.O. Box 188
Morrilton, AR 72110
E. Kent Hirsch
JUL-24-2000 1539 521 9995 P. 10
FAYETTEVtLLE
THE CITY Of fAYETTEVILLE, ARKANSAS
DEPARTMENTAL CORRESPONDEN
To: Steve Davis, Budget and Research
From: Heather Woodruff, City Clerk
Date: September 12, 2000
Attached is a copy of the resolution approving the budget adjustment to appropriate funds for the
rollback of Ad Valorem Taxes Lawsuite for the years 1994 through 1999. The original will be
microfilmed and filed with the City Clerk.
cc: Jerry Rose, City Attorney
�N
RESOLUTION NO, 122-00
A RESOLUTION APPROVING A BUDGET ADJUSTMENT TO
APPROPRIATE FUNDS FOR THE ROLLBACK OF AD
VALOREM TAXES`LAWSUIT,•(HICKSJet al vs. CITY OF
FAYETTEVILLE, et all FOR THE YEARS 1994 THROUGH 1999
SETTLEMENT APPROVED AT THE CITY COUNCIL MEETING
ON AUGUST 1, 2000.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE,
ARKANSAS:
Section 1. That the City Council hereby approves a budget adjustment to appropriate
funds for the rollback of ad valorem funds for the rollback of ad valorem taxes lawsuit for the years
1994 through 1999 settlement approved at the City Council meeting on August 1; 2000. A copy
of the budget adjustment is attached hereto marked Exhibit "A" and made a part hereof.
PASSED AND APPROVED this 5h day of September , 2000.
APPROVE
(1 By:
f140
oa6
Fred Hanna, Mayor
TA-I�• `4k
'Si
CD`,
By:
Heather Woodruff, City &erk