Does the Arkansas General Assembly have the authority to enact legislation requiring the Arkansas Game and Fish Commission to make payments in lieu of taxes to any affected Arkansas School District and/or political subdivision of the State when the Commission purchases private land situated within such a local school district? Q2) Would such payments in lieu of taxes be a proper usage of revenue belonging to the Commission and/or the State of Arkansas?
RESPONSE: Q1) In all likelihood "no." Although there are no Arkansas cases on point, other courts have rejected legislative attempts to require so-called "payments in lieu" by public owners of property, reasoning that such payments constitute an indirect attempt to tax public property which is otherwise exempt from taxation under the constitution. This conclusion would appear to render moot your second question. I will note, however, that Amendment 35 to the Arkansas Constitution plainly proscribes the redirection of Commission funds to purposes other than those listed in the amendment. See Ops. 98-115 and 2006-169.