492 TURNBOW V. TALKINGTON. [191 TURNBOW V. TALKINGTON. • 4-4145 • Opinion. delivered Octoher 28, 1935. 1. COUNTIES—REFUNDING BONDS.—The power conferred on counties to issue bonds, under constitutional amendment No. 17, includes the power to refund, them, provided the refunding bonds do not increase the amount of the outstanding bonds or the rate of interest. 2: CouNTIEs—couxmousE BONDS.— Amendment No. 17, authorizing - counties to issue bonds for construction of courthouses and jails on approval of a majority of the voters, held not to contemplate that the aleetnre chnuild vote fnr the le‘iy nf any nertienlar rate of taxation. 3. COUNTIES—LEVY TO PAY COUNTY BONDS.—The levying courts 'are given a discretion as to the rate to be levied to discharge bonds for construction of courthouses and jails, subject to the limita-. tion that the rate shall be sufficient to meet the maturities, and that the rate shall never exceed 5 mills: 4. COUNTIES—COURTHOUSE AND JAIL BONDS—RATE . OF LEVY.—Where a majority of the electors approve the issuance of courthouse and jail bonds, a second election is not required to confer authority to . change the rate of levy where such action become§ necessary. 5. COUNTIES—COURTHOUSE AND JAIL BONDS—RATE OF LEVY.—Acts • 1935, No. 102, prohibiting counties from refunding courthouse and jail bonds so long as taxes collected from the millage tax "heretofore authorized to be levied" shall be sufficient to pay such indebtedness as same matures, refers not to the election or amend-• Ment authorizing the tax, but to the action of the quorum couit in levying a particular rate. . • COUNTIES—COURTHOUSE AND JAIL BOND TAX.— Refunding of court-' house and jail bonds held proper where the amount colleeted under
'TtiENBOAV V. TALKING'iON. 493 the rate fixed by the levying court Of three mills Was inSufficient to pay the indebtedness aS it matured. ' - .. ' Appeal from pope ChancerY Court; A. S. Rays, Special . Chancellor ; , reversed. . lOhn O. Rye,.1 7 . N. Carter and John L. Carter, for appellant. . , • Joe D. Shephe;d, Babert Bailey and J. B.. Wetrd, for appellees. J. - This suit . W . as broUght by apPellees, the owne. r of real property land citizens and. taxpayer§ of .POPe Connty;:against appellants; the .conntY judge and - COunty treasurer, resPeCtively, of said county, t6 'enjOin them from refitnding or extending' the maturities of the bends 'Of said confify 'theretofore . i.Ssned 'under. ' AMendment No. 17 ofthe ConstitutiOn of. th6State of Arkansas. An anSwer was : filed, exhibiting the' records of 'the county . court relating to the Original bond issue' and the subsequent 'orders for the 'refunding of these bonds, together With a Stateinent 'Of : die assessed valuations of .the countY and the . revennes deriVed from the taxes 'levied thereon. If Was alleged in the ansWer of appel-. hints . that these figures show the necessity for refunding, 'and 'the answer concludes With the following suMmary of the connty's'fiScal condition in relation tO these bonds: 'As their further' answer; : defendants aver that fel . the year 1934 the county leVied three mills 'on the : dollar, 'as : reflected by 'the tax.. books . .ef said County ; that. the assessed valuation of tlie taxable Property of said comity for said year is $4;3'44,000; that the ;estimated income for the year 1.935 is $10,946.88 (allowing for delinquencies as reflected . .by an aVerage over the Past three years).; that the amount due September 1, 1935, including past-due interest and principal; -i§- $18;400 ; that if the full•five mills were levied under the.preSent conditions it 'would produce an insufficient amonnt t6meet • the • September ' 1, 1935, requirement ;-• and that 'in :any. 'event and undef all circumstances there will remain a. deficit, with, no way to meet said deficit even if the five Mills were available." • The county's *officials stoOd' on this ailwer 'without, offering to plead further- after: 'a demurrer thereto' had been sustained. 'The • question : fOr decision is therefore
111=11111.1M■IMIM E"" 494 .TITENBOW v. TALKING-TON. [191 .whether, -under the facts alleged in the answer, the authority existed to refund the bonds. The same parties appear here as in the case of Talk-ingión v. Turibbow,190 Ark. 1138, 83 S. W. (2d) 71. The citizen and taxpayer in that ease sought to enjoin the refunding of bonds issued by Pope County nnder the authority of Amendment No. 10. 'This amendment authorized counties S, cities and inCorporated towns to iSsue bonds to pay indebtedness outstanding : at the .time of its adop-. tion.. The same citizen. and 'faxpayer Seeks to enjoin the refunding Of blinds issued under the authority . Of Amendment'No;17, which authorized counties to issue bonds' for the construction Of courthouses and jailS. • .In the . . former ' appeal: We upheld the ;authority of the County to refund its bond§ issued under Amendment :NO. 10.. We . there held . that . it is the general rule that • the power. , conferred on. counties . to issue bends in the first instance includes tile power to refund them, pro-i rided. that the refimding bonds s do not increase the amount Of' the '.outstanding: bonds' or the rate of interest. In that case the validity of act 102 , of the Acts of 1935 waS attacked, but it was held to be . Valid legislation. . This act is' entitled "An Act : to Permit Counties io .Refund, Bonded Indebtedness of the Counties, Including , Funding . Bonds and Bonds Issued for the. Building of „ Court . houses and Jails, and . for Other Purposes. . A portion of § 1 of this, act reads as .follows : "Provided, that no.county shall refund its outstanding bonded indebtedness or accrued interest or extend : the maturities : thereof .as herein authorized, so long as the taxes collected from the millage tax heretofore .authorized to be levied for that, purpose shall be sufficient to pay such indebtedness as same matures.'.' It was lield in the former case that this prohibition : has no application where the amount collected, from the millage . tax is. insufficient . to pay the original bonds as they. mature. . • .The orders of the county court which are exhibited with the pleadings are to the.. following. effect :. The county "issued its serial county courthouse and. jail bonds dated April 1, 1931, numbered from one (1) to one
;1 ' 111i.] T IJR111301V v. TALKINGTO. 495 hundred forty-eight (148); both inchisive, : due Serially on SepteMber 1 of the years '1932 tO'1961; both inclusive, bearing interest at the rate 'of five pet ceiltuni (5 0 /0 p6r annum." To pay these bon& and the interest thereon the: quortini court' levied taxes at the • folloWing rates: For: 1931, PA 'mills ;.'fbr 1932, 2 niills"; for 1933 hnd4934, 3 thills. It appears that four Of theSe bonds of $1;000 . each have . been paid by thd eoinitY, and ;the . refunding Order ProVides that the . rOmaining 144 -'bonds, 'of 11;000:each, shallbe 'refunded with' bonds for the shine ainounts ,and bearing the same 'rate 'of 'ildefeSt Maturing serially froin 1949 tO 1967: Three queStiOns 'we're presented • 15Y the ' pleadings for the decision of the COurt'beloW, according to rthe of. appellee : . , . . 'First': "That the , 'levying cOnr .t: having' Made a le, T'y 'of one' and -one-lief Mills'AO bO' • continned'oVer a periOd of years, and the CUnnty 66411 having % 'entered' its order in accordance -With Sneh l'eVy, to the{'6ffect' Thai , : same shOuld be extended' npini 'the 'tax bookS'-froM year io year, and 'that : bonds , were *WA and the : Original Aevy *wa g made; ; pledged for' the payment . thereof,- that the levying court was not authdrized to increase 'sneh:leVy at 'a . : subsequent 'term." ' • • Seednd:: • "That a proposal to refund such-bolillsrand create- a new and different fOrin 'of obligation WoUld have to . be'submitted to the ciunlified'electOrs for their approval in order to giVe the 'eOuntY'colitt : jurisdiction - to act.":' • Third': • -"That th'edi.MtY dOurt 'wonld net' haVe ' Aft-thority, s under OM prOViSionS Of -aa No; 104, 'of . the ACtS of 1935, to refund' the Ontstanding indebtedness in 'any event, unless it should definitely appear that c011ectiOri .from 'the 'Millage . tax' aiithoried • to be ' 'levied , foi that purpose: g htill be in'snffi'Cient' paY -such outstanding bonds as 'they mature." ," • • ''" • • • 'Considering collectiVely these objections the - &- der and judgment of the county 'Court here-qUestioned, it may be said: The-authority to issue . 4he :bonds was derived frOm the vote of , the electOrs. , of the. comitT at the : election which the'amendment required to be'heldto determine whether there': should 'be . a. , bond issue . to.:1Mild
496 TURNBOW v: TALKINGTON: [191 a courthouse or . a jail, or both.. It was not contemplated that the electors 'should vote for Abe levy of any particular rate of taxation. On the contrary, the amendment provides that : "If a majority voting in such election vote for such building or buildings, as the ease may be, and for tax, then tbe levying court at any regular, special or adjourned, lerm thereafter held may levy, in addition to all other taxes now authorized by law, to be levied against all taxable property in the county, a special building tax not exceeding one-half of one per cent. on the dollar of the assessed valuation of such . property to pay for such improvements, or to • provide a sinking fund for such purpose, which levy, when once made, shall continue and be in force from year to year, and extended on the tax books and collected until sufficient funds are collected to pay off and discharge the cost of such . improveMent, Or -any bonds or notes and interest thereon, sold to raise money for the payment of Such improvement. '? This does not contemplate that the levying court shall in aThcases levy a tax of five mills. The inhibition is tbat it shall not exceed that rate. The court must levy a sufficient rate to meet the maturities, provided the rate shall never exceed five mills. Until . this limitation bas been reached a discretion abides in the levying court. Building costs as well as .assessed valuations may differ widely in the various counties which avail themselves of the provisions of the amendment. The levying courts are therefore giveira discretion as to the rate to be levied, subject, however, to the limitation that it shall be sufficient to pay off and discharge , the cost of suCh iniprove-ment, provided that ill• no, event . shall the rate' exceed five mills. • • We conclude therefore that . a second election was not required to confer authority to change this rate if that action has become necessary:- Nor do we think there has been any violation of the portion of act 102 of the Acts of 1935 above quoted. As was pointed out in the opinion in the case of Talkington v. Turnbow, supra, this act confers express authority to refund, but this action is not permitted, under , the proviso above quoted,. "so long as the taxes
ARK.] 497 collected from the millage tax heretofore . authorized to be levied for that purpose shall be sufficient to pay such indebtedness as same matures." We think the phrase, "heretofore authorized to . • e levied," refers, not to the election or amendment' authorizing the tax, 'but fo the Actioi: of the quoruni court in levying a . particular .rate. The bonds may not be . refunded so long as the taxes collected from this rate are .. suffiCient to pay the indebtedness as the same matures: But the converse of the proposition is also true. ' They * may be refunded if the . taxes so collected are insufficient.. Here 'it is alleged, and the demurrer concedesAhe ansWer to be true; that the taXes being collected are insufficient for this purpose, and "that in any event and under . all circumstances there will reMain a . defiCit with .. nd way to meet said deficit Oven *if the five mills Were available." Under these facts the ceunty court, should wit be restrained froth refunding the bonds, and the decree of the . court will therefore be . : reversed, and the cause reManded for further proceedings not inconsistent v■rith this opinion.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.