No ruling issued in 1% food tax trial (Updated)

A ruling on a lawsuit over Fort Smith’s 1% prepared food tax could come next week, with one attorney saying a decision will be made no later than two weeks.

Sebastian County Circuit Court Judge Michael Fitzhugh presided over a hearing on the matter Friday (June 17) morning, with attorneys for both sides presenting Fitzhugh with numerous depositions and case law to consider. Not counting court personnel and attorneys, more than 25 people were in attendance. The trial was over in less than 2 hours.

“It could take two weeks,” Fort Smith attorney Brian Meadors said after the hearing concluded. “You saw what all was presented. … It is a lot for the judge to go through.”

1% TAX HISTORY
A 1% prepared food tax was enacted Feb. 24 by the Fort Smith Board of Directors to resolve the more than 10-year search to plug an annual deficit with convention center operations predicted to occur when $1.8 million in annual state turnback money dried up. The state turnback program — which supported expansion or construction of tourism facilities — ended for Fort Smith in June 2010.

On April 25, Fort Smith City Clerk found the petition insufficient. Gard’s investigation, including interviews and testimony from several persons who gathered petitions, found that “at least” 1,409 of the 3,363 signatures verified as legal voters “cannot be accepted as verified inasmuch as those affiants have confirmed that there were signatures that they did not personally witness.”

Judge Fitzhugh on May 27 granted an injunction stopping collection of the 1% prepared food tax. The Citizens for Responsible Taxation, represented by Meadors, on May 24 filed the lawsuit asking to stop collection of the tax until a trial could be held in the attempt to force an election on implementation of the tax.

FILING ERRORS
Friday’s hearing included an early debate about which side’s filings had more clerical errors. Meadors wanted to submit into evidence the subpoenas issued by the city that contained errors, saying they will show a “double standard” when the city argues that errors resulted in rejecting petitions and signatures.

Jerry Canfield, attorney for the city, said the errors on the subpoenas do not relate “logically or legally” to a judicial review of Gard’s determination of petition sufficiency. Canfield also noted that Meadors erroneously listed on a pre-trial brief Doris Tate as Sebastian County Clerk (Sharon Brooks is now the elected County Clerk) and listed wrong two of the three members of the Sebastian County Election Commission.

Fitzhugh allowed Meadors to submit the subpoenas, but in addressing Canfield said he would only give the errors the “weight” they deserve.

Also, Fitzhugh denied Canfield’s request for summary judgment to dismiss the lawsuit and reinstate the 1% prepared food tax. Fitzhugh, saying he would address the matter in his ruling, did not rule on a request by Canfield to dismiss Meadors civil rights action against the city.

TITLES, LETTER ISSUES
The key points of debate focused on Gard’s letter of April 25 in which she ruled the petitions were insufficient and the alleged lack of a ballot title with the petitions.

Meadors argued that Gard in her April 25 letter did not inform the petitioners they had 10 days to amend problems with the signatures. Gard’s April 1 letter identifying problems with the ballot title did inform them they had 10 days to amend, with Meadors using the legal concept of “detrimental reliance” to suggest that Gard had set the precedent with her April 1 letter in providing petitioners with guidance as to their options.

Further, Meadors argued that his clients should not have to know every small detail of the law.

“They should not have to go and read the (Arkansas) Constitution,” Meadors said.

Canfield argued that the 10-day issue is moot for two reasons. The first is that the “controlling law” as it relates to petitions does not require Gard to offer petitioners any legal advice or guidance. And because she provided advice on one letter does not require her to do so on subsequent letters. The second point, according to Canfield, is that the petitioners failed to provide a legal ballot title with the petitions even after being advised to do so in Gard’s letter of April 1.

Canfield also read from testimony of Eddie York, de facto leader of the petition drive, who admitted that the group did not take action on using a “proper ballot title” during the process.

“Mr. Meadors is asking the court to ignore controlling law,” Canfield said.

PETITION PROCESS
Canfield also called into question the effort by petitioners to collect signatures. Based on comments from more than 30 depositions of those involved in the petition process, Canfield said the effort was an “ill-conceived method.” He said several petition gatherers admitted they left petitions at several locations, and did not witness all the signatures on the petitions they submitted.

Canfield added that several petitioners “openly acknowledged” that they did not fully understand the process, with one person essentially saying during deposition that she merely did what Eddie York and Frank Glidewell asked them to do.

Meadors responded by saying the issues would have been fixed if the city had provided the disputed 10 days after the April 25 finding from Gard.

REACTION
In closing the trial, Fitzhugh praised the work of all involved in the legal process.

“Both sides have represented your clients very well,” he said.

Meadors said he was pleased with the process and, despite previously being critical of Canfield’s subpoena process, also praised the “professionalism on the part of all lawyers” during the expedited hearing and trial schedule.

Canfield would not speak to the press.

Fort Smith City Administrator Ray Gosack was optimistic.

“We feel that we’ve followed the requirements of the Constitution. And the city clerk’s obligation is to protect the rights of all voters, and not just those who signed the petitions,” Gosack said.