Judge grants 1% petitioners 10 days to fix signature problems (Updated)

Sebastian County Circuit Court Judge Michael Fitzhugh issued an order Tuesday afternoon (June 28) that forces Fort Smith City Clerk Sherri Gard to give the Citizens for Responsible Taxation 10 days to correct deficiencies “related to the insufficient number of verified signatures.”

The signatures were part of a petition effort by restaurateur Eddie York and other members of the Citizens for Responsible Taxation seeking to force a vote on a 1% prepared food tax that would support operations of the Fort Smith Convention Center.

Fitzhugh’s ruling essentially rejected the city’s argument that the petition failed because the petition effort did not have a proper ballot title and failure of petition organizers to know and follow the process with respect to gathering and submitting signatures.

“This Court does not find that the ballot title on the petition to be misleading, incomplete, deceptive or otherwise defective,” Fitzhugh ruled.

Continuing, Fitzhugh explained: “Further, she failed to grant the sponsors of the petitions the required ten (10) days to correct or amend the deficiency as required by the Arkansas Constitution. Instead, she told the Plaintiffs that the petition was insufficient and that her decision ‘shall be final unless suit is brought …’ That being Plaintiffs only option, this lawsuit was filed.”

The ruling gives the petitioners 10 days to submit signatures following receipt of a letter from Gard notifying them of their “right to correct or amend” the signature problems.

Fitzhugh rejected the petitioners (Citizens for Responsible Taxation) request to seek relief under the Arkansas Civil Rights Act and their request for the judge to force Gard to set an election date on the 1% prepared food tax. (Link here for a PDF of Fitzhugh’s order.)

REACTION
Fort Smith City Administrator Ray Gosack said the city will comply with Fitzhugh’s order and Gard will send a letter to the petitioners.

“It may not go out today, but it will go out quickly,” Gosack said, adding that Jerry Canfield, the city’s attorney, was not available Tuesday afternoon to discuss the ruling.

Gosack also said discussion of the ruling will likely be on the Board of Directors’ July 5 regular meeting agenda. Only the board can decide if the city will appeal the ruling.

“After that report (from city staff about the court’s decision), the board can decide if it wants to take any action,” Gosack explained.

Fitzhugh’s ruling did not include detail on the time Gard will have to verify signatures that are resubmitted.

“Clearly she will need some time, and she will move as quickly as she can, but while maintaining thoroughness and accuracy,” Gosack said when asked about the process following the 10 day deadline.

Attorney Brian Meadors, who represented York and others, called the ruling a “clear victory.” He said his clients look forward to collecting and correcting enough signatures during the 10-day window to force a vote on the tax.

Meadors says there should be no confusion about what it means to correct or amend signatures.

“Amend or correct means we can address those (existing signatures not accepted by Gard) or amend with new signatures. Or we can do both. … I think that’s pretty clear,” Meadors said.

As to the process after the 10-day period, Meadors said their is some confusion.

“We’re in new territory here, and the reason we are in new territory is that the city has never done what they were supposed to do,” Meadors said.

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, Gard 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 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.

TRIAL ARGUMENTS
During the June 17 trial, Jerry Canfield, the city’s attorney, 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.

Meadors responded during the trial 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.