Changes in the Arkansas tax code on how school taxes are collected and distributed could allow the state to shift collections from property rich school districts to less-wealthy ones, Assistant Attorney General Scott Richardson told lawmakers last week.
In November the Arkansas Supreme Court ruled, 4-3, that school districts that generate property tax revenues above the state’s basic per-student stipend do not have to share the excess collections with poorer districts.
Eight districts currently generate tax revenue above than the mandated state funding level.
Richardson said legislative changes to the tax code could provide for the reallocation of the local revenues. The Legislature can stipulate whether the revenue from a statewide 25 mill tax for education can be kept by the district or redistributed, he said.
“It’s the General Assembly that decides, once these funds hit the state treasury, how they go back out to the school districts,” Richardson told a joint session of House and Senate education committees.
The revenue reallocation is an effort to ensure an adequate education across Arkansas, Richardson said.
The current funding level is $6,267 per student. If the local tax revenue is not sufficient, the state provides the additional funding. If the per-student revenue exceeds the funding level, the additional revenue is distributed to districts that do not reach the statewide funding level.
The state will ask the high court to rehear the case, Richardson said.
“We’re going to ask them to reconsider it and just to reconfirm,” he said “The court was split.”
