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                SUPREME COURT OF ARKANSAS
                                      No.   CV-15-606

SOUTHWEST POWER POOL, INC.                       Opinion Delivered   March 31, 2016
                  APPELLANT

V.                                               APPEAL FROM THE PULASKI
                                                 COUNTY CIRCUIT COURT
                                                 [NO. 60CV-13-1018]
KANIS AND DENNY ROADS
SUBURBAN WATER IMPROVEMENT                       HONORABLE W. MICHAEL REIF,
DISTRICT NO. 349 OF PULASKI                      JUDGE
COUNTY, ARKANSAS, BY AND
THROUGH ITS COMMISSIONERS
BARRY HAAS, ROD NEAL, JAMES
FONTENOY, SHIRLEY HERNDON,
BILL ADAIR (DECEASED), AND MIKE                  REVERSED AND REMANDED.
REBICK
                        APPELLEE


                          PAUL E. DANIELSON, Associate Justice


       Appellant Southwest Power Pool, Inc. (“SPP”), appeals an order of summary judgment

entered in favor of appellee Kanis and Denny Roads Suburban Water Improvement District

No. 349 of Pulaski County (“the District”). On appeal, SPP argues that the Pulaski County

Circuit Court erred in granting summary judgment on SPP’s challenge to the reasonableness

of an assessment of benefits and accompanying levy of taxes. We reverse and remand.

       The District was formed in 2000 for the primary purpose of constructing water lines

and related improvements to serve real properties within the District. The District was

financed by bond issues; in order to repay its debts and fund general operations, the District
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assessed the benefits accrued to each real property within the District resulting from the

construction of the water lines, and levied taxes accordingly. The District completed

construction of the water lines in 2006. At that time, the District conveyed and dedicated its

easements and water lines to Central Arkansas Water (“CAW”), which has owned, operated,

and maintained the easements and water lines since that time.

       In 2010, SPP purchased 24.04 acres of unimproved real property lying within the

District. SPP dedicated 3.2 acres to the City of Little Rock and constructed its commercial

facility on the remaining 20.84 acres. This property had originally been part of an 80-acre

tract, which was initially assessed in the amount of $138,078 in 2003. This assessment resulted

in an annual levy of approximately $3,500, which was paid without protest from 2003

through 2012, and which SPP conceded was fair.1 In 2013, the District reassessed SPP’s

property, determining that the assessed benefits to the 20.84 acres alone totaled $2,521,954.

This assessment resulted in an annual levy of $60,653.

       SPP appealed the 2013 reassessment to the District’s board of equalization, composed

of its assessor and commissioners. The reassessment was confirmed. SPP then filed its

complaint in circuit court, asserting that the reassessment was wrong as a matter of law and

as a matter of fact.2 Specifically, SPP argued that an assessment was supposed to represent the


       1
        According to SPP, the 2003 assessment resulted in an annual levy of $3,492; according
to the District, the 2003 assessment resulted in an annual levy of $3,600.
       2
       Pursuant to Arkansas Code Annotated section 14-92-228(c)(1) (Repl. 1998), the
remedy against the levy of taxes by a suburban improvement district shall be by suit in
chancery.


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benefit to its property resulting from the District’s construction of water lines, which had been

completed in 2006, and that the subsequent construction of its facility on the property would

not have changed that value. SPP also alleged that it had chosen not to use the District’s

water lines and instead connect to lines that had already been constructed by the owner of the

original 80-acre tract and CAW. Thus, it contended, the presence of the District’s water lines

near its property was of no benefit to it, and the assessment should have been reduced to zero.

For the same reason, SPP argued that it was exempt from assessment under Arkansas Code

Annotated section 14-92-225(c)(2). SPP maintained that the reassessment violated procedural

and substantive due process and equal protection and constituted a taking without just

compensation. Finally, SPP alleged that the District had failed to follow statutory procedures

for reassessment, including those having to do with notice.

       The District answered and filed its motion for summary judgment. The District

disagreed with SPP’s interpretation of section 14-92-225(c)(2), arguing that it did not exempt

SPP from assessment and that it allowed the District to assess property in proportion to the

benefit conferred. The District also argued that it had provided proper notice to SPP and that

the reassessment was reasonable. In response to the motion for summary judgment, SPP

submitted the affidavit of Ray Owen, Jr., a licensed attorney and registered professional

engineer who had experience serving as an assessor for over thirty improvement districts over

a period of more than four decades. Owen opined that the reassessment of SPP’s property

was improper because there was little to no benefit accruing to the property as a result of the

District’s earlier construction of water lines. Additionally, Owen questioned the assessor’s


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calculations, which apparently valued SPP’s land and the facility built upon it at $0.00 prior

to the District’s construction of its water lines. Owen also referenced minutes of the District’s

commissioners’ meetings and emails between the District’s assessor and commissioners,

opining that the commissioners’ input on the SPP reassessment was inappropriate and

questioning whether the reassessment was independently made by the assessor as required by

statute.

       Following further briefing and two hearings, the circuit court granted the District’s

motion for summary judgment on all issues except notice.3 The court found that a material

physical change in property after an original assessment is a basis for reassessment and that all

assessments and reassessments are presumptively reasonable (citing Sugarloaf Dev. Co., Inc. v.

Heber Springs Sewer Improvement Dist., 34 Ark. App. 28, 805 S.W.2d 88 (1991), and Kelley

Trust Co. v. Paving Improvement Dist. No. 47 of Ft. Smith, 185 Ark. 397, 47 S.W.2d 569

(1932)). The court concluded that SPP’s connection to a CAW line did not exempt it from

assessment under section 14-92-225(c)(2); rather, SPP’s “alternative water source is not

supposed to be taken into consideration at all.” In addition, the court determined that the

reassessment was not void because of the communications between the District’s

commissioners and its assessor. SPP filed a motion for reconsideration, which was denied.

Following a bench trial on the issue of the sufficiency of the 2013 notice of reassessment, the



       3
        The circuit court denied the District’s motion for summary judgment on the issue of
notice and also denied a subsequent motion for summary judgment on the issue of notice filed
by SPP, reserving this issue for trial.


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circuit court entered a final order granting judgment in favor of the District.4 SPP filed a

timely notice of appeal.

       SPP’s appeal challenges the circuit court’s entry of summary judgment in favor of the

District. The law is well settled regarding the standard of review used by this court in

reviewing a grant of summary judgment. See, e.g., Anderson’s Taekwondo Ctr. Camp Positive,

Inc. v. Landers Auto Group No.1, Inc., 2015 Ark. 268. A circuit court will grant summary

judgment only when it is apparent that no genuine issues of material fact exist requiring

litigation and that the moving party is entitled to judgment as a matter of law. See id. The

burden of proof shifts to the opposing party once the moving party establishes a prima facie

entitlement to summary judgment, and the opposing party must demonstrate the existence

of a material issue of fact. See id. After reviewing the undisputed facts, the circuit court

should deny summary judgment if, under the evidence, reasonable minds might reach

different conclusions from the same undisputed facts. See id.




       4
        SPP’s property was also reassessed in 2014; that reassessment was unchanged from the
2013 reassessment. SPP challenged the 2014 reassessment, and the board of equalization
confirmed it. SPP filed an amended complaint contesting the 2014 reassessment, and the
District filed an amended motion for summary judgment to address it. The circuit court’s
order granting summary judgment applied to the 2014 reassessment as well as the 2013
reassessment. Following entry of the summary judgment, SPP’s property was again reassessed
in 2015, with the assessed benefit remaining the same as in the 2013 and 2014 reassessments.
SPP challenged the 2015 reassessment, the board of equalization confirmed it, and SPP filed
a second amended complaint contesting it. The District renewed its motion for summary
judgment, asking the circuit court to apply its earlier ruling granting summary judgment to
the 2015 reassessment as well. This motion was granted.


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       On appeal, this court determines if summary judgment was appropriate based on

whether the evidentiary items presented by the moving party leave a material question of fact

unanswered. See id. This court views the evidence in the light most favorable to the party

against whom the motion was filed, resolving all doubts and inferences against the moving

party. See id. This review is not limited to the pleadings but also includes the affidavits and

other documents filed by the parties. See id.

       SPP raises four points on appeal: (1) that the circuit court erred in granting summary

judgment in favor of the District; (2) that the District’s commissioners improperly assumed

the role of the assessor, which violated statutory guarantees and denied SPP due process; (3)

that the amount of the reassessment and the erroneous way in which it was determined are

very much in dispute and present issues for trial; and (4) that any ambiguity in section 14-92-

225(c)(2) is required to be resolved in favor of the taxpayer. Our analysis begins and ends

with SPP’s fourth point on appeal because it raises a threshold issue and is dispositive.

       SPP argues that section 14-92-225(c)(2) prohibits any assessment of its facility. Section

14-92-225(c) provides as follows:

               (1) The assessment shall embrace not merely the lands, but shall embrace all
       railroads, tramroads, telegraph lines, telephone lines, pipelines, and other
       improvements on real estate that will be benefited by the acquiring or making of the
       improvement.

             (2) No assessment shall apply against any pipelines or other improvements
       which are extensions of or connected to the pipeline distribution system or other
       improvements within any city adjacent to the district.




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Ark. Code Ann. § 14-92-225(c) (Repl. 1998). The parties have totally opposing views

concerning the meaning of the plain language of this statute. According to SPP, the statute

can only mean that its facility cannot be assessed because it is an improvement that is

connected to a CAW line within the City of Little Rock, which is adjacent to the District.

The District reads the statute differently, contending that subsection (c)(1) specifically requires

the assessment to embrace SPP’s facility and that subsection (c)(2) specifically excludes from

consideration SPP’s connection to a CAW line.

       The question of the correct application and interpretation of an Arkansas statute is a

question of law, which this court decides de novo. See, e.g., Rose v. Harbor E., Inc., 2013 Ark.

496, 430 S.W.3d 773. We are not bound by the circuit court’s decision; however, in the

absence of a showing that the circuit court erred, its interpretation will be accepted as correct

on appeal. See id. The basic rule of statutory construction to which all other interpretive

guides defer is to give effect to the intent of the drafting body. See id. In reviewing issues of

statutory interpretation, we first construe a statute just as it reads, giving the words their

ordinary and usually accepted meaning in common language. See id. When the language of

a statute is plain and unambiguous and conveys a clear and definite meaning, there is no need

to resort to rules of statutory construction. See id. It is axiomatic that this court strives to

reconcile statutory provisions to make them consistent, harmonious, and sensible. See id.

       We find SPP’s interpretation of the plain language of section 14-92-225(c) to be

correct. It seems that the parties’ disagreement stems from confusion over the meaning of the

word “improvement” within the statute. Section 14-92-225 as a whole makes clear that the


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benefits to be assessed and taxed are those arising from the improvements constructed by the

improvement district, not those arising from improvements constructed on the taxpayer’s real

property by the taxpayer. For example, subsection (a)(1) states that the assessor shall “assess

the benefits which will accrue to the real property within the district from the acceptance of

the gift of improvement or facilities, the purchase of the improvement or facilities, or the

construction of the improvement or facilities” that the district’s board of commissioners has

voted to accept, purchase, or construct. Ark. Code Ann. § 14-92-225(a)(1). Subsection (a)(2)

states that the assessor will assess “all benefits that will accrue to the landowners of the district

by reason of the acceptance, purchase, or construction of the proposed improvement or

facilities, sometimes referred to as ‘improvement.’” Ark. Code Ann. § 14-92-225(a)(2).

Subsection (b) describes the process to be undertaken by the assessor: he or she shall

determine the “Assessed Value of Lands Prior to Improvements” and the “Assessed Value of

Lands After Improvements,” and “[i]f the assessed value of land after improvements is greater

than the assessed value of land before improvements . . . then the difference between the two

shall be the assessed benefits that will accrue to each tract by reason of the improvement.”

Ark. Code Ann. § 14-92-225(b)(1) & (2)(A)(i).

       Subsection (c) is somewhat different in that it uses the word “improvement” to refer

to both improvements made by the improvement district and those made by the taxpayer.

We read subsection (c)(1) to mean that an assessment shall take into account the land plus any

improvements on the land constructed by the taxpayer—such as SPP’s commercial

facility—that will be benefited by the construction of improvements by the improvement


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district. It follows that the word “improvements” appearing in the first clause of subsection

(c)(2) would refer to those improvements made on the land by the taxpayer—again, such as

SPP’s commercial facility. Thus, “[n]o assessment shall apply against” SPP’s facility because

it is “connected to the pipeline distribution system” within the City of Little Rock. Ark.

Code Ann. § 14-92-225(c)(2).

       The District’s interpretation of subsection (c)(2), which the circuit court accepted as

correct, does not comport with the plain language of the statute. If the General Assembly had

intended to say that a taxpayer’s connection to an adjacent city’s waterworks system could not

be considered in the assessment process, it presumably would have said that. The “[n]o

assessment shall apply” language simply does not lend itself to that interpretation. In addition,

as SPP points out, any ambiguity in the statute must be resolved in favor of it as the taxpayer.

See, e.g., Cent. & S. Cos., Inc. v. Weiss, 339 Ark. 76, 3 S.W.3d 294 (1999).

       Moreover, we are unpersuaded by the District’s argument that section 14-92-225(c)(2)

evidences the General Assembly’s intent to protect improvement districts from encroachment

by neighboring municipalities. Section 14-92-219 sets out the purposes for which a suburban

improvement district may be organized, including to construct a waterworks system and “to

operate and maintain any such waterworks system it may purchase, construct, or own.” Ark.

Code Ann. § 14-92-219(1) (Supp. 2015). It is clear that some suburban improvement

districts, including the District involved here, are organized for the purpose of constructing

a waterworks system or related improvements, but not for the purpose of operating or

maintaining that system. Here, as noted above, the District conveyed all of its water lines and


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easements to CAW upon completion of construction, and CAW has owned, operated, and

maintained the lines since then. The District is not, and has never been, a source of water.

Its water lines were apparently always intended to tie onto CAW lines. Section 14-92-

225(c)(2) covers this precise situation, providing that improvements attached to an adjacent

city system are not subject to assessment.

       For these reasons, we hold that SPP’s commercial facility, an improvement on its

property that is connected to the City of Little Rock’s waterworks system, cannot be assessed.

Accordingly, the 2013 reassessment, and the 2014 and 2015 reassessments that followed, are

invalid. We reverse the circuit court’s grant of summary judgment and remand for entry of

an order consistent with this opinion.5

       Reversed and remanded.

       Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., by: M. Samuel Jones III, for

appellant.

       Quattlebaum, Grooms & Tull, PLLC, by: John E. Tull III, Joseph R. Falasco, and R. Ryan

Younger, for appellee.




       5
        Because the issue is likely to arise on remand, we note that the 2003 assessment
amount covered the entire 80-acre tract, of which SPP now owns only 20.84 acres. See, e.g.,
Rees v. Smith, 2009 Ark. 169, 301 S.W.3d 467 (reversing grant of summary judgment and
addressing remaining arguments that were likely to arise again on remand).


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