Member Matt Boch was recently quoted in an Arkansas Democrat-Gazette article, “Universities' tenants responsible for property taxes, new law says.”
In April, the Arkansas Generally Assembly passed Act 1076, which effectively reverses the result of a February 2016 state Supreme Court opinion that sided with the University of Arkansas saying Washington County could not collect property tax on university parcels.
Now, tenants are responsible for paying property taxes when leasing from a state entity for “an ongoing commercial or residential purpose.”
Boch said, “the way the law is written, if a state instrumentality such as a university or commission is alone engaging in commercial activity without a tenant, the new rule would not be triggered.”
He said the law is “definitely unusual,” which requires tenants to pay property taxes if occupying the property on January 1 under a lease of more than 90 days.
Boch added he expected state universities to be the entities most affected by the law, though he was uncertain how often other state agencies operate in a landlord role.