Clark County, Ark. v. At&t Corp.

• Court: Court of Appeals of Arkansas
• Decided: May 20, 2026
• Status: Published

Opinion

Cite as 2026 Ark. App. 348 ARKANSAS COURT OF APPEALS DIVISIONS III & IV No. CV-24-54

CLARK COUNTY, ARKANSAS, EX REL. TROY TUCKER, IN HIS OFFICIAL Opinion Delivered May 20, 2026

CAPACITY AS COUNTY JUDGE OF APPEAL FROM THE CLARK COUNTY CLARK COUNTY, ARKANSAS, CIRCUIT COURT INDIVIDUALLY AND O/B/O A CLASS [NO. 10CV-17-28] OF SIMILARLY SITUATED PARTIES

HONORABLE GARY M. ARNOLD, APPELLANT JUDGE

V. AFFIRMED IN PART; REVERSED AND REMANDED IN PART

AT&T CORP. AND SOUTHWESTERN BELL D/B/A AT&T ARKANSAS

APPELLEES

MIKE MURPHY, Judge

This appeal arises from a class-action lawsuit filed by Clark County against AT&T

Corp. and Southwestern Bell d/b/a AT&T Arkansas (collectively, “AT&T”), which alleged

that AT&T unlawfully charged Clark County and other Arkansas counties three fees for the

counties’ use of AT&T’s telephone services. The circuit court certified a class and, following

a bench trial, entered judgment in favor of AT&T on all claims. We affirm in part and

reverse and remand in part. I. Background

AT&T provides telephone services to Clark County. As part of providing these

services, AT&T assesses a 911 fee, a Special Municipal Charge, and an Arkansas Universal

Service Fee. The 911 fee is an emergency telephone service charge that AT&T is required,

under the Arkansas Public Safety Communications Act (“APSCA”), to bill and collect from

its “service users” and remit to the government. Ark. Code Ann. § 12-10-318(f)(4) (Repl.

2016). The Special Municipal Charge is a charge that AT&T collects from “its customers

residing in each municipality” to recover the amount of the franchise fee assessed by the

municipality on AT&T for authorization to use the municipal streets and rights-of-way to

deploy AT&T’s facilities. Ark. Code Ann. § 14-200-101(b)(2) (Supp. 2025). The Arkansas

Universal Service Fee is a surcharge collected by AT&T to recover mandatory payments that

AT&T must make to the Arkansas High Cost Fund (“AHCF”). Ark. Code Ann. § 23-17-

404(2)(B) (Repl. 2015). Clark County filed a class-action lawsuit against AT&T alleging that

the imposition of these three fees against the county was unlawful. The circuit court

thereafter certified the following class:

All Arkansas counties, or their agencies or departments, which have been charged or have paid Defendant’s 911, or Arkansas Universal Service or special municipal charge fees or related charges from the five years immediately prior to the filing of this lawsuit up through the date of the entry of judgment in this case.

In the operative complaint, filed May 31, 2018, Clark County requested relief

pursuant to Arkansas Code Annotated section 16-111-101 et seq., seeking a declaratory

judgment that:

2 (1) Clark County and the class members are not subject to 911 fees under the provisions of APSCA, Ark. Code Ann. § 12-10-300, et seq.;

(2) Clark County and the class members are not subject to payment of a Special Municipal Charge;

(3) AT&T has no basis to collect from Clark County and the class members an Arkansas Universal Service Fee;

(4) AT&T improperly charged, billed, and collected public funds from Clark County and from the class members;

(5) Such improper and unlawful fees include, but are not limited to, the following:

(a) 911 fees and associated administrative charges collected by AT&T;

(b) “Arkansas Universal Service” charges;

(c) “Special municipal charges”; and

(d) taxes imposed on each of these improper charges;

(6) Clark County and the class members are entitled to a refund of all such fees which were unlawfully exacted from public funds.

AT&T answered and asserted that Clark County’s claim challenging the “Arkansas

Universal Service Fee” is subject to the primary jurisdiction of the Arkansas Public Service

Commission (“PSC”). The same day, AT&T filed a third-party complaint against the city of

Arkadelphia and the city of Gurdon, alleging that “Arkadelphia and Gurdon are or may be

liable for part of [Clark County’s] claim against AT&T,” specifically relating to the “Special

Municipal Charge.”

AT&T subsequently filed a “Motion to Dismiss or Stay Pursuant to the Doctrine of

Primary Jurisdiction.” The motion stated that AT&T had, on July 2, 2018, filed an

3 application for a declaratory ruling by the PSC relating to the “Arkansas Universal Service

Fee” surcharge and noted that the PSC has regulatory authority over the AHCF. According

to the motion, AT&T specifically “asked the PSC to hold that nothing in the AHCF statute

or the PSC’s AHCF regulations exempts an intrastate retail telecommunications service

customer from AHCF surcharges based on its status as a governmental entity.” AT&T

contended that because the PSC has primary jurisdiction over claims relating to the AHCF,

the circuit court should dismiss or stay Clark County’s claim challenging the “Arkansas

Universal Service Fee” pending the outcome of the administrative proceeding in the PSC.

The circuit court did not rule on AT&T’s motion.

On October 30, 2018, the PSC issued an administrative order declaring (1) that Clark

County, in its capacity as intrastate retail telecommunications service customer, is subject to

AHCF surcharges like any other retail customer; and (2) that governmental entities that

purchase intrastate retail telecommunications services are not exempt from Arkansas Code

Annotated section 23-17-404(b)(2)(B) and AHCF Rule 4.04(A).

The parties thereafter litigated cross-motions for summary judgment, which the

circuit court denied. After the class received notice, the circuit court conducted a bench trial

on December 9, 2022. At the trial, the circuit court heard testimony from Clark County

Judge Troy Tucker and accepted agreed-upon stipulations of facts and exhibits filed by the

parties.

On November 1, 2023, the circuit court entered a final order setting out its findings

of fact and conclusions of law. The court concluded in the order that Clark County failed

4 to establish that either the county or any class members are exempt from any of the three

disputed fees.

The court found that Clark County and the class members fall within the statutory

definition of a “service user” and are therefore subject to the 911 fees imposed under the

APSCA. In reaching this conclusion, the court found that Clark County is a person who was

“provided landline telephone service” with the capability of calling 911. “Like any other

telephone customer,” the court said, “Clark County and its employees could use Clark

County’s telephone service to dial 911 in the event of an emergency.”1 The court further

found that Clark County, like any other Arkansas county, is a person “not exempt from

county or municipal taxes or utility franchise assessments.”

In rejecting Clark County’s challenge to the “Special Municipal Charge,” the court

found that special municipal fees are permitted by Arkansas law and further found that

nothing exempted Clark County or the class members from such charges. As to Clark

County’s arguments raising public-purpose-doctrine and constitutional concerns, the court

found that “AT&T is the party that is being taxed, and the special municipal fee is merely a

statutorily authorized pass through charge.” While Clark County “may not have specifically

appropriated funds to pay franchise fees or to make AHCF contributions,” the court found

that it had “full authority and appropriations to pay its telephone bills.” Further, “[b]y paying

1 There was testimony at trial that AT&T charged and collected 911 fees on more than one “phantom” phone line—lines that the county later discovered actually were misconnected or disconnected and without service altogether. 5 its bills, including the special municipal fee,” the court concluded, “Clark County was not

giving ‘financial aid’ to AT&T—it was merely paying its bills, in an amount sufficient for

AT&T to recover its costs of providing telephone services.” The court noted, “Nothing in

the Arkansas Constitution prohibits counties from paying for the services they receive.”

The court likewise rejected Clark County’s challenge to the “Arkansas Universal

Service Fee.” The court found that nothing in the AHCF statute or in the PSC’s AHCF

regulations exempted Clark County, or any other county customer, from this surcharge. The

court found, as a separate basis to reject this claim, that “the PSC has already squarely

decided this dispute,” and the doctrine of res judicata applies to the PSC’s decision.

Additionally, the court found no merit in Clark County’s constitutional and public-purpose-

doctrine arguments relating to the universal service fees for similar reasons as the special

municipal charges, As a separate basis for rejection, the court found that these arguments

“constitute an improper collateral attack on the Arkansas PSC’s final order, as Clark County

could have and should have raised the same arguments before the PSC, and/or on appeal of

the PSC’s decision.”

Finally, the court found that Clark County’s constitutional and public-purpose

doctrine arguments are “procedurally improper.” More specifically, it found that to the

extent the county argues that the statutes authorizing AT&T’s discretionary surcharges to

recover its municipal franchise fees and AHCF contributions are “unconstitutional or violate

the public-purpose doctrine,” the county was required to give notice to the Attorney General

pursuant to Arkansas Code Annotated section 16-111-111(a). The court found that “Clark

6 County has not complied with this provision, and hence its constitutional and public-

purpose doctrine attacks are improper in this forum.”

Clark County now appeals. For reversal, Clark County asserts that the circuit court

erred (1) by ruling that the APSCA allows AT&T to collect 911 fees from political

subdivisions; (2) by ruling that AT&T could collect the “Arkansas Universal Service Fee”

and “Special Municipal Charge” on county telephone lines; (3) in ruling that Clark County’s

challenge to the “Arkansas Universal Service Fee” was barred by principles of res judicata;

and (5) in concluding that notice to the Attorney General was required.

II. Standard of Review

The standard of review on appeal from a bench trial is whether the circuit court’s

findings were clearly erroneous or clearly against the preponderance of the evidence. City of

Rockport v. City of Malvern, 2010 Ark. 449, at 6, 374 S.W.3d 660, 663. “A finding is clearly

erroneous when, although there is evidence to support it, the reviewing court on the entire

evidence is left with a firm conviction that an error has been committed.” Id. “Facts in dispute

and determinations of credibility are solely within the province of the fact-finder.” Id.

Issues of statutory construction are reviewed de novo. Id. This court is not bound by

the circuit court’s interpretation of law, but “in the absence of a showing that the circuit

court erred in its interpretation of law, that interpretation will be accepted as correct on

appeal.” Id.

III. Discussion

A. 911 fees 7 Clark County’s first argument is that the circuit court erred in ruling that the APSCA

allows AT&T to collect 911 fees from political subdivisions such as counties. We agree. This

issue turns on statutory interpretation, which we review de novo. Cent. Okla. Pipeline, Inc. v.

Hawk Field Servs., LLC, 2012 Ark. 157, at 9, 400 S.W.3d 701, 707.

The basic rule of statutory construction is to give effect to the legislative intent

underlying the statute. Sw. Bell Tel. Co. v. Ark. Public Serv. Comm’n, 69 Ark. App. 323, 329,

13 S.W.3d 197, 200 (2000). When the language of a statute is plain and unambiguous, we

determine legislative intent from the ordinary meaning of the language used. Helena-W.

Helena Sch. Dist. v. Fluker, 371 Ark. 574, 580, 268 S.W.3d 879, 884 (2007). In considering

the meaning of a statute, we construe it just as it reads, giving the words their ordinary and

usually accepted meaning in common language. Id. We construe the statute so that no word

is left void, superfluous, or insignificant, and give meaning and effect to every word in the

statute, if possible. Id.

A statute is ambiguous if it is open to more than one construction. Id. When the

statute is ambiguous, we are permitted to look at the language of the statute, its subject

matter, the object to be accomplished by the statute, the purpose to be served, and other

appropriate matters. Sw. Bell Tel. Co., 69 Ark. App. at 329, 13 S.W.3d at 201. As a guide in

ascertaining the legislature’s intent, we examine the history of the statutes involved, as well

as the contemporaneous conditions at the time of their enactment, the consequences of

interpretations, and all other matters of common knowledge within the court’s jurisdiction.

Id. In determining legislative intent, we must look at the whole act and, as far as practicable, 8 give effect to every part, reconciling provisions to make them consistent, harmonious, and

sensible. Id. at 333, 13 S.W.3d at 203. We do not, however, engage in statutory

interpretations that defy common sense and produce absurd results. McDaniel v. Ark. Public

Serv. Comm’n, 2014 Ark. App. 529, at 9, 444 S.W.3d 380, 385.

The 911 fee at issue arises under the APSCA.2 The General Assembly passed the

APSCA in furtherance of “the public interest to shorten the time and simplify the method

required for a citizen to request and receive emergency aid.” Ark. Code Ann. § 12-10-302(a)

(Repl. 2016). The legislative purpose behind the APSCA is statutorily codified:

(1) Establish the National Emergency Number 911 (nine, one, one) as the primary emergency telephone number for use in participating political subdivisions of the State of Arkansas;

(2) Authorize each chief executive to direct establishment and operation of 911 public safety communications centers in their political subdivisions and to designate the location of a 911 public safety communications center and agency which is to operate the center. . . .;

(3) Encourage the political subdivisions to implement 911 public safety communications centers; and

(4) Provide a method of funding for the political subdivisions which will allow them to implement, operate, and maintain a 911 public safety communications center.

Ark. Code Ann. § 12-10-302(e) (Repl. 2016).

2 A former version of the APSCA was amended and replaced by the Arkansas Public Safety Communications and Next Generation 911 Act of 2019, effective July 24, 2019. Ark. Code Ann. § 12-10-301 (Supp. 2025). 9 In line with these stated goals, the APSCA authorizes and encourages the “chief

executive” of each “political subdivision” to create a 911 public safety communications

center. See Ark. Code Ann. § 12-10-304 (Repl. 2016). In this vein, the Act permits the

“governing authority” of each “political subdivision,” when so authorized by the local

taxpayers, to levy an “emergency telephone service charge,” or 911 fee, to be imposed on

local telephone service lines. Ark. Code Ann. § 12-10-318(a)(1)(A) (Repl. 2016). “Upon its

own initiative, the governing authority of the political subdivision may call such a special

election to be held in accordance with § 7-11-201 et seq.” Ark. Code Ann. § 12-10-318(a)(2)

(Repl. 2016).

As the terms are defined in the Act, the “chief executive” of a political subdivision

means “the Governor, county judges, mayors, city managers, or city administrators of

incorporated places, and is synonymous with head of government, dependent on the level

and form of government.” Ark. Code Ann. § 12-10-303(5) (Repl. 2016). And the “governing

authority” of a political subdivision means “county quorum courts and governing bodies of

municipalities.” Ark. Code Ann. § 12-10-303(12) (Repl. 2016).

A 911 fee, or “emergency telephone service charge,” imposed under the APSCA “shall

be added to and may be stated separately in the billing by the service supplier to the service

user.”3 Ark. Code Ann. § 12-10-318(f)(4) (Repl. 2016). The Act provides: “Every billed service

3 The APSCA, as it existed before 2019, provided that the emergency telephone service charges collected by the service supplier shall be remitted to the “political subdivision” on a quarterly basis. Ark. Code Ann. § 12-10-320(c)(1) (repealed 2019). The Act also permitted the service supplier “to retain as an administrative fee an amount equal to one percent (1%) 10 user shall be liable for any service charge imposed under this subsection until it has been

paid to the service supplier.” Ark. Code Ann. § 12-10-318(f)(5) (Repl. 2016). The Act

authorizes the “political subdivision” to “pursue against a delinquent service user any remedy

available at law or in equity for the collection of a debt.” Ark. Code Ann. § 12-10-318(g)

A “service user,” within the meaning of the APSCA, is “any person, company,

corporation, business, association, or party not exempt from county or municipal taxes or

utility franchise assessments who is provided landline telephone service, CMRS service, voice

over internet protocol service, or any nontraditional phone service with the capability of

placing a 911 call in the political subdivision.” Ark. Code Ann. § 12-10-303(26) (Repl. 2016).

Notably, the Act does not include a “political subdivision” or “chief executive” or “governing

authority” of a political subdivision among the list of entities identified as a “service user.”

Considering that the Act refers repeatedly to a “political subdivision,” or to the “chief

executive” or “governing authority” of a political subdivision, both within and beyond the

definitional section, this contrast is significant. Where the legislature includes a term in one

part of a statute but omits it in another, we should not expand those categories or add

omitted entities. MacSteel Div. of Quanex v. Ark. Okla. Gas. Corp., 363 Ark. 22, 31, 210 S.W.3d

878, 883–84 (2005). Here, the repeated used of “political subdivision” throughout the Act—

from the gross receipts to be remitted to the political subdivision.” Ark. Code Ann. § 12-10- 320(c)(3) (repealed 2019).

11 paired with the absence from the “service user” definition—confirms that political

subdivisions such as counties and municipalities are not “service users” within the meaning

of the statute.

Further, not only does the Act omit political subdivisions from the definition of

service user, but its language also expressly demonstrates legislative intention to exclude

certain entities as a service user—namely, any “party exempt from county or municipal taxes

or utility franchise assessments.” We disagree with the circuit court’s conclusion that political

subdivisions, including counties such as Clark County, are not exempt from county or

municipal taxes, as contemplated in the Act, because they may sometimes pay some

unidentified local sales tax. It is well established that constitutional and statutory exemptions

from taxation refer to “ordinary taxes, for the general purposes of government—state, county,

or municipal[.]” Bensberg v. Parker, 192 Ark. 908, 95 S.W.2d 892, 893 (1936).

Counties, under the Arkansas Constitution, “are civil divisions of the state for

political and judicial purposes, and are its auxiliaries and instrumentalities in the

administration of its government.” Lake v. Tatum, 175 Ark. 90, 1 S.W.2d 554, 556 (1927).

As such, property held by a county in connection with its governmental functions is within

the tax exemption clause of article 16, § 5(b) exempting public property used exclusively for

public purposes. City of Hope v. Dodson, 166 Ark. 236, 266 S.W. 68, 69 (1924). It is no

surprise that local governmental subdivisions of the state, like Clark County, by and large

are not subject to taxation. See Washington Cnty. v. Bd. of Trs. of the Univ. of Ark., 2016 Ark.

34, at 14, 480 S.W.3d at 182 (discussing immunity versus exemption and holding that the

12 University of Arkansas, as an instrumentality of the state, is immune from ad valorem

taxation).

The 911 fee at issue here, moreover, is a charge levied and imposed by a political

subdivision that is operating a 911 public safety communications center. Again, one of the

main purposes of the APSCA is to provide funding to political subdivisions to carry out

these very operations. The Act achieves this purpose, in part, by authorizing “county quorum

courts,” as the governing authority of the political subdivision, to levy a 911 fee on local

telephone lines to be collected by the telephone-service supplier and remitted to the county.

It makes little sense for a county to levy a charge to be imposed on the county’s phone lines

to fund the county’s operations. As our supreme court has said:

Some things are always presumptively exempted from the operation of general tax laws, because it is reasonable to suppose they were not within the intent of the legislature in adopting them. Such is the case with property belonging to the State and its municipalities, and which is held by them for governmental purposes. All such property is taxable if the state shall see fit to tax it; but to levy a tax upon it would render necessary new taxes to meet the demand of this tax, and thus the public would be taxing itself in order to raise money to pay over to itself, and no one would be benefited but the offices employed, whose compensation would go to increase the useless levy. It cannot be supposed that the legislature would ever purposely lay such a burden upon public property, and it is therefore a reasonable conclusion that, however general may be the enumeration of property for taxation, the property held by the statute and by all its municipalities for governmental purposes was intended to be excluded, and the law will be administered as excluding it in fact.

Bensberg, 192 Ark. 908, 95 S.W.2d at 894 (1936) (quoting Board of Imp. v. Sch. Dist. of Little

Rock, 56 Ark. 354, 19 S.W. 969 (1892)).

13 For these reasons, we hold that the circuit court erred in its interpretation of the

APSCA. We therefore reverse the circuit court’s judgment as to the 911 fee and remand the

case to the circuit court for further proceedings, including consideration of issues concerning

a refund of the fee.

B. Arkansas Universal Service Fee and Special Municipal Charge

In its second point, Clark County argues that the circuit court erred in upholding the

imposition of the “Arkansas Universal Service Fee” and the “Special Municipal Charge.”

Clark County contends that the counties’ payment of both charges is not in exchange for

telephone services but to help AT&T pay the government. According to Clark County, a

diversion of public funds to a private purpose in this manner offends the Arkansas

Constitution and is in direct violation of the public-purpose doctrine. We disagree.

1. Arkansas universal service fee

The parties stipulated at trial that “AT&T charges its intrastate retail

telecommunications service customers, including County customers, a surcharge called the

AR Universal Service fee to recover the Arkansas High Cost Fund fees it pays to the Arkansas

High Cost Fund.” The Arkansas High Cost Fund (“AHCF”) was established “to promote

and assure the availability of universal service at rates that are reasonable and affordable and

to provide for reasonably comparable services and rates between rural and urban areas.” Ark.

Code Ann. § 23-17-404(a)(1). The General Assembly granted the PSC the authority to

implement and make funds available for the AHCF. The AHCF provides funding to eligible

telecommunications carriers serving rural or high-cost areas of the state. Ark. Code Ann. §

14 23-17-404(a)(2)–(3). Each telecommunications provider in the state is required to pay an

amount into the AHCF that is proportionate to its intrastate retail service revenues. Ark.

Code Ann. § 23-17-404(b)(1), (2)(A)(i). The AHCF statute provides: “Because customers of

the telecommunications providers that would pay the AHCF charge receive the benefits of a

universal network, the telecommunications providers may surcharge their customers to

recover the AHCF charges paid by the telecommunications provider.4 Therefore, the AHCF

charge is not a tax and is not affected by state laws governing taxation.” Ark. Code Ann. §

23-17-404(b)(2)(B).

In short, we agree with the conclusions reached by the circuit court. The AHCF

payments that telecommunications service providers like AT&T must pay into the fund are

a required cost of doing business in Arkansas. Telecommunications providers are permitted

to recover those costs of doing business from their customers. See Ark. Admin. Code

126.03.10-4.04, AHCF Rule 4.04(A) (“A telecommunications provider may recover the

amount of its contribution to the AHCF from its interstate retail telecommunications service

customers.”). The “AR Universal Service Fee” on AT&T’s bills to customers, including Clark

County, merely recovers some of the costs necessary for AT&T to provide service to those

customers.

4 AHCF Rule 10 defines “customer” as “any person, firm, partnership, cooperative corporation, corporation or lawful entity that has ordered and is receiving retail telecommunications services supplied by any telecommunications provider and is receiving a bill from the provider for services associated with one or more retail access lines.” Ark. Admin. Code 126.03.10.

15 Clark County Judge Troy Tucker testified at trial that there is an appropriation to pay

the county’s monthly utility bills, and those funds are used to pay the phone bill each month.

The AHCF, as mentioned, serves an important public interest in promoting the availability

of universal service at affordable costs. Indeed, among other things, the AHCF provides

funding to “Arkansas counties for 911 public safety answering points in the amount of two

million dollars ($2,000,000) annually.” Ark. Code Ann. § 23-17-404(e)(6)(A)(iv).

For these reasons, we cannot say that the circuit court erred in upholding the

imposition of the “Arkansas Universal Service Fee.” Accordingly, we affirm the circuit court’s

judgment on this point.

2. Special municipal charge

The parties also filed agreed stipulations of fact relating to the “Special Municipal

Charge,” which AT&T charges its local telephone service customers, including customers

that are counties. The special municipal fee is intended to recover franchise fees that

Arkansas cities impose on AT&T for permission to put AT&T’s facilities in the municipal

streets and rights-of-way. According to the parties’ stipulated facts, the cities of Arkadelphia

and Gurdon each impose a 5% franchise fee upon AT&T by ordinance. AT&T, in turn,

charges customers who obtain local telephone service within those cities a special municipal

fee to recover the franchise fees imposed upon it by each city.

16 For the purpose of providing “public utility necessities for itself and for the

inhabitants of any municipality, the mayor and city council, or the other governing bodies

of municipalities . . . may contract on its own behalf, and on behalf of the inhabitants of the

municipality,” with a utility company and may grant to the company “the privilege of using

the streets, alleys, and public grounds of the municipality for such purposes, on such rates,

charges, and terms as may be agreed upon.” Ark. Code Ann. § 14-54-704(a). Further,

municipalities have the right to establish terms and conditions upon which public utilities

may be permitted to operate within the borders of said municipalities and may by ordinance

impose a reasonable franchise fee for service rendered by any public utility occupying streets

and rights-of-way within the municipality. Ark. Code Ann. § 14-200-101(b)(1). “In common

parlance, such franchise fees are, in form, rental payments for a public utility’s use of the

municipality’s right-of-way[.]” City of Little Rock v. AT&T Communications of the Sw., Inc., 318

Ark. 616, 620, 888 S.W.2d 290, 292 (1994). A public utility is permitted by law “to collect

from its customers residing in each municipality an amount that equals the franchise fee

assessed by the municipality on the public utility.” Ark. Code Ann. § 14-200-101(b)(2).

We cannot say that the circuit court erred in upholding the imposition of the “Special

Municipal Charge” AT&T collects from its customers located within the city limits of

Arkadelphia and Gurdon, including Clark County, to recover the franchise fees assessed by

those cities on AT&T. The municipal surcharge, like the universal-service fee, is a cost of

doing business that AT&T is permitted by law to recover from its customers. We agree with

the circuit court’s conclusion that the “Special Municipal Charge” is not an improper private

17 use of funds. Instead, it is directly tied to AT&T’s use of city rights-of-way to provide services

to customers within the city limits, including county customers such as Clark County. AT&T

could not furnish these services without paying the franchise fees. Accordingly, we affirm the

circuit court’s judgment on this point.

C. Res Judicata

Clark County next argues that the circuit court erred in ruling that its claims relating

to the “Arkansas Universal Service Fee” were barred by principles of res judicata because of

the PSC’s October 30, 2018 declaratory order. As we have already addressed the claims

involving the “Arkansas Universal Service Fee” and have found them to be without merit,

we need not discuss whether these claims are also barred by res judicata. See Cent. Okla.

Pipeline, Inc., 2012 Ark. 157, at 19, 400 S.W.3d at 712–13.

D. Notice to the Attorney General

Clark County’s final argument is that the circuit court erred in concluding that the

county’s public-purpose-doctrine and constitutional arguments were “procedurally

improper” because the county failed to notify the Attorney General. Arkansas law provides

that when declaratory relief is sought, if the statute is alleged to be unconstitutional, “the

Attorney General of the State shall also be served with a copy of the proceeding and be

entitled to be heard.” Ark. Code Ann. § 16-111-111(a). The purpose of the notice statute is

to prevent a statute from being declared unconstitutional without a full adjudication and

adversarial parties. Sherland v. Sherland, 2015 Ark. App. 342, at 5, 465 S.W.3d 3, 7.

18 We disagree with the circuit court’s conclusion that notice was required. Clark

County did not allege that any statute is unconstitutional. Rather, the county asserted

“public funds” claims and alleged that AT&T’s exaction of the disputed charges from

government subdivisions, like counties, was either not authorized by law or contrary to law.

Because notice to the Attorney General was not required in these circumstances, we must

reverse the circuit court’s ruling on this issue.

Affirmed in part; reversed and remanded in part.

TUCKER, THYER, WOOD, and BROWN, JJ., agree.

BARRETT, J., dissents.

STEPHANIE POTTER BARRETT, Judge, dissenting. I respectfully dissent from the

majority’s decision to reverse the circuit court on the issue of the 911 fees. I would affirm

the circuit court’s well-reasoned conclusion that Clark County falls within the statutory

definition of a “service user” and is therefore subject to the fee imposed under the Arkansas

Public Safety Communications Act (“APSCA”).

This appeal presents an issue of statutory interpretation, which we review de novo.

See Harts v. Damsky, 2024 Ark. App. 604, 704 S.W.3d 638. Even so, our review is guided by

the plain language of the statute, and where the circuit court correctly interprets and applies

that language, affirmance is required. Id. Here, the circuit court carefully analyzed the

statutory framework and concluded that Clark County received landline telephone services

capable of placing 911 calls and therefore satisfied the definition of a “service user” under

19 Arkansas Code Annotated section 12-10-303(27). The circuit court further found that no

express statutory exemption applies to Clark County. I agree.

The APSCA expressly provides that the 911 service charge “shall have uniform

application and shall be imposed throughout the political subdivision to the greatest extent

possible in conformity with availability of the service in any area of the political subdivision.”

Ark. Code Ann. § 12-10-318(e). The circuit court correctly recognized that this language

reflects the legislature’s intent that participation in the funding structure be broad and

uniform, not selectively limited. Construing the statute to exempt municipalities would

conflict with the legislature’s directive that the charge be imposed “throughout” the political

subdivision “to the greatest extent possible.”

The circuit court also correctly relied on the settled principle that tax-exemption

provisions must be strictly construed against the exemption, with any doubts resolved in

favor of taxation. See Miller Cnty. v. Opportunities, Inc., 334 Ark. 88, 971 S.W.2d 781 (1998)

(citing Pledger v. Noritsu Am. Corp., 320 Ark. 371, 896 S.W.2d 595 (1995)). The APSCA

contains no explicit exemption for counties or municipalities. Thus, as the circuit court

concluded, Clark County’s position necessarily depends on implying an exemption that the

legislature did not provide. Our rules of statutory construction do not permit such a result.

For these reasons, I must dissent.

Turner & Turner, P.A., by: Todd Turner and Dan Turner, for appellant.

Smith Williams LLP, by: Richard Smith; Mayer Brown, LLP, by: Kevin Ranlett, pro hac vice;

and Heather B. New, pro hac vice, for appellees. 20 Colin R. Jorgenson, for amicus curiae Association of Arkansas Counties