Ark. court says schools can keep excess money

Associated Press

LITTLE ROCK (AP) - A split Arkansas Supreme Court has ruled that school districts where property tax collections exceed state-mandated school funding levels can keep the money.

The Department of Education wanted the Eureka Springs and Fountain Lake school districts to return a total of $2.2 million, saying they received too much school aid when it was considered with money collected locally. Justices split 4-3.

Pulaski County Circuit Judge Tim Fox ruled for the districts last year. He said current Arkansas law doesn't allow the state to withhold property tax money from local school districts.

In a dissent Thursday, Chief Justice Jim Hannah warned that the court's decision "obliterated" the state's school-funding system. Major overhauls changed Arkansas' funding formula after a challenge from the Lake View School District decades ago.

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