Does the county treasurer take a 2% commission on prisoner commissary and telephone profits before they reach the sheriff's communications fund?

Plain-English summary

State Representative Scott Baltz asked the AG two related questions: do county treasurers get the 2% commission under Ark. Code Ann. § 21-6-302 on prisoner-commissary profits and prisoner-telephone-service commissions that flow through the county sheriff's office fund on their way to the sheriff's communications facility and equipment fund, and does the answer change if the communications fund is on the county's books versus the sheriff's books.

AG Leslie Rutledge said yes to the first, no to the second. The 2% commission statute is unambiguous. With exceptions for school funds, municipal improvement district assessments, fire premium tax moneys, certain official fees, and nonrevenue receipts (reimbursements to the county), the county treasurer is required to "collect, as a treasurer's commission, two percent (2%) on all funds coming into their hands as treasurers and to be paid out of the respective funds." None of the carve-outs covered prisoner-related receipts.

The 100% transfer rule the requester cited (Ark. Code Ann. § 12-41-105(b)(1), which says 100% of the commissions and profits "deposited into" the sheriff's office fund must be credited to the communications facility and equipment fund) refers to 100% of the net amount, not the gross. The treasurer takes the 2% before crediting the funds to the sheriff's office fund. Whether the downstream communications fund sits on the sheriff's books or on the county's books does not change the commission analysis, because the treasurer's commission is triggered by the funds passing through the treasurer's hands.

Currency note

This opinion was issued in 2016. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Where do prisoner commissary profits and prisoner telephone commissions go in Arkansas counties?
Under Ark. Code Ann. § 12-41-105(a)(1), they are deposited with the county treasurer and credited to the county sheriff's office fund, an agency fund the treasurer holds as agent for the sheriff. § 12-41-105(b)(1) then requires 100% of those deposits to be transferred to the sheriff's communications facility and equipment fund (a separate fund created by § 21-6-307 from 25% of certain sheriff's fees).

What is the 2% treasurer's commission?
Ark. Code Ann. § 21-6-302(a) requires county treasurers to collect a 2% commission "on all funds coming into their hands as treasurers and to be paid out of the respective funds," with statutory exceptions. The commission is a long-standing fee structure for treasurer offices.

What are the carve-outs?
School funds (§§ 6-13-701, 6-17-908, 6-20-221), municipal improvement district assessments (§ 14-90-913), fire premium tax moneys (§ 14-284-403), official fees not specified in law (§ 21-6-104), and nonrevenue receipts defined as reimbursements to the county (§ 21-6-302(e)(1)-(2)). The AG concluded prisoner-commissary and telephone receipts fit none of these.

Does the 100% transfer rule conflict with the 2% commission?
Not in the AG's reading. The 100% applies to the amount "deposited into" the sheriff's office fund, which is the amount remaining after the treasurer's commission. Read together, the treasurer takes 2%, then 100% of the rest moves to the communications facility and equipment fund.

Does the location of the communications fund (sheriff's books vs. county books) matter?
No. The commission is triggered by the funds passing through the treasurer's hands. The downstream fund's accounting location does not change that. Either way, the commission applies.

Background and statutory framework

Prisoner-fund flow. Ark. Code Ann. § 12-41-105(a)(1) (Supp. 2015) directs that commissions on prisoner telephone services and profits on prisoner commissary services are deposited with the county treasurer for credit to the county sheriff's office fund. § 12-41-105(a)(2)(A) classifies the sheriff's office fund as an agency fund (held by the treasurer for the sheriff). § 12-41-105(b)(1) requires 100% of those deposits to be transferred to the communications facility and equipment fund.

Communications facility and equipment fund. Ark. Code Ann. § 21-6-307(b)(2)(A) (Supp. 2015) created this fund as a special fund from 25% of all fees collected by the sheriff. Prisoner-related receipts are a separate stream that lands in the same fund.

The 2% treasurer's commission. Ark. Code Ann. § 21-6-302(a) (Supp. 2015) is the spine of the AG's analysis: county treasurers must collect a 2% commission on all funds coming into their hands, subject to a closed list of statutory exceptions. § 21-6-302(e)(1) and (2) define one of those exceptions ("nonrevenue receipts" = reimbursements of county payments), which did not apply here.

Citations

Statutes: Ark. Code Ann. §§ 12-41-105(a)(1), 12-41-105(a)(2), 12-41-105(b)(1), 21-6-302(a), 21-6-302(e)(1), 21-6-302(e)(2), 21-6-307(b)(2)(A), 6-13-701, 6-17-908, 6-20-221, 14-90-913, 14-284-403, 21-6-104 (Supp. 2015).

Cases: none cited.

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

Opinion No. 2015-147
May 20, 2016
The Honorable Scott Baltz
State Representative
4589 Highway 90 West
Pocahontas, AR 72455
Dear Representative Baltz:
STATE OF ARKANSAS
ATTORNEY GENERAL
LESLIE RUTLEDGE
This is in response to your request for my opinion on the following questions
concerning county treasurers' commissions:

1. Are county treasurers authorized to comm1ss1on the profits from
   prisoner commissary services and commissions from prisoner
   telephone services that are deposited with them by the county sheriff
   for credit to the County Sheriffs Office Fund before being credited
   to the Communications Facility and Equipment Fund?
2. Does it make a difference, concerning the allowance of a treasurer
   commission on these funds, if the Communications Fund is on the
   books of the county rather than on the books of the Sheriff?
   RESPONSE
   It is my opinion that the answer to your first question is "yes." The answer to your
   second question is "no," in my opinion.
   DISCUSSION
   Question 1 - Are county treasurers authorized to commission the profits from
   prisoner commissary services and commissions from prisoner telephone services
   that are deposited with them by the county sheriff for credit to the County
   323 CENTER STREET, SUITE 200 · LITTLE ROCK, ARKANSAS 72201
   TELEPHONE (501) 682-2007 · FAX (501) 682-8084
   ARKANSASAG.GOV The Honorable Scott Baltz
   State Representative
   Opinion No. 2015-147
   Page 2
   Sheriff's Office Fund before being credited to the Communications Facility and
   Equipment Fund?
   Your question relates to certain revenues that derive from prisoner services
   namely, "commissions derived from prisoner telephone services and profits earned
   from prisoner commissary services."1 These commissions and profits are
   deposited with the county treasurer and credited to the county sheriffs office fund:
   Commissions derived from prisoner telephone services and profits
   earned from prisoner commissary services provided in the various
   county and regional detention facilities in the state shall be deposited
   with the county treasurer of the county in which the detention
   facility is located, and the county treasurer shall credit the funds to
   the county sheriffs office fund.2
   Arkansas Code Annotated § 21-6-302 provides that with certain exceptions,
   county treasurers have a duty to collect a 2% commission on all money they
   handle:
   Unless otherwise provided by§§ 6-13-701, 6-17-908, 6-20-221, 14-
   90-913, 14-284-403, and 21-6-104, the county treasurers shall be
   required to collect, as a treasurers commission, two percent (2%) on
   all funds coming into their hands as treasurers and to be paid out of
   the respective funds. 3
   None of the listed statutory exceptions pertains to the telephone commissions and
   commissary profits at issue under your question. 4 The county treasurers handle
   1 Ark. Code Ann.§ 12-41-105(a)(l) (Supp. 2015).
   2 Id. The "county sheriffs office fund" is an agency fund that accounts for funds held by the
   county treasurer as an agent for a governmental unit until the funds are transferred to that unit for
   its intended use. Id. at § 12-41-105(a)(2)(A). Such funds do not require appropriation, nor are they
   subject to the county claims process. Id. at § 12-41-105(a)(2)(B).
   3 Ark. Code Ann.§ 21-6-302(a) (Supp. 2015) (emphasis added).
   4 Sections 6-13-701, 6-17-908, and 6-20-221 involve school funds; section 14-90-913 deals with municipal
   improvement district assessments; section 14-284-403 addresses fire premium tax moneys; and section 21-
   6-104 relates to official fees in amounts not specified by law). There is also an exception for funds that are
   reimbursements to the county: "The treasurer shall receive no commission for the handling of . . . all
   nonrevenue receipts .... As used in this subsection, 'nonrevenue receipts' means reimbursement of all or a
   part ofa payment made by the county."). Ark. Code Ann. § 21-6-302(e)(l) and (2). The funds at issue do
   not fall into this category. The Honorable Scott Baltz
   State Representative
   Opinion No. 2015-14 7
   Page 3
   these commissions and profits, and I believe it necessarily follows that these funds
   are subject to the 2% commission under section 21-6-302. This statute is
   unambiguous in requiring, with certain exceptions that do not apply in this case,
   the 2% commission "on all funds coming into [the treasurers'] hands as
   treasurers."
   I note that in presenting this question, you mention the requirement .under Ark.
   Code Ann. § 12-41-10 5 that 100% of the telephone commissions and commissary
   profits in the sheriffs office fund must be credited to the "communications facility
   and equipment fund":
   Of the commissions and profits deposited into the county sheriffs
   office fund in each county under subsection (a) of this section, one
   hundred percent (100%) shall be credited to the county sheriffs
   office communications facility and equipment fund under § 21-6-
3. 5
   In my opinion, this "one hundred percent ( 100% )" is 100% of the net amount after
   the county treasurer has collected the 2% commission required by Ark. Code Ann.
   § 21-6-302. The 100% requirement applies to the "commissions and profits
   deposited into the county sheriff's office fund." The amounts "deposited into" the
   sheriffs office fund are the amounts that have been credited to this fund by the
   county treasurer. The treasurer will have collected the 2% commission before
   crediting the funds to the sheriffs office fund.
   Question 2 - Does it make a difference, concerning the allowance of a treasurer
   commission on these funds, if the Communications Fund is on the books of the
   county rather than on the books of the Sheriff?
   In my opinion, the 2% commission applies because the telephone commissions
   and commissary profits are deposited with the treasurer, who credits them to the
   sheriffs office fund prior to transferring them to the communications facility and
   equipment fund. The fact that the latter fund may not be on the books of the
   5 Ark. Code Ann. § 12-41-105(b )(I). The communications facility and equipment fund was
   created under § 21-6-307 as a special fund from 25% of all fees collected by the sheriff. Ark.
   Code Ann. § 2 l-6-307(b )(2)(A) (Supp. 2015). This fund is different from the "county sheriffs
   office fund" described in note 4, supra. The latter fund is the county agency fund that is credited
   with the telephone commissions and commissary profits. The Honorable Scott Baltz
   State Representative
   Opinion No. 2015-147
   Page4
   county does not change the fact that the treasurer handles these funds, and there is
   no applicable exception to the 2% commission.
   It is therefore my opinion that the answer to this question is "no."
   Sincerely,
   _:;;;;::::> ffi
   LESLIE RUT~~~
   Attorney General