Did the Arkansas Attorney General approve the interlocal agreement renaming Pulaski County's CATA transit system as Rock Region METRO?

Plain-English summary

The Pulaski County area's transit authority, originally known as the Central Arkansas Transit Authority (CATA), was renamed Rock Region Metropolitan Transit Authority (METRO). To formalize the rename and incorporate prior amendments, Pulaski County and the cities of Little Rock, North Little Rock, Maumelle, and Sherwood needed to update their interlocal cooperation agreement. The Arkansas Interlocal Cooperation Act (Ark. Code Ann. § 25-20-101 et seq.) requires the AG to review and approve such agreements as proper in form and consistent with state law.

The AG approved the agreement as submitted. The opinion is brief: the parties qualify as "public agencies" under § 25-20-103(1), the cooperative purpose (operating a public transit system within Pulaski County) falls within the joint exercise of governmental powers each party already has, and the agreement contained the six required elements under § 25-20-104(c) plus the two additional elements required when no separate legal entity is created.

A footnote flags one substantive item: subsection 1.02(j) of the agreement requires a two-thirds vote of the METRO Board to approve creation of any improvement district. The AG noted this is a self-imposed procedural rule, not a substitute for the statutory requirement under Ark. Code Ann. § 14-334-108(A) that property owners (two-thirds in value) petition before a transit authority can act as improvement-district commissioner.

Currency note

This opinion was issued in 2018. 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.

What the Interlocal Cooperation Act requires

Under § 25-20-104(c), every interlocal agreement must specify:

1. Duration of the agreement.
2. Identity of any separate legal entity to conduct the undertaking.
3. Purposes of the agreement.
4. Manner of financing the joint undertaking and establishing/maintaining a budget.
5. Methods of accomplishing termination and disposing of property upon termination.
6. Any other necessary and proper matters.

Under § 25-20-104(d), if no separate legal entity is established, the agreement must additionally specify:

1. Provision for an administrator or joint board responsible for administering the undertaking.
2. Manner of acquiring, holding, and disposing of real and personal property used in the undertaking.

Under § 25-20-104(f), the AG must approve the agreement as proper in form and compatible with state law.

The METRO agreement satisfied all of these.

The improvement-district footnote

Subsection 1.02(j) of the agreement requires a two-thirds vote of the METRO Board of Directors to approve creating any improvement district. The AG read this as the parties imposing a higher procedural bar on themselves than state law requires, while still recognizing that the statutory prerequisite remains: under Ark. Code Ann. § 14-334-108(A), a transit authority can act as an improvement district commissioner "upon the petition of persons claiming to be two-thirds (2/3) in value of the owners of real property in the area." Both requirements (Board supermajority vote and property-owner petition) would have to be satisfied to form an improvement district under the agreement.

Common questions

What is the Interlocal Cooperation Act for?
It lets two or more "public agencies" (state agencies, counties, cities, school districts, political subdivisions) jointly exercise any governmental power any of them has individually. The AG must approve the agreement before it takes effect.

Why does this opinion matter?
It illustrates the routine but procedurally important AG-approval step for public-agency cooperation in Arkansas. Transit authorities, regional crisis stabilization units, jail consolidations, water systems, and similar joint efforts all run through this process.

What does an interlocal agreement do that simple contracts cannot?
It creates a cooperative governance framework that lets parties exercise governmental powers (taxing, condemning, regulating) jointly. A simple commercial contract cannot do this.

Background and statutory framework

Ark. Code Ann. § 25-20-104(a) provides that any governmental powers exercisable by one public agency "may be exercised and enjoyed jointly with any other public agency of this state which has the same powers, privileges, or authority under the law." Pulaski County and the four cities all have authority to support public transit, so cooperation is permitted.

The AG's statutory role is limited to verifying form and state-law consistency. The AG does not pass on the wisdom or business terms of the agreement.

Citations

• Ark. Code Ann. § 25-20-101 et seq. (Interlocal Cooperation Act)
• Ark. Code Ann. § 25-20-103(1) (definition of public agency)
• Ark. Code Ann. § 25-20-104 (form requirements; AG approval)
• Ark. Code Ann. § 14-334-108(A) (transit authority improvement-district creation)

Source

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

Original opinion text

Opinion No. 2017-132
February 6, 2018
J.E. Sweere, Esq.
Cross, Gunter, Witherspoon & Galchus, P.C.
500 President Clinton Avenue, Suite 200
Little Rock, AR 72201

Dear Mr. Sweere:

You have requested approval, pursuant to the Interlocal Cooperation Act, Ark. Code Ann. § 25-20-101 et seq., of a proposed interlocal agreement between Pulaski County and the Cities of Little Rock, North Little Rock, Maumelle, and Sherwood, to continue a public transit system within the boundaries of Pulaski County. You have submitted a copy of the renewed agreement, the terms of which provide for the parties' joint participation and membership in the Rock Region Metropolitan Transit Authority ("Transit Authority"). You are seeking my approval of the Agreement pursuant to the statutory requirement that I approve as proper in form and consistent with state law any interlocal agreement to undertake a joint enterprise between or among "public agencies."

[Footnote: Pulaski County and the Cities clearly qualify as "public agencies" as that term is defined at Ark. Code Ann. § 25-20-103(1) (Supp. 2017) (including within the definition of "public agency" any "[p]olitical subdivision of this state"). With respect to the range of permissible agreements, subsection 25-20-104(a) provides that any governmental powers, privileges, or authority exercisable by a public agency alone may be exercised and enjoyed jointly with any other public agency of this state which has the same powers, privileges, or authority under the law. This grant of authority would generally include an agreement between political subdivisions to cooperate in the design and other work associated with participation and membership in the Transit Authority.]

The Interlocal Cooperation Act requires that interlocal agreements for joint or cooperative action specify the following items:

(1) The duration of the agreement;
(2) The identity of any separate legal entity to conduct the undertaking;
(3) The purposes of the agreement;
(4) The manner of financing the joint or cooperative undertaking and of establishing and maintaining a budget for it;
(5) The methods of accomplishing termination of the agreement and for the disposal of property (if any) upon termination;
(6) Any other necessary and proper matters.

In addition, if the interlocal agreement does not establish a separate legal entity to conduct the joint or cooperative undertaking, it must specify the following items:

(1) The provision for an administrator or a joint board that will be responsible for administering the joint or cooperative undertaking;
(2) The manner of acquiring holding, and disposing of real and personal property (if any) used in the joint or cooperative undertaking.

Having reviewed the Agreement, I find that it meets the requirements of the Interlocal Cooperation Act. Accordingly, I hereby approve the Agreement as submitted.

[Footnote: The Agreement is in proper form. And although my review indicates that it is compatible with state law, some mention should be made of subsection 1.02(j), regarding the creation and operation of an improvement district. This subsection of the Agreement requires a two-thirds vote of the Transit Authority's Board of Directors to approve the creation of any such district. I gather that the parties to the Agreement are agreeing to impose this vote requirement on the Board, while also recognizing that a petition of property owners is a statutory prerequisite to forming such an improvement district. See Ark. Code Ann. § 14-334-108(A) (Supp. 2017) (authorizing a transit authority to "constitute the authority or a committee thereof as improvement district commissioners and to create and operate an improvement district . . . upon the petition of persons claiming to be two-thirds (2/3) in value of the owners of real property in the area . . . .").]

Sincerely,

LESLIE RUTLEDGE
Attorney General