- Associated Press - Tuesday, June 2, 2015

LITTLE ROCK, Ark. (AP) - A Pulaski County circuit judge has upheld a ruling that banned Little Rock and North Little Rock from paying their chambers of commerce for economic development services.

Judge Mackie Pierce ruled Monday that the cities’ contracts with their commerce chambers violate the state Constitution, which he said prohibits municipalities from paying private companies without receiving anything in return, the Arkansas Democrat-Gazette (https://bit.ly/1AIto3u ) reported.

Several community activists had sued the cities in 2013, challenging the legitimacy of the payments to the chambers and similar development promoters.

Pierce struck down the contracts in January, but agreed to hear arguments again from the municipalities who hoped to change his mind. Still, he said he found the cities’ arguments, which had compared the chamber contracts to other ones they would have with any other consultant, unconvincing and sided in favor again with the plaintiffs’ attorneys.

Pierce said he also would consider the plaintiff lawyers’ requests for the cities to pay their legal fees and expenses.

Since the January ruling, the Arkansas Legislature has proposed a constitutional amendment for voters to consider next year that would eliminate the contract restrictions. Several other cities have put their contracts on hold or are reconsidering their financial agreements with their chambers.


Information from: Arkansas Democrat-Gazette, https://www.arkansasonline.com

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