Brown v. City of Stuttgart

Jack Holt, Jr., Justice.

This is an action challenging the validity of a tax exempt lease agreement between the City of Stuttgart and First Continental Financial Corporation on the grounds that the lease contains interest bearing evidence of indebtedness in violation of Ark. Const., art. 16, § 1. We find that it does and reverse the trial court.

The appellees, City of Stuttgart and First Continental Financial Corporation, entered into a lease agreement for a garbage truck. Stuttgart chose this method of acquisition because it did not have enough cash to purchase the garbage truck in one year. A…