concurring. I concur. The circuit court unquestionably has jurisdiction to determine the legal validity of the initiative ordinance at issue in this case. See Catlett v. Republican Party, 242 Ark. 283, 413 S.W.2d 651 (1967). The initiative ordinance here clearly conflicts with statutory law and should be declared invalid and stricken from the ballot for that reason alone.
Under Ark. Code Ann. § 26-75-613(a)(2) (Repl. 1993), any municipality by ordinance can levy a hotel and restaurant tax and pledge all or any part of the revenues to the payment on bonds authorized under that provision. The bond-authorizing ordinance must specify the nature, extent of the pledge, terms, conditions and covenants, including a covenant that the hotel and restaurant tax will be collected so long as the bonds are outstanding. § 26-75-613(a)(2) and (b)(2).
On September 8, 1987, the City of Hot Springs passed Ordinance 3914, calling for an election for the purpose of refunding certain outstanding bonds to be secured by a portion of the City’s hotel and restaurant tax. On January 4, 1988, the City’s board of directors adopted Ordinance 3942 authorizing the refunding of bonds provided for under Ordinance 3914. Ordinance 3942 further provided, “The bonds shall mature over the period from 1989 through 1997.”1
On May 1, 1989, the City adopted Ordinance 4002 to reaffirm the City’s hotel and restaurant tax (3% “hamburger tax”) which was being used to pay off existing bonds. It is this ordinance that the proposed initiative ordinance is intended to amend, reducing the tax by one-half (3% to 1-1/2%).
From the record before us, we know certain bonds were duly authorized by City Ordinance 3942 and those bonds will not mature until 1997. In addition, Ordinance 3942 (and subsequent amending ordinances) pledged two-thirds of the tax (2% of the 3% tax) for the payment of bonds. As provided in § 26-75-613(b)(3)(A), the authorizing ordinance (3942) is a contract between the municipality and bondholders and must be performed in strict compliance with the covenants. The initiative ordinance conflicts with and breaches that city-bondholder contract entered into on January 4, 1988, and cannot be upheld.
Because the proposed initiative ordinance is invalid, I would uphold the circuit court’s decision to omit the proposed ordinance question from the 1994 General Election ballot.
The city board also passed Ordinance 3943 to refund other bonds previously issued under Ordinance 3914.