AR SB138

Creates Chapter 62 of Arkansas Code establishing procedures to revoke a municipal corporation's charter if the Legislative Joint Auditing Committee concludes the audit process under § 14-59-117 twice within a three-year period, triggering Attorney General filing in the Sixth Judicial Circuit.

Upon charter revocation, the circuit court appoints a receiver within five business days to manage the defunct municipality's assets, collect outstanding taxes and revenues, and resolve indebtedness while preserving creditor rights.

Returns the municipality's territory and population to the county, abolishes municipal offices and ordinances, voids all licenses and permits, and transfers all municipal property to the receiver subject to existing liens and creditor interests.

Establishes procedures for public utility disposition through a priority system: first to adjacent municipalities within five miles, then to the county, then to improvement districts, then to other entities, with specific timeframes for each acquisition stage; if no acquisition occurs, creates a suburban improvement district for potential bankruptcy proceedings.

Transfers police and fire retirement fund obligations to the Arkansas Local Police and Fire Retirement System and continues collection of pledged taxes until indebtedness is satisfied; provides for final dissolution order once all municipal indebtedness is fully satisfied.