Sales tax revenue to fund Fort Smith city operations continues to move in the wrong direction. For the first four reporting months of 2013, the collections are 1.55% below 2012 levels and 4.33% below budget.
Each of the city’s 1% sales taxes (1% for streets and 1% for water and sewer projects) collected $1.646 million in the April report, down 1.78% from the same period in 2012.
The collections in the April report were 4.66% below budget estimates. (Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted to cities in May are from taxes collected in March and transferred by merchants to the state in April.)
The dip in collections has resulted in city officials seeking 4% budget cuts from all departments.
For the first four reporting months of 2013, each of the 1% sales taxes generated $6.687 million, down compared to $6.792 million in the same period of 2012.
Collections in 2012 of the two 1% taxes totaled $39.21 million, slightly ahead of the $38.683 million during 2011. The 2011 collections were 3.9% above 2010 collections.
Fort Smith’s share of the county 1% sales tax in the April report is $1.276 million, down 2.63% compared to April 2012. The collection was down 4.99% compared to the revenue estimate.
For the first four months of 2013, the countywide tax has generated $5.186 million for Fort Smith, down 1.64% compared to 2012 and down 4.03% compared to budget forecasts.
The countywide tax collection is critical because the revenue is a little more than 40% of the city’s general budget of roughly $42 million. A majority of the general fund budget general supports fire, police and other critical city functions.
A REGIONAL LOOK
Outside of Fort Smith, collections are mixed and indicate flat consumer spending.
Crawford County collections for the first three reporting months of 2013 total $1.494 million, down from $1.515 million during the same period of 2012.
Van Buren collections for the first three reporting months total $1.683 million. The city began collecting an extra 1% tax in January to pay for emergency services upgrades, a new senior center and other improvements. The city collected $849,606 during the first three reporting months of 2012.
Sebastian County collections totaled $6.996 million during the first three reporting months of 2013, slightly ahead of the $6.98 million during the same period of 2012. Collections in Greenwood for the first three months totaled $482,638, slightly more than the $474,423 during the 2012 quarter.
PREVIOUS ANNUAL COLLECTION INFO (Fort Smith)
2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2012: $39.210 million
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million
Fort Smith portion of 1% countywide sales tax
2012: $15.279 million
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million