Fort Smith sales tax revenues in May once more got here in higher than this time last yr and better than expected, with town’s share of the Sebastian County tax up almost 9% greater than April 2022. April numbers reflect February transactions.
The May sales tax report shows town’s share of the 1% Sebastian County sales tax totaled $2.039 million, up 8.9% in comparison with the $1.871 million reported in May 2022. Town estimated the revenue generated by the tax for the month could be $1.901 million, which suggests the actual collection got here in 7.26% higher than budgeted.
Town’s share of the countywide tax is closely watched since the revenue provides money for town’s general fund budget, with much of that budget paying for police, fire and other essential city services. The primary five months of 2023 show revenue from the tax at $10.219 million, 8.26% higher than the $9.439 million the tax reported through May 2022.
Voters will go to the polls Aug. 8 to increase or end the 1-cent countywide sales tax in Sebastian County for one more 10 years. The tax, which generated $33.768 million in 2022, is ready to sunset June 30, 2024, without the extension. The tax is split among the many city and towns within the county and the county itself based on population and makes up an enormous a part of the budgets of lots of the municipalities within the county.
Fort Smith City Director Neal Martin said he isn’t any longer surprised by the sales tax data provided every month because there have been too many months of positive growth yr after yr for it to be a fluke.
“While inflation does play a task, the consistent growth has shown the strength of the local economy. I’m not an economist, but I hear that a recession may not occur, which can bode well for continued growth,” Martin said. “With the development activity for the Foreign Military Sales mission, we’re going to proceed to see growth. That is an important thing for our city.”
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1% in May on a seasonally adjusted basis after rising 0.8% in April, in accordance with the the U.S. Bureau of Labor Statistics June report. The all items index increased 4% before seasonal adjustment over the past 12 months.
Fort Smith’s 1% street tax – used for maintenance and recent construction on streets, bridges and drainage – reported $2.491 million in May, up 6.76% from the $2.333 million reported in May 2022. Through May, the tax has generated $12.456 million, 7.58% greater than the $11.578 million reported in the primary five months of 2022.
“Fort Smith’s sales tax collections are still performing higher than expected. For the yr to day through May, city tax collections are 8.68% over budget and town’s portion of the countywide sales tax is 6.57% over budget. The present record low unemployment rate, despite the upper rates of interest, and the upcoming FMS project and economic development projects proceed to expand the Fort Smith and River Valley economy. This growth and the stable employment figures are reflected in these sales tax figures,” said City Administrator Carl Geffken.
Geffken said the taxes support the police, fire, engineering, and parks departments in addition to all administrative departments in town, which allows town to exchange of fireside and police equipment, pave city-owned roads, provide police officer and firefighter salaries, fix drainage problems, and provides the funding to take care of our parks and for parks projects, similar to the John Bell, Jr. park and work at Creekmore Park, including the brand new walking path and future bath house.
In 2022, Fort Smith’s share of the 1% Sebastian County sales tax was $23.553 million, 9.6% higher than 2021 and up 9.05% from budget estimates for the yr. The 2022 total was $1.955 million greater than city officials budgeted to spend throughout the fund budget and $2.06 million, greater than the tax brought town in 2021. The 1% street tax generated $28.85 million, up 7.4% over 2021 and up 7.65% from budget estimates. The 2022 total was $2.05 million greater than city officials budgeted to spend on the road tax program.
PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 1% sales tax collection for streets
2022: $28.85 million
2021: $26.667 million
2020: $22.66 million
2019: $21.73 million
2018: $21.503 million
2017: $21.204 million
2016: $21.156 million
Fort Smith portion of 1% countywide sales tax
2022: $23.553 million
2021: $21.49 million
2020: $18.246 million
2019: $17.265 million
2018: $17.043 million
2017: $16.691 million
2016: $16.58 million