Agency funding plan may change; 1% ordinance vote set

story by Luke Hobbs
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The Fort Smith Board of Directors decided in Tuesday’s (July 26) study session to use a new formula for funding outside agencies in the 2012 budget.

Each year, a portion of the City’s general fund is allocated to provide funding for outside groups whose work benefits the community. These groups are divided into three categories — Recreation, Arts & Humanities, and Social/Community Services.

The amount of total funding for outside agencies has been cut in recent budgets. In 2010 and previous years, the City provided around $227,000 for outside agencies; in 2011, the allocation was only $202,700.

Tracy Winchell, city communications manager, told the board she expects the outside agency funding to be cut further in the 2012 budget.

Several directors suggested the three categories of outside agencies each receive the same proportion of funding in 2012. This three-way split differs from the way outside agency funding has been allocated in the past two years.

In the 2010 budget, the three categories were allocated the following funding percentages: Recreation, 37%; Arts & Humanities, 30%; and Social/Community Services, 33%.

In the 2011 budget, the percentage funding formula was abandoned and allocations were instead made based on the number of applications for each category. As a result, the three categories ended up receiving allocations in the following percentages: Recreation, 17.86%; Arts & Humanities, 28.57%; and Social/Community Services, 53.57%.

Winchell said this process caused some outside agencies to not receive as much funding as they needed.

City Director Philip Merry Jr. asked his fellow board members whether it would be wrong to abandon the funding categories and simply allocate a flat amount, such as $8,000, to each outside agency.

But other directors said some agencies rely far more on city funding than do others, making a flat allocation inadvisable.

“Some of these groups would close their doors if they didn’t have that funding,” said Director Steve Tyler.

The board then agreed to keep the three categories and divide their funding evenly, and it plans to monitor outside agency allocations so that specific organizations receive appropriate funding based on their needs.

City Director Pam Weber asked for a special board meeting on Thursday (July 28) at noon to vote on an ordinance setting up a November voter referendum on a 1% prepared food tax. She requested the vote because Merry will not be able to attend the regular meeting on Aug. 2. (This post will be updated when a meeting location is announced.)

The ordinance expected to be considered has three major parts:
• Repealing the original 1% prepared food tax ordinance;
• Re-adopting the 1% prepared food tax; and
• Submitting the measure to the people in a referendum, which would take place on a yet-to-be-determined date in November.

The tax was approved by the board in February as a solution to an annual deficit with Fort Smith Convention Center operations predicted to occur when $1.8 million in annual state turnback money dried up. The state turnback program — which supported expansion or construction of tourism facilities — ended for Fort Smith in June 2010. The center has since operated on a reserve fund.

The last few months have included a petition drive to force the tax to an election and a court hearing that essentially overturned the city’s rejection of the petition drive.