Anti-tax group: No financial reporting required

story by Michael Tilley
[email protected]

The Forward Fort Smith committee pushing for passage of the 1% hospitality tax has raised at least $9,100 to support their effort, but a leader of the group opposing the tax believes they are not required to file financial reports.

Proceeds from the 1% prepared food tax, which is on the Nov. 8 ballot, would support operations of the Fort Smith Convention Center. A 1% prepared food tax is estimated to raise about $1.8 million annually.

FORWARD FORT SMITH REPORT
Forward Fort Smith has posted with the Arkansas Ethics Commission a “Ballot Question Committee Financial Report” showing $9,100 in contributions and $36.30 in expenditures. Contributions and expenditures greater than $50 must be itemized and reported.

The Forward Fort Smith contributors, listed in order of the report, were:
Belle Point Beverages — $1,000
Weldon, Williams & Lick — $1,000
Dwight Curry — $1,000
Davis Iron & Metal — $1,000
Mickle-Wagner-Coleman — $500
Arvest Bank — $1,000
John Q. Hammons — $500
First National Bank of Fort Smith — $1,000
OG&E — $1,000
Chester Koprovic — $100

The report lists Jeff Smith as a committee officer, and the phone number on the report belongs to the Fort Smith Regional Chamber of Commerce. The report, stamped by the commission on Oct. 19, was filed Oct. 14, six days before the chamber officially endorsed passage of the 1% prepared food tax.

Chamber President Paul Harvel said use of the chamber phone number is a mistake.

“If it’s on there, it’s a mistake, because I didn’t authorize it,” Harvel said.

NO REPORT
But there is no report for individuals or a group opposed to the 1% prepared food tax. Liz Armstrong, a leader of the group opposing the tax, said they do not meet the filing requirements.

“According to the information I have received from Rita at the Arkansas Secretary of States Office, The Citizens for Efficient Government, does not fall within guidelines of the filing requirements,” Armstrong noted in an e-mail.

The rules, according to Graham Sloan, director of the Arkansas Ethics Commission, are simple: “If a group, or an individual, receives or expends $500 dollars to advocate passage or defeat (of a ballot item), then there is reporting that is required.”

Opponents of the 1% tax have purchased, either as individuals or a group, a billboard, yard signs and literature distributed at recent forums in which both sides debated the necessity of the 1% tax. The cost of a billboard would more than likely exceed $1,000. In-kind donations also count toward the $500 requirement, Sloan said.

“We had nothing to do with the billboards,” Armstrong said Monday (Oct. 24) when asked about expenditures to oppose the tax.

‘NONE OF YOUR BUSINESS’
The billboard, located at the corner of Towson and Fresno, was paid for by Hamel Properties. Jerry Hamel, owner of C&H Tire, and a vocal critic of Fort Smith city government, would not disclose the cost of buying the billboard.

The “Rita” mentioned by Armstrong is Rita Looney, who is with the Arkansas Ethics Commission and not the Secretary of State’s office. Looney confirmed with The City Wire that commission staff did advise Armstrong about state law related to advocating or opposing a ballot item.

According to Sloan and Looney, Armstrong was advised that groups or individuals can’t avoid reporting requirements by, for example, having five people pay $100 each for a $500 radio ad.

The reporting-avoidance example provided by Sloan somewhat mirrored the response given by Hamel when asked about the billboard costs.

“(R)eally hate to not give a direct answer but most of the people that gave money for the NO PREPARED FOOD TAX SIGN think that its none of your business!” Hamel noted in an e-mail response.

In a subsequent e-mail exchange, Hamel wrote: “a whole lot of people are helping with cost of everything and on a cost per person it is very little but when we look at the amount the city has spent to get this tax passed, all we can say is wow!”

A Clear Channel Outdoor official would not reveal the cost of the billboard.

Sloan said violation of reporting requirements could result in several possible sanctions. Those include a public letter reprimand, $50 to $2,000 fine, and/or an order to file the proper documents.

However, the commission does not initiate investigations. An investigation is launched only when a citizen submits a complaint form that commission staff believes may represent a violation. Complaint forms may be received by fax when requested. The commission phone number is (501) 324-9600.

The commission also requires a financial report be filed 7 days before the election, and a final report due 30 days after the election.