Northwest Arkansas businesses collected 4.4% more in sales tax during April which returned $4.265 million to the region’s five largest retail markets in June, according to the Arkansas Department of Finance report released this week.
The cities of Fayetteville, Springdale, Rogers, and Siloam Springs each posted gains from a year ago, while Bentonville fell a little short in collections for the month.
June’s tax revenue reflects April sales remitted to the state in May creating a two-month lag in the city reporting. Each of the five cities collect a 2% sales tax which is divided evenly between the cities’ general operating fund and the repayment of bonds. This report tracks the city’s portion, or 1% of the tax collected.
2012 TAX COLLECTIONS (June)
(Data represents a 1% sales tax, compared to prior year period.)
Bentonville: $664,781, down 4.97%
Fayetteville: $1.437 million, up 8.61%
Rogers: $1.078 million, up 8.45%
Siloam Springs: $244,928, up 0.45%
Springdale: $839,385, up 1.79%
Source: Respective cities.
Kathy Deck, director for the Center for Business and Economic Research at the University of Arkansas, credits the higher sales tax revenue trend to an improving job market in this region.
The local unemployment rate stood at 5.3% in April, down from 5.9% in the year-ago period. The April jobless rate is at the lowest level since 2008, according to the Bureau of Labor Statistics. The May report will be released Wednesday (June 27).
While there is a lot of uncertainty in world financial markets of late, local business owners say they are seeing decent traffic which has been validated by stronger sales tax collections, higher building permit issuance and healthy hospitality tax revenue through the first five months of 2012.
Rogers officials wore a big grin on their faces this week as the city finally reached the $1 million club. The city has been knocking at that threshold for several months but finally got in with $1.078 million in June receipts.
Steve Cox, director for economic development for the Rogers-Lowell Chamber, said the pulse among local business owners is upbeat with the anticipation of Cabela’s and Fresh Market set to open soon.
“We are already trending higher in collections without these two big draws, so we can’t wait to see what happens when they open,” Cox said. “There is also a renewed excitement in our downtown area with several new businesses there.”
Springdale is also beaming from a brighter economy to start 2012. Springdale Mayor Doug Sprouse said there are lots of projects on tap this year and the steady revenue source will go along way in helping to pay for them.
Fayetteville posted strong gains in the month and is up more than 7% for collections this year. The 2012 year-to-date budget impact for the five months is up a total of $782,550, according to Kevin Springer, budget director for the city.
Siloam Springs is also improving year-over-year with a small increase in sales tax revenue in June.
Bentonville has been sprinting through 2012 on the coattails of Crystal Bridges tourism. But sales tax revenue taped off in June down almost 5% for the month.
City officials say it’s a minor hiccup and look forward to the July numbers which will include the Wal-Mart shareholder activity.
Year-to-date Bentonville still leads the pack with the highest improvement in sales tax collections from 2011.
CUMULATIVE (year-to-date) TAX COLLECTIONS
2012: $4.737 million
2011: $4.101 million
2012: $8.512 million
2011: $7.959 million
2012: $6.464 million
2011: $5.936 million
2012: $1.489 million
2011: $1.425 million
2012: $5.001 million
2011: $4.703 million