Much like the national economy, Northwest Arkansas consumers slowed their spending in June. After several months of positive sales tax growth, four of the five largest commercial districts in the region hit a brick wall in June.
Rogers saw modest gains in June tax collections, while Bentonvillle, Fayetteville, Springdale and Siloam Springs each posted declines from a year ago.
Businesses in these cities received a cumulative $4.339 million in sales tax revenue in June. Sales receipts declined 2.53% from the same month in 2011, according to the Arkansas Department of Finance report released this week.
August tax revenue reflects June sales remitted to the state in July 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 (August)
(Data represents a 1% sales tax, compared to prior year period.)
Bentonville: $656,619, down 4.33%
Fayetteville: $1.444 million, down 1.83%
Rogers: $1.129 million, up 2.63%
Siloam Springs: $228,713, down 13.5%
Springdale: $881,546, down 4.19%
Source: Respective cities.
Rogers was the only city surveyed to outperform last year’s numbers. City treasurer Richard McComas, attributed that to the LPGA tournament held at Pinnacle Country Club in June. It was held in September a year ago and perhaps skewed the June numbers.
McComas and other city leaders in Rogers are anxious to see what impact Cabela’s will have on sales tax collections in the coming months. The outdoor specialty store will open Aug. 30.
“Northwest Arkansas followed the national economy in June with lower consumer spending at the retail level. That could be related to nice weather which had families doing other things or more savings as consumers saw gas prices dip a little lower in June. We know the national savings rate ticked higher in June,” said Kathy Deck, director for the Center for Economic Research at the University of Arkansas.
Deck said consumer confidence has been mixed but retail spending did pick up some in July on the national level.
She said it’s important to note that June is just one month and the region is up year-to-date which has city budgets in good shape going into the fall — typically stronger collection months with Razorback football and holiday shopping.
Springdale Finance Director Laura Favorite said Springdale’s June collections did include some rebates, but the recent decline from 2011 was not unexpected as June receipts jumped 16.25% last year. She noted collections are up year-to-date by nearly $250,000.
Crystal McNutt, administrator in the Siloam Springs Finance Department, said the city’s collections are trending higher in 2012 from 2011, despite an occasional down month.
“It will be interesting to see if the gains made this year can be held as a slower economy is expected into 2013,” Deck said. “On the bright side, this region continues to post strong job numbers and improving real estate sector which helps consumers feel more like spending.”
CUMULATIVE TAX COLLECTIONS
2012: $6.147 million
2011: $5.462 million
2012: $11.464 million
2011: $10.774 million
2012: $8,694 million
2011: $8.024 million
2012: $1.948 million
2011: $1.924 million
2012: $7.750 million
2011: $6.504 million
Source: Respective cities.