School sales boost Fort Smith tax collections

Back-to-school sales were good in Fort Smith and Sebastian County based on Wednesday’s (Oct. 24) sales tax report from the city of Fort Smith.

Each of the city’s 1% sales taxes (1% for streets and 1% for water and sewer projects) collected $1.644 million in the September report, up 4.04% from the same period in 2011.

The collections were up 4.64% compared to budget estimates. (Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted to cities in October are from taxes collected in August and transferred by merchants to the state in September.)

For the first nine reporting months of 2012, each of the 1% sales taxes generated $14.937 million, 2.74% above the 2011 period and 3.33% more than budgeted.
Collections in 2011 of the two 1% taxes totaled $38.683 million, ahead of the $37.229 million during 2010 and ending a two-year decline in tax collections.

The sales tax collections in Fort Smith are also better than similar collections at the statewide level. Sales and use tax collections in Arkansas’ September report were down 1.2% compared to September 2011. The collections, which are a good measure of consumer spending, were 3.9% below forecast.

Also, the $1.644 million in the September report is the highest since $1.655 million in the September 2008 report.

Fort Smith’s share of the county 1% sales tax in the September report is $1.293 million, up 3.85% compared to September 2011. The report ended two consecutive months of declines for the county tax. The collection was up 3.14% compared to the revenue estimate.

For the first nine months of 2012, the countywide tax has generated $11.640 million for Fort Smith, up 2.09% compared to 2011 and up 1.4% over budget forecasts.

The countywide tax collection is critical because the revenue is a little more than 40% of the city’s general budget of roughly $42 million. A majority of the general fund budget general supports fire, police and other critical city functions.

Franchise fee collections as of Oct. 23 were $4.364 million, down from $4.771 million during roughly the same period of 2011. Property tax collections placed in the city’s general fund as of the September report were $3.584 million, down slightly from the same period in 2011.

PREVIOUS ANNUAL COLLECTION INFO
2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million

Fort Smith portion of 1% countywide sales tax
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

PROPERTY TAX (ad valorem) REVENUE
2011: $11.458 million
2010: $11.105 million
2009: $10.092 million
2008: $9.381 million

FRANCHISE FEE REVENUE (with % comparison to previous year)
2011: $6.571 million (1.23%)
2010: $6.492 million (8.37%)
2009: $5.99 million (-18.68%)
2008: $7.366 million (8.97%)
2007: $6.76 million (-8.72%)
2006: $7.406 million (8.38%)