Numbers remain positive for Fort Smith tax revenue

With just two months remaining in the 2012 tax collection period, revenue to Fort Smith from city and countywide tax collections continue to trend positive.

Each of the city’s 1% sales taxes (1% for streets and 1% for water and sewer projects) collected $1.594 million in the October report, up 0.78% from the same period in 2011.

The collections were up 1.36% 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 November are from taxes collected in September and transferred by merchants to the state in October.)

For the first 10 reporting months of 2012, each of the 1% sales taxes generated $16.532 million, 2.55% above the 2011 period and 3.13% 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’ October report were down 0.6% compared to October 2011. The collections, which are a good measure of consumer spending, were 4.6% below forecast.

Also, the $1.594 million in the October report is the highest since $1.716 million in the October 2008 report. October marks the second consecutive month that collections of the 1% tax have been above those for the month in the three previous years.

Fort Smith’s share of the county 1% sales tax in the October report is $1.243 million, up just 0.18% compared to October 2011. The collection was down 0.5% compared to the revenue estimate.

For the first 10 months of 2012, the countywide tax has generated $12.884 million for Fort Smith, up 1.9% compared to 2011 and up 1.21% 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.

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%)