Jonesboro Sales Tax Forum Continues Debate, Incentives Questioned

The money invested as part of an economic development corporation will help the city of Jonesboro compete in a larger worldwide economic playing field, a supporter of a proposed one-cent sales tax said Monday.

Attorney Robert Jones said it will give Jonesboro an opportunity to continue to grow in the future.

At least 50 people attended the third and final forum at Nettleton Performing Arts Center in southeast Jonesboro. Voters here will decide Nov. 10 the proposal, which is expected to bring in $16 million a year to fund infrastructure and economic development plans. The tax, if approved, would expire in April 2026.

The city now has a combined 8.5% state, county and city tax rate (6.5% state, 1.5% county and 1% city rate). Under the proposal, seven-eighths of the tax will go toward roads, bridges and infrastructure while the remaining one-eighth will go toward economic development. A seven-member economic development board would be created to help recruit business, build workforce training and purchase land for possible projects.

City officials have looked at least 20 road projects to complete over the 10 year period. Mayor Harold Perrin has said the city’s growth has led to bottlenecks and safety concerns, with an estimated 42,000 vehicles alone on Red Wolf Boulevard every day.

However, tax opponents have said it would have an impact on the cost of items at the grocery store and other businesses as well as more and more money going to government at all levels. Linda Reed said “there is a ton of money” already collected for education on a college and vo-tech level and asked why more needed to be collected. Reed also asked about the collection for so-called incentives for businesses.

Jones said the incentive can help with workforce training, noting many of the incentive agreements negotiated have claw back provisions to protect against companies not hiring or training employees over a certain period of time. Perrin said the workforce training world has changed over the past 15 years, with two-year colleges playing more of an increased role in getting students ready.

Gary Latanich asked why the city did not consider raising property taxes, considering the 10-year length of the sales tax.

“Also, economic development is not a temporary activity,” Latanich said.

Jones agreed and said city residents would have to revisit the economic development aspect of the tax, if and when the tax was approved. As for the timing of the election, several who attended the meeting asked why the city asked for the election in an off year. Perrin said to wait until 2016 on a special election would push needed projects back through 2017 and 2018.

Rick Cheshier asked about millage and tax incentives forgiveness for businesses. Jones said businesses can receive tax-free bonds through the state for construction. Cheshier asked if the city would break even on the amount of money given, compared to the jobs and revenue created.

Jones countered that the investment helps with payroll, as well as with people who live outside Jonesboro but work in town and spend money with retailers in the city. Information on the tax proposal, including maps and a copy of the ballot, can be found at this page on the city’s website.