June sales tax revenue dips 2.3% in Northwest Arkansas

Consumer spending continues to baffle economists month to month and the sales tax revenue collected among Northwest Arkansas’ four largest cities is a direct reflection of that sporadic spending behavior. Total revenue collected by Bentonville, Rogers, Springdale and Fayetteville totaled $5.190 million in June, down 2.3% from the $5.192 million booked a year ago.

June revenue correlates to consumer spending in April. Each of the cities collect a 2% local sales tax on good and services. Half of the proceeds are used to pay debt and the other 1% of the collections are funneled in the respective city’s annual budget. This report reflects the latter 1%.

The results logged in June were mixed around the region.

Bentonville continues to see the biggest month-to-month swings in its revenue. The city has had just two growing months of revenue in the first half of 2016. When it’s good, it’s really good – like the 46% jump in sales tax in February.

Lately, there have been more negative months than positive. So far through June, the city’s revenue collected by Bentonville totals $5.321 million, down slightly from the $5.372 million reported a year ago. June was a particularly challenging month with collections of $666,720, down 27% from a year ago. It’s the lowest June revenue the city has had in more than five years.

Bentonville city officials report sales tax revenue is still tracking ahead of budget despite the volatile swings month-to-month. The city has budgeted $9.8 million in revenue for 2016 collections and is $516,130 ahead of budget through June.

The revenue in neighboring Rogers is far more positive as the city reported June revenue of $1.408 million. It’s the best June on record. Revenue rose 7.32% from a year ago. The reopening of the Walmart AMP has resulted in a positive impact on Rogers, and local restaurants are busy with expansions planned from Foghorn’s Sports Bar to Raisin’ Cane’s Chicken and Newk’s Eatery, all of which have already or are presently expanding to Rogers from Fayetteville.

Through the first half of 2015 sales revenue in Rogers totals $8.478 million, up 7.61% from $7.878 million a year ago. The city has budgeted $15.264 million in tax revenue for the year and collections are over target with half of the year in the books.

Springdale reported sales tax revenue of $1.002 million in June, down 2.72% from a year ago. City officials are pleased with the sales tax reported through June which totals $6.341 million, up 5.87% from the $5.989 million reported a year ago.

Springdale continues to see growth in its retail and restaurant sector which could keep more local residents eating and shopping at home as opposed to driving to neighboring Fayetteville or Rogers, according to Mayor Doug Sprouse.

Freddy’s Frozen Custard and Steakburgers is planning to open a new stand-alone restaurant in West Springdale at the corner of Founder’s Circle and Sunset. 3PRG Real Estate of Rogers is building it along with an ancillary retail development, according to CBRE in Fayetteville who helped to broker the 3-acre real estate deal. The Sam’s Club to be located at 56th Street and Sunset in Springdale should begin construction before the end of the year. A permit was issued by the state health department for this club on May 9.

Fayetteville continues to see growth around the city helping to elevate sales tax revenue 4.23% in June, the best June on record. The city reported monthly sales tax revenue of $1.655 million, compared to $1.588 million a year ago.

For the first half of 2016, Fayetteville reported revenue of $10.119 million, up 5.3% from $9.609 million in the same period last year. City leaders have been eager to see the benefits that Whole Foods will have on its sales tax. April marked the second month Whole Foods was open and city officials attribute the solid month in part to the popularity of Whole Foods.

Last year, Fayetteville saw sales tax revenue increase 7.5% after a stagnant 2014 and lackluster 2013. Mayor Lioneld Jordan expects the city will repeat the healthier revenue levels of 2015 again this year.

Sales Tax Revenue (January to June)
Bentonville
2016: $5.321 million
2015: $5.372 million
-0.009%

Fayetteville
2016: $10.119 million
2015: $9.609 million
5.3%

Rogers
2016: $8.478 million
2015: $7.878 million
7.61%

Springdale
2016: $6.341 million
2015: $5.989 million
5.87%