NWA sales tax revenue totals $62.34 million in 2016, growth slows to 4.39% from 2015

by Talk Business & Politics (admin@talkbusiness.net) 99 views 

Despite a growing Northwest Arkansas economy this year, sales tax revenue growth slowed across the region’s four largest cities. Fayetteville, Rogers, Springdale and Bentonville did however report record sales tax revenue this year totaling $62.34 million, up 4.39% from a year ago. Revenue grew a whopping 9.48% last year and city officials said that level was unsustainable even for Northwest Arkansas.

Lower fuel prices and a growing population in Benton and Washington counties did help three of the four cities reap solid single-digit growth this year. All four cities report sound financial positions and say they are happy with revenue growth overall as it did exceed budgetary spending. Bentonville’s revenue growth was flat for the calendar year, after volatile swings month-to-month and December was no exception.

December revenue was mixed among the cities, but overall revenue totaled $5.25 million, down 4.07% from a year ago. Each city collects a 2% tax on goods and services, half of that goes to repay debt and the remaining 1% is funneled into the annual budget. This report reflects the latter.

December Sales Tax Revenue
• Bentonville: $933,009, down 22.36%
• Fayetteville: $1,72 million, up 0.26%
• Rogers: $1.45 million, up 3.94%
• Springdale: $1.13 million, down 1.19%

The bulk of the decline in December is attributed to Bentonville, but city officials say revenue is still within budget for the year.

BUSINESS GROWTH
Each of the cities have seen growth over the past year with more housing starts, new restaurants and a few new shopping venues as well.
• Raising Canes, Fayetteville, Rogers
• Captain D’s, Rogers, Springdale
• Harbor Freight Tools, Rogers
• Newk’s Eatery, Rogers
• Bike Rack Brewery, Bentonville
• Great American Taco Co., Bentonville
• Fuzzy’s Taco, Rogers
• Ross Stores, Rogers (second location)
• Freddy’s, Springdale, Fayetteville
• Steinmart, Rogers

All four mayors in the respective cities have said their sales tax revenue exceeded budget projections for 2016 and they could not be happier with the growth they’ve witnessed year-over-year.

Bentonville Mayor Bob McCaslin said the growth in the region should continue to fuel modest gains in sales tax revenue if the economy remains strong.

“We continue to see businesses seek out private investments in the city and that’s a big vote of confidence for Bentonville. We are pleased with the growth and we will continue to budget conservatively,” McCaslin said.

Bentonville reported total revenue of $11.3 million for the past 12 months, down fractionally from the $11.4 million reported in 2015, which was a record for the city. McCaslin said the city’s fiscal year budget includes the tax revenue that will be collected in January and at this point revenue is within budget, and January revenue should ring up a slight surplus.

Earlier this year Fayetteville Mayor Lioneld Jordan predicted another solid year of growth for the city and while revenue growth slowed from a year ago the city managed to pull off a record $20.587 million total this year, up 4.6% from a year ago. There is ample residential building going on both uptown and downtown and Jordan expects more retail to follow those rooftops later this year.

JJ’s is building a large beer garden restaurant and entertainment venue uptown in the Steele Crossing development, within a stone’s throw of two major multifamily housing complexes under construction in North Fayetteville.

In Springdale, growth continues to blossom, particularly on the west side of Interstate 49. Arkansas Children’s Hospital Northwest will remain under construction through the fall of 2017 with opening slated for January 2018. Just down the road, Sam’s Club is taking shape with construction underway on the retailer’s third club in the region. The Springdale Sam’s Club is expected to open later next year.

Springdale Mayor Doug Sprouse said the growth around the city and the revitalization of downtown are positive aspects that could help the city attract more businesses in the future. Sam’s Club alone is expected to bring a nice bump to the city’s revenue stream. Sprouse said when the retailer pulled out of Springdale in 2006 it was about a $1 million hit to the city’s sale tax revenue. Today there are two other Sam’s Clubs operating in the region, which wasn’t the case before 2006. Springdale’s 2016 revenue totaled $13.19 million, up 5.4% from a year. While the growth rate was solid, it was half of the 10.22% growth recorded in the prior year.

Rogers continues to see retail growth around town, more so than its sister cities. Rogers saw record revenue of $17.26 million for the year, up 7.08% from last year. City officials budgeted $15.26 million for the year and pulled in nearly $2 million more. Rogers came closest to hitting last year’s growth rate but fell a little short of the 8.34% reported for 2015.

While the local economy appears to be strong, city leaders overwhelming agree they will take a conservative approach with next year’s budgets. Each of the cities continue to work on street improvements, trails and parks along with other amenities for their residents.

SALES TAX REVENUE (January through December)
• Bentonville
2016: $11.300 million
2015: $11.401 million
2014: $10.007 million
• Fayetteville
2016: $20.587 million
2015: $19.682 million
2014: $18.307 million
• Rogers
2016: $17.260 million
2015: $16.118 million
2014: $14.877 million
• Springdale
2016: $13.190 million
2015: $12.513 million
2014: $11.353 million

 

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