Northwest Arkansas sales tax revenue rebounds in May report, rising 8.9%
Consumers began spending more money as spring approached this year and that is showing up in local sales tax revenue among Northwest Arkansas’ four largest cities.
Cumulative sales tax revenue reported in May for Fayetteville, Bentonville, Rogers and Springdale totaled $5.652 million, up 8.9% last year and a May record for the region. Year-to-date sales tax revenue for the four cities totaled $27.347 million, up 7.2% from the same period last year.
May revenue reversed a 2.16% decline reported last month, after double-digit gains of 18.13% in March. The May revenue reflects consumer spending in March. Each city collects 2% sales tax over above the state’s portion. Half of that local tax goes to debt retirement and the remainder is dumped into the respective cities operating funds. This report reflects the latter 1%.
Fayetteville reported May revenue of $1.791 million, up 7.92% from a year ago, benefiting from later-than-usual tax refunds hitting consumers bank accounts. The city continues to see retail development completed on its west side and north parts of town.
The warmer spring weather has also been a plus for the outdoor music venues in the city’s entertainment district. The Arkansas Razorbacks baseball team also had a long homestretch in the middle of March that drew big crowds. Fayetteville Chamber CEO Steve Clark said there are some business scouting locations in Fayetteville and while it’s too early to know for sure if they will locate here, he said the recreation venue Top Golf is looking at the area again. Fayetteville’s sales tax revenue through May is $8.798 million, 5% more than a year ago.
Springdale reported May sales tax revenue of nearly $1.225 million, up 15.67% over the $1.058 million reported in the same period last year. The downtown region of Springdale and the Har-Ber Meadows area on the west side of town are two areas seeing retail growth. A new Freddy’s Restaurant just opened on West Sunset near Har-Ber and the long-awaited Sam’s Club located along U.S. 412 and Gene George Parkway began ringing up sales. The Cotton Patch has also found a site for a new restaurant at 4101 W. Sunset, near the city’s downtown area. Year-to-date Springdale’s sales tax revenue is up 8.77% with more than $5.786 million in the coffer.
Bentonville reported May revenue of $1.103 million, up 18.31% year-over-year. Some of that gain may be erased next month given the city’s yoyo pattern of collections throughout the year. Last month the city’s revenue dropped 6.23% on the heels of a 27.25% gain in March. New retail on tap for the city includes a Wendy’s restaurant to locate at 814 S. Walton Blvd., according to recent permits filed with the Arkansas State Health Department. Yeyo’s Mexican Grill will soon open in the new 8th Street Market venue near Bike Rack Brewing. Reggie’s Pizzeria is also going in at 1001 SW Regional Airport Blvd. Bentonville’s sales tax revenue collections though May total right at $5 million, up 7.1% from a year ago.
Rogers reported a slight dip in May sales tax revenue with proceeds of nearly $1.533 million. Revenue was down 0.46% from the $1.54 million reported a year ago. There continues to be new retail on tap for the city, the most of any of its peers in the region. Revenue in the coffer through May totals $7.763 million, up 9.8% from last year.
Discount retailer Tuesday Morning is locating at 208 S. Promenade Blvd. and The Rustic Mule, a Fayetteville apparel retailer, is also planning a new boutique at 4204 S. J.B. Hunt Drive, Suite 60. Juicy Tails is planning a second location in the region adding a new site at 4204 J.B. Hunt Drive, Suite 100, near the Walmart AMP. Smitty’s Garage Burgers & Beer is also adding a Roger’s location at 4200 S. 48th Street. Juicy Tails and Smitty’s already have locations in Fayetteville.
Angus Jack Restaurant is going in at 1001 S.W. Airport Road in Rogers. The Old Chicago Pizza and Tap Room will land in the Pleasant Grove Road area at 1900 W. Pleasant Grove Road. Tacos 4 Life has plans to locate a new restaurant in the Pinnacle Heights area of Rogers, and this eatery is already located in Fayetteville.
Economists expect consumer spending to be better in the second and third quarters of this year after the dismal 0.3% reported in the first quarter. Mervin Jebaraj, interim director for the Center for Business and Economic Research at the University of Arkansas, said consumers remained confident through April with the national sentiment reading near 100 which is about as good as it gets.
Despite the low unemployment rate in the region and state, he said wages have not gone up as many expected given tightness in the job market. He said a warm winter did mean consumers spent less on heating their homes and that gave them more disposable income to spend elsewhere. But health insurance costs were higher, offset somewhat by slightly price deflation in meat and dairy products.
Jebaraj said the area’s increasing population is also helping to fuel economic growth. Between 2016 and 2015 the population in Northwest Arkansas grew 2% to 525,032 people, making it the 22nd fastest growing metro in the country. The region added at 31 people per day during that period. The two largest cities in Benton County — Bentonville and Rogers — saw their combined population grow to 112,114 people between 2015 and 2016. That’s an increase of 3.77%. Fayetteville and Springdale had a combined population of 162,383, up 1.52%.
SALES TAX REVENUE (January through May)
2017: $4.999 million
2016: $4.654 million
2017: $8.798 million
2016: $8.464 million
2017: $7.763 million
2016: $7.070 million
2017: $5.786 million
2015: $5.319 million