Sales tax revenue off almost 5% in Fort Smith’s September report

by Aric Mitchell (aric.mitchell@gmail.com) 108 views 

Sales tax revenue fell 4.83% in Fort Smith’s September report to $1.637 million from $1.72 million the previous year, but year-to-date figures for 2017 continue to hold up at $16.021 million against $15.967 million in 2016, a gain of 0.34%.

The YTD tally is 1.8% above the budget estimate, according to Fort Smith Finance Director Jennifer Walker. Total revenue to date for street, bond, and parks/fire departments is $190,085 more than the budget estimate.

The city receives 3.25% of the area’s 9.75% sales tax. From that figure, 2% is a city sales tax divvied up between the streets, drainage, and bridges program (1%), collections for bond issues (0.75%), and fire and parks (0.25%, evenly split between the two). The state receives the remaining 6.5%.

The combined city sales tax tally in September, which reflects collections on July transactions, was $3.274 million against $3.44 million in September 2016. Year-to-date figures were $32.041 million, a 0.15% improvement from 2016’s $31.993 million.

The city’s share of the county sales tax for September 2017 was $1.301 million, 5.31% less than last September’s $1.374 million and 6% below budget. The city’s share of county sales tax revenue to date is $12.618 million, 0.86% above last year’s $12.511 million and 0.2% above budget. Total revenue to date is $20,824 more than the budget estimate.

County sales tax revenue is critical because it funds a majority of city functions, including police and fire services.

Sales tax revenue is up in several counties in the Fort Smith metro, according to Arkansas Department of Finance and Administration reports. Crawford County sales tax revenue for the first six reporting months of 2017 totaled $6.189 million, up 5.5% compared to the same period in 2016. Franklin County sales tax revenue in the six months was $1.765 million, up 36.2% compared to the same period in 2016.

The Logan County sales tax rate rose from 1% to 2% in January. Tax revenue in the county during the six months totaled $2.182 million, well ahead of the $1.092 million in the same period of 2016. Sebastian County revenue in the six months totaled $15.423 million, up 1.3% compared with the same period of 2016.

Franchise revenue is now trending at 6% above budget, more in line with budget expectations thanks to a strong third quarter from the oil and gas industry, Walker said, noting she now expects franchise fees to end the year at budget after choppy July and August reports placed the figure on pace to end at 5% below. Walker said prior that she believed excesses in the city’s portion of county sales tax and its share of property taxes would help out, but property tax figures will not be available until after November.

PREVIOUS ANNUAL SALES TAX COLLECTION INFO
Fort Smith 2% sales tax collection (1% for streets; 0.75% for 2012 water/sewer bonds; 0.25% for fire and parks)
2016: $42.313 million
2015: $40.76 million
2014: $40.198 million
2013: $38.938 million
2012: $39.21 million
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.84 million

Fort Smith portion of 1% countywide sales tax
2016: $16.58 million
2015: $16.09 million
2014: $15.625 million
2013: $15.353 million
2012: $15.279 million
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

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