State statute kills Fort Smith business license fee, parking meter rate increases discussed

The Fort Smith Board of Directors’ push to enact a $100 business license fee has failed, but it did not come from any changed votes as Director George Catsavis was considering.

Instead an overlooked part of the Arkansas Code proved to be its undoing. Arkansas Code Annotated 26-177-102, entitled “Authority to tax or license businesses,” requires that enactment of any license fee only be carried out with a two-thirds vote in support. Since the increase passed with just four of seven votes, it fell short of the five needed.

Fort Smith City Administrator Carl Geffken said the city would present the business license fee as an option at the Dec. 19 meeting so Board members can make a final vote with a full understanding, but if it fails to get the 5-2 supermajority, he and City Finance Director will have to dig into the proposed spending that was passed in the 2018 budget on Dec. 5 and make $471,000 worth of removals — the amount the fee was estimated to generate from the city’s approximately 5,000 businesses.

Among the items in danger of losing funding, there would be approximately $500,000 in police equipment purchases and training and 13 new police officer positions (a $695,000 line item) along with positions in policy/administration, management services, police services, utilities, sanitation, and transit. The Board’s top priority of 2.5% salary increases for all city personnel will be untouched.

The statute requirement was presented to city directors at a special meeting on Tuesday (Dec. 12) shortly before the Board’s study session.

During the session that followed, Geffken presented the Board with options regarding possible parking meter fee increases in downtown Fort Smith. Those increases would affect 435 meters and a 55-spot “flash-and-dash” lot on 8th Street, Geffken said, and would exclude metered parking on 2nd Street that supports the Saturday farmers’ market.

Meter rates have not seen an increase since 1985 and are 25 cents an hour. The proposal from Geffken would increase rates from 25 cents for a full hour of parking on Garrison and Rogers Avenues to 50 cents, or “25 cents for half an hour, and, for the side streets, 25 cents for 40 minutes,” Geffken said at a recent Central Business Improvement District (CBID) meeting, adding that “If you look at it on an hourly basis, it would be a 100% increase because it had been 32 years since any other increases, and a 50% increase for our side streets.”

With the rate increases, the city plans a capital outlay of approximately $217,000 to pay for upgraded meters and an automated gate at the downtown parking deck. The updated meters would allow parking customers to pay and replenish funds as well as pay fines from an app on their phone. The money to incorporate the upgrades would come from an existing $350,000 in the parking meter fund, and the expense would be replenished over the next three years from new revenues. As it stands, the city loses approximately $35,000 a year on parking. The move would maintain one parking enforcement employee.

As to the suggestion of free downtown parking, Geffken cautioned that “we do have businesses downtown, and if people decide to park in front of those businesses, then there’s no incentive for them to move, and then parking gets taken up with a person or car who has parked there the full day. I’ve seen it in other cities.”

With his proposal, Geffken believes the city can maintain its assets, pay for the upgrades, and establish a solvent parking fund. It also would not preclude the city from offering free parking promotions as it did last December and again during the current month.

Geffken told Talk Business & Politics on Tuesday that the parking meter situation likely will appear for Board consideration on the Jan. 2 regular meeting agenda and not the upcoming Dec. 19.