Early voting began Tuesday (Dec. 3) on a bond issue for a road project that could help relieve Greenwood’s traffic congestion problems. The Greenwood City Council approved an ordinance in October calling for a special election Dec. 10 to issue bonds that would finance Greenwood’s portion of a traffic relief project between the city and the Arkansas Department of Transportation (ArDOT).
There are two questions on the ballot. The first question is on giving the city permission to retire a 2014 police fund bond voters approved in 2013. That bond issue created a ¼ cent sales tax specifically to pay for the city’s new police station.
“We need voter permission to pay off $2.2 million left on that bond,” said Thomas Marsh, Greenwood’s finance director.
The second issue on the ballot asks voter extend that ¼ sales tax to be specifically used for the traffic relief project. The sales tax would finance a 35-year bond from the 2014 bond for 35 years to generate the funds the city needs for its portion of the traffic relief project, which is $5 million, Marsh said.
The original maturity date on the 2014 bond is 2039, but according to Marsh, because the city has seen an approximate 3.5% average growth of the ¼-cent sales tax over the last five years, that bond, if left to mature, would be paid off 10 years earlier.
“The additional revenue (which came because of the growth in sales tax revenues) was put in escrow and paid on the back end, no different than paying an additional payment on a mortgage,” Marsh said.
If the voters approve both issues, they will approve a 35-year bond initiative, but in actuality it will only extend the current tax theoretically another 16 years, Marsh said. If Greenwood’s sales tax revenues continue to see a 3.5% annual increase, the bond could be paid in 2038, one year earlier than the original date of 2039. If the sales tax revenues stay flat where they are, the bond would still be paid off in 28 years, seven years early, Marsh said.
“We are hoping for economic growth along the new road. Once (the Arkansas 10 project west of the city) is completed, that becomes premium commercial property. The city will grow as the project is realized. That is our hope,” Marsh said.
The traffic relief project would do more than just spur future economic growth of city though. It would relieve traffic congestion in the mornings and afternoons that stem from the east side of the city on the Arkansas 10 Spur because there would be an alternate route around the city. The route would also help with safety concerns, according to the city. If a bridge is out or flooded between downtown and the east side of the city, emergency personnel would have a 60-mile detour.
The traffic relief project will be divided into two phases. The first would include one mile of new highway from the intersection of Arkansas 10 and Coker Street to the intersection of Arkansas 10 and Arkansas 96, which would then be added to the state highway system. Greenwood would assume ownership and responsibility for the portion of Arkansas 10 between Arkansas 96 and Bass Street once completed.
The second phase of the project would widen about 2 miles of Arkansas 10 between Coker Street and U.S. 71. Greenwood would assume ownership and responsibility of the portion of Arkansas 10 between Bass Street and Elm Street and the portion of Arkansas 10 Spur between Arkansas 10 and U.S. 71 upon completion.
Finding a way to fix the congestion problems and safety concerns has been a priority for the city for at least the last 10-15 years, Marsh said. This traffic relief project and the proposal of how to pay for it is the best solution the city could find, he added. When the project was looked at last year, the total cost was projected at $26 million, Marsh said. ArDot now has the projected cost at $33 million. Before it’s finished, Marsh speculated the cost would be closer to $50 million. But if Greenwood agrees to the project and to pay its portion with the passage of this extended tax, the city’s portion is locked in at $5 million he said.
“The mayor came to me and asked how we could finance this without putting a burden on our citizens. This is how we can do that,” Marsh said.
If the measures are passed by the voters, the city will receive a $50 million road/street project for $5 million with no new taxes, just an extension of a sales tax already in place, Marsh said. But both measures have to pass in order for the project to proceed.
“If they approve the first to pay off the existing bond, but not the second, there is no project. We don’t have the money for our portion of the traffic relief project. And where are we going to get the $2.2 million to pay off the bond?” he said.
There would be no increase in taxes should Greenwood residents vote to pass the two issues, Marsh said, but rather an extension of a current tax.
“If both issues do not pass, citizens are still going to be paying that ¼-cent sales tax for 10 to 12 more years, at least 10 more years. But there would be no economic impact felt from the construction costs from ArDot working on the project and no new economic development and grown. The safety concerns are not addressed, and there is no relief to traffic congestion. There is no new road, but we’re still paying the tax.”
A sales tax lifts the burden of funding the project off the residents of Greenwood, Marsh said, because shoppers and visitors from surrounding communities are also paying that sales tax when they shop, dine or stay at businesses in the city.
“Once this road project is completed, we’ll see even more people coming into the city to eat at our restaurants and shop at our Walmart and our mom and pop stores,” Marsh said.