Fort Smith sales tax revenue up more than 8% in the first quarter

Fort Smith sales tax reports continue to get bigger with March sales tax revenues coming in around 13% higher than this time last year. March numbers reflect January transactions.

The March sales tax report shows the city’s share of the 1% Sebastian County sales tax totaled $1.88 million, up 12.57% compared to the $1.67 million reported in March 2022. The city estimated the revenue generated by the tax for the month would be $1.697 million, which means the actual collection came in 10.73% higher than budgeted.

The city’s share of the countywide tax is closely watched because the revenue provides money for the city’s general fund budget, with much of that budget paying for police, fire and other essential city services. The first three months of 2023 show revenue from the tax at $6.045 million, 8.2% higher than the $5.586 million the tax reported in the first quarter of 2022.

Fort Smith’s 1% street tax – used for maintenance and new construction on streets, bridges and drainage – reported $2.294 million in March, up 13.59% from the $2.019 million reported in March 2022, according to the report. The city’s budget estimate for the tax was the same as the actual reported revenue in March 2022, so the collections are 13.59% above the budget estimate.

During the first quarter of the year, the tax has generated $7.358 million, 8.2% more than the $6.801 million reported in January through March of 2022.

“Fort Smith, the hub of its MSA (metropolitan statistical area), is growing and expanding. We are adding new jobs, building new homes, welcoming new businesses, and continuing the work to implement the Foreign Military Sales project,” said City Administrator Carl Geffken. “We continue to attract people from around the country due to these attributes and our reasonable cost of living. The 10.73% and 13.59% higher sales tax collections over the budgeted figures for March is great news, and it supports the work performed by the city for our residents and our employees’ wages.”

While the city’s sales tax gain can be attributed to growth, inflation is also a key factor. The closely watched Consumer Price Index in March showed that all prices were up 5% compared with the same period in 2022.

In 2022, Fort Smith’s share of the 1% Sebastian County sales tax was $23.553 million, 9.6% higher than 2021 and up 9.05% from budget estimates for the year. The 2022 total was $1.955 million more than city officials budgeted to spend within the fund budget and $2.06 million, more than the tax brought the city in 2021.

The 1% street tax generated $28.85 million, up 7.4% over 2021 and up 7.65% from budget estimates. The 2022 total was $2.05 million more than city officials budgeted to spend on the street tax program.

PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 1% sales tax collection for streets
2022: $28.85 million
2021: $26.667 million
2020: $22.66 million
2019: $21.73 million
2018: $21.503 million
2017: $21.204 million
2016: $21.156 million

Fort Smith portion of 1% countywide sales tax
2022: $23.553 million
2021: $21.49 million
2020: $18.246 million
2019: $17.265 million
2018: $17.043 million
2017: $16.691 million
2016: $16.58 million