Fort Smith sales tax revenue up in September, down slightly year to date

Fort Smith sales tax revenue in the September report showed better results with the city seeing increases of around 7% from the same time in 2024, even though revenue came in below the budget estimate.

The city’s share of the Sebastian County sales tax was $2.062 million September, up 6.6% compared to the $1.934 million reported in September 2024, according to the city’s sales tax report. However, the September county tax share, which measures August transactions, was down 3.9% compared to projected September 2025 revenue listed in the city’s budget.

The year-to-date countywide tax total for Fort Smith is $18.349 million, down just 0.34% from the $18.414 million generated through September 2024. That tax brought in $24.49 million in 2024, 0.95% lower than 2023.

The city’s share of the countywide tax is important 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.

“Although not trending along with our budget forecast, it is encouraging to see sales tax revenues back in line with, or just ahead of, 2024 revenues for the last two months,” said Acting City Administrator Jeff Dingman. “If this trend continues we should see revenues very much on par with 2024. Overall, the city’s general fund needs these sales tax revenues to grow to meet the growing cost of providing city services. These numbers show that, while growth isn’t yet where we thought it might be, we are at least not losing ground.”

The 1% city sales tax generated $2.537 million in the September report, up 7.4% from the $2.363 million in the September 2024 report. That tax is broken down to $1.585 million for streets, bridges and drainage and $951,261 for federal consent decree work required to make sewer system improvements.

The city’s budget for those revenues was $1.609 million for streets, bridges and drainage and $965,381 for consent decree, resulting in the revenue 1.46% below the budget projection.

For the three reporting quarters of 2025, the tax generated $22.173 million, down 0.09% compared with the $22.173 million in the same period of 2024. That tax brought in $29.516 million in 2024.

Fort Smith voters in May approved a sales tax reallocation plan to provide $360 million over 30 years to fund federally-mandated sewer system work. The vote reallocated a 0.75% sales tax first approved by voters in 2022 to pay for consent decree work and to pay bonds, with 0.125% used for the Fort Smith Police Department. It also renewed the 1% street tax but reallocated 0.625% for streets, bridges and drainage work, with the remainder of the tax to fund consent decree work and bonds.

PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 1% sales tax collection for streets
2024: $29.51 million
2023: $29.92 million
2022: $28.65 million
2021: $26.66 million
2020: $22.66 million
2019: $21.73 million
2018: $21.5 million

Fort Smith portion of 1% Sebastian County sales tax
2024: $24.49 million
2023: $24.64 million
2022: $23.55 million
2021: $21.49 million
2020: $18.24 million
2019: $17.26 million
2018: $17.04 million
2017: $16.69 million