Fort Smith board approves capital project ordinance, adjusts business license fee

The Fort Smith Board of Directors on Tuesday (Nov. 18) approved an ordinance that forces non-budgeted capital projects of $100,000 or more to first be considered in a study session before it can be brought before the board for a vote.

Director Christina Catsavis on Oct. 29 first proposed the plan for the purpose of preventing the rushing of board approval of new capital projects over $500,000. Catsavis on Tuesday successfully amended the proposal to projects valued at $100,000 or more. She said a review of recent project approvals indicates that the $100,000 level would not be a burden on city staff or the board.

The ordinance would not apply to capital improvement plans already reviewed and approved during study sessions and at board meetings.

Catsavis’ has said her motivation for the ordinance was the controversial move by the city to buy water slides for Parrot Island Waterpark. The slides initially were expected to cost the city $2.1 million for acquisition and installation but are now estimated to cost more than $6.3 million. The city has spent an estimated $3.55 million on the slides and installation prep work, and it remains unclear what the city will do with the slides.

The board also approved an amendment striking a required two-thirds vote of the board for the limited emergency exception clause in the ordinance. The board voted unanimously for the new ordinance with the two amendments.

The key provisions of the approved ordinance include at least a seven calendar-day gap between the date of the study session presentation and any formal vote to approve the project; city staff must provide scope, cost estimates, funding sources, operational impacts, and alternatives considered; an exception being only for true emergencies threatening public health or safety, certified by the city administrator; and the internal auditor will conduct an annual compliance review and report findings to the Audit Advisory Committee and the board.

“I think this will give us time to pause and hear community feedback and analyze the information we receive before we make a vote,” Catsavis said.

She also agreed that the requirement for a capital project to have a study session and analysis could have a chilling effect on projects being brought to the city.

“I do and I think that’s important, and I think it should,” Catsavis said when asked about a chilling effect. “I think transparency is important, and we’ve got to prioritize public trust.”

The board also on Tuesday approved a change in the business license fee that is estimated to generate an additional $137,900 in new revenue, bringing potential total revenue from business license fees to $164,000.

The new fee does not apply to businesses based in Fort Smith, and instead is a $500 fee for a first-time business registrant and/or renewal without a physical brick-and-mortar presence in Fort Smith. Deputy City Administrator Maggie Rice said one example of a business that would pay the fee is an out-of-area construction firm that comes into the city after a major hail storm to do roof repair.