Impact of Taxes Already Felt

Since Fayetteville’s taxpayers ponied up a three-fourths cent sales tax on Nov. 6 to save the city’s overburdened sewage system, do we really still need a $1,128 impact fee for the same cause?

The three-quarter percent tax is expected to take about 14 years to retire $120 million worth of bond issuance for which the voters raised their collective thumbs. We know the measure actually dropped the city’s sales tax from 8.125 percent to 7.875 percent. A one-cent sales tax for the new public library expires March 31, and the new tax will start — no foolin’— the next day.

But we feel like levying both the tax and the fees at the same time is double jeopardy for Fayetteville’s citizenry. We’re convinced the sewage tax made much more sense than a massive rate hike for the city’s water and sewer customers. But we question the need for the additional $1,128 fee per new construction project.

Proponents in favor of keeping the impact fee — which is expected to soon have an additional $1,800 tacked onto it for streets and sidewalks, etc. — say the water treatment fees will be needed to cover additional capacity in the future. While the city is wise to look that far down the road — instead of procrastinating itself into another critical corner — this just doesn’t seem like the best time to “pile on.”

Mayor Dan Coody said the fee has already been ratcheted down to $1,128, because revenue from the sales tax was taken into consideration. Other proponents have suggested that developers will bear the burden of the fees. But be assured builders will pass them on to future homeowners and business people or simply pass on Fayetteville.

We applaud the mayor’s office for it’s foresight, but we’re concerned with so many other regulations and fees hitting the books, it’s only a matter of time until the A-list developers start taking their A-list projects elsewhere.

With today’s economy, we fear it’s not the time to risk stalling quality growth when Northwest Arkansas offers builders and property buyers so many other good choices. We understand, and even somewhat appreciate the logic. Kyle Mooty’s cover story in this issue on the city’s economic turmoil explains why Fayetteville is strapped for revenue.

We’re just worried that the city’s tax-and-spend fervor will eventually do us more harm than good.

Instead of additional fees, why not a few tax incentives that could be used to keep existing businesses and recruit quality new ones.