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Fort Smith sales tax collections dip 0.69% in 2013

Editor’s note: This story is a component of The Compass Report. The quarterly Compass Report is managed by The City Wire and presented by Fort Smith-based Benefit Bank. Other supporting sponsors of The Compass Report are Cox Communications and the Fort Smith Regional Chamber of Commerce.

Sales tax collection for the city of Fort Smith were down 0.69% for the 2013 reporting year, ending two years of collection gains and coming in 1.16% below budget estimates. However, the year ended on a positive note with the December report showing gains in city collections and the city’s portion of the countywide 1% sales tax.

Each of the city’s 1% sales taxes (1% for streets and 1% for water and sewer projects) collected $1.595 million in the December report, up 2.26% from the same period in 2012.

The collections in the December report were 8.9% below budget estimates. (Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted to cities in January are from taxes collected in November and transferred by merchants to the state in December.)

Total collections in the 2013 reporting period of the two 1% taxes were $38.937 million. Collections in 2012 of the two 1% taxes totaled $39.21 million, slightly ahead of the $38.683 million during 2011. The 2011 collections were 3.9% above 2010 collections.

Fort Smith’s share of the county 1% sales tax in the December report was $1.243 million, up 2.52% compared to December 2012. The collection was down just 0.08% compared to the revenue estimate.

The countywide tax has generated $15.353 million for Fort Smith during 2013, up 0.49% compared to 2012 and down 1.99% compared to budget forecasts.

The countywide tax generated $15.279 million in 2012, just ahead of the $15.15 million in 2011, but lower than the peak collection of $16.61 million in 2008.

The countywide tax collection is critical because the revenue is a little more than 40% of the city’s general budget of roughly $42 million. A majority of the general fund budget general supports fire, police and other critical city functions. The dip in collections compared to budget estimates has resulted in city officials seeking 4% budget cuts from all departments.

AREA COLLECTIONS
Following are selected regional tax collection figures provided by the Arkansas Department of Finance and Administration.

Sales tax collections in Crawford County for the first 11 months of 2013 total $5.824 million, up more than 2.3% compared to the $5.691 million in the same period of 2012.

Collections in Van Buren for the first 11 months of 2013 are $6.559 million, well ahead of the $3.219 million in the same period of 2012. The city approved a 1% sales increase in 2012 for infrastructure improvements and emergency services upgrades.

Collections in Franklin County for the first 11 months of 2013 were $2.41 million, down 0.31% compared to the same period in 2012.

Collections in Logan County for the first 11 months of 2013 were $1.861 million, up an impressive 20.3% compared to the same period in 2012.

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Collections in Sebastian County for the first 11 months of 2013 were $26.097 million, up 1.24% compared to the same period in 2012. Collections in the Sebastian County city of Greenwood totaled $1.818 million for the first 11 months of 2013, better than the $1.783 million during the same period of 2012.

PREVIOUS ANNUAL COLLECTION INFO (Fort Smith)
2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2013: $38.937 million
2012: $39.210 million
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million

Fort Smith portion of 1% countywide sales tax
2013: $15.353 million
2012: $15.279 million
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

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