Fort Smith tax collections up in July report, below estimates year-to-date

story by Ryan Saylor
rsaylor@thecitywire.com

For the second month in a row, Fort Smith sales tax collections have surpassed the same month last year. But even with the increase in revenues, sales tax receipts are still below expectations for the year.

The city's sales taxes (1% for streets and 1% combined for water and sewer projects and fire and parks and recreation) collected $3.27 million in the July report. The figure is 1.26% above the same month last year, but 1.15% lower than budgeted.

For the first seven months of the year, revenue from the city's sales tax collections are up 1.46% from the same period last year but off budget by 0.95%, or $112,285 below projections.

The total in the July report represents a overall drop in all sales tax receipts of 0.49% below budget. (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 July are from taxes collected in May and transferred by merchants to the state in June.)

Collections so far in the 2014 reporting period of the city's sales taxes were $23.324 million, up from collections of $22.988 million during the same period in 2013. The same seven months in 2012 saw collections of $23.372 million, while 2011 saw collections of $22.601 million. The city sales tax for fire and parks did not begin collecting revenues until 2012.

Total collections of the Fort Smith city sales taxes in 2013 was $38.938. Collections in 2012 totaled $39.21 million, just ahead of the $38.684 million collected in 2011. The 2011 collections were 3.9% above the 2010 revenues of $37.23 million.

Fort Smith's share of the countywide 1% sales tax in the June report was $1.288 million, up 0.65% from July 2013 when the city's share of the county sales tax revenues was $1.28 million. The figure was also 0.18% above revenue estimates of $1.286 million.

The countywide tax 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 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.

In an email to the Fort Smith Board of Directors, Finance Director Kara Bushkuhl said she believed the revenues to not be indicative of any "irregular trends." The statement is a change from last month, when the city posted 12% higher revenues than what was budgeted, the first large jump in revenues this year.

"It appears that this is some kind of adjustment but I have no information over what period it would cover or for what reason. Other cities are experiencing varied fluctuations like Fort Smith is seeing," she wrote to city directors and city administration at the time.

Advertisement:

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

Five Star Votes: 
Average: 5 (2 votes)

Like This Article? Share It!