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Sales tax collections slow down in Fort Smith


Sales tax revenues in Fort Smith have cooled a bit. Michael Tilley, executive editor of Talk Business and Politics, explores the latest collection numbers. He also provides updates on the search for a new director at the Fort Smith Convention & Visitors Bureau and construction at the Community School of the Arts.

Kyle Kellams: Let's go back to when you and I talked last week. We talked about Project X and I couldn't help but notice the very next day Elon Musk rebrands Twitter as X. I'm not saying it was us but an interesting coincidence.

Michael Tilley: Yeah, they're going to start launching rockets from the Best Buy building, so… SpaceX is what it is. I think the neighbors are going to be a little upset, but that’s what we're hearing.

Sebastian County Tax Report

KK: well let's talk about something we know what we're talking about or at least you know what you're talking about and that's the pace of growth of sales tax revenue in Fort Smith. It has been going up, just a bit slower in this June report.

MT: It was a lot lower than what I was expecting. What I expect on sales tax—everyone that’s been listening to this show for any length of time should understand that they shouldn't go with what I think—but yeah, it's kind of slowed down a tick. June sales tax reports show that the city's share of Sebastian County tax was just a little over 2 million. That was up under 2%. That increase has been in the past you know 5, 6, 7, 8 if not double-digit percentage increase. Now, through the year, through the first six reporting months of the year, the taxes are around $12.3 million and that's about 5.5% higher than the same time in 2022. It's still impressive, it's still good growth.

It's getting to that percentage, Kyle, because we can't analyze the tax numbers, we can't see where it's coming from, it's hard to say with any confidence, but that 5.5% growth, that's somewhere within the inflation range that we've seen in the last six months. But, you know, the state of Arkansas doesn't allow us to analyze those tax revenues, so it's hard to say, but it's not surprising growth. We will be reporting on in the next few days though—remember it's coming up for renewal on August 8th, a pretty important tax for the county.

The city’s 1% street tax—which is used primarily for maintenance, new construction, bridges, and drainage work—it's about $2.5 million in June that was up even less, just 1.5%. And through the first six reporting months of the year it's generated just under $15 million, and that's up 6.3% from last year. Of course, both of those taxes are critical. The city’s share of the county wide tax supports a lot of the administration, fire, polices services, that type of thing. Then the street taxes, for obvious reasons, are important, because even with the money the city gets from it, I think they struggle to stay ahead of the needed maintenance. So unless it just slows down tremendously on the back half it looks like on both of those taxes the city will set another record. Last year was a record 23.5 million from the one percent sales tax and it was 28.8 million for the street tax. Again, unless it just all falls apart in the back half, we’ll break that record.

KK: You mentioned that August 8th Election Day for the possible renewal of the tax. Any feeling on how that's going to go?

MT: No, in fact there's some discussion about opening up new voting centers. We hope to have that reporting very soon, But I’ve not seen any active campaigns from either the city of Fort Smith or Sebastian County, we're asking them what kind of campaigns they're gearing up. They have to be careful, they either have to go through third parties or their campaign can just be to encourage folks to get out and vote, but it's critical. It generated almost 34 million last year for the county, and for some of the cities in the county, that's their biggest chunk of revenue. That's what keeps their fire and police and general services going, and it's been approved by voters by pretty good margins in the past. Ideally, that will continue.

Community School of the Arts Update

KK: We know the US Marshals Museum is now open. Earlier this year ground was broken for the Community School of the Arts new facility. You have an update about that. What do we know?

MT: We're hearing some rumors, and yes, it's coming out of the ground, it's pretty impressive to see both the Marshalls Museum and then the same image you can see the Community School of the Arts coming out of the ground. We heard some rumors that they're running out of money, the construction was halted, and that's only partially true. They're not running out of money, but remember we reported earlier this year they had pivoted somewhat. Dr. Rosilee Russell, director of the school, sought out a charter. The Arkansas LEARNS act opens up some more charter schools, so she's seeking a charter school. It would be the first and only charter high school for the performing arts. But, the trick is, though, if the charter is approved, you know, it mandates certain type of facilities in a school.

If it's approved, they're going to have to redesign some of the spaces they have now for a different use, for example for cafeteria for classrooms and that type of thing. So, there's a little bit of a delay on some of those spaces, but it's not for negative reasons or positive reasons. They're just waiting for the charter school application to be approved, and if it is approved, it’ll include some things they’ll have to do. It's a process we're watching, I know there are some definite opinions out there about charter schools, that's kind of beyond our control here at Talk Business & Politics, we're just going to report on how the Community School of the Arts proceeds if they get their charter approved.

Finalists for Fort Smith Convention & Visitors Bureau Director

KK: Also moving ahead is the search for someone to lead the Fort Smith convention and visitors Bureau. We understand that it's down to four finalists.

MT: Yep, four finalists. We finally get that information; we've been asking for it. Tim Jacobsen just suddenly resigned back in March. Lynn Wasson, a longtime journalist and community promoter, she was named interim director, I think she also applied for the position. However, her name wasn’t among the four finalists. They have Ashleigh Bachert, she's out of Tulsa; Alfred Snow from Lakeland, Florida; Cody Waits from Maumelle; and Donnie Crane from Morrilton. Those are the four finalists.

Storm Nolan, who’s the head of the Fort Smith Advertising and Promotions Commission, he said they’re going to meet August 1st to figure out the final steps for how they select someone. He’s eager to get someone, I’ve talked to him several times over the past few months. With the US Marshals Museum and other things happening in the Fort Smith region—I don’t want to say Storm is concerned, but they want a good director in there and get some good active messaging, good progressive messaging on tourism for Fort Smith and for the region. That’s something we’ll watch, but we expect by the end of August—that’s what Storm has told us—that they will name a new director.

KK: You can follow along with these stories and many others at TalkBusiness.net

This transcript has been edited and condensed for clarity’s sake.

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Kyle Kellams is KUAF's news director and host of Ozarks at Large<i>.</i>
Michael Tilley is the executive editor of Talk Business & Politics.
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