Conway sales-tax vote set for Feb. 14

CONWAY — What Conway Mayor Tab Townsell would love on Valentine’s Day is for voters to approve the quarter-percent-sales-tax rededication on the ballot.

The campaign slogan is “4 the Love of Conway,” which he admits is “just this side of cheesy.”

It’s part of the big push, however, for the Feb. 14 special election to pass four ballot questions that Townsell said can fix the city’s financial problem “immediately.”

“This is meat-and-potatoes stuff; this isn’t anything excessive,” he said, citing the Sanitation, Fire and Police departments’ needs.

The original half-cent sales tax, approved in 1988 and reapproved three times, “is part of what has been the workhorse” of keeping up with Conway’s growth, he said.

In 2006, that half-cent was split, and one of the quarter-cents is the issue at hand.

Under the new proposal, that quarter-cent would be split in half - with one-eighth of a percent for the general fund and the other eighth of a percent for debt service - to pay off police-station bonds in 2022, if not sooner, Townsell said.

The eighth of a percent for the general fund would raise $1.5 million each year, and in the first year, the City Council has approved giving one-time bonuses to city employees, who have not had step pay raises.

The first two questions on the ballot have to be approved to rededicate the tax, he said.

“If they don’t [get approved], we’ll keep paying the police-station debt with the full quarter-cent until it pays off,” he said.

The third question on the ballot is whether to issue $6 million in bonds for firetrucks and equipment.

“That will give us the firetrucks we need,” Townsell said.

The plan calls for replacing two ladder trucks and three pumpers, and switching the analog radio system to digital.

Most of the fire fleet was purchased through bond

issues in 1993 and 1997, Townsell said.

“That will handle the next few years of

major fire needs,” he said of the proposal.

The city will guarantee $500,000 for po

lice cars every year, too, Townsell said.

The fourth question, if approved, would

provide the Sanitation Department with $2

million in bonds, which would go toward

trucks, equipment and landfill expansion.

“The main thing - the real benefit to us

• is that it allows us to recapitalize the city’s

general-fund budget and stabilize our city’s

financials,” he said. “We have been under

crushing pressure on a cash-flow basis the

past two years.” In what Townsell called the city’s “Febru

ary 2010 financial crisis,” the city discovered

it had $1 million less in the general fund than

officials thought.

That money was committed for economic

development and should never have been

lumped into the general fund, he said.

Sales-tax collection dropped below pro

jections, and extra money was spent on dif

ferent shift hours for police officers.

Money had to be borrowed from the Sani

tation Department every month in 2011, and

in April through September, the city could

not pay the Sanitation Department back all

it owed.

“If we had the proper cash flow, we would

never have to borrow from the Sanitation

Department,” Townsell said.

If the tax rededication is approved, the

City Council has adopted a resolution to put

$500,000 in a stand-alone, reserve fund for

the city for four years.

“That’s money not to be spent,” Townsell

said.

“If all four of these pass, the day we issue

bonds, we’ll put $2 million in the city’s gen

eral fund, not to spend, just to serve as cash

flow, just so we won’t have to be leaning on

Sanitation,” he said.

In May, a sales-tax rededication proposal

failed, which included only the first two

questions.

“One of the flash-point items on the first

vote, it didn’t have a resolution until the

night of the election,” he said. “The other

flash point is that it was not pushed - it lay

real quiet.” This time, “we’re making a push,” he said,

and voters know where the money will be

used.

Alderman Mark Vaught, often on the op

posite side of issues as Townsell, wrote in anemail, “I do believe this tax should be extended, because it’s a source of revenue that Conway has depended on since 1988.” Voting “yes” on all four questions “is the quickest way to solve the city’s current financial problems.” However, Vaught said, “there is a fairly large contingent of citizens and voters that do not have a favorable view of the city government and its handling of city financials in the past few years.” He said people have expressed concern about the proposed bonds, questions three and four, “and the city effectively taking out a 10-year loan with them.” Vaught said the compromise is to vote in favor of the first two questions, but vote against questions three and four.

“In this way, the voters can indicate that they are willing to extend the tax but would prefer a ‘pay-as-you-go’ plan for the city’s financial needs,” he said.

Vaught said he favors that approach “because it does not put the city at risk for longterm loans in this uncertain economy.” If the city needed to, Vaught added, it could get short-term financing with local banks to purchase pressing capital needs.

Townsell said that approach puts off fixing the needs.

The mayor said the bonuses that city employees would get are an important consideration, too.

“Surprisingly, there are a lot of people who are concerned about us losing police and firemen to Little Rock,” he said.

Little Rock approved a 1-cent sales tax, he said, and leaders are looking at adjusting salaries of those firefighters and police officers.

“We stand to lose trained firemen and policemen,” Townsell said.

“That’s why I’m for passing all four now and fixing these things now,” he said. “Most people don’t see the city is in an extremely weak financial position.” “It’s like watching a person across the lake water skiing. It looks like they’re doing a good job, not knowing they’re in 1 foot of water,” he said. “We’re still in 1 foot of water, so to speak.” “Quicker better than later is a safer, I think more fiscally responsible, way of doing it.” Townsell said that on a scale of 1 to 10 in importance of the proposal, “I’d say it’s getting up there. It’s just meat and potatoes - the stability of government - I’m going to say 10, in my mind.” Senior writer Tammy Keith can be reached at (501) 327-0370 or tkeith@arkansasonline.

com.

River Valley Ozark, Pages 57 on 02/02/2012

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