"Can I balance the budget without it? Yes. I don't think you'd want me to make some of the cuts I'd have to make. We're going to have to cut some things we don't want to cut."
--Joe Smith, mayor of North Little Rock
If voters in North Little Rock approve the sales tax increase next month, Joe Smith would be the one to thank. Or blame. The mayor of North Little Rock has given dozens of presentations--the other day the paper said he was up to 40--pushing the 1-percentage point increase. He's not going to be outworked on this.
Still . . . .
• The paper said the city raised salaries by 2 percent this year and 3 percent last year. In this economy, talk to any number of people outside government who have not received raises in the last few years.
• According to dispatches, North Little Rock's general fund budget this year is $66.3 million, up from $60.1 million in 2013.
• And the city spends almost $5 million a year to provide garbage and yard waste pickup, and doesn't charge residents for it.
So spending is up, salaries are up, the budget increases, the city gives away services that other cities must charge for. Why the unwanted cuts that Joe Smith suggests will happen should the tax increase fail?
The other day, over on the right, the Voices page carried a column from a couple of tax and economic experts that quoted the Tax Foundation's State-Local Tax Burden report. It found that Arkansans has the 17th highest tax burden in the country. Consumers in North Little Rock already pay 8.5 percent in sales taxes. (To be clear, only 1 percent goes to the city. Another 6.5 percent goes to the state and yet another 1 percent to the county.)
One more point: According to the Tax Foundation, Arkansas already has the second-highest sales tax rate in the country. Second only to Tennessee.
The city and other government agencies such as the local school districts get increasing tax revenues from higher retail sales and increasing property taxes, which have just been reappraised in Pulaski County. Those government outfits need to learn to live within those increasing revenues rather than raise taxes. Yes, in North Little Rock the sales tax revenues have not risen much in 10 years, thanks mainly to online sales, but they have risen.
A better idea would be to get the Legislature to finally, finally, finally pass a bill requiring that online retailers collect and remit taxes properly. These taxes are already owed under Arkansas law, but it's up to the taxpayers to write checks to the various governments when they buy things. You can imagine how many do.
Too many lawmakers in the last session complained that requiring companies to pay an already required tax would "seem like" a new tax. It wouldn't be.
If mayors like Joe Smith, and not only Joe Smith, think they need more cash for their governments, a good place to start would be by collecting taxes already on the books. The state Legislature could make that happen. If it only would.
Editorial on 07/30/2017