A series of town halls and neighborhood group meetings over the next few weeks will have North Little Rock Mayor Joe Smith appealing for residents' support of a proposed city sales tax increase to shore up the city's budget and complete several major projects within the next five years.
The sales tax special election will be Aug. 8. The increase, if passed, is projected by the city to raise an additional $16 million per year. The 1 percent additional sales tax would start being collected Jan. 1, raising North Little Rock's sales tax to 2 percent, if approved.
The 1 percentage-point increase is to be divided for two purposes: One-half percent will be levied for five years, until Dec. 31, 2022, to "acquire, construct, repair, equip and/or improve" streets and drainage structures, the police and courts building, and fire department stations. The remaining one-half percent, a permanent tax, will be for the city's general operations, such as city services and personnel.
"We've cut expenses over the last four to five years," Smith said Friday. "I think any reasonable person would agree that it's time we raise our income level."
Opposition to the tax is forming, as well. Kenny Wallis of North Little Rock, who helped to lead organized opposition to North Little Rock's unsuccessful sales tax election in 2011, is again speaking out against any new tax.
Wallis has set up a Facebook page called Stop the 2017 North Little Rock Sales Tax. Social media and word of mouth were reported to have largely contributed to the tax defeat in 2011.
"While a city's job is to provide services like police, fire, sanitation, [and] infrastructure, North Little Rock has wasted taxpayer funds on pet projects [and] intends to do so while raising taxes," reads a statement on the Facebook page.
Smith said he wants to use his coming speaking engagements to explain why a higher sales tax is needed.
"My goal is to give the facts to as many people as I possibly can," Smith said. "I think when they see how our income has not grown over the last 10 years, they'll understand where we are financially and why."
Five town hall meetings have been scheduled for Smith to directly discuss the tax proposal with voters. Their times and locations are:
• 6 p.m. June 21, at Lakewood United Methodist Church, 1922 Topf Road.
• 6 p.m. June 29, at Sherman Park Recreation Center, 624 N. Beech St.
• 6 p.m. July 13, at North Heights Community Center, 4801 Allen St.
• Noon July 20, at Patrick Henry Hays Senior Citizens Center, 401 W. Pershing Blvd.
• 6 p.m. July 27 (a Facebook Live event), at William F. Laman Public Library, 2801 Orange St.
Smith already has spoken to a few neighborhood groups and civic organizations about the tax proposal and has about a dozen more talks scheduled. City aldermen have been provided "briefing points" for their use.
Among the city's statistics is that the combined city and county sales tax collections for North Little Rock have grown from $29.3 million to $30.3 million over the past 10 years, an average increase of 0.3 percent annually. City expenses, meanwhile, have increased from $48.9 million to $68 million over those same 10 years, a 3.5 percent annual rise, according to city figures.
The city's reserve fund, which Smith has referred to as the city's "savings account," will be depleted within three years without the extra funding from a tax increase, according to the city's projections. With the increase, the reserve fund would grow from about $9 million to just more than $20 million in 2022, according to city figures.
Consumers pay 8.5 percent in sales taxes on purchases in North Little Rock. The total tax is made up of the city's 1 percent sales tax, a 6.5 percent state tax and a 1 percent Pulaski County tax.
North Little Rock voters approved the city's current 1 percent sales tax in a March 2000 special election but rejected a proposed additional 1 percentage-point sales tax increase in November 2011.
Wallis, who is organizing opposition to the tax, said in a recent interview that the "big thing we are going to focus on is the city wanting to waste money" on projects such as a planned downtown plaza and the funding for several nonprofits. Those things show city officials place "pet projects first" over basic needs, he said.
Wallis also spoke against the city using part of its reserve funds to give raises to employees and elected officials.
City employees and elected officials received a 3 percent raise in 2016 and a 2 percent raise for 2017. The raises amounted to $2.37 million of the total $3.69 million the city transferred from its reserve fund over those two years in order to balance the city's general fund budget.
Aldermen's "briefing points" say the city has used its "savings account to balance budgets. We cannot do this anymore."
"You certainly don't give elected officials raises when you're saying you're running out of money for the essentials," Wallis said.
Smith countered that Friday, saying, "No employee of ours is overpaid."
"We have streamlined government as best we can in the last four years," Smith said. "We've cut everything we can cut without cutting services."
The North Little Rock Chamber of Commerce set up an organization called North Little Rock Proud on May 17 to head the election campaign, paid for through private contributions, with "no city money being spent on anything political," Smith said.
The organization has hired Craig Douglass Communications, a Little Rock marketing firm, to manage and promote the campaign.
Metro on 06/11/2017