Cities, counties see jump in sales tax revenue; businesses recovering from covid

FAYETTEVILLE -- Washington County Treasurer Bobby Hill described the county's May sales tax receipts as "unreal" and credited the federal stimulus checks for a jump of nearly 32% over the May 2020 receipts.

Sales tax revenue for Benton and Washington counties was up substantially in May 2021, as were the sales tax receipts for Fayetteville, Springdale, Rogers and Bentonville.

"These are March numbers for sales, and that's when the stimulus checks started hitting a lot of people's bank accounts," Hill said. "If it's not 100% of the increase, it's a big part of it."

The American Rescue Plan, signed by President Biden on March 11, provided a $1,400 check per person to about 160 million people.

"It was meant to stimulate the economy, and I guess it did," Hill said. "There's no doubt this is the biggest month we've had since the sales tax was adopted in 1981."

Washington County showed an increase of about 31.6%, with revenue of $913,000 compared to $694,000 in March 2020. Benton County showed an increase of about 34.8%, with revenue of $1.2 million compared to $890,000 last year.

Fayetteville had an increase of about 38%, with revenue of $2.5 million compared to $1.9 million. Springdale received an increase of about 21%, with revenue of $1.7 million compared to $1.4 million.

Rogers showed an increase of about 29%, with revenue of $2.1 million compared to $1.6 million. Bentonville showed an increase of about 43%, with revenue of $1.8 million compared to $1.3 million.

Casey Wilhelm, finance director for the city of Rogers, agreed with Hill that the jump in sales tax revenue could be tied to the federal stimulus checks. Wilhelm added people are getting out and spending more since the easing of covid-19 restrictions in place for more than a year.

"In March, we had spring break and the stimulus checks were hitting," Wilhelm said. "This was the largest May we've ever had."

Wilhelm said Rogers relies on dining and entertainment for a large part of its sales tax revenue. Spending in those areas dropped during the pandemic, hitting Rogers harder than the other three large cities, she said.

"This summer is going to be very important for the city," Wilhelm said. "We're hoping to get back to the 2019 and earlier levels of growth. We're seeing about 9% growth so far this year. We were averaging about 6% a year before the pandemic hit."

While local governments have seen increases in revenue through much of the pandemic, small businesses haven't fared as well. The Dickson Street Bookshop in Fayetteville was closed to in-person customers from March 13, 2020, until Sept. 1 because of the social distancing restrictions.

Suedee Hall Elkins, who has managed the shop for 12 years, said she tried to make curbside pickup available to customers, but that was of little benefit to the business.

"It was exhausting. It was a lot of work, and we hardly made any money at all," she said. "We didn't know when, or if, we would be able to open again."

Elkins said the bookshop has 10 people on staff, including herself, and owner Don Choffel. She and Choffel were the only ones working when the shop closed. The shop has gone back to being fully staffed since reopening, she said.

The business was able to weather the pandemic with help from government grants and loans made available to small businesses, Elkins said.

The shop opened, with restrictions on the number of customers allowed inside at one time, on Sept. 1, 2020. Masks are still required for customers and employees and the bookstore's hours have been cut from 9 a.m. to 9 p.m. to 10 a.m. to 6 p.m. to allow for cleaning. Elkins said the reduction in hours has surprisingly not reduced business.

"That's about 140 hours less a month," she said. "I thought that would really hurt our sales, but people have been coming back."

Paul Becker, Fayetteville's finance director, said the May numbers were "fantastic" and agreed relaxing covid-19 restrictions boosted the economy. He said he expects that to continue.

"People are seeing the coronavirus numbers dropping, and there's a lot of pent-up demand," he said. "I think we're seeing a lot of people expanding travel and spending on that. People were buying 'big ticket' items last year. This year, it's more travel and travel-related spending."

Wyman Morgan, Springdale's finance director, said Springdale's sales tax numbers continue to reflect growth as well as a return to prepandemic spending.

"For building materials, we're up considerably," Morgan said. "Full-service restaurants were up also. Those were our two biggest categories."