During a meeting with the Little Rock Board of Directors on Thursday, Mayor Frank Scott Jr. presented his plan to put a sales tax increase on the November ballot.
Scott said his proposal would increase the sales tax by 1% and generate about $600 million over 10 years. He said the revenue from the sales increase would be put toward parks and recreation, public safety, the Little Rock Port and infrastructure. He said with the growing population, there is a need to increase the sales tax.
“We are the state’s largest city so our sales tax rate garners more dollars,” Scott said. “Our population has grown to about 205,000, but from 7 a.m to 7 p.m we’re probably about 300,000. That brings a lot of strain on our infrastructure and quality of life and place amenities.”
According to data from the city, Little Rock currently has a sales tax rate of 8.75%, which puts it below surrounding cities like Conway, North Little Rock and Bryant. Under the current tax rate, 1.125% goes to Little Rock and the remaining revenue generated goes to the county and state, according to the Arkansas Times.
Scott said the projected $600 million from the proposed sales tax is a conservative estimate and that it is possible the sales tax increase could generate $670 million over 10 years. After 10 years, he said voters would have the option to renew the sales tax increase or let it end. Scott said Oklahoma City uses a similar approach and that allows the city to adjust what areas the tax revenue will go toward.
In order to get the tax increase proposal on the ballot this November, the city will have to submit the proposal to Pulaski County officials by Sept. 5, Scott said. He added that if the proposal is on the ballot next March it will be difficult to get it passed because that is a presidential election year.
City Director Lance Hines disagreed with Scott’s approach to get the issue on the November ballot.
“I think we’ve got the cart a little bit in front of the horse. We’ve come up with a plan without talking with our constituents and our voters,” Hines said.
Vice Mayor Kathy Webb, Director Capi Peck and Director BJ Wyrick agreed with Hines and said it would make it difficult to hear from residents if they tried to meet the September deadline.
