Arkansas Economy

Tax revenue through the first nine months of Arkansas’ fiscal year is up 7.5%, and the fiscal year-to-date revenue surplus – “net available revenue” collected beyond what was estimated – totaled $549.9 million.

The February tax revenue report again shows broad year-over-year gains to include an almost 15% increase in statewide sales and use tax revenue – a sign that consumer spending appears to be robust.

Arkansas’ tax revenue picture continues to be impressive, with gross revenue for the first seven fiscal months (July-January) up almost 10% compared with the same period in 2019-2020. January revenue was up more than 20% above forecast.

Arkansas employers added more than 65,000 jobs between November and December, pushing the state’s jobless rate down from 6.3% in November to 4.2% in December, according to Tuesday’s report from the U.S. Bureau of Labor Statistics.

The number of employed in Arkansas during December was an estimated 1,303,673, down 12,396 jobs compared with December 2019. The year-over-year job losses are down considerably compared to the 78,011 jobs between November 2019 and November 2020.

Arkansas businesses can now apply for a second round of loans through the Paycheck Protection Program, or PPP.

The second set of loans from the federal program opened to businesses getting loans from lenders with under $1 billion in assets late last week, and will open for all other businesses Tuesday.

Gov. Asa Hutchinson and officials with Mars Petcare were in Fort Smith on Friday to announce a $145 million expansion of the company’s plant at Chaffee Crossing that will create more than 120 jobs.

Arkansas’ economy continues to outperform its forecasts, according to the most recent revenue report.

The December revenue report, released Tuesday by the Department of Finance and Administration, shows the state’s net available general revenue totaled $530.3 million for December, which is 7.3% above forecast, but $17.2 million or -3.1% below last year’s amount.

Gains in retail and vehicle sales, along with a shift in individual income tax payments, continue to show up in Arkansas tax revenue that beats estimates. For the first five fiscal months (July-November), gross revenue is up almost 12% compared with the same period in 2019.

The Arkansas Department of Finance and Administration reported Wednesday that gross revenue for fiscal year-to-date is $3.092 billion, up 11.9% compared with the same period in 2019 and up 11% over the budget forecast.

A company that produces disinfectant wet wipes is expanding its facility in northeast Arkansas. Gov. Asa Hutchinson joined Nice-Pak officials online Monday to make the announcement. The New York-based company is among the world’s largest wet wipes producers.

Chairman and CEO Robert Julius says the Jonesboro facility has shifted to around-the-clock operations to meet rising demand amid the pandemic. Even prior to the pandemic, the company employed about 400 people at the plant.

Tax revenue in Arkansas' first four fiscal months (July-October) totaled $2.558 billion, up 13.8% from the same period in 2019 and 12% over the budget forecast. The increase has resulted in $242.6 million in revenue above what was expected.

The group tasked with disbursing the $1.25 billion Arkansas received from the CARES Act has approved new funds to go toward stabilizing the state’s Unemployment Insurance Trust Fund.

Members of the state CARES Act steering committee on Friday voted to approve the infusion of $165 million from the federal coronavirus bailout to the fund at a meeting held virtually. This comes as the panel faced a deadline of Sept. 30 to stabilize the fund, otherwise employers would have to pay an extra $10 per employee per year in taxes.

As measured by double-digit gains in sales tax revenue in the state’s August report, Arkansans continued to spend through the summer despite COVID-19 worries, with gross revenue up almost 30% to $1.331 billion during the first two months (July-August 2020) of the fiscal year.

The gross general revenue was up 29.4% compared to the same period in 2019, and up 11.2% above the budget forecast, according to Wednesday’s report from the Arkansas Department of Finance and Administration (DFA).

Arkansas State tax revenue in July totaled $766.8 million, up 47.2% thanks to an almost 90% growth in individual income tax resulting from a tax deadline shift from April to July, according to Tuesday’s report from the Arkansas Department of Finance and Administration.

A 225-year old Italian company with a large North American presence is expanding manufacturing operations in Central Arkansas.

Fiocchi of America, the U.S. subsidiary of Italy-based Fiocchi Group, announced plans Wednesday to establish a new manufacturing facility in Little Rock. It will invest $15 million in a new facility and hire 85 skilled employees with plans to further increase its workforce as the facility reaches its full potential.

Arkansas-based Walmart announced Tuesday its third cash bonus for workers in stores, clubs, distribution centers and fulfillment centers for their work with the public during the COVID-19 pandemic.

Full-time hourly workers will receive $300 cash payouts while part-time and temporary workers will get $150. Drivers, managers and assistant managers in retail stores and supply chain and health and wellness will also receive bonuses for a total of $428 million.

Walmart made the announcement through an internal memo to employees from Walmart U.S. CEO John Furner.

Amazon announced Tuesday plans to open its first fulfillment center at the Port of Little Rock. The new fulfillment center, which is anticipated to launch in 2021, will create over 1,000 new full-time jobs.

The 825,000 square-foot distribution facility will be located on 80 acres at the port and will benefit from yesterday’s announcement of upgrades to road infrastructure.

Arkansas restaurants were allowed to begin reopening for dine-in service Monday, but many are waiting until they feel more comfortable letting patrons back in during the coronavirus outbreak. Some also said that with already thin profit margins, it doesn’t make sense from a business perspective to reopen.

Numbers from Arkansas's monthly revenue report are beginning to show the economic impact of the coronavirus.

The report was released Monday by the state's Department of Finance and Administration. John Shelnutt, an economist with the department, pointed out the data represents transactions from March and social distancing measures were only in effect for half that month.

"We expected large losses in major categories, and, in most cases they were not as bad as we predicted." Shelnutt said.

Cynergy Cargo, an enclosed cargo trailer manufacturer headquartered in Douglas, Georgia, announced Thursday that it will build a new facility in the Crossett Industrial Park. The company plans to hire 70 new, full-time employees within 24 months, including carpenters, welders, and electricians.

Cynergy currently employs about 60 people at its facility in Douglas where it runs two lines. The company chose to expand in Crossett to be closer to customers and increase production with a third line.

The surge in Arkansas jobless claims receded last week by 44%, according to Thursday’s U.S. Department of Labor report. Arkansas’ total for the week ending April 11 was 34,635, down from a spike of 62,086 the week prior.

The latest data pushed Arkansas’ total the past four weeks to 133,752.

Once heralded as an advanced manufacturing success for Arkansas, LM Wind Power announced it will close its wind blade facility that has been in existence for more than a decade.

A spokesperson for GE Reneweable Energy, parent company to LM Wind Power, tells KATV television that the site will close later this year due to a decrease in demand for wind blades made at the plant.

Little Rock Mayor Frank Scott Jr. announced that retail giant Amazon has bought an 80-acre site at the Port of Little Rock for $3.2 million.

“We have settled upon acquisition of land with Amazon online,” Scott said, according to KATV, channel 7.

Small indications of the economic impact of the coronavirus outbreak could be showing in Arkansas's most recent revenue report. The March report, released Thursday, reflects mainly taxable transactions from February, before local and national recommendations for social distancing were widely in effect.

Representatives of Sun Paper Co., the $1.5 billion paper mill project slated for Clark County near Arkadelphia, have said the deal is officially terminated.

In a letter dated March 15, Andrzej Bednarski, International Project Director for Shandong Sun Paper Co., Ltd. notified Gov. Asa Hutchinson and AEDC officials that the project would not move forward, citing trade tensions, economic uncertainty, and the coronavirus outbreak as reasons for pulling the plug.

A new report funded by Entergy Arkansas and the Winthrop Rockefeller Foundation indicates that 41% of Arkansas households are either below the federal poverty level or have incomes that struggle to afford housing, childcare, food, transportation and healthcare.

The report addresses “ALICE” households – those that are “Asset Limited, Income Constrained, and Employed.” While the federal poverty line for a family of four sits at $24,600, ALICE households are between that amount and $46,812.