LITTLE ROCK, Ark. — Mayor Frank Scott Jr. says he wants voters to consider a sales tax increase as soon as this summer.
Mayor Scott and Little Rock Finance Director Sara Lenehan delivered a presentation about the Lift Little Rock proposal to the city’s Board of Directors on Tuesday.
While some board members wanted to see a detailed financial breakdown, Scott indicated he would not provide that level of information about his plan for two more weeks.
“We’re still working with a number of different architects, as well as our financial team, to refine those numbers,” Mayor Scott said after the meeting.
“As you know, I’m a former banker. I want to get the numbers right the first time.”
The Lift Little Rock plan, which Mayor Scott first announced during his State of the City address, would aim to improve the quality of life in the city. Mayor Scott said improvements to the city’s parks and the Little Rock Zoo, infrastructure, and public safety will encourage more people to want to live in the city.
He said millennials and retirees are increasingly likely to list quality of life as the main factor in determining where they live.
“The city of Little Rock is the state’s capital city,” he said. “We are a population of 200,000, but at any given point of time, we can be somewhere between 300,000 in the city of Little Rock.
As being the urban core, many people are coming to our city—which we want them to. We want them to work here and play here, but we also have to account for the infrastructure cost of that type of impact.”
Lenehan reported to the board about the money spent as a result of the LR Cent tax increase that took effect in 2011. That tax had three-eighths dedicated to capital projects and five-eighths earmarked for the maintenance of those projects.
“Our 3/8 cent tax sunsets at the end of 2021,” Linehan mentioned. “It is our belief—and by our, I mean the mayor, the city manager, and I, and the other department directors—that the city has followed through on its commitments, and that the transparency and accountability that we’ve demonstrated with the 3/8 cent tax will give taxpayers confidence to Lift Little Rock by supporting a permanent one percent tax.”
She then explained that if voters approve the proposed one-cent sales tax increase, the sales tax rate in Little Rock would jump from nine percent today to 10 percent in 2021. Beginning in 2022, however, the tax rate would drop to 9.625 percent as the previous tax sunsets.
Mayor Scott said all the capital projects he wants accomplished as part of the tax increase would be completed within the first 10 years and added that the city would have to sell bonds to pay for the construction costs.
He added that Lenehan’s report proves that Little Rock is worthy of an additional investment from its residents and visitors. "Before we ever ask the citizens of Little Rock, we also want to always show our stewardship,” he stated, “and we've shown that, in 2019, we've shown that we are the right individuals, the right team to provide stewardship and leadership."
Tax increases frequently receive pushback from residents who do not want their tax bills increased, whether because they are on fixed incomes, limited incomes, or oppose tax increases for political reasons.
Mayor Scott said he does not believe opposition will be a substantial impediment to passing his plan.
“We’ve been hearing a lot of great things,” he stated, “about the appetite to fund and revitalize and repurpose War Memorial Park and Hindman Park, how we reinvest into our current park system, as well as our zoo. We have the state’s only zoo. Again, we’ve heard nothing but great feedback about it. Now, clearly, there are going to be some individuals who don’t want to add another tax to their plate. But as we shared the numbers, the city of Little Rock is the lowest tax—from a sales tax perspective—in the state of Arkansas, within the cities that are contiguous to us”
After Mayor Scott releases his plan's numbers on March 10, the Board of Directors will decide when they want to consider it and whether to send it to voters.