City Council report in Northwest Arkansas Times on October 7, 2009

Petty suggests tax hike to spur economic growth

Aldermen hold trash rates steady in Fayetteville

By Robin Mero

Wednesday, October 7, 2009

FAYETTEVILLE — Fayetteville Alderman Matthew Petty on Tuesday suggested increasing the city’s levy on real andpersonal property taxes to invest in economic development.

“It seems to me the community is ready to make a certain kind of investment in itself,” Petty said. “Maybe there is an investment that is appropriate; maybe there’s a good one and maybe there isn’t.”

The Fayetteville City Council was considering approving the same millage that has been in place, which funds the library, firefighter and police pensions, and the general fund.

Petty suggested waiting two weeks and considering increasing that levy.

The levy is now distributed as follows:

◊Fayetteville Public Library, 1.0 mill

◊Policemen’s Pension and Relief Fund, 0.4 mill

◊Firemen’s Pension and Relief Fund, 1.0 mill

◊General Fund, 1.3 mills

Each mill generates about $1.2 million in revenue. Each mill costs asingle-family home with an appraised value of $100,000 about $20 per year, according to city data.

Petty suggested not approving the levy immediately but taking the next two weeks to consider how to invest in economic development. He mentioned the possibility ofraising the millage for one year.

Aldermen Bobby Ferrell said he didn’t mind waiting but increasing the millage wasn’t constructive for economic development.

Alderman Shirley Lucas was also willing to wait.

“But once you get [the increase] on there, it’s very hard to take it off,” Lucas said. “We’ve all been worried and trying to work on strategies, so I don’t mind waiting two weeks.”

In other business, aldermen decided residential trash rates won’t go up for the third year in a row.

The City Council onTuesday passed an ordinance to waive an automatic annual price adjustment for residential rates.

Small businesses also will, for the first time, be charged for commercial recycling. Since 2000, the city has offered a trial service for small businesses, but new accounts can’t be added until a rate is set.

The rate will be the same as residential recycling, $5.88 per 18-gallon recycling container.

Staff intends to perform a rate study in2010 to evaluate all solid waste rates. Commercial solid waste rates haven’t changed since 2000. Residential solid waste rates were last increased in 2006.

Consideration of ordinances regarding red dirt and rock quarry operations was tabled until the next meeting, Oct. 20. The council’s ordinance review committee will redraft those ordinances in detail at 4:30 p.m. today.

The council also voted to issue $11.3 million insales tax bonds - $10 million for streets and $1.3 million for trails projects.

Voters in 2006 approved $110 million of A-plus rated sales tax bonds for wastewater, street and trails projects. The balance will be $31.8 million for streets. Bonds can’t be sold for that third phase until these bonds are paid off, which should be in 2013 or 2014, unless sales tax revenue picks up and they are paid more quickly, said Paul Becker, finance director.

News, Pages 1 on 10/07/2009