The Little Rock Regional Chamber of Commerce has yet to take a position on the Little Rock sales tax referendum scheduled for Sept. 14, according to the group of companies chief.
“Our leaders have not yet met to discuss the proposal. It will probably be a few weeks before they do so,” Chamber President and CEO Jay Chesshir wrote in an email on Monday.
According to Chesshir, the executive committee and the board of directors of the chamber will make the final decision.
A week ago, the Little Rock board of directors voted to allow the September sales tax referendum at the behest of Mayor Frank Scott Jr.
Scott proposed increasing the sales tax by one percentage point as a way to fund initiatives related to infrastructure, early childhood education, public safety, parks and the Little Rock Zoo.
The tax, dubbed “Rebuild the Rock”, is expected to generate $ 530 million over 10 years.
Under the economic development subsections of the latest version of a council spending resolution, $ 11 million over the next decade would be spent on economic development operations.
The figure includes the city‘s partnerships to renovate or redevelop existing buildings, plots or businesses “to provide incubator space, living / working space, laboratory, test kitchen, training space. manufacturing, workshop or other local incentives designed to help people wishing to start or grow businesses in the City. “
An important target “will be existing businesses that primarily sell technology or technology services,” the resolution said.
In addition, $ 30 million would be spent on capital projects related to economic development as part of âRebuild the Rockâ.
The resolution specifically mentions the construction of a “job creation site southeast of the existing limit of Little Rock Harbor, providing the opportunity to recruit large heavy industrial jobs for the city and also providing the opportunity to attract projects that will create jobs â.
The symbolic spending resolution has yet to receive formal board approval. The measure failed in a close vote at last Tuesday’s meeting when Ward 2 City Manager Ken Richardson voted “present.”
If voters approve the tax increase in September, because a separate three-eighth percent (0.375%) sales tax expires at the end of that year, the local tax rate will increase by five-eighth percent (0.625%) ). Consumers in Little Rock will pay an aggregate rate of 9.625% starting in 2022 including state and county taxes.
Scott’s original version of the proposal would have instituted a permanent sales tax increase, but according to the version approved last week, the tax will expire at the end of 2031.
In April, Regional Chamber President John Burgess wrote to Scott raising a number of questions and concerns on behalf of the House leadership regarding the version of the tax proposal that was circulating at the time.
Chief among them was the lack of an expiry date for the capital spending portion of the tax, according to Burgess’ email.
âThe removal of the capital expenditure portion of the tax is a big problem. It is the biggest problem with the proposal raised by our steering group and it is the biggest problem that is mentioned by those in our networks. social, âhe wrote. âYour proposal represents a 40% increase in the city’s budget. The idea of ââasking for a 40% increase in perpetuity versus asking for 20% over a period of time to invest in a defined set of upgrades with a 20% increase in funding is huge, in our opinion. “
Burgess went on to say that local governments elsewhere in Arkansas “manage very successfully by funding capital spending through fixed-term (temporary) taxes.”
He asked: “Why can’t this part of your proposal be converted into a 10-year sunset tax, given that your proposal says all identified initiatives will be dealt with in the first 10 years anyway?”
The addition of the expiration date was part of the adjustments made to the package shortly before the June 15 board vote to trigger the election.
When asked if he thought adding the expiration date improved the odds of the tax package getting chamber approval, Chesshir declined to say.
“I’ll be happy to comment once they make up their minds,” Chesshir wrote on Monday.