LOSING REVENUE: Officials’ Millage Views Vary

MAYORS MAY BE UNHAPPY WITH CHANGE IN TAX RATE

By John Gore

Tuesday, November 24, 2009

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Justices of the peace didn’t make the mayors of the two largest cities in Benton County happy when they approved a millage change last week.

Lowering the country road fund tax from 2.2 mills to 1.9 mills and raising the general fund millage to 5 mills is costing Bentonville and Rogers hundreds of thousands of dollars in road turnback money.

A mill is one-tenth of a cent, and each mill produces $1 of tax for each $1,000 of assessed valuation on property.

A property’s assessed value is 20 percent of its appraised value.

Bentonville stands to lose $250,000 in 2010, approximately 30 percent of the projected revenue of $822,300 for streets, according to Denise Land, city fi nance director.

Rogers is expected to lose $325,000 or 8 percent of its projected revenue of $4 million for streets, said Jerry Hudlow, city treasurer.

Rogers Mayor Steve Womack said he understands county off - cials have budget issues but putting more money in the county general fund at the expense of city street improvement and county roads isn’t the way to do it.

“I think it’s foolhardy to pull money for streets away from the cities,” Womack said. Population and retail growth driving the economy in the cities is directly related to improved streets, he said.

The majority of growth and the increased sales tax revenue over the last 10 years has come from the cities not the county, Womack said, making a case for cities to get the lion’s share of county taxes and road millage.

Bentonville Mayor Bob McCaslin is also unhappy with the county action.

“This is an unfortunate time to lose a quarter of a million dollars from street revenue,” McCaslin said.

It is important to Bentonville offcials to address the transportation needs of the city and taking money away is not helping, McCaslin said.

Bella Vista Mayor Frank Anderson said his city will lose between $60,000 and $70,000 in road turnback money.

“Any amount of money loss to a city no bigger than we are is going to have an impact,” Anderson said.

Bella Vista has 550 miles of street, Anderson said. Some planned work will not be done, he said.

County Judge Dave Bisbee said Monday he understands the cities don’t like losing money, but the court had no choice: it had to take millage from the roads to put in the general fund.

“We are in purgatory ... The county must provide services for everyone in the county but we have no way to increase our revenue,” Bisbee said.

The county, by state law, can only level a 5-mill general fund tax. A sales tax increase would not benefit the county because the majority of the increase would go to the cities not the county, Bisbee said.

The county provides a variety of services used by county and city residents which include the court system, the jail, the election commission, tax collector and the juvenile detention center.

Pulaski is a big county and the county government keeps 5 mills of the property tax on high end real estate in the urbanized area in the county, Bisbee pointed out.

Benton County is in flux; it’s becoming more urban than rural, but doesn’t have the large tax base of Little Rock, Bisbee said.

Bisbee said all of the mayors in the county knew the shift in millage was coming.

“Not one mayor called to tell me he was against us shifting the millage. I understand they don’t like losing money, but most of the mayors understood the situation the county is in, Bisbee said.

“Everybody thinks of the county as just another entity, like a city — but it’s not,” Bisbee said.

City officials only have to worry about the city but county offcials must worry about everything in the county, which includes cities, Bisbee said.

“Eighty percent of the money I spend is spent on the county at-large. Only 20 percent is directed to the rural section of the county,” Bisbee said.

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arkwild78 says...

Did the cities care when they annexed more land into their boundries, causing the counties revenue to go down. The answer is no. They were watching their bottom line and that is all the county is doing.

November 24, 2009 at 7:13 a.m. ( permalink | suggest removal )