BENTONVILLE — Numbers from the Bentonville Advertising and Promotion Commission illustrate a city undergoing rapid change as the home to 36,000 people morphs from a small company town into an urban arts hamlet.
Tax dollars are increasing as new restaurants and hotels take advantage of economic progress. The city averaged $73,170 a month in Advertising and Promotion taxes between January and August 2004, before the announcement of the incoming Crystal Bridges Museum of American Art. The museum will celebrate its one-year anniversary today.
The commission has averaged $124,291 a month in that same time period this year.
“We’re on pace to have the best year of collections that we’ve ever had for the A&P tax,” said Chris Sooter, the Bentonville City Council representative on the commission. “A good amount of that is attributable to Crystal Bridges and the large number of group tours that are coming in. There has also been a steady increase in business and leisure travel.”
Restaurants pay a 1 percent tax on prepared food and nonalcoholic beverages, while hotels pay a 2 percent tax on gross receipts.
At A Glance
A&P Taxes
Before Crystal Bridges (2010) With Crystal Bridges (2012)
January $81,817 $111,859
February $90,944 $111,872
March $102,975 $123,579
April $109,858 $128,222
May $104,678 $136,370
June $105,840 $132,308
July $100,743 $118,921
August $106,293 $131,202
Source: Advertising And Promotion Commission
The tax dollars haven’t fallen below $100,000 a month since February 2011, according to commission documents.
The January through August figures in the first year of the museum’s opening have been an average of $16,215 higher than the same month before it opened. On the whole, collections are up 15 percent over last year. Food and beverage taxes are up 16.6 percent, while lodging taxes are up 12.5 percent.
Kalene Griffith, director of the Bentonville Convention and Visitors Bureau, said the museum has been a catalyst for economic development in the city. Once just a quick stop on a tour bus itinerary, Bentonville has become an overnight destination, according to John Lamparski with the Bentonville Convention and Visitors Bureau. The hundreds of visitors fill restaurants and hotels that are rapidly opening to meet demand. Griffith said group tours have increased from 20 in 2011 to more than 100 this year. Lobby visits to the Visitors Bureau have tripled since the museum opened last November.
At least 17 restaurants have opened in the city over the past year. They range from T.H. Benton’s on the Bentonville square to Teri-Rocki Road, an Asian fusion food truck. Cupcake shops, the Flying Fish, sandwich eateries and a new McDonald’s are all profiting from the influx of tourism.
The museum’s restaurant, Eleven, brings in the highest amount of taxes among nonchain restaurants. It paid $1,950 in Advertising and Promotion taxes in August. The Flying Fish was close behind with $1,669 in taxes.
The stream of new restaurants is continuing, with new eateries planned, including Maid-Rite, Muscle Maker Grill and The Hive at the 21c Museum Hotel.
Hotel taxes are growing at a slower rate than restaurants, perhaps because the only new hotel to open in the last year is a Motel 6. That’s coupled with the loss of the Clarion Hotel, Travelodge and the Economy Inn. Despite the closings, occupancy rates and hotel taxes are still increasing. Taxes from the Doubletree are up 48 percent from August 2011 to August of this year. Comfort Suites is up 58 percent.
Sooter said he expects incoming hotel taxes to grow faster after the opening of the 21c Museum Hotel planned for the first quarter of next year. The luxury downtown hotel will have 104 rooms.