Commentary: Madison County To Tackle New Sales Tax Proposal

Another Northwest Arkansas county has taxing issues.

Madison County's Quorum Court is now struggling, like Benton County's, over a funding question.

The Madison County situation is quite different, however, from Benton County's challenge to find money for rural ambulance services.

Quorum Court members in Madison County are debating referral of a sales tax hike to their constituents. The change would increase the county sales tax from 2 percent to 3 percent, possibly with a sunset clause that would cause it to be collected for just 12 years.

The court is scheduled to consider the issue on Monday in a 6 p.m. meeting.

Then, a plan for use of the roughly $1 million more in annual sales tax revenue will also be ready. That's what the additional 1 percent tax is supposed to generate; but not all of the funds would go to the county government. The countywide levy would be shared with Hindsville, Huntsville and St. Paul.

Originally, the expected county use of the money was for a new county jail and increased jail staffing, for courthouse restoration and for solid waste and recycling, county libraries, rural fire departments.

The county's general operating budget would also get a boost, at least for the 12 years being discussed. A plan for allocation of county money is due Monday.

County Judge Frank Weaver said recently that it should consider the pros and cons of adding a cutoff date for the new levy. He doesn't think the county could build a new jail with the reduced revenue flow.

This idea of a sunset clause came about because Madison County voters rejected a similar tax proposal just last year.

This is the second time around for a tax hike and is arguably more critically needed to address county problems, including the big-ticket items like jail and courthouse needs.

With the state's 6.5 percent tax and Huntsville's 2 percent tax and the county's existing 2 percent, county residents are already paying a total of 10.5 percent in sales taxes on purchases made in the county seat. The hike would bring the total tax to 11.5 percent.

That's a big tax bite and a good reason the Quorum Court may temper the proposed 1 percent hike by making it go away after 12 years.

County needs will surely continue a dozen years hence as the county continues to grow in population and faces greater demands for service, but this proposal is about finding additional money for the county now.

Madison County Quorum Court members are looking for something that voters will approve and will try to hash this all out on Monday.

Meanwhile, Benton County Quorum Court members are still struggling with their challenge to fund rural ambulance service.

The Quorum Court considered two plans on Thursday, approving both but rejecting the necessary resolution to send either to the ballot. The court may take them up again soon in a special session.

One plan would impose a $40 household fee in a new emergency medical service district that would include all unincorporated areas of the county except that now served by the Northeast Benton County Fire Department. That area already funds its own service with a household fee.

A similar plan, with an $85 household fee, was soundly defeated earlier.

The other proposal is a 0.2-mill property tax hike for all residents of Benton County that could be spent only on emergency services.

The property-tax hike drew some pointed opposition last week from Rogers Mayor Greg Hines. His is the most populous city in Benton County.

"I can't for the life of me imagine a scenario where city residents will vote to tax themselves to provide a service to other people that they are already paying to provide for themselves," he said.

City residents in Rogers and six other municipalities that fund their own emergency services far outnumber rural residents. What they say on election day would likely decide a property-tax vote.

So, if Hines is right about city voter sentiment, the tax may not fly.

For the record, similar opinions have come from other mayors and city council members, who think their constituents would defeat a property tax hike.

The problem for the Benton County Quorum Court is that the household fee isn't all that popular with the people who would have to pay it either.

While the cost of the tax increase would be $4 per $100,000 of property value per year, the $40 fee would cost anyone with less than $1 million in property holdings more than the tax would.

The underlying issue here is that rural Benton County and the smaller cities and towns have relied on the larger cities with well-staffed, city-funded fire departments to provide them "free" emergency response. City residents paid the freight to have responders at the ready.

No one seems to believe that the cities will eventually shut off service, but that day will come if the county doesn't pay the negotiated fees to the city providers.

Whether the money comes from one or the other of the ballot proposals or from a $1 million-plus cut to other items in the county budget, that bill must be paid.

BRENDA BLAGG IS A FREELANCE COLUMNIST AND LONGTIME JOURNALIST IN NORTHWEST ARKANSAS.

Commentary on 07/27/2014

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