The half-cent sales tax is half over
How are your streets currently funded, and how will they continue to get funded? Newly elected officials throughout the state may be asking these same questions for their constituents. In 2009, the Arkansas Legislature created the Blue Ribbon Committee on Highway Finance. The 19-member, independent panel was comprised of elected officials, business leaders, and civic leaders from across the state.
The committee’s goal was to develop recommendations that could be considered by the General Assembly to help address the state’s highway funding shortfall. Because of this committee, the General Assembly referred to voters a proposed constitutional amendment to levy a temporary, 10-year, half-cent sales tax increase in order to fund highway improvements; this is what would later become Issue No. 1 on the November 2012 ballot. With passage of Issue No. 1 (effective July 1, 2013) the temporary halfcent sales tax was approved by 58 percent of Arkansas voters, increasing the sales tax to 6.5 cents. The tax increase will sunset (expire) in July 2023.
That means that cities and counties will no longer receive the millions of funding dollars currently being received. Individual cities/counties stand to lose close to $40 million a year, and the Arkansas Department of Transportation stands to lose close to $200 million a year with the end of the half-cent sales tax.
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