The Blytheville City Finance and Purchasing Committee met Thursday for its regular monthly meeting and unanimously agreed to send the Mayor's proposed "Public Safety Tax" to the full council for approval.
The proposed "Public Safety Tax" would have a 10-year sunset and would be used "for public safety purposes or to pay and secure the repayment of Capital Improvement Bonds, or both."
The ordinance defines "public safety" as "including police, firefighting, code enforcement and animal control purposes." The tax will be a one-half of one percent Sales and Use tax to begin on October 1, 2017 and end on September 30, 2027.
If the full council passes the proposed ordinances, then the special election will be held on May 9, 2017. The ballot title is, "A one-half of one percent (0.5%) sales and use tax for public safety purposes and bond retirement."
An additional question that will be presented to Blytheville voters, if Ordinance Number 3 is approved by the full council, is whether the voters will give the city permission to issue bonds under Amendment Number 62 of the Arkansas Constitution.
"Bonds of the City of Blytheville in the maximum aggregate principal amount of $2,750,000 to finance all or a portion of the costs of renovating, expanding and equipping the old National Guard Armory for use as a Justice Center to house the police department and district court and other personnel for the administration of justice, and any necessary parking, landscaping, drainage, lighting, street and utility improvements therefor [sic], and in order to pay the bonds, the pledge of the net collections of a new City-wide one-half of one percent (0.5%) sales and use tax."
After Councilman L.C. Hartsfield asked a number of questions, he made the motion to send the three ordinances to the full council for approval and Councilman John Musgraves seconded.
Committee Chairman Stan Parks said, "I'm not even going to ask for a vote, because I support all three of them myself."
"Technically, you know, they could pass the tax and not pass the bond, which we wouldn't be able to do the improvements," Callens said. "Technically, you could pass the bond and not pass the tax, but if that happened, you know, it's a moot point."
"There would be no funding [for the bond]," Parks pointed out.
The proposed bond would be up to $2,750,00 but Callens says that the cap is more a safety net.
Callens said, "We're hoping it'll be two and a half million. It's what we think it will be. When we spoke to the USDA they recommended setting it at $2.75 [million], just in case. But when it's all said and done, hopefully the bond issue will only be for $2.5 [million]."
Parks asked, "And we are looking at a government loan through the USDA?"
"Yes," Callens said. "And everything is being put in place for the loan to be approved and paid off within 10 years using the increased tax money. This loan will be issued to the city as bonds to make the necessary improvements mentioned in the ordinances."
Callens also explained that in addition to financing the bond, the levy increase would go towards financing police force salaries.
"This year, we felt like we had to do something to give them some type of raise. And the only way we could do it was by increasing the amount that we use in the current police tax... any increases on salaries will come out of the public safety tax," Callens said.
Hartsfield asked about accountability and what safeguards were there for the general public to feel assured that the money would be spent how it was promised.
Callens said a separate fund would be set up in order to easily track where the money is going.
"Every dollar of the money will be put into a separate, we'll probably call it the Public Safety account, and then at the end of the month a check will be written on the account back to General Funds for what we put in. That way it is all easily accounted for," Callens explained.
He also said that it would allow auditors to easily see what it all came from and went.
He admitted that payroll is the most difficult to track, therefore doing it that way makes it more clearly discernable for those that want to verify.
Callens also announced that the city's revenue in January from its one percent sales tax was up from 2016.
"For the first month, in January, as compared to January 2016, our sales tax revenue was up $49,698 [from $184,042.20]...now as far as [the city's portion of] the county sales [tax], it was pretty well the same. It was up $366.57. It was a total of $172,073 as compared to a $171,706 in 2016," he explained. "As far as collections and [the] General Fund, as you can see, the revenue in the general fund was up about $16,000 for the first month of the year, which is good. And as far as expenses, the expenses were down about $19,000 in the month of January for General."
Callens explained that January is always tough for the city, and that percentages are somewhat skewed because the city is forced to pay workman's compensation, employee insurance and a number of other expenses for the entire year at one time.