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City’s sales tax collections off to fast start in ’23

by David Showers | March 24, 2023 at 4:04 a.m.
A chart shows Hot Springs sales tax detail for January, general fund only (1%). - Submitted photo

A report the city released Wednesday showed January collections of Hot Springs' 1% general fund sales tax increased 8.19% compared to the previous January, marking the 23rd straight month collections grew on a year-over-year basis.

The strong January followed a record-setting year for collections in 2022. The tax raised $18,412,291 last year, a 7.37% increase from the previous record set in 2021. Last year's collections increased more than $6.5 million, or 55%, compared to 2013.

The $1,436,389 the tax raised in January exceeded the previous January by $108,730 and beat the 2023 budget's revenue forecast by 10.37%, or $134,906. The tax is projected to collect $18,254,692 this year.

The 0.50% public safety sales tax the city levies collected $666,859 in January. Sixty percent of the proceeds support the police fund, and 40% supports the fire fund.

The state treasurer's office has yet to release reports for December or January collections of the 0.625% countywide sales tax voters reauthorized last year. The tax raised $6,876,316 for the county and its incorporated areas during the first five months of its reauthorization.

Per the ballot title voters narrowly endorsed in the low-turnout special election in February 2022, proceeds from the tax are dedicated to the repair and replacement of existing roads and bridges in the more than 1,000-mile network the county and city collectively maintain. Collections began in July and will continue through June 2027.

Area job numbers have tracked the rise in collections, with January marking the 23rd straight month of job growth in the Hot Springs Metropolitan Statistical Area. The U.S. Bureau of Labor Statistics' preliminary jobs report for January showed 41,400 jobs in the metro area, an increase of 800 compared to the previous January.

The area economy added more than 840 jobs a month on average last year and 760 in 2021. The two-year expansion followed a 12-month contraction that ended in March 2021 with more than 2,000 jobs lost a month on average.

January's preliminary unemployment rate was 4.1%, higher than the December rate of 3.5% but lower than the 4.6% reported for the previous January. BLS reported 39,871 people were employed in a labor force of 41,589, the highest employment rate for January since January 2020.

BLS defines civilian labor force as people 16 and older who are working or actively looking for work.

January was also a strong month for collections of the 3% sales tax the Hot Springs Advertising and Promotion Commission levies on prepared food and lodging in the city. The report the commission provided showed collections of $707,570, a 22.17%, or $128,394, increase compared to the previous January.

The $561,522 in prepared food collections exceeded the previous January by 25.08%, or $112,587. Lodging collections of $146,048 outpaced the previous January by 12.14%, or $15,808. The $9,159,702 the ad commission reported in 2022 collections beat 2021 by 11.47%, or $942,710.

Print Headline: City’s sales tax collections off to fast start in ’23


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