Elkins residents to vote on proposed sales tax in August
Posted on Friday, May 16, 2008
URL: http://www.nwanews.com/nwat/News/65226/
ELKINS — The city might step up its sales tax by a penny come Aug. 12.
On Thursday night, the Elkins City Council unanimously voted to hold a special election that day to let citizens choose whether they want to have the 1-cent sales tax increase to pay off $ 1. 9 million in sewer bonds to replace the city’s main line along Arkansas 16.
Mike Lemaster, chairman of the Water and Sewer Committee, said the group basically wants to replace the 40-year-old, 8-inch line that runs from one end of the city to the other with a 14-inch line.
“ When you (dig ) a hole in the ground and take up that pipe, you better prepare for your city to expand, ” Lemaster said about upgrading the line.
He said the project is long overdue, describing the section of line recently viewed by the committee as “ Swiss cheese-like. ”
The city needs to pass the tax because the sewer line currently sits in the Arkansas Highway and Transportation Department’s right of way, Lemaster said, and if the department ever widened Arkansas 16 the city would have to scramble for money to move the line.
According the Arkansas Department of Finance and Administration, Elkins is one of three cities in Washington County that has a 1-cent sales tax. Elm Springs and Lincoln are the other two. Every other city has at least a 2-cent sales tax levied. Prairie Grove is at 2. 25 cents.
Don Zimmerman, a spokesman with the Arkansas Municipal League, said there is not a specific limit on how much sales tax a city can levy. The highest sales tax levied by a city in Arkansas is 4 cents, he said.
City Attorney Danny Wright said that if the tax passed the council would have to pass a resolution dedicating the income to the bonds and that the city probably wouldn’t see the extra income until 2009. He said that after the $ 1. 9 million was paid off, the city could dedicate the tax to another bond issue if the water and sewer system needs one.
Lemaster said that will probably be the case because the city would only be replacing its freshwater pipes and a few other pipes, like the one that goes under the White River, will soon need replacing. The Water and Sewer Department currently does not have the income to handle that many big projects, he said.
“ We have no funding other than the income we make off of sewer rates, ” he said.