The Little Rock, Ark. Board of Directors gave tentative approval last week to a September election asking voters to extend a property tax that would support $105 million of general obligation bonds.
The proceeds would be dedicated to street and drainage efforts. The earliest election date would be Sept. 11.
The rate would be lowered to 3 mills from the current 3.3 mills. The proposed rate would drop the tax on an average $154,000 residence by $9 a year.
The new rate would be renewed for another 15 years if voters approve. The tax was first levied in 1958.
Directors asked the staff to study whether it would be better to issue debt supported by the increase in a single sale or in several annual tranches.
Voters in September 2011 approved a 10-year, 1% sales tax increase expected to generate almost $200 million for capital improvements, but Mayor Mark Stodola said that additional revenue is not enough because the city has a $700 million backlog of needed street and sidewalk upgrades.
"When we go out to talk about the infrastructure needs under the sales tax, there are going to be a lot of projects that fall under the line based on the available funding," Stodola said.
Little Rock's outstanding debt includes $87.5 million of GO bonds and $31.7 million of revenue bonds. GO debt is rated Aa3 by Moody's Investors Service and AA by Standard & Poor's.