A group of Little Rock residents have formed a political action committee, dubbed $500 Million Tax - Too Much, to oppose Mayor Mark Stodola’s proposal to raise the city’s sales tax rate by 1% to fund capital projects.
A vote on the plan is set for Sept. 13.
The 1% increase would include a permanent 0.625% tax to generate $31.6 million a year for operational expenses and a 10-year, 0.36.5% sales tax to finance $195 million of construction projects and economic development efforts.
Jim Lynch, a spokesman for the group and a long-time community activist, said Stodola’s plan would total $123 million more than the last public improvement program, financed with $72 million of general obligation bonds approved by voters in 2004.
Speaking at a weekend rally, Circuit Judge Wendell Griffen said the plan would triple the city sales tax from the current 0.5% to 1.5%.
He said the proposed academic research park would displace a large number of poor residents without providing jobs for them.
The temporary portion of the tax would finance construction of two fire stations and a police headquarters and provide $67.5 million for street and drainage improvements.
The capital plan includes $38 million to build a research park, expand the Little Rock Port on the Arkansas River, and other job-creating efforts.
Stodola said the city has not raised its sales tax since it was levied in the early 1990s, and would have one of the lowest tax rates in the state even with the increase.
Little Rock’s $115 million of outstanding debt includes $87.5 million of general obligation bonds and $31.7 million of revenue bonds.
The city’s debt is rated Aa3 by Moody’s Investors Service and AA by Standard & Poor’s.
