Greenland considers sales tax to prop up schools
Posted on Thursday, November 20, 2008
The Greenland City Council will consider holding an election next year to levy a sales tax in support of the local school district.
Greenland Public Schools is currently under state control and is on the Arkansas Department of Education’s fiscal distress list.
Alderman Bill Groom, who was also president of the Greenland Board of Education before the takeover, discussed the idea at a council meeting this week. His proposal involves asking voters to extend an existing tax that is set to expire.
The city currently has a sales tax levy of 2 cents on the dollar. A 1-cent portion of the tax dedicated to a sewer project is set to expire, and it could be replaced with a 1-cent tax that would divert money to the schools, Groom said.
“ The timetable I’ve looked at is probably having an election in February or March. Then the tax would take effect July 1, 2009, ”he said.
Based on current revenues, he estimated the tax would generate $ 100, 000 annually that could help the school district. One issue that remains to be discussed further is how many years the tax would last.
“ I’m just trying to solve the problems right in front of us, ”Groom said. “ If they do decide Greenland (schools ) should not stand on their own, it’s going to have a not good effect on any receiving district. ”
In November 2007 at Bald Knob, city voters approved a two-year sales tax to help the school district after it fell into fiscal distress and under state control.
School districts and cities operate independently of each other, but Groom said he believes such a sales tax would be legal as long as it was approved by the voters. The council could not decide on its own to divert money to the school district, he said.
The Fayetteville School District and the city of Fayetteville had an arrangement years ago in the early 1990 s where the city diverted some sales tax revenue to fund a high school addition. The courts later ruled they could not do that, district spokesman Alan Wilbourn said.
In that case, Wilbourn said he believed it was a City Council decision to transfer money to the school.
The sales tax would only affect businesses in the Greenland city limits. Greenland’s school boundaries encompass a much broader territory, but the entire city is located within the district.
Most students live in the northern portion of the district, which includes the city.
“ Bald Knob has done it, ”Groom said. “ That’s a possibility that we’re looking at. ”
Groom said extending a city sales tax to help the schools may be less costly to city residents than being annexed later into another district. Fayetteville, for example, has a higher property tax rate than Greenland.
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