Economic development to keep going even without tax

INDEPENDENCE COUNTY, AR (KAIT) – Voters approved aquarter-cent sales tax five years ago to stimulate the economy in IndependenceCounty and create jobs.

During a special election, residents decided Tuesday thatenough was enough.

The Independence County clerk's office reported that nearlytwice as many people voted against the proposal to renew the economicdevelopment sales tax for another five years. The results showed that only 714voted in favor of the sales tax, while 1,349 opposed it.

Now that voters have decided not to reauthorize the salestax, many are wondering what happens next.

The county can keep collecting revenue from the economicdevelopment sales tax until April 1, 2014. Economic development officials said they'lluse that money to stay afloat a few more years, while they search for differentsources of funding.

"We are going to continue the program," said Larry Jones,the economic development director. "The program has about $2.3 million as wellas a 47-acre, partially developed business park, so we'll continue the programbased on the funds that we have."

Jones said the special election results did take him by surprise, but suggested that he can see why the tides turned against the tax.

"There's been a number of other local initiatives and salestaxes approved in Independence County at the county and the City of Batesvillelocal level," he said. "There was, I think, a general feeling that our salestax is just too high."

Anti-tax sentiment likely grew after voters approved twosales tax increases in 2012 – one to benefit the county's fire departments; theother to fund a new community center and sports complex in Batesville.

"All those initiatives have great value," Jones said, "butwhen you add them together, they create a total sales tax, which is burdensome."

Jones expects the economic development program to still runfor several years even after the sales tax is taken off the books.

"We'll have about $2.3 million in funds," he said, "so we'llcontinue to utilize those funds for economic development purposes as long asthey're available and then we'll be exploring other opportunities for funding."

Jones said the economic development commission will "probably"have to scale back some of the incentives that it has awarded in the past toattract new industry and help existing businesses grow.

"We respect the voters and their determination," he said, "andwe'll move forward with other sources of funding."

Jones also hinted there's a chance that supporters will tryto get the sales tax back on the ballot, but at a later time.

"That's really not been determined," he said. "That is apossibility, though."

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