Election News

Issue 1: Transportation Sales Tax

On Nov. 3, Arkansas voters have the opportunity to vote for or against a half-percent sales tax on Issue 1, which was moved to the ballot by Arkansas lawmakers. The name on the ballot for Issue 1 is the Transportation Sales Tax Continuation Amendment.

This half-percent sales tax is currently in place but is set to expire in 2023. If Issue 1 is approved, the half-percent sales tax will become permanent and will provide funds for better roads, bridges and highways. If Issue 1 is denied, the sales tax will cease.

According to the Public Policy Center associated with the University of Arkansas System Division of Agriculture’s Cooperative Extension Service, Issue 1 asks voters to “approve a permanent dedicated 0.5% state sales tax, use the revenue from this tax for maintaining, repairing and improving highways, roads and streets from across the state, and divide the revenue under and existing formula of 70% going to the Arkansas Department of Transportation, 15% to county governments and 15% to city governments for roads, bridges and ‘other surface transportation.’”

Arkansas Gov. Asa Hutchinson is featured prominently in a television commercial that encourages residents to vote for the issue, and he has traveled the state to advocate for passage. “A vote for Issue 1 means better roads, a stronger economy and a safer Arkansas without raising taxes,” Hutchinson said. “It will benefit every resident and every small business that calls Arkansas home, and I am delighted to lead this effort.”

The state chapter of Americans for Prosperity is among the organizations opposing the tax. Its website states that, if the issue passes, it represents a permanent sales tax increase, enshrined in the state constitution. The website also states that there will be no accountability because the funds will go directly to the Arkansas Department of Transportation. The Libertarian Party of Arkansas also has taken a stance against the issue. Arkansas has the 9th highest sales tax rate in the United States, according to the party’s website.

Advocates of Issue 1 say the measure’s passage will support over 3,600 jobs every year and provide $8.2 billion of economic activity over 10 years. They also argue that every city and county will receive funding for roads, so every Arkansan will benefit.

During a local candidate forum organized by the Siloam Springs Chamber of Commerce, current director Carol Smiley referenced Issue 1 and noted that the city currently receives about $350,000 annually through the half-percent sales tax.

Opponents have stated that other states have multi-modal transportation programs that fund public transportation programs, but Arkansas’ transportation department has spent almost no money on public transit. Opponents argue that the measure is of almost no value to Arkansans who want mobility but cannot drive.

Kristin Higgins is a program associate with the Public Policy Center at University of Arkansas System Division of Agriculture Cooperative Extension Office. The center’s staff has produced a series of objective summaries of each of the three ballot issues facing Arkansas voters available at www.uaex.edu/business-communities/voter-education/state-ballot-issues.aspx.

Higgins said during an email interview that, if Issue 1 does pass, there would be a seamless transition between the two taxes and there would be a permanent source of funding for roadwork in Arkansas.