Board of Directors

AGENDA SPECIAL-CALLED MEETING SILOAM SPRINGS BOARD OF DIRECTORS DECEMBER 15, 2025 BOARD ROOM / 5:30 PM Call to Order Roll Call I. Ordinance 25-36 / 2nd Reading / Extension of Existing Levy of 0.375 Percent Sales and Use Tax (3/8ths) II. Adjournment  STAFF REPORT TO: Christina Petriches, Interim City Administrator FROM: Josh Napier, Public Works Director DATE: October 9, 2025 RE: Ordinance 25-36 / 2nd Reading / Extension of Existing Levy of 0.375 Percent Sales and Use Tax (3/8ths) Recommendation: Extend the Existing Levy of 0.375 Percent Sales and Use Tax (3/8th). Place Ordinance No. 25-36 on its 2nd reading, suspending the rules and reading by title only. Update: The Board has amended this ordinance to reflect the following split of the 3/8ths cent sales tax to 50% utility capital improvements, 30% street capital improvements, and 20% quality of life capital improvements. Background: Staff have prepared the attached ordinance to extend the existing 3/8-cent sales and use tax for an additional ten (10) years, subject to voter approval. The ordinance also calls for a special election on the question of extending the tax. Under the proposed ordinance, 80% of the net revenue from the tax would be dedicated to utility capital improvements, with the remaining 20% restricted for quality-of-life capital improvements. This proposed 80/20 allocation not only establishes a dedicated funding source for quality-of-life projects but also helps minimize the impact of such projects on the City’s overall operational budget. Furthermore, increasing the utility capital share from 50% to 80% will allow staff to more aggressively address critical infrastructure needs, most notably within the sewer collection system. Fiscal Impact: The 3/8-cent sales and use tax is projected to generate approximately $19.2 million between 2026 and 2036. If voters approve the extension, an estimated $15.36 million would be available over the 10-year period for utility capital improvements and $3.84 million for quality-of-life projects. Staff has identified approximately $60 million in needed utility capital improvements over the next five years. While a portion of these improvements can be funded through depreciation and general capital funds, the additional dedicated sales tax revenue would allow staff to address these critical infrastructure needs more proactively. Attachments: Ordinance No. 25-36  ORDINANCE NO. 25-36 AN ORDINANCE PROVIDING FOR THE EXTENSION OF AN EXSISTING LEVY OF A .375 PERCENT SALES AND USE TAX WITHIN THE CITY OF SILOAM SPRINGS, ARKANSAS; REVISING THE SPLITTING OF THE PROCEEDS OF THE EXSISTING SALES AND USE TAX; AND PRESCRIBING OTHER MATTERS PERTAINING THERETO. Whereas, the Board of Directors of the City of Siloam Springs, Arkansas (the “City”), has determined that there is a current need for continuation and improvement of municipal services for a source of revenue to finance such services; and given "under such rules and regulations as the board may by ordinance prescribe"; and Whereas, Title 26, Chapter 75, Subchapter 2 of the Arkansas Code of 1987 Annotated (the “Authorizing Legislation”) provides for the levy of a .375 percent (3/8%) citywide sales and use tax; and Whereas, the proposed 50/30/20 allocation provides dedicated funding for Streets and quality- of-life projects while reducing pressure on the City’s operational budget and allowing staff to address critical infrastructure needs. Now Therefore Be It Ordained, by the Siloam Springs Board of Directors, as follows: Section 1. Under the authority of the Authorizing Legislation, there is hereby levied a ten (10) year extension of the existing .375 percent (3/8%) tax on gross receipts from the sale at retail within the City of all items which are subject to the Arkansas Gross Receipts Act of 1941, as amended (A.C.A. §26-52-101, et seq.) and the ten (10) year extension of an excise (or use) tax on the storage, use, distribution or other consumption within the City of tangible personal property subject to the Arkansas Compensating Tax Act of 1949, as amended (A.C.A. §26-53- 101, et seq., at a rate of .375 percent (3/8%) of the sale price of the property or, in the case of leases or rentals, of the lease or rental price (collectively, the “Sales and Use Tax”) Section 2. That 50% of the net collections of which remaining from the aforesaid .375 percent (3/8%) sales and use tax after deductions of the administrative charges of the State of Arkansas, shall be used for the purpose of paying all or a portion of the cost of capital improvements to the water, sewer, sanitation and electric facilities of the City’s utility system, 30% shall be for the purpose of capital improvements in the street fund, and the remaining 20% will be used for the purpose of paying all or a portion of the cost of quality of life capital improvements, including but not necessarily limited to downtown, parks, sidewalks, and trails. Section 3. That all ordinances and parts thereof in conflict herewith are hereby replaced to the extent of such conflict. Section 4. That this Ordinance shall not take effect until an election is held on the question of levying the Sales and Use Tax at which a majority of the electors voting on the question shall Ordinance 25-36 Page 1 of 2 have approved the levy of the Sales and Use Tax, and thereafter upon the expiration of the existing .375 percent (3/8%) sales and use tax. Passed and Ordained this ____ day of 2025. ATTEST: APPROVED: __________________ ________________________ Jené Fain, City Clerk Judy Nation, Mayor (SEAL) Page 2 of 2 Ordinance 25-36