Monday, March 31, 2008

Alderman Lioneld Jordan urges legislators to pass severance tax

Severance Tax

As cities work hard to provide comprehensive transportation programs and fund needed projects, I support Governor Beebe’s natural gas severance tax proposal recently announced by the Governors office. Raising over 14.5 million annually in tax revenues for the municipal aid fund — would allow these severance tax revenues to go towards targeted city streets and an equally a similar amount for county roads thus reducing the further tax burdens on communities like Fayetteville. This is just another step in diversifying available revenues outside of local sales tax collections. I support this severance tax, and below is the communications I sent to our locally elected officials.

I am writing to encourage you to support and vote for Governor Beebe’s proposed legislation to increase the state severance tax on natural gas and dedicate 95% of the revenue as special revenues to be distributed as provided by the Arkansas Highway Revenue Distribution Law, § 27-70-201 et seq. Our constituents deserve a safe and efficient public transportation system, and I know that you share my commitment to doing all we can to achieve that result.

No one can deny that our transportation needs are great nor that the funding for our transportation system in Northwest Arkansas is inadequate to met those needs. As a member of the City Council and as Chair of the Street Committee, I am well aware of both the transportation needs and the construction costs for well designed streets. This legislation will not solve all of our transportation problems, but the revenue would be a significant contribution toward that goal.

Governor Beebe's proposal would generate an estimated $57 million next year and about $100 million annually by 2012. If 95 percent of that revenue is distributed under the Highway Revenue Distribution law, it eventually will mean an additional $14.25 million annually for the Municipal Aid Fund for streets and an additional $14.25 annually for the County Aid Fund for county roads, as well as an additional $66.5 million for state highways.

Thank you for your consideration of my request that you support this important legislation in the upcoming Special Session. I appreciate your dedication to public service, and I look forward to working with you on other issues of mutual concern in the future.


Lioneld Jordan
1600 Arrowhead
Fayetteville , AR 72701