The Hardy City Council voted Monday night to postpone a proposed ordinance that would dissolve the city’s Advertising and Promotion (A&P) Commission and eliminate the 3% sales tax on prepared food and lodging that funds it. The council will revisit the measure at its next meeting on Nov. 9.
The decision to delay followed a contentious meeting attended by hundreds of residents, prompted by the ordinance’s inclusion on the agenda released just days prior. Tensions were high as both citizens and council members expressed a need for more discussion. The agenda itself was narrowly approved in a 4-2 vote.
The 3% tax, which helps promote tourism and local businesses, was raised from its original rate of 1.875% during Mayor Ethan Barnes’ administration. Barnes acknowledged regret for that decision.
“I made a mistake. We should not have raised the tax at that time, and I take full responsibility for that today,” Barnes said during the meeting.
John Treat, co-owner of Three Magi restaurant and chair of the A&P Commission, criticized the abruptness of the proposal, stating that neither the commission nor the public had been informed in advance.
“This is politics in a small community,” Treat said. “We have tried and tried to work with the mayor. But what the mayor wants is capitulation and control. We are willing to work and come up with good solutions for Hardy, but that takes partnership.”
Local business owner Corey Gilliland, whose establishment is located outside Hardy’s downtown area, voiced concerns about the commission’s operations. Gilliland criticized the lack of advertising benefits for businesses beyond the downtown strip, arguing that funds primarily aid downtown businesses that do not directly pay into the tax.
“It’s not about our restaurant, it’s not about any of the motels,” Gilliland said. “It’s about Downtown Hardy, and they don’t have to pay any of it. So, they get free advertising and we don’t.”
Gilliland said he supports revising the tax to lower the rate or to ensure broader benefits for Hardy businesses, but as the commission stands now, he favors its dissolution.
Opponents of the tax also argued it burdens residents in a financially struggling community. Several called for the decision to be presented to voters. Barnes noted that the commission was originally established in 2001 without public approval, as allowed by Arkansas law, and that the tax increase in 2023 was similarly implemented.
The meeting saw heated exchanges between the A&P Commission, Barnes, and residents. Some proponents of dissolving the commission argued it would give citizens greater oversight of their tax dollars, while others objected to the limited notice and transparency surrounding the proposal. Critics speculated the move was a city effort to retain control over public funds before any decision could be put to a vote.
The council’s decision to table the ordinance provides additional time for deliberation. Residents are expected to revisit the issue when the council reconvenes in November.