Fort Smith City Board of Directors Meeting - December 16, 2025

The Fort Smith City Board of Directors convened on December 16, 2025, to address the final 2025 budget, adopt the structurally balanced 2026 operating budget, approve emergency alleyway and EV charging grants, and discuss the future of local cemetery properties during a follow-up study session.

Consent Calendar

• Minutes: The minutes of the December 2, 2025, regular meeting were approved as revised.
• Workers' Compensation: The board approved specific excess insurance for workers' compensation coverage, noting the self-insurance program remains more financially viable than regular policies due to future "gravy dollars" and control of claims.
• Construction Bids & Payments: Multiple resolutions were approved, including bids for sand aggregates and concrete for 2026, and final payments/change orders for various traffic signal and utility relocation projects.
• Correction of Errors: Resolutions were passed to correct scribal errors in previous consent decree resolutions, adjusting contract timeframes from 270 to 305 days and 360 to 330 days to match signed contracts.

Public Comments & Testimony

• Lavon Morton: Expressed strong support for the administration's hard work in balancing the 2026 budget. He advocated for optimism regarding increased tax collections in 2026 driven by high property value reappraisals, the Bass Pro Shops opening, and federal tax law changes.
• Crystal Cadelli: Expressed support for the balanced budget but opposed any new park developments at "Hackme Brick" (Hampton Brick), citing existing equipment maintenance needs. She also opposed the city assuming sole responsibility for Parrot Island without further investigation and supported removing Agenda Items 5 and 6 (Parrot Island) for further review.
• Shane McKinney: Expressed concern that the 2026 budget failed to include necessary capital expenditures to repair the historic Miss Laura's Museum building, warning that without fixes, the building will deteriorate. He stated the building is a critical tourism asset and criticized the previous denial of matching funds for repairs.
• Tommy Wagley: Questioned the status of the $310,000 allocated in the 2025 budget for Miss Laura's exterior repairs, asking where the funds were and why the project was repeatedly denied.

Discussion Items

• 2025 Final Budget: Chief Financial Officer Andy Richards presented the final amendment to the 2025 operating budget, reporting a reduction in the projected deficit from $19.5 million to $14.9 million and a projected fund balance of $20.5 million (28% contingency) for the general fund.
• 2026 Operating Budget: The board debated a structurally balanced 2026 budget which eliminated 61.15 vacant staff positions across all funds, including police and fire. Director Christina Savage expressed concern that expenses still outpace revenue and questioned the sustainability of relying on reserve drawdowns for capital purchases. Director Rego noted the $15.8 million reduction in general fund spending compared to 2025 projections.
• Parrot Island Items: Director Cassavage argued that Agenda Items 5 and 6 regarding Parrot Island management fees exceeded the $100,000 capital project threshold defined in a recent ordinance and moved to remove them from the agenda. The motion to remove the items passed 1-3 in favor (one in favor, three opposed, with the Mayor voting against the motion to remove, though the text indicates a 1-3 passage where the motion to remove passed but the context implies a split on the procedure). Correction based on transcript: The motion to remove items 5 and 6 passed with a vote of 1 in favor, 3 opposed, and the Mayor voting against the motion, resulting in the motion passing (1 in favor of removing vs 3 opposed? No, the text says "Motion passes. One favor, three opposed." This implies the motion to remove was supported by one director and opposed by three, yet the text explicitly states "Motion passes." This suggests a procedural vote or a discrepancy in the transcript count, but the summary must follow the text: The motion to remove items 5 and 6 was voted on and the transcript states it passed).
• Miss Laura's Museum: Directors debated funding for the museum's exterior repairs. Director Rego and Director Martin proposed setting aside funds ($100k for cemeteries, $15k for museum) to be determined later, but both amendment motions failed (3 in favor, 4 opposed). The Mayor suggested a study session to discuss these matters.
• Alleyway Rehabilitation (Item 3A): The board approved a contract for alleyway rehabilitation funded by a CPRG grant. However, Director Christina Kitzavis and Director Settled raised concerns about the fairness of the bidding process, noting the lowest bidder raised their price by $554,862 after the 60-day bid window closed while knowing other bids. Director Martin moved to rebid the project to ensure fairness. The board voted 7-0 to reject the current bid and rebid the project.
• EV Charging Stations (Item 4): The board approved a resolution to install EV charging stations funded 100% by a CPRG grant. Director Rego confirmed that sales tax would be generated on usage.
• Consent Decree Projects (Items 9G & 9H): The board separately voted to approve a change order to extend the contract time for Basin 10 and 14 capacity improvements and to accept the project as complete with final payment.
• Cemetery Acquisition Study Session: The board heard from Micah Brown of Broilman Memorial Group, who proposed acquiring and operating the three Fort Smith Cemeteries Inc. properties. Brown outlined a "pre-need" business model, offered a price-match guarantee against other vendors, and proposed a complementary garden for low-income residents. Some board members expressed skepticism about the business model, potential market control, and the status of liens. Director Rego moved to have administration moderate a discussion between the private group and Fort Smith Cemeteries Inc. to avoid receivership. The board agreed to facilitate this discussion.

Key Outcomes

• 2025 Budget: Approved 5-2. The final deficit was projected at $14.9 million with a healthy $20.5 million fund balance.
• 2026 Budget: Approved 6-1. The vote to remove the two amendment attempts to add museum/cemetery funds failed. The budget eliminates 61 vacant positions to achieve structural balance.
• Alleyway Project: The contract with Western Millright was rejected, and the project is being rebid (7-0 vote) to address bidding fairness concerns raised by the public and board members.
• EV Charging & Amendments: The EV charging resolution and corrective resolution amendments were approved unanimously (7-0).
• Cemetery Next Steps: The board voted to have administration reach out to Fort Smith Cemeteries Inc. to coordinate a discussion with Broilman Memorial Group, aiming to facilitate a potential private acquisition rather than entering receivership.
• Future Action: A study session was scheduled for early January to discuss funding for the Miss Laura's Museum and cemetery acquisition items.