Fort Smith finance staff reports $10.5 million midyear shortfall; nonrecurring projects drove part of gap

At a Fort Smith City Board of Directors study session, Finance Department staff presented an interim midyear financial report showing a $10.5 million gap between expenditures and revenues for the six months ended June 30, 2025.

Finance staff member Andy said the municipality’s contingency balance was stronger than earlier projections, with a midyear fund balance of about 31% (projected to be about 20% by year-end under the amended budget). "Considering what we've been doing here as far as, you know, trying to retool the budget, trying to make cuts, making large investments in the city ... I think just overall, the numbers look fairly positive to me," Andy said.

The report compared four operating funds to the same six-month period in 2024 and to the adopted and amended 2025 budgets. Andy identified roughly $7 million in nonrecurring general-fund spending within about $34.2 million of year-to-date general-fund expenditures. Large one-time items included the Crane Kia property purchase from 2024 (about $2.3 million carried in expenditures), approximately $2 million in roof repairs, and roughly $600,000 toward the airport runway barrier/arresting-cable work. Those…