On March 23, Eureka Springs City Council met for a budget and proposed tax workshop prior to the regular meeting.
Finance Director Michael Akins walked council through a review of city finances, underlining differences between restricted funds vs. unrestricted funds, exemplifying the music park rehab project, which is funded by restricted grant money. After speaking to bond counsel regarding the proposed sales tax, Akins explained that voters will have to pass three items on the ballot: One for the sales tax, one for authorization to use the tax for water improvement bonds, and a third for sewer improvement bonds. If the tax were to pass without the bonds, they could still use the tax money for intended purposes, but not to secure bonds for large chunks of money.
Public Works Director Simon Wiley said that a master water plan was created with McClelland engineering in 1998 but never implemented. The $17 million bond they are looking at today would replace approximately 17 miles of pipe. “We have quite a bit more than that in the city, some dating as far back as the late 1800s that has not been replaced.”
Meeting comes to order
Discussion of a downtown Permanent Entertainment District was removed from the agenda because a workshop was scheduled for later in the week. Still, many residents shared opinions surrounding the PED during public comments.
Speakers opposing the PED raised concerns about public safety, community impact, and lack of infrastructure, arguing that more public drinking could lead to more harassment, disorderly behavior, and unsafe conditions on streets and sidewalks. Several emphasized that Eureka’s family-oriented character could be harmed, potentially pushing families away and conflicting with local values, also noting respect for conservative religious groups in the area.
Others raised questions about the city’s ability to enforce boundaries and legal liability risks for bartenders and servers. Some also doubted the district would provide meaningful benefits for the city and warned it could normalize excessive alcohol use in the community. A common theme across comments was the need for greater public input.
Multiple people called for the issue to be decided by public vote. Rachael Hancock spoke on behalf of Main Street Eureka Springs. Although the organization is not decidedly opposed to the PED, Hancock suggested a public vote would “help strengthen transparency, build trust in the process, and ensure that the outcome reflects the desires of the community.”
Supporters of the PED framed it as a practical way to manage and regulate activity that already exists, rather than to expand it. Devin Henderson, speaking on behalf of the Chamber of Commerce, highlighted that the proposal includes structured safeguards like wristbands, ID checks, and continued oversight for special events. Henderson said the aim was to increase accountability – not reduce standards. Proponents also argued the PED could support the local economy while creating a clearer, more controlled environment. A workshop on the matter will be held on Wednesday, March 25 at 3 p.m. in the lower AUD.
Public Works update
Public Works Director Simon Wiley reported crews repaired two leaks in front of the Osage Lodge on US 62 but identified a larger issue requiring replacement of about 100 feet of pipe.
Public Works is currently working to get software for all their laptops that will help with meter-reading and troubleshooting.
Alderman Steve Holifield commended Wiley for a recent video post on Facebook, where he shared information about an affordable plumbing part – a pop-off valve – an easy way to prevent sewage backups.
Land sale fails
Council moved to discuss a revised offer by Lyla and Cory Allison to purchase city-owned lots 12–16, Block 46. Allison acknowledged the value in reserving city property and revised her proposal to reduce the number of lots and increase the price. Alderman Rachael Moyer initially stated she would only support selling lot 12.
Confusion over lot lines and whether council had possession of a proper map furthered Moyer’s disagreement with the sale. Allison said she had given council a map in their original packet.
Alderman Terry McClung motioned to approve the sale of lots 12–15 for $5,500. Alderman Harry Meyer seconded, but the motion failed three to two.
Reimbursement amount reached
Council continued a hearing about water damage on Spring St., following up on a claim made by Rodney and Autumn Slane, owners of Grotto LLC. While repair estimates were around $38,000, the claimants requested closer to $60,000 to include costs of business interruption, which Berry stated would not be legally allowable. Legal counsel for the city Heather Owens clarified that the city has governmental immunity and is not required to pay but could choose to cover documented damages using taxpayer funds. “Lost business income would be vulnerable to an illegal exaction lawsuit for improper use of taxpayer money,” Owens said.
Much of the discussion centered on a lack of receipts versus estimates, concerns about setting a precedent, and the nature of fault. Ultimately, council approved a motion to reimburse up to $35,000 for physical damages only, without admitting fault, with a formal agreement to be drafted.
TED passes
Council discussed establishing a Temporary Entertainment District for Spring Fling. There was some debate over end times, and the resolution was amended to adjust the end time from 11 p.m. to 10 p.m. Meyer raised concerns about crossing the highway and pedestrian safety, but Police Chief Billy Floyd indicated the event has historically been “pretty tame.” The Resolution No. 907 to establish a temporary entertainment district and establishing standards for its operation for Spring Fling 2026 was passed.
Other Business:
- Katherine Lopez was approved for HDC, Pos. 5.
- An application from Anna Smedley for Planning Commission Pos. 2 is being processed.
- Richard and Samantha Webb submitted letters to public comments expressing stark concerns over council’s oversight of hospital issues, asserting they are breaking oath and ignoring state and federal labor laws.
- In closing comments, Moyer acknowledged Jerry King, Michael Akins, and Harrie Farrow for speaking out with real evidence regarding marriage licenses. Moyer also said she was very impressed after attending the hospital’s open house and announced she had requested a financial update through the mayor’s office.
- Mayor Butch Berry commended ES hospital for exceptional care he received at the start of his medical leave.
- Alderman Terry McClung stated he thought council has done the Allisons a disservice.
- Akins said he is exploring the possibility of a city-wide logo.