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Home My WebLink About018-26 RESOLUTIONPage 1 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Resolution: 18-26 File Number: 2025-2616 A RESOLUTION TO APPROVE AND CERTIFY THE PARTICIPATION OF PACKAGING SPECIALTIES, INC. IN THE ARKANSAS TAX BACK PROGRAM AND TO AGREE TO AUTHORIZE THE ARKANSAS DEPARTMENT OF FINANCE AND ADMINISTRATION TO REFUND CITY SALES TAX BACK TO PACKAGING SPECIALTIES, INC. FOR QUALIFIED PURCHASES WHEREAS, Packaging Specialties, Inc. is a privately-owned company located in Fayetteville at 1755 S. Armstrong Avenue which plans to expand its operations as it continues work on the design and development of food-grade packaging and manufacturing of packaging machinery with a planned investment of $24 million in construction and equipment; and WHEREAS, Packaging Specialties, Inc. will add more than 101 new employees over the next five years, with an average hourly wage of $25.18; and WHEREAS, in order to certify Packaging Specialties, Inc. to participate in the sales and use tax refund program, either Washington County or the City of Fayetteville, or both, must “(s)pecify that the Department of Finance and Administration is authorized to refund local sales taxes to the qualified business.” {A.C.A. §15-4-2706 (d)(1)(B)(ii)}; and WHEREAS, the City of Fayetteville or Washington County must also endorse Packaging Specialties, Inc.’s participation in this state and local sales and use tax refund program; and WHEREAS, bond indentures prevent diversion of sales tax proceeds from the city’s bonded penny sales and use tax. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby endorses Packaging Specialties Inc.’s participation in the sales and use tax refund program authorized by A.C.A. §15-4-2706(d) in relation to its construction, equipping and hiring at its new facility in Fayetteville, Arkansas. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby specifies that the Department of Finance and Administration is authorized to refund the non-bonded penny city sales tax to Packaging Specialties Inc. for qualified construction and equipment purchased for its facility in Fayetteville, Arkansas. Resolution: 18-26 File Number: 2025-2616 Page 2 Approved: _______________________________ Molly Rawn, Mayor Attest: _______________________________ Kara Paxton, City Clerk Treasurer PASSED and APPROVED on January 6, 2026 Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov CITY COUNCIL MEMO 2025-2616 MEETING OF JANUARY 6, 2026 TO: Mayor Rawn and City Council THROUGH: Blake Rutherford FROM: Devin Howland, Director of Economic Development SUBJECT: Packaging Specialties, Inc. Tax Back Program RECOMMENDATION: Staff is recommending approval of a Resolution to approve and certify the participation of Packaging Specialties, Inc. in the Arkansas Tax Back program and to agree to authorize the Department of Finance and Administration to refund City sales tax back to Packaging Specialties for qualified purchases as authorized by {A.C.A. §15-4-2706 (d)(B)(ii)}. BACKGROUND: Packaging Specialties was founded in Fayetteville, Arkansas in 1974 and is a long-standing, family-owned employer. The company specializes in the design and development of food-grade packaging products, as well as the manufacturing of packaging machinery. They currently employ more than 473 people across three U.S. locations, with over 250 of those jobs based in Fayetteville. As the company advanced plans to expand its facilities, the City of Fayetteville was able to assist on several fronts. The Department of Economic Development supported Packaging Specialties in pursuing state incentives through the Arkansas Economic Development Division. DISCUSSION: The Packaging Specialties expansion will take place at its existing facilities at 1755 S. Armstrong Avenue and will include construction of a new building along with improvements to current operations. In total, the company plans to invest $24 million in its Fayetteville operation. The project will add more than 101 new employees over the next five years, with an average hourly wage of $25.18. The purpose of this Resolution is to endorse Packaging Specialties participation in the Arkansas Economic Development Commission’s Tax Back Program, authorizing the Department of Finance and Administration to refund local sales taxes for eligible expenses under the Tax Back Program. What is the Arkansas Economic Development Commission’s Tax Back Program? The Arkansas Economic Development Commission’s Tax Back Program is an investment incentive designed to reduce the upfront costs of eligible business expansions and new facilities. The program provides a refund of state and local sales and use taxes paid on building materials, taxable machinery, and equipment used in qualified projects (purchased within the participating municipality). The Tax Back program is governed by {A.C.A. §15-4-2706 (d)(B)(ii)} of the Consolidated Incentive Act of 2003. Mailing address: 113 W. Mountain Street Fayetteville, AR 72701 www.fayetteville-ar.gov BUDGET/STAFF IMPACT: Staff believes the budget impact will be neutral. The growth of jobs and wages is expected to generate new sales tax revenue from additional employees, and the expansion may also position Packaging Specialties to make further investments in the future. ATTACHMENTS: 3. Staff Review Form, 4. Packaging Specialty Letter of Support Chamber Page 1 City of Fayetteville, Arkansas Legislation Text 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 File #: 2025-2616 A RESOLUTION TO APPROVE AND CERTIFY THE PARTICIPATION OF PACKAGING SPECIALTIES, INC. IN THE ARKANSAS TAX BACK PROGRAM AND TO AGREE TO AUTHORIZE THE ARKANSAS DEPARTMENT OF FINANCE AND ADMINISTRATION TO REFUND CITY SALES TAX BACK TO PACKAGING SPECIALTIES, INC. FOR QUALIFIED PURCHASES WHEREAS, Packaging Specialties, Inc. is a privately-owned company located in Fayetteville at 1755 S. Armstrong Avenue which plans to expand its operations as it continues work on the design and development of food-grade packaging and manufacturing of packaging machinery with a planned investment of $24 million in construction and equipment; and WHEREAS, Packaging Specialties, Inc. will add more than 101 new employees over the next five years, with an average hourly wage of $25.18; and WHEREAS, in order to certify Packaging Specialties, Inc. to participate in the sales and use tax refund program, either Washington County or the City of Fayetteville, or both, must “(s)pecify that the Department of Finance and Administration is authorized to refund local sales taxes to the qualified business.” {A.C.A. §15-4-2706 (d)(1)(B)(ii)}; and WHEREAS, the City of Fayetteville or Washington County must also endorse Packaging Specialties, Inc.’s participation in this state and local sales and use tax refund program; and WHEREAS, bond indentures prevent diversion of sales tax proceeds from the city’s bonded penny sales and use tax. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby endorses Packaging Specialties Inc.’s participation in the sales and use tax refund program authorized by A.C.A. §15-4- 2706(d) in relation to its construction, equipping and hiring at its new facility in Fayetteville, Arkansas. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby specifies that the Department of Finance and Administration is authorized to refund the non-bonded penny city sales tax to Packaging Specialties Inc. for qualified construction and equipment purchased for its facility in Fayetteville, Arkansas. Comments: Purchase Order Number: Change Order Number: Previous Ordinance or Resolution # Approval Date: Original Contract Number: Project Number Budget Impact: FundAccount Number Project Title City of Fayetteville Staff Review Form 2025-2616 Item ID 1/6/2026 City Council Meeting Date - Agenda Item Only PACKAGING SPECIALTIES, INC.: A RESOLUTION TO APPROVE AND CERTIFY THE PARTICIPATION OF PACKAGING SPECIALTIES, INC. IN THE ARKANSAS TAX BACK PROGRAM AND TO AGREE TO AUTHORIZE THE DEPARTMENT OF FINANCE AND ADMINISTRATION TO REFUND CITY SALES TAX BACK TO PACKAGING SPECIALTIES, INC. FOR QUALIFIED PURCHASES. N/A for Non-Agenda Item Action Recommendation: Submitted By Devin Howland ECONOMIC DEVELOPMENT (050) Division / Department 12/8/2025 Submitted Date No -$ -$ V20221130 Budgeted Item? Does item have a direct cost? Is a Budget Adjustment attached? Total Amended Budget Expenses (Actual+Encum) Available Budget Item Cost Budget Adjustment Remaining Budget -$ -$ No No -$ -$ P00 Chamber FAYETTEVILLE November 25, 2025 To Whom it May Concern: I am writing to express our strong support for Packaging Specialties receiving the City's Tax Back commitment associated with the company's announced major expansion in Fayetteville. As Packaging Specialties continues to grow, the company is investing in new technology and expanding its workforce to support long-term operations. This expansion represents a significant decision to grow in Fayetteville, versus their other locations across the U.S., and demonstrates their confidence in the City's business climate and workforce. Truly a "Fayetteville" company, Packaging Specialties is a legacy, family -owned manufacturer founded in 1974. Between its two divisions (Packaging Specialties, Inc. and Pacmac), the company currently employs around 250 people. Many of its workers live and/or spend their income here in Fayetteville. This expansion will have a substantial impact on Fayetteville and the region. The company will add an additional 100 employees over the next five years with average wages above $25 per hour, representing an injection of $5M in new payroll into the economy. This expansion will witness a $23M capital investment in building upgrades and new equipment here in Fayetteville. Chamber Fayetteville conducted an economic impact assessment of this project in support of the company in their announcement. Based on modeling, the following is expected to be realized: • This project will have an employment multiplier in Washington County of 1.66, suggesting that these new 100 positions will indirectly support an additional 66 jobs in the county across other sectors, from construction to retail, and from healthcare to business services and other sectors; • The direct and indirect employment associated with this expansion will generate $302,000 in local taxes annually across Washington County; and • Based on current employment commuting patterns, a strong majority of direct and "impacted" jobs and associated revenue collections across the County should be realized in Fayetteville. At Chamber Fayetteville, we support this initiative and stand ready to assist the City and company as they expand and enhance the economy and quality of life for residents of Fayetteville and the entire region. Respectfully, C J e nNferwin, IOM President & CEO