contributed by Joy Cressler
It seems the south has the least expensive cities in America. Last fall, when the noted Kiplinger report was released, seven of the ten least expensive cities on its list were in Arkansas, Texas, Kentucky and Tennessee.
But the No. 1 city was none other than Fort Smith, Arkansas!
Arkansas is a low-cost, low-tax state, and its second largest city, Fort Smith, is no exception. Housing, grocery and transportation costs here are well below the national average. And compared with the most-expensive city on our list, New York, everything in Fort Smith is a bargain. ~ Kiplinger.com
According to the website for the Council for Community Economic Research, or C2ER, the ACCRA COLI measures relative price levels for consumer goods and services in participating cities or areas, not including taxes. The research group samples all U.S. cities with metropolitan area populations of at least 75,000, numbering about 300-plus cities each quarter.
The Kiplinger agency, a Washington, D.C.-based publisher of business forecasts and personal finance advice, uses the information to report various aspects to the public.
The Fort Smith ranking of No. 1 is based on the fact that Arkansas is a low-cost, low-tax state; therefore, the basics like housing, groceries, utilities, and transportation is available on a less expensive scale than the national average.
Fort Smith, the state’s second largest city in western Arkansas, is also home to several major nationwide corporations and manufacturing plants.
The designation is based on Fort Smith’s statistics:
- Cost of living index: 85.2
- Metro population: nearly 290,000
- Median household income: almost $36,000
- Average home price: $224,000
Cheryl Garner, vice president of economic development for the Fort Smith Chamber, said the quarterly COLI report is a huge asset in communicating with prospective companies about the low cost of doing business in Fort Smith and the low cost of living, especially in the current economic environment.
Garner said more than half of the Chamber’s calls and leads she receives come directly from companies themselves, often based on COLI and other reports that call attention to Fort Smith during their preliminary searches.
The average for all participating places in each quarter is represented with a score of 100, and each participant’s score is read as a percentage of that average.
The C2ER has developed a formula to determine the pay increase needed for a move from a cheaper city to a more expensive city. For example, a move from Fort Smith to New York (with its COLI rating of 218) means that a person making $50,000 after taxes in Fort Smith would have to make $78,000 more, or a total of $128,000, to live a similar lifestyle in New York.
Likewise, a person moving from New York to Fort Smith could sustain a 60.9 percent cut in salary without a change in lifestyle.
The other top 10 cities and their COLI index rating were: Pueblo, Colo., 85.9; Harlingen, Texas, 86.1; McAllen, Texas, 86.5; Johnson City, Tenn., 86.6; Conway, Ark., 86.8; Springfield, Ill., 87.3; Covington, Kent., 87.4; Louisville, Kent., 87.7; and Omaha, Neb., 87.9.