Sept. sales tax revenue down 2.43% from 2006

In numbers that signal continuing trouble for city revenues, September sales tax collections slipped 2.43 percent from the September before, the city Finance Department reported Monday.

The September collections are on August sales. Year to date, sales tax collections are up a meager 0.83 percent.

WHY IT MATTERS:

The city funds most of its services through sales tax collections. A “cautiously optimistic” forecast last year of a 3.5 percent increase in sales and use tax revenue for 2007 proved to be overly optimistic, interim City Manager Mike Anderson said in a recent overview of the proposed 2008 budget. Use tax is collected on manufacturing equipment and construction materials purchased outside the city and makes up a small part of the city budget.

THE DETAILS:

Sales tax collections on hotels and motels were up 17.42 percent over the previous September. Restaurants, up 4.82 percent, and grocery stores, up 3.39 percent, were among other categories reporting increases. Categories showing decreases included sales to business, down 13.21 percent, building materials, 11.95 percent, auto dealers, 10.83 percent, and department/discount stores, 10.10 percent.

LODGER’S TAX:

Lodger’s and auto rental tax collections rose 22.96 percent over the previous September.

DOWN THE ROAD:

Anderson’s 2008 budget projects a $5.6 million, or 4.2 percent, decrease in sales and use tax revenue when compared with the 2007 budget.