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Sales tax revenue falls dramatically

Posted 9/20/16 (Tue)

Sales tax revenue falls dramatically

By Cecile Wehrman
Members of the Crosby City Council last week briefly discussed statistics provided by Community Developer KayCee Lindsey in regard to a dramatic drop in city sales tax revenue since a historic high of $385,165 in 2013.
Based on the current trend, Lindsey estimates 2016 collections at $156,850. That’s still slightly above the pre-boom level of $119,374 collected in 2010 -- and still more than double the amount collected in 2005 or 2006.
Councilman Doug Anderson asked whether the city is approaching a point where it has to re-evaluate existing commitments because of the  precipitous decline in the Spirit Fund’s income.
Mayor Bert Anderson told the council there are sufficient funds from past collections to handle the commitments made to projects -- most notably, a new daycare center. 
The fund has collected over $1.1 million over the past four years.
The mayor reflected that at one time, Spirit Fund monies were given mostly as loans that were paid back.
“What we do now is we just give it away and it’s gone,” the mayor said.
Lindsey said one reason for the change was a Bank of North Dakota program that encouraged interest buydowns on its loans in order to help local projects cash flow. Such  buydowns became an effective way to provide local support. 
The amount any one project would receive was capped at $25,000 in buydowns.
The Crosby Park Board and St. Luke’s Medical Center each have their own one percent city sales tax, established on either side of the zenith of sales tax collections and are also feeling the pinch of lowered collections.
In other action related to the Spirit Fund:
nThe council approved forgiveness of a $164,000 loan to the airport authority, see Page 11.
nApproved the extension of the city’s Spirit Fund Enhancement Grant program, under which up to a total of $15,000 will be awarded to non-profit groups applying for projects that improve some aspect of life in the Crosby trade area.