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Tioga sales tax revenue shows sharp decline this year

 

Posted 9/20/16 (Tue)

Tioga sales tax revenue shows sharp decline this year

By Kevin Killough
Sales tax figures show a sharp decline from the heyday of earlier boom times, but it also shows an economy that’s greatly improved over the past decade.
In 2006, Tioga had monthly sales tax revenues between $4,000 and $14,000. 
Up and down
While the amounts collected fluctuated every month, through 2010, Tioga never received more than $26,000 in revenues at the 1 percent rate it first collected.
In Sept. 2010, the city suddenly received a payment from the state of $44,651, a milestone that provides a good mark for the beginning of the oil boom.
Tioga would see its peak sales tax revenues in January 2015, when it topped out at $604,847. 
By that point, the city had increased its sales tax rate to two-and-a-half percent. The first increase came in Jan. 2013, when it increased to 2 percent. 
The following April the rate went up another half-percent, which goes directly to Tioga Medical Center.
This past August, the monthly payment to the city was $144,751. The previous July it was $50,495. 
Buckle down
The trend is considerably down from the peak, but it’s also higher than it was a decade before.
Part of the increase over the decade would be due to the 150 percent increase in tax rates. The average monthly payment this year is $128,304. 
If the tax rate were still 1 percent and all other factors being equal, the city would have brought in an average monthly payment of $51,322, which is considerably higher than the average monthly payment of $8,760 in 2006. 
However, as City Auditor Abby Salinas pointed out, there’s a difference in population to consider. 
During the boom, the number of residents is estimated to have more than doubled and now it’s fallen once again. The exact figures are uncertain.  
In developing the preliminary budget that the commission adopted earlier this month, the city is projecting to take in $240,000 in sales taxes for the year. 
“We do need to buckle down,” Salinas said.
Other pots of money are also seeing a drop.
Currently, the economic development fund, which is fed by a portion of the city’s sales tax revenue, is down to $299,287. 
At the end of 2014, the fund was at $782,358. 
“That’s quite a bit of difference,” said Ronica Pederson, secretary for the Tioga Fund Board. 
Salinas said budgets may be slimmer, but the city isn’t suffering. 
There are reserves to cover emergencies and some needed projects, such as the Welo Street project currently underway. It’s being paid for with “surge funding” from the state. 
“We’re not a broke city at all,” she said. 
Ray
Ray didn’t implement a sales tax until Jan. 2013, when it went to 1.5 percent. 
The town increased it again by one-half percent in April 2014. 
From March 2013 through this past month, Ray averaged $36,505 per month. 
While the town’s revenues declined in the same time period as Tioga, in the last month, Ray received $73,184. 
Ray Finance Commissioner Troy Kupper said the falling revenues may have some slight impacts on the city police budget, which is covered by one-half percent of the 2 percent sales tax rate, but he said city operations will see little impact. 
So far this year, Ray averaged $29,086 per month in sales tax revenue.