Friday, March 22, 2013

TOP STORY >> Sales-tax collections show a dip

Leader staff writer

This was not a good Christmas season for Cabot as city figures showed its sale tax collections drop by almost $100,000.

But the Christmas shopping season turned out well for Jacksonville and Sherwood as both saw upticks in collections, but not enough to offset drops in the county tax collections.

Cabot Mayor Bill Cypert says the drop is not a real concern because some stores were closed because of the Christmas storm and collections for up for the year.

“If it was anything but the weather, it would be a cause for concern,” Cypert said, adding that annual sales tax revenue for Cabot has increased an average of 1.93 percent every year since 2006.

About two-thirds of most cities’ revenue comes from sales taxes and as the economy has dropped so has the intake at both the city and county levels.

All sales tax money is collected by the state then sent to the counties and cities. The counties share their portion with the cities based on population. All tax money is delivered about two months after it has been collected. The money the cities and counties received in February reflects December sales.

Cabot City Clerk Tammy Yocum said the weather definitely hurt the city’s December sales. Cabot’s one-cent sales tax collections were $363,683, a $98,000 drop from December 2011’s totals of $461,686.

However, collections for all of 2012 were up 2.93 percent from the previous year.

Cabot’s share of the one-cent Lonoke County sales tax also fell in December from $246,335 in 2011 to $211,417 in 2012.

Jim Durham, Jacksonville’s director of administration, thinks the city has turned things around. “Our December 2012 sales were about $250,000 higher than December 2011,” he said.

Durham added that what makes that really good is nearly all of central Arkansas was without power for up to seven days in late December, causing many businesses to lose out of the after Christmas shopping.

Sherwood has a one-cent sales tax and Jacksonville a two-cent sales tax, but half of that is dedicated to police and fire pension funds.

Jacksonville’s sales-tax take for December 2012 was $681,801 compared to December 2011’s amount of $676,002, up about $5,000. Durham was quick to point out that it may not seem much at the tax level but it equates to an additional quarter million dollars in sales. “That says something, especially with the weather,” he added.

In Sherwood, the city also saw a slight bump in December sales. Tax collections for December 2012 were $470,520, up about $9,000 from December 2011’s totals of $461,760.

Pulaski County’s share to Jacksonville fell, partly because the new census numbers kicked in between the two Decembers, and with a smaller population the city gets a smaller share of the county pie. In December 2012 it got $556,913, a drop of about $24,000 from December 2011’s amount of $580,515.

Sherwood also saw a drop in its share of the county take, and it can’t be traced to a smaller population since the census showed Sherwood with increased numbers. Sherwood’s share of the county take in December 2012 was $579,669 and in December 2011 it was $604,235, a difference of about $24,000.

So while Jacksonville and Sherwood saw an up tick in December sales it was not enough to counter the drop in county collections. Durham says that although he is excited about the December numbers, it’s too early to see if the trend will continue.