Sales tax receipts for May dipped slightly — down 2.6 percent — compared to the same period last year, but the month was still the second largest collection this fiscal year, Chief Finance Officer and City Clerk Jason Muninger said this week.
“We were down just a little compared to collections at the same time last year, but that collection, in May 2021, was the second largest on record,” Muninger said. “So even with the decline, it’s still significantly higher than we would have seen during more traditional collections prior to the past 12-plus months or so, when our collections have been unusually high.”
The highest collection on record was reflected in the February 2022 report, when the tax generated $2 million in revenue, or 13.2 percent, over the same period the year before.
The May reports shows the City collected $1,961,460 in sales tax revenue for the period, which is about $54,000 less than collections during the same period the year before. The amount is still about $340,000 over the anticipated budget for the month, Muninger said.
“We are still in good shape. With one month to go in our current fiscal year, we are $2.5 million, or 14.3 percent, over-budget for the year,” he said.
City staff is in the process of preparing Fiscal Year 2022-23 budget recommendations for City Council consideration next month. Muninger said his office has used FY 2019’s collections and applied conservative growth factors for revenue projections for the upcoming fiscal year rather than rely on non-traditional revenues generated over the past year or so.
“These 15 and 16 percent increases are not sustainable and therefore cannot be used to create reliable budget projections,” he said. “These increases almost certainly are what we call ‘one-time funds,’ which we avoid in projecting revenues for the new year due to the likelihood they will not be recreated in the upcoming year.”
Muninger said the over-budget revenue has not been spent and will be carried into next year’s fund balance.
“We spend what we budget for; anything in excess of that will be carried over into FY 2022-23 as a fund balance,” he said, noting the City Council could elect to use the excess revenue for projects or allocate it to the Reserve Fund.
Staff is expected to present budget recommendations to the council during a workshop meeting beginning at 7 p.m. May 23 at City Hall, 401 S. Johnstone. The council will consider official adoption of the budget during its regular meeting in June.