Sales tax revenues up for most

Published 9:13 pm Monday, December 1, 2008

Despite hard economic times, local sales tax revenues spiked in the last year for all but two key entities — schools.

The cities of Troy and Brundidge, as well as the Pike County Commission all have seen growth from 2007 to 2008, but Troy City and Pike County schools’ sales tax revenues have dropped, in a time where school funding is already tight.

Troy City Schools Superintendent Linda Felton-Smith said the decrease comes from legislation passed in 2007 by the Pike County Commission, granting it a chunk of the school’s 1-cent sales tax.

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Between the two budget years, from October 2006 to September 2007, and October 2007 to September 2008, Troy City Schools sales tax revenues dropped a little more than $257,000. Pike County Schools revenues similarly fell by more than $180,000.

For four years, Troy and Pike County Schools received two cents of each dollar of local sales tax revenues, but the law allowing one cent of that tax was set to expire. Felton-Smith said agreeing to share a portion of the revenues generated by that 1-cent tax was critical to its renewal.

“We had a 1-cent sales tax that was going to expire Sept. 30, 2007, and we worked with the county commission because they were having financial problems, and rather than let the tax expire and go back to (only) one cent, we mutually agreed to this redistribution,” Felton-Smith said. “(Revenue) is down, but it is higher than it would be if we were only receiving one cent (for each tax dollar).”

And even with the decreases in funding, Pike County Schools Superintendent Mark Bazzell said the school system is still in good shape and appreciative of the funding it has.

“That extra penny continues to be our bread and butter,” Bazzell said. “We put some of it back to build a reserve that would allow us to weather the storm we’re currently in.

“Many school systems, when faced with only 75 percent of their funding last month, had to go to the bank to make payroll. If we hadn’t had the extra tax, we would have had to do the same.”

In addition, Bazzell said the extra funds have enabled the district to improve facilities and programs.

County Administrator Harry Sanders said the agreement was to split the tax to make it permanent, and though it will decrease schools’ funds for now, it will be more beneficial in the long run because it makes the tax permanent.

Unlike local schools, other entities have seen an increase in sales tax revenues in the last year.

Pike County Commission’s rose more than $219,000 in the last year, with a total of $6,794,777 collected.

Sanders said the revenues collected were prior to the major downturn in the economy, and he hopes a slow economy won’t affect next year’s collections. “We’re hoping with the decrease in fuel cost, there will be more to spend for sales tax,” Sanders said.

The city of Brundidge has seen a smaller increase than the county and Troy, but a sizeable 7.4 percent, or $31,000, more funding than they did in 2007.

City Manager Britt Thomas said he attributes their local industries and rising gas prices keeping shoppers at home as possible reasons for an increase.

Likewise, the city of Troy has seen more than $433,000 added to their revenues to total $5,847,632.

City Clerk Alton Starling said he isn’t sure exactly what has sparked the increase, but growth of local retail may play a big role.

“From 2007 to 2008, we’ve added the Santa Fe Cattle Company, Ruby Tuesday has been open a full year and Yannis’ moved to 231,” Starling said.

And, as the holiday season continues, officials remind residents that shopping at home does make a difference.

“It really does pay to shop at home,” Thomas said. “We want to encourage everyone to shop at home, and help their own county out,” Sanders added. “It goes toward their county government, keeping the city safe and having good roads.”