Sales tax rise on way
Residents looking to do some shopping in Troy might want to get it knocked out this weekend.
That’s because Monday things will cost a little more at the city’s cash registers, as an additional penny is added to local sales taxes.
As the city of Troy took ownership of Troy Regional Medical Center in mid-January, it also passed a 1-cent sales tax to fund its operations, a tax set to take effect Monday.
Though the tax may not be here to stay for good, Troy Mayor Jimmy Lunsford said previously its revenues were needed to keep the hospital doors open in the short-term as the city establishes a self-sufficient facility.
Lunsford estimated it takes around $2.2 million to operate the hospital each month.
In the city’s first month of ownership, City Clerk Alton Starling said the city’s spent some $2.6 million in operating costs. These funds have been drawn from a line of credit Troy has taken out, for up to $6 million.
He said he isn’t sure how much revenue has been made during that time, and hospital CFO Janet Smith could not be reached Friday afternoon.
In the last year, Starling said the city’s averaged about $5.4 million in sales tax collections for the year on its current 2-percent rate.
Therefore, it’s estimated this additional cent could generate around $2.7 million.
These estimates are also based on a year when the city did not grow its sales tax numbers.
Starling said all items in the city, except farm and manufacturing expenses and automobile purchases will be taxed at the new rate, totaling 9 percent with city, county and state sales taxes. Lunsford has promised a referendum to lessen amount of tax and taping into Troy’s $16 million trust fund.