Jail sales tax revenue ahead of schedule

Published 3:00 am Friday, January 5, 2018

If the numbers keep pace, a new temporary sales tax to fund the construction of a new Pike County Jail will expire much faster than officials had projected.

“We didn’t know exactly what to expect when we made those projections,” said county administrator Harry Sanders. “And we don’t know if it’s going to hold out every month, but if it does, it appears the money will amount up pretty quickly.”

When officials were planning the sales tax increase last year, they said it was projected to generate about $2.5 million each year. But the results from October, the first month that the sales tax went into effect, are nearly twice as much as the projected monthly average.

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The county raked in nearly $379,000 in that first month alone. If the other 11 months of the year bring in that much on average, the county would have over $4.5 million by October 2018.

The commission voted to increase the sales tax by 1.5 percent in most of the county in September. The tax was raised 0.5 percent in the Troy city limits.

Sanders said one of the factors that might be playing into the major intake of revenue is the fact that commissioners opted not to exclude automobile dealerships from the tax on their higher-priced merchandise.

Sanders said officials haven’t been able to get a final count yet on November and December numbers.

“It takes a little while to get all the numbers together,” Sanders said. “All the tax has to be collected first and then delineated out by our sales tax folks. With the holidays, I’m not sure where they’re at with that right now.”

The commission is currently working with  TCU Consulting Services to build a plan for the new jail’s construction and to get an idea of what the jail is going to cost. The consulting firm expects to have their results in by February.

The resolution authorizing the tax only allows it to remain in place to collect the funds required to fund the costs associated with the jail construction. Sanders said that once enough money comes in, the tax will expire.

“We should have a projected cost soon,” Sander said. “I don’t think we’re going to collect all the money it takes to build it before we build it, but it’s going to take a lot less time than we thought.”

Although officials haven’t gotten an official cost estimate for the jail yet, they had said prior to beginning the process that the cost could be somewhere around $8 million.

If that projection is accurate and numbers from October hold, the construction funds could be generated within 24 months of the beginning date.

The commission also raised court costs by $35 to increase the operation budget for the new jail once it opens. Those costs began being collected in May.