City sales tax collections continue to drop

Posted by Michael Hetrick

Released by Susan Guthrie with City of Tyler:

Information from the Texas Comptroller indicates that the City of Tyler sales tax revenues have decreased 3.36 percent year-to-date as compared to 2008. Current period sales tax revenues have declined 13.12 percent, which is the largest drop in recent history.

"The latest figure now puts Tyler at $1.7 million short of our budget in the current year before year-end accruals," said City Manager Mark McDaniel. "The cost control measures we put in place months ago and conservative budgeting for next year are now clearly paying off."

The average statewide sales tax revenues declined 12.16 percent. Other east Texas cities reported mixed results for the current period with Lufkin decreasing 3.42 percent; Lindale decreasing 13.84 percent and Longview's reported revenues declining 17.33 percent.

The reported revenue of $2,538,535.47 is comprised of $1,692,356.98 general sales tax revenue and $846,178.49 half-cent sales tax revenue. The figures represent receipts from July collections, as there is a two month period before revenue is reported.

"Sales tax collections are definitely disappointing," said McDaniel. "The good news is that there are strong signs that the recession is ending. A recent article by Ray Perryman, an economist and Distinguished Professor of Economic Theory and Method at the International Institute for Advanced Studies, cites several economic indicators that the national economy is on the rebound, including a rise in the gross national product, housing sales and auto sales. Because Tyler has weathered the economic storm better than many areas of the country, I feel confident that our local economy will rebound sooner as well."