San Marcos City Hall.
San Marcos city officials are implementing a “selective” hiring freeze after this month’s sales tax allocation from the state came in 7.65 percent lower than in January 2009.
The city received an allocation of $1,442,710.61, a drop of nearly $120,000 from an allocation of $1,562,260.84 12 months ago. This January marked the seventh straight month that the city’s sales tax allocation came in lower than in the same month a year earlier. The sales tax allocations from the state comptroller’s office reflect sales activity from two months before, meaning the January check is based on November 2009 sales.
The sales tax allocation year for 2009 ended with the city declining in sales taxes for the first time since 1987. San Marcos finished 2009 with $17,798,267.42 in sales tax collections, down $584,606.71 (3.18 percent) from $18,382,874.13 in 2008, which was the city’s all-time high.
In response to the city’s consistent decline in sales tax collections, San Marcos City Manager Rick Menchaca directed the hiring freeze earlier this month. The freeze will not apply to public safety and other “crucial” positions.
“Current vacancies will be reviewed to determine if they will be placed on hold,” Menchaca told the department heads in a memo. “Several positions have been previously approved for hire, however, starting immediately, before a position is to be interviewed or hired, additional approval from the City Manager’s Office is required.”
Sales taxes are budgeted to account for 48.1 percent of the city’s $39.9 million operating budget for FY 2010.
For the first three months of the fiscal year, the city’s sales tax haul has decreased $310,674.81, or 7.05 percent, from a year ago. The decline is strong enough to initiate the city’s contingency plan, which comes into play when the budgeted sales tax shortfall surpasses $500,000 or comes to five percent less than the amount budgeted.
Under the contingency plan, the city can reduce services, programs and workforce to keep expenditures even with revenues.
The city’s adopted budget for FY 2010 calls for $18,511,430 in sales tax revenue. If sales tax collections for the last nine months of the fiscal year are even with the same nine months in FY 2009, then the city would collect $17,678,717.19, which would come to $832,712.81 less than projected.
Cities across Hays County collected barely more than $2 million between them in sales taxes this month, falling 6.45 percent from a year earlier. Kyle’s 21.06 percent sales tax growth kept the aggregate losses from being even greater. Bolstered by new retail openings in the last year, Kyle collected $198,193.40, up from $163,712.66 a year earlier.
Buda’s sales tax take fell 9.42 percent from a year earlier, to $258,718.58. The largest drop among Hays County municipalities occurred in Wimberley, which fell 39.2 percent to $36,967.57.
Unincorporated portions of Hays County also endured a year-over-year decrease, with its $766,854 allocation this month representing a 4.76 percent decline.Email | Print