November sales tax shows year-to-year improvement

Posted on Thursday, January 23, 2014 at 11:31 am

A key economic indicator could suggest Morristown’s retail sector is moving out of the doldrums, a city official says.

For the first time in 18 months, year-to-year sales-tax collections rose in November 2013, the last month for which statistics are available, according to Larry Clark, Morristown director of financial services.

“To me, it suggests that our decline in revenue has bottomed out, and hopefully from this point forward we’ll either be flat with no continued decrease, or we will begin to see an increase,” Clark said this morning.

Clark says the year-to-year increase was about $40,000. So far this fiscal year, sales-tax collections are about $60,000 below projections, according to Clark. Clark attributes the drop to ongoing construction near Morristown’s No. 1 retail center, Wal-Mart.

The all-important December sales-tax report will come in March. Sales in December are typically about 1.3 times higher than in other months, according to Clark.

Total projected sales-tax revenues for this year are slightly more than $10 million.

Once city finance staff gets the Christmas sales-tax figures, they will begin the 2014-15 budget process, as the broad outlines of city government’s revenue situation will be clearer.

City government is expected to begin the fiscal year, which starts in July, with $11.3 million in cash reserves.

When Morristown City Administrator Tony Cox started work about four years ago, city government had a negative fund balance.

Clark reported the sales-tax numbers to Morristown City Council Finance Committee members Tuesday afternoon.

Also Tuesday, Clark advised councilmembers of a proposed new policy regarding rental charges for the Morristown City Center.

The philosophy is to restrict City Center gatherings to nonprofit groups, and charge a rental fee that covers the expense, according to Clark.

The previous rental fee for the rotunda or the upstairs meeting room was $35, no matter how long a gathering lasted.

If councilmembers approve the new fee structure, groups will pay $100 for the first four hours and $30 for each hour thereafter. Groups also must pay a $25-per-hour staffing fee and put down a $50 refundable damage deposit.

Renting tables and chairs will cost extra, according to Clark, who told finance committee members Tuesday that on at least one occasion City Center was rented to a for-profit business.

Clark says if councilmembers don’t significantly modify his proposal, the new charges will go into effect in about two weeks.

-By Robert Moore, Tribune Staff Writer

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