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City’s sales tax revenue shows positive trend

July 20, 2011


Starkville sales tax revenues for May 2011 saw a 10.56 percent increase over revenues for the same month in 2011, erasing the effects of a revenue slump in January 2011.
The city of Starkville’s report on sales taxes showed January 2011 revenues to be at $393,970.11, where May 2011 revenues were at $468,471.49. That put January 2011 revenues 12.21 percent lower than in January 2010, a decrease of $54,817.12. The large increase for May 2011, combined with smaller increases for February, March, and April, added up to a gain of $65,037.12 in revenue versus the same four-month period last year.
As a result, revenues for January-May 2011 came out $10,219, or 0.47 percent, ahead of revenues for January-May 2010, growing from $2,191,571.16 to $2,201,791.08.
Starkville Mayor Parker Wiseman said it would be impractical to seek an explanation for either January or May’s figures by themselves.
“It’s very difficult if not impossible to hypothesize why there may be an increase one month or decrease next month,” Wiseman said. “What is much more realistic, in my view, is to look over a year or, certainly, a quarter to see what the overall trend in sales taxes is.”
From that perspective, Wiseman said, the past 18 months have shown a positive trend.
“There was one month that was low, and that’s one of those months it’s hard to explain why we might have been off base that month. I think what you take from that is that coming out of the national recession, our local economy has picked up considerably, and that’s a good sign for our city. We’re very pleased.”
January 2011 was the first month since May 2009 with sales tax revenues below $400,000. The final total for sales tax revenues in 2010 was $5,317,568.11, the highest annual revenue dating back to 1999, the earliest year with figures available in this month’s report.
When revenues for February-May 2011 are compared with each other instead of with past years, they show a steady pattern of consecutive increases averaging $11,986.91. Finally, May 2011 revenues were the highest the month has seen dating back to 1999.
The city’s 2 percent restaurant tax results are opposite those of the overall sales taxes, showing a revenue increase in January and a decrease in May. The city collected $108,521.81 in May 2011, down 3.88 percent from May 2010. In January 2011, the city collected $121,136.09 in restaurant taxes, up 12.5 percent.
Lynn Spruill, chief administrative officer for the city of Starkville, said the total revenue for January-May 2011 from restaurant taxes still exceed those of January-May 2010. The report shows a 2011 total of $610,385.93, up 3.26 percent from last year’s $590,859.34.
“We’ve been very fortunate,” Spruill said. “Our sales tax and food and beverage tax revenues have been steady or growing incrementally over the years. It reflects the growth of Starkville.”

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