Municipal revenue was impacted by the economic fallout the COVID-19 pandemic; however, officials said their cities are equipped to weather the storm.
West Lake Hills saw a 20.54% drop in sales tax revenue for April, as coronavirus restrictions limited operations at nonessential businesses. Despite the significant hit, Mayor Linda Anthony said in May the city is in relatively good financial shape given the circumstances.
“We certainly don’t like to see double-digit reductions in sales tax revenue,” City Administrator Travis Askey said in an email to Community Impact Newspaper. “However, this month’s allocation wasn’t entirely unexpected since it represents consumer spending from 45 days prior.”
Sales tax revenue makes up 67% of West Lake Hills’ overall tax revenue, according to the fiscal year 2019-20 budget. However, due to decreases in administration and public works expresses, the overall hit on the city will not be as drastic.
Council previously discussed a recommended budget amendment of $300,000 to reflect the losses.
“Hopefully, it won’t get worse, but we recognize it’s a long, slow process, and we’re prepared accordingly,” Askey said.
The neighboring city of Rollingwood experienced a steeper drop in revenue, with a sales tax decrease of 42.69%. The data showed a notable difference when compared to the previous month’s numbers.
At the beginning of the pandemic, Rollingwood was experiencing a revenue increase. March sales tax revenue reflecting a year-over-year increase of 21.38%, which was attributed by Amber Lewis, city administrator to record sales at the city’s Trader Joe's.
However, sales tax makes up a smaller percentage of Rollingwood’s budgeted tax revenue. Property taxes account for about 80% of the revenue and sales tax 20%.
Decreases in Lakeway were less severe. City Manager Julie Oakley said during a June 16 council meeting that collections were $25,000 short. Comptroller data showed a decrease of 13.67% when compared to April 2019.
"We were very excited to see our sales tax number come in, which was our collections for April. ... We were all kind of holding our breath," Oakley said, adding that in total, the city should come in close to the projected with regard to sales tax.
