Cedar Park’s economic development fund’s sales tax collections are expected to drop by around $1.59 million in Fiscal Year 2019.
The city’s Economic Development Corp. Type A Board, or 4A Board, works to attract new businesses to Cedar Park through means such as economic development agreements and marketing, according to city documents.
Currently, for every 2 cents collected in sales tax revenue by the city, a half-cent goes to fund the 4A Board. In May, Cedar Park voters decided to reallocate one-fourth of the 4A Board’s budget to create a new city department to address stormwater drainage issues.
“The sales tax has come in [to the 4A Board]steadily increasing over the years; we see that drop off in 2019 due to the one-eighth of a cent being moved for drainage,” Cedar Park Finance Director Kent Meredith said at the 4A Board meeting July 16.
The economic development fund’s Fiscal Year 2018 sales tax collections are estimated to reach $7.22 million, while Fiscal Year 2019’s collections are projected to be around $5.63 million, according to city documents.
The proposed Fiscal Year 2019 budget for the board includes approximately $4.81 million in expenses, down from around $5.31 million in Fiscal Year 2018, according to the documents.
The majority of expense reduction is planned to be in economic development agreements, which can provide incentives for businesses in Cedar Park. The proposed budget allocates $784,150 for economic development agreements, reduced from around $1.27 million in Fiscal Year 2018, according to city documents.
At the July 16 meeting, the 4A Board voted to approve the budget, which will next be presented to Cedar Park City Council. Board member Haley Norman was absent.
If council decides to makes any changes to the board’s budget, it would need to come before the board again, Meredith said.
The below chart shows 4A board sales tax collections over time. The Fiscal Year 2018 collections are an estimate and Fiscal Year 2019 collections are a projection.