Sugar Land city manager weighs in on economic strain attributed to coronavirus pandemic

Sugar Land is feeling the economic strain from the coronavirus pandemic. (Beth Marshall/Community Impact Newspaper)
Sugar Land is feeling the economic strain from the coronavirus pandemic. (Beth Marshall/Community Impact Newspaper)

Sugar Land is feeling the economic strain from the coronavirus pandemic. (Beth Marshall/Community Impact Newspaper)

Fort Bend County Judge KP George issued a Stay Home to Save Lives order March 24, which will remain in effect through April 3.

"While [in the] short-term, the economic impact is difficult, based on the global experience with the coronavirus, this is the only way that we can be able to preserve the long-term economic and social fabric of our community," George said.

Jacquelyn Minter, Fort Bend County Health and Human Services director, said these orders were put in place to protect the local health care system and, “speed the return of health to our communities and our economy,” during a March 24 press conference.

However, because of these closures and limitations, Sugar Land is feeling the economic strain.

"This will significantly affect planning for the budget," Sugar Land City Manager Mike Goodrum said in an email. "While our finances are sound and resilient, the economic impact of COVID-19 is unprecedented. We are working hard to model short-term and long-term impacts; however, no one knows when this event will end and what the ultimate impact will be."

Goodrum, who became the new city manager in January, said planning for the fiscal year 2020-21 budget is ongoing and includes estimations as to how the economic strain will affect various revenue sources. Sales tax, mixed beverage taxes and hotel occupancy taxes are the main areas in which the city is anticipating decreases, Goodrum said.

"While our priority is the health and safety of the public, there are business closures that must happen in order to flatten the curve and stop the spread of the virus," he said. "There is an inevitable impact to the local economy. However, at this time, we can’t quantify the impact. Residents and businesses can support our local food establishments by ordering takeout and delivery to help support our community."

Goodrum said Sugar Land's finances were in a positive position at the end of FY 2018-19, which he said he hoped will help offset the anticipated decline in FY 2019-20 revenue.

"As we develop the FY21 budget, the main factor influencing the budget is the duration of this event and how quickly the economy can recover," he said. "Our conservative forecasting for sales tax provides additional flexibility in that we are not counting on growth to balance the budget. This allows us to proactively make adjustments to nonessential services to reduce expenditures."

City staff is working to collect information from local businesses to assess their strain. Staff is also assessing the economic effects of postponing events at destination venues, Goodrum said.

During this time, the city's economic development department is focused on communicating with local businesses, offering support and developing a recovery plan that could potentially include new local assistance programs and legislative advocacy, Goodrum said. This could allow for flexible use of economic development funds toward recovery efforts, he said in an email.

"We are building scenarios based on possible revenue losses in revenues generated by this sector in sales and mixed beverage taxes," Goodrum said. "Our hotels are seeing cancellations of conferences and events, and will feel a significant impact as well. The primary unknown at this time is the duration of the closures."
By Beth Marshall
Born and raised in Montgomery County, Beth Marshall graduated from The University of Texas at San Antonio in 2015 with a bachelor's degree in communication and a minor in business. Originally hired as a reporter for The Woodlands edition in 2016, she became editor of the Sugar Land/Missouri City edition in October 2017.


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