The release of May sales tax allocations from the Texas Comptroller’s office this week shows how coronavirus closures in March may affect The Woodlands, Oak Ridge North and Shenandoah. The comptroller's information for Texas cities' May 2020 net sales tax payments may be viewed here, while information for special purpose districts, such as The Woodlands Township and its economic development zone, may be viewed here.
The Woodlands Township
In The Woodlands, the May net sales tax payment of about $3.86 million for March activity was a decline of 7.43% from the same month the previous year, according to information from the comptroller’s office. That figure represents payments from both The Woodlands Township and The Woodlands Township Economic Development Zone, which each collect 1% sales tax across the same geographic area.
Monique Sharp, the township’s assistant general manager for finance and administration, said deposits for the month declined by $316,174, or around 7.4%. However, she said, on a year-to-year basis, sales tax revenue is 3.4% higher than the same period for 2019 and is $375,919, or 1.7%, higher than budgeted.
“The township board and staff anticipate sales tax revenues will continue to be impacted in the coming months,” Sharp said May 7. “Because we cannot accurately predict the extent of those impacts until more data is available, the board is budget planning for a range of possibilities.”
In April, the board established a budget task force consisting of Directors Bruce Rieser, John Anthony Brown and Bob Milner.
“The task force has been working to develop a plan that will address revenue shortfalls in 2020 with a combination of decreases in operating expenses, deferrals of capital projects and limited utilization of reserve balances,” Sharp said.
The task force will present its recommendation to the board of directors at a special meeting at 4 p.m. May 21. Township board meetings have been held by videoconference since mid-March.
City of Shenandoah
According to information from the comptroller's office, the city of Shenandoah's May 2020 net sales tax payment of about $405,560 for March activity was 26.54% lower than the $552,085 payment reported last May. The city's year-to-date payments saw a smaller annual drop of 3.64%, with net sales tax payments decreasing from $2.51 million as of May 2019 to $2.42 million as of May 2020.
Shenandoah Finance Director Lisa Wasner confirmed the city experienced an approximately 26% decrease in general fund sales tax for its March receipts. Wasner said the city will continue to adjust its budgeting plans as more information about the fiscal effects of the coronavirus becomes available.
"We are currently meeting internally and looking at our operational and capital budgets for the current and upcoming year and will make continual modifications as we receive more information. Due to the uncertainty and the unprecedented nature of this ongoing pandemic, it is hard to make accurate predictions without continued information," Wasner said. "There will be a decrease in sales tax revenue allocation for the city next month for receipts collected in April, which is expected due to the closure of most retail and limited restaurant activity, but we cannot be certain what that amount will be."
City of Oak Ridge North
Oak Ridge North's May net sales tax payment of $289,188 for March activity represents a 15.18% decrease over the $340,949 net sales tax payment it made in May 2019, according to information from the comptroller’s office.
Oak Ridge North's year-to-date net sales tax payments of $1.13 million this May is 5.67% less than the approximately $1.2 million the city had collected year-to-date through May 2019.
Oak Ridge North Finance Director Eva Clawson did not immediately respond to a request for comment about the city's May sales tax payments. According to the city’s fiscal year 2019-20 budget approved last August, $2 million in sales taxes were expected to be collected over the year. That figure represents around one fourth of Oak Ridge North's total taxes and revenue budgeted for FY 2019-20.
The city is expected to begin planning for its FY 2020-21 budget through spring and early summer before budget workshops begin in July. The city's budget and tax rate are scheduled to be voted on at the city's Aug. 24 council meeting.