Sales tax drop concerns School Board
By Jim Butler
St. Landry Parish School Board sales tax collections through March 30 were about $194,000 below the same period last fiscal year, raising concerns about collections through the remaining quarter of the year.
The sales taxes fund general operating expenses, including payroll, and capital spending.
The board originally budgeted to collect about $22.5 million this fiscal year from the sales taxes it levies. Through 75 percent of the year, collections were less than 69 percent of that projection.
Worrisome sales tax collections prompted Finance Director Randy Manuel in early February to begin drafting budget revisions for the board.
When February sales taxes came in at an 18% jump over Feb. of last year, there was a glimmer of hope of an economic rebound.
March’s sales tax revenue, down 16% from last March, dampens that and leaves officials waiting to see the April numbers.
One hope over the horizon - the federal economic stimulus plan will pump “free” money in the parish beginning in early May. If consumers spend it as fast as they get it, which is expected, there will be an artificial, but nevertheless real, bump in sales tax collections the last two months of the fiscal year.
The totals so far this year are a reversal of sales tax fortunes of the past few years.
They have grown at a steady rate. Last fiscal year (July 1, 2006-June 30, 2007) collections were $856,000 over the previous year.
Some cooling off in collections was expected due to the surge of spending last summer and fall as hurricane recovery spending ramped up. But the latest numbers could indicate something different.
The numbers through March are within 2.5% of Manuel’s draft budget revision.
Budget revision is an annual process for school boards.
They adopt budgets based on projected state and federal funding, then have to revise them to accommodate actual numbers once the Legislature and Congress have finished their deliberations and official student numbers are in hand.
This year’s budget. which runs through June 30, requires a Minimum Foundation Program revision of an additional $8.3 million.
Manuel’s preliminary revisions also included about $1.7 million in revenue growth beyond original estimates from other sources, bringing total revenue to $113.6 million.
Correspondingly, the expense budget has to be revised to accommodate increased costs which the MFP funds - in particular raises that went to every teacher and teaching certificate-holding employee beginning last fall.
The initial revised expense estimate totaled $112.4 million, creating an estimated balance from the year of $1.3 million. The board entered the year with balances of $2.1 million.
While the resulting year-end balance of $3.3 million seems substantial it still leaves the board a couple of million short of the five percent of budget the Board of Elementary and Secondary Education wants school systems to have on hand.