New Albany tax revenue better than expected but tourism still low

New Albany officials received some good economic news Monday concerning retail sales and tourism.

The city’s retail sales tax income from April was $322,225, which was up more than eight percent from April a year ago regardless of any effects of the coronavirus pandemic.

It also represented an increase of about 2.25 percent over the March income this year. Despite fears to the contrary, the sales tax revenue for March had been up very slightly from the previous year as well.

The city’s tourism tax income did not fare as well, but it also was better than expected. That total for April was $64,890.

The April number was down about 14 percent from April 2019 but also up about 13 percent from March this year, which brought in $57,430.

The March total had been down almost 30 percent from the previous year, attributed mostly to so many restaurants being closed. That is about what city officials had estimated so they were pleased when the April total was higher.

The relatively higher tourism tax revenue from April was helped by restaurants as they adapted to curbside and carryout service.

“This was all unexpected good news,” Mayor Tim Kent said. “We’re pleasantly surprised and more optimistic.”

City officials are getting ready to work on next year’s budget but were waiting on the April tax figures to try to gauge how much business closings and job losses might be affecting revenue. They had enacted a spending freeze when the mayor and governor ordered precautions to prevent spread of the OCVID-19 virus.

The retail sales tax and tourism tax are two of the city’s main sources of revenue.

Merchants in New Albany charge a seven-percent tax on any items sold in the city. That money goes to the state, which returns 18.5 percent of the total back to the city.

The tourism tax is two percent, but it is only levied on lodging and food that is prepared on site. The city gets to keep all of that money but it can only be spent on things that promote tourism or to help attract senior citizens.

Sales tax is more important in that it is primarily used for necessary city functions. The tourism tax is used for valuable projects but those budgets can be adjusted to a degree more easily than the general city budget.

Shopping remains heavy but people do not appear to be hoarding items like they were two months ago. Building supply businesses are seeing good business, possibly because people stuck at home due to the pandemic and closings are undertaking more home improvement projects.

The unusual amount of work around homes has resulted in a considerable increase in the amount of trash placed out on streets.

Mayor Kent had said the public was “wearing out the street department,” but trucks were running every week when they can and sometimes returning for trash.

Businesses and governmental offices have relaxed precautions to some degree, allowing people in in limited numbers but still urging the use of masks and social distancing as the number of COVID-19 cases continues to increase.

The drive-up window at the former Fred’s has been available for paying utility bills in addition to the main office on Cleveland Street, but the lobby on Cleveland is now open.

The Freedom Fest was cancelled, although Pedaling for Hope will be held on the Tanglefoot Trail June 27 and a fireworks display will be presented about 9 p.m. that evening.

The Union County Fair, usually in July, was also cancelled and the Biscuits and Jam Farmer’s Market will be operated more like a traditional roadside stand with no set hours, music or programs, although vendors and shoppers are urged to go by during the middle of the day.