City’s first quarter sales tax collections show 1.55% increase
First quarter collections of the 1% sales tax the city of Hot Springs levies in support of its general fund rose 1.55% from the previous first quarter.
The city reported collections of $4,716,148 through March, beating the first three months of last year by $71,776. March was the best month, making up for the 2.76%, or $39,654, year-over-year decline in January. It was the first month that collections had fallen since February 2021. Winter storms shuttered businesses, government offices and schools for close to a week during both months.
The tax collected $1,807,270 in March, a 4.17%, or $72,412, increase from last year. Collections through the first three months are 5.04%, or $226,186, ahead of the city’s $19 million revenue forecast. The tax netted $19,539,858 last year.
General fund revenue was $3,853,879 ahead of expenses, according to the city’s first quarter financial report. Revenue outpaced expenses by more than $2.4 million during the previous first quarter. Revenue was down $134,656 compared to last year, but expenses were also down. The $6.53 million spent through March was almost $1.5 million less than last year.
Finance Director Karen Scott noted personnel expenses rose moderately despite raises the board approved based on the salary survey Evergreen Solutions of Florida performed last year. The two-month premium holiday the city budgeted was recognized in January and February, waiving the $671 monthly contribution it makes per employee to its self-insured health care plan.
‘That’s what’s been the result of not a very big increase in personnel expenses you would’ve expected,” Scott told the Hot Springs Board of Directors at its May 21 business meeting. “In the next quarter we’ll see that.”
She said the drop in revenue was partially a function of the city not receiving all of the franchise fees it charges utilities to operate in its rights of way.
“Last year we got the franchise fees for electric, gas and telephone in this quarter,” Scott said. “This year we only got two of them. That’s the same case with business licenses. We had a little bit slower collection.”
The city’s share of the tax Oaklawn Racing Casino Resort levies on net gaming receipts was up $53,391 compared to last year, a 5.32% increase from the $1,004,532 the tax netted the city in the previous first quarter.
The casino gaming amendment voters approved in 2018 gave the city 19.5% of the 13% tax applied to Oaklawn’s first $150 million of annual net gaming receipts. The 13% tax increases to 20% on net receipts of more than $150 million. The city received 1.5% of net receipts from Oaklawn’s games of skill under the allocation formula in place prior to the ballot initiative.
The city reported an $11.64 million balance in its general fund reserve, almost double the 16.5% of general fund expenses it’s required to maintain.