TUPELO – Cities that feed their budgets with the bread-and-butter twins of property and sales taxes won’t go hungry next fiscal year, but they won’t get fat either.
By law, all Mississippi municipalities start the new fiscal year Oct. 1 and must prepare their annual budgets by Sept. 15. That means officials from the hills to the coast will spend the next six weeks studying their monetary outlooks.
The outlook in Lee County is flat. While property tax assessments increased in most of the county’s nine municipalities, sales tax collections took a dive. It’s not a big problem for communities like Baldwyn, for example, which rely more heavily on property-generated funds than sales tax.
But it can hurt cities like Tupelo, the bulk of whose revenues come from sales tax. Case in point: Sales taxes fed more than $17.7 million into Tupelo’s current general fund, versus the roughly $7.4 million from property taxes. The total general fund was $35.2 million.
“Sales tax is low for this year, but we don’t believe it will continue to plummet,” said Tupelo’s interim Chief Financial Officer Kim Hanna, who remains optimistic going into the upcoming budget cycle.
Officials from other cities also expressed hope that they’ll have the money they need to operate successfully in FY10.
“We’re going to be a little short probably, but I don’t think it will be anything bad,” said Shannon City Clerk Mary Lee Helms.
Shannon is one of three Lee County municipalities whose property assessments decreased since the previous fiscal year; Sherman and Verona were the others. It’s also one of six whose sales tax collections dropped; only Guntown, Plantersville and Verona earned more since last year.
Despite the early look at revenues, Helms said FY10′s financial picture hasn’t yet come into focus. Shannon city leaders only had one budget workshop and haven’t started putting together the pieces. Much work remains before the budget is ready, she said.
It’s a similar story across the county. Baldwyn’s new mayor, Michael James, said he and his board are only just starting on their budget. Same for Tupelo’s new mayor, Jack Reed Jr., who has met with department heads but hasn’t sat down with the entire City Council to hash out budget details.
The county, too, has much to do before setting its next annual budget, including holding public hearings said Administrator Sean Thompson. One hearing, about property assessments, will be held Monday.
Another, about the draft budget, will take place in early September.
So right now,” Thompson said, “we’re still in the early, early stages of it.”
Emily Le Coz/NEMS Daily Journal