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Sales tax collection up from 2012, thanks to annexation

For the first seven months of this year, the city is seeing an 11.65 percent increase in sales tax collection.

One reason is last April’s annexation of the Bethel Corridor North, which includes Walmart and Safeway, along with other stores and restaurants.

According to Treasurer Allan Martin, the annexation of the Bethel Corridor is a big factor in the sales tax collection increase.

“It is a major retail corridor for this area,” Martin said. “To increase from $2.96 million in 2012 to $3.3 million this year is substantial.”

Martin said the increase from 2012 is about 22 percent.

“It’s a major driver for what the city is able to do with the sales tax.”

Martin said when the city knew there would be an increase in sales tax collections because of the annexation, but only an estimation of what the city would actually collect.

He said the city had only three months of collection history in 2012 to base the 2013 sales tax collection.

“We did it conservatively because we wanted to err on the side of caution,” Martin said. “Some of it is economic activity, but the bulk is new business in the Bethel Corridor.”

So far, the city has collected $2.1 million over the seven-month period and is on pace to reach the $3.3 million projected for 2013.

In July, collections tallied $308,218 — a 14.6 percent increase from the same month in 2012. The biggest increase from last year was in April, when the city collected 24 percent more than in 2012.

Martin said 36 percent of the city’s budget comes from sales tax.

The city collected $2.75 million in 2010, $2.78 million in 2011 and $2.96 million last year. Martin said the city is projecting about $3.3 million this year.

Martin said with the increase in sales tax collection, the city will have a great opportunity to budget for some of its “needs” in the 2014 budget.

He said the biggest month for collections is February because the sales tax comes in 60 days after it’s paid at the local store registers during the Christmas holiday.

Martin noted that 36 percent of the budget comes from sales tax, while 25 percent is from property tax and 17 from other taxes.

The overall city budget for 2013 was $30.2 million — with the General Fund budget about $10.3 million.

Other money is generated from other taxes such as gas, phone and electricity.

The Bethel Corridor North — 566 acres of land from Sedgwick Road to Shelton Lane and from BlackJack Creek to about 1,300 feet east of Bethel Road — was annexed into the city in April 2012.

The Fred Meyer shopping center was annexed in 2009.

 

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