How to prepare yourself for a job search after COVID-19

Butler County sales tax was triple estimates for March, but what about the future?

County Administrator Judi Boyko told the Journal-News sales tax receipts announced by the state late last week show the county culled $3.4 million, almost triple the $1.2 million estimated in the revised year-end projections. Gov. Mike DeWine issued his stay-at-home order mid-March, and up to that point the county’s financial position was extremely strong, according to Commissioner Don Dixon.

“We were on a pretty positive swing there in sales tax, our economy was rolling, it was really strong,” Dixon. “That was the trend we were trending on for the rest of the year. We were hopeful that’s where it was going to stay the rest of the year. But I can tell you the next one is going to be ugly.”

RELATED: Butler County tapping rainy day fund, cutting 4.14 percent with revenues falling

Boyko said another factor that might have influenced the influx of cash was federal money that had strings attached for merchants. President Donald Trump signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act March 27, providing more than $2 trillion in economic relief from the pandemic.

“State law allows 60 days past due sales tax accounts so March’s collections could include past due sales tax from January and February, artificially inflating collections,” Boyko said. “Some proprietors may have remitted payments in March to possibly qualify for federal funding.”

Sales tax makes up about 45 percent of the general fund revenues and Boyko is estimating a 30 percent drop this year — it was budgeted at $44 million — probably a 10 percent reduction in property taxes due to delinquencies and a 20 percent decrease in property transfer taxes. All tolled she estimated the general fund could be short $20 million hole by year’s end.

Dixon said the shortfall might be less now but they will continue to keep a keen eye on the situation.

“We’re going to be somewhere between $15 and $17 million short and that’s probably on the best day,” he said. “It’s good to have a little more come in because of the shut-down than what we anticipated, but it’s still way, way short of what it should be. It’s not near what it’s going to take but it’s better than a poke in the eye.”

The commissioners convened a meeting with other office holders and department heads almost two weeks ago to lay out how the deficit will be covered.

The commissioners have agreed to empty the $12 million budget stabilization fund and use $1.5 million from a reserve fund that started the year with a $56 million balance to help close the revenue gap. The commissioners have directed a 4.14 percent cut across the board.

Commissioner Cindy Carpenter said when they first began talking cuts the range was around 20 percent. Of the latest sales tax figures she said she knows people have continued to shop online during the two-month quarantine and perhaps the long-term impact might not be as dire.

“I don’t think its going to be as bad as people say…,” Carpenter said. “I think that asking to cut the 4 percent is still a good number and I think that’s going to get us close to where we need to be.”

Boyko reported to the commissioners Monday that several office holders have already submitted budget reduction plans and there will be a completed plan before tax budget time in June. The commissioners asked for the reduction for the balance of this year and future budget cuts.

“Let’s say sales tax hardly dips at all, that’s okay that’s going to give us some leeway to put that money back into a rainy day fund,” Carpenter said of future finances. “We’re going to have to rebuild it, sometime in the future there is going to be another emergency that the county’s going to have to fund. I’m really comfortable that all we asked for was such a small reduction in their operating budgets.”

Thank you for reading the Journal-News and for supporting local journalism. Subscribers: log in for access to your daily ePaper and premium newsletters.

Thank you for supporting in-depth local journalism with your subscription to the Journal-News. Get more news when you want it with email newsletters just for subscribers. Sign up here.

X