Rim Country’s economy continues to chase recovery like the shimmering illusion of water in the dips of an endless highway.
That’s the gist of Payson’s quarterly tracking report on the state of the Rim Country economy — and the town’s budget.
From June to September the town collected $1.1 million in local sales taxes — down a negligible $4,000 from the same period a year ago.
Not too bad, given pervasive fears the country will slide into a renewed recession. However, Rim Country also seems to be lagging behind the rest of the state.
The sales tax money the state collects and then redistributes on a per-capita basis actually rose 4 percent to $189,000.
“Local sales tax collections are holding up,” said Payson Finance Director Hope Cribb, “and state sales tax receipts have increased — which is good for us.”
Local residents pay a 9.72 percent sales tax in Payson. Of that, 6.6 percent goes to the state, 1 percent goes to the county and 2.2 percent goes to the town.
So the state’s economy shows signs of a little engine revving, but Rim Country appears stuck in neutral.
Other revenue sources have declined slightly, including a small drop in vehicle license taxes spurred mostly by the sale of new cars and a big drop in state shared income tax money, which actually reflect collections from two years ago.
However, in one of the more heartening reports, revenue from building permits and plan review fees jumped significantly over last year — although the totals remain a pale shadow of the revenues the planning department raked in during the boom years before the recession and fiscal crash when builders added 200 to 300 homes to the town’s housing stock each year.
Plan review fees rose more than 40 percent to $19,000, whole building permit fees rose more than 11 percent to $42,000.
Revenue from hotel bed taxes also rose significantly, but some of that reflects a boost in the rate approved by the council to generate extra money to promote tourism.
Cribb said despite the tight revenue, the town’s budget remains on track three months into the fiscal year.
“We’re trying to keep an eye on our budget this year,” she told the town council during a recent meeting.
Payson Mayor Kenny Evans praised the town staff for the new, quarterly overall report, which amounts to a summary and consolidation of the monthly reports the council receives. The council had gone nearly three months without a financial report due to delays in receiving and analyzing year-end statements from the state.
Cribb listed several significant developments.
For starters, the town didn’t get federal grants to hire more firefighters or police officers. The town had hoped for federal money to cover initial salaries for enough firefighters to operate the newly opened third fire station.
Instead, a program expanded with stimulus funds contracted with Congress shifted from a focus on stimulating the economy to reducing the soaring deficit. As a result, the town will have to juggle to provide staffing for the new fire truck based at the third station. The town used about $160,000 in savings on its mutual aid contract with Hellsgate Fire Department to hire two or three of the roughly nine firefighters it takes to provide an around-the-clock, three-man crew. The town hopes to cover the additional manpower needs by expanding its use of paid volunteers at all three fire stations and perhaps sometimes running two-man crews.
Crib reported that the town has not received additional millions in additional applied-for state and federal grants. The town routinely puts hoped-for grant money in the budget, but doesn’t spend it if the money doesn’t come through.
The various town departments have generally kept spending below their adopted budgets so far this fiscal year.
“All funds have spent less than prior years, except the water department — due to capital projects,” said Cribb.
The water department generates all its own money from water bills and impact fees on new development, which have been nearly non-existent in the past three years.
The water department has nearly spent a $10 million fund accumulated from impact fees for the Blue Ridge pipeline, including its current, $800,000 project to retrofit three wells so they can inject Blue Ridge water into the ground in addition to pumping groundwater out.
The town also is moving slowly to implement a plan to upgrade 40-year-old water mains and trunk lines to prevent breaks and to extend the system of fire hydrants.
Some departments looked over budget on paper, but that’s just because they paid some major bills up front, said Cribb, while the month-by-month projections are based on simply dividing the total budget by 12.
Overall, revenues in the town’s general fund that includes most operations except for the water department totaled $2.4 million for the first quarter of the fiscal year, compared to budget projections of $3.1 million.
On the other hand, with 25 percent of the year gone the town’s various departments have spent only 20 percent of their budgets.
In the water department, revenues total about $1.2 million for the quarter compared to projections of $3 million — but most of that shortfall stems from various state and federal grants the town hoped for but didn’t receive.
The report also included a breakdown of sales tax receipts by categories — although those figures represent August sales since the breakdown lags a month behind the overall figures.
The August figures show the taxes generated by hotels totaled $35,000, up 14 percent from last year and up a similar margin even over 2008-09. However, a portion of that increase reflects an increase in the rate rather than an increase in visitors.
In other categories, sales fell slightly from last year and remain about 15 percent below their pre-recession totals in 2008-09.
Construction remains a shadow of itself, despite a 12 percent rise from last year to a total of $27,000. That compares to $80,000 for August of 2008-09.
The dominant category — retail trade — in August dropped about 1 percent to roughly $300,000 for the month. That compared to $337,000 in that category in 2008-09 — a 1 percent decline.