Sales in Payson so far this year have risen a heartening 12 percent, according to the town’s financial tracking report for April.
Moreover, the value of building permits issued rose a whopping 31 percent to $128,000, according to the report.
The report showed signs of life in the local economy heading into the vital summer months, when tourism lifts economic activity — although local officials are already fretting about the economic impact of a possible forest closure due to extreme fire danger.
The rise in local sales tax, vehicle license taxes, building permits, planning fees and other purely local sources of revenue would make town budget planners downright cheerful were it not for the deep cuts in most sources of revenue from the state.
The loss of $175,000 in shared income tax money and $149,000 in shared gas tax money wiped out the modest increases in most local revenue.
The town received almost none of the hoped-for state and federal grants for hiring police and firefighters and building sewage treatment facilities in cooperation with the Tonto Apache Tribe.
The town did enjoy a roughly 10 percent increase in state shared sales taxes, collected statewide then distributed on a per-capita basis. Even that number harbors some additional encouragement, since local sales tax receipts increased at a slightly higher rate than the overall statewide increase.
For most of last year the opposite held true, with local sales tax gains lagging behind the statewide average.
The breakdown of the sales tax collections by category lags a month behind the overall figure. The figures from March showed a much smaller percentage gain in sales tax collections, suggesting the economy is revving up for the summer. In March, retail trade rose about 9 percent from the same period a year earlier. However, real estate, restaurants and hotels had all actually declined slightly from the year previous.
Unfortunately, three years into a glacial recovery, the local economy remains well below the boom times in 2007 and 2008. At that time, Payson was approving an average of 250 to 300 new homes annually.
The town’s budget projections had anticipated a much stronger recovery this year than in fact materialized. For instance, at this point in the year the budget projections called for collecting $11 million in various taxes (not counting the water department fees). Instead, the town has collected only $8.7 million. The shortfall included some state and federal grants the town hoped for but never received.
Fortunately, spending in most of the town’s departments remains below budget, cushioning the impact of the lagging state-shared revenues.
The adopted budget called for spending totaling $11.8 million at this point. In fact, the town has so far spent $9.4 million. That amounts to $587 per resident, with the bulk of the money coming from sale tax collections.
Most of the savings have come from the police department, the single most costly item in the general fund budget. The police department has spent $3.2 million so far in the current fiscal year, about 20 percent under budget. The department has five patrol officer vacancies and continues to operate under a hiring freeze.
The fire department is also operating about 21 percent under budget and has spent $2.7 million so far this year.
Most other departments continue to operate under budget. Parks and Recreation, a wan shadow of its pre-recession self, has spent $194,000 so far in the current fiscal year — 26 percent below budget.
Tourism and Economic Vitality has spent $84,000 so far this year, about 9 percent under budget.
Community development has spent $485,000, about 11 percent under budget.
Even the $1.1 million year-to-date total for central services — which mostly covers the cost for employee benefits — remains about 9 percent under budget.