As municipalities grapple with the economic impact of the coronavirus pandemic, Port Arthur has offered a healthy monthly report on its 2019-20 budget.
Revenue from the City’s general fund totaled $63.6 million as of May 31, which is above the estimate of $2.9 million. According to the monthly report, property taxes, the majority of which were due on January 31, are 12% over budget and industrial tax revenue is $30.9 million.
Total operating expenses, not including those transferred through May, were $38,553,325 year-to-date, more than $4.3 million below budget. The estimated general fund closing balance is $24.7 million, but for the year-to-date through May, it is actually $47,058,747.
The monthly report was presented to Port Arthur City Council on July 7th.
Port Arthur is also receiving a state sales tax payment of $1,311,914.41 from Texas Comptroller Glenn Hegar this month. The allowances are based on sales made in May by businesses that file tax monthly.
“For the year to date, we are in good shape on the sales tax front,” said Port Arthur Acting Chief Financial Officer Kandy Daniel. “We watch it month by month, and so far so good. We had a very conservative budget. We always try to do that. This little slowdown doesn’t hurt.
Port Arthur received $9,462,386.80 in sales tax for the year to date, an increase of 10.83% over the July 2019 cumulative total, according to data provided by Hegar’s office. The sales tax the city received through May was 15% higher than the prior year and 13% higher than budgeted, representing sales through March, according to the city’s budget report.
“The first part of the exercise was very good,” said Daniel.
Water and solid waste fund revenues were below their estimates by $1.1 million and $278,020, respectively. The city had adopted a policy of not cutting water accounts during the pandemic and ended it on July 8.
The city has 528 budgeted positions and 43 vacant positions. City Manager Ron Burton said at the July 7 meeting that he had kept his promise to keep everyone at City Hall “in gainful employment”.
“I have gone from department to department and have assured every citizen of Port Arthur who works here with us that as your town manager I will stay with them for as long as possible and ensure that everyone keep a paid job because I know they’ve got spouses, they’ve got kids, and they’ve got family at home to take care of,” Burton said.
Nederland receives $431,481.12 in sales tax from the Comptroller, reflecting sales through May, 2.61% less than July 2019, but it received $3,741,642.85 for the year to that day, or 16.26% more than that month.
Groves’ sales tax of $187,223.23 is 5.65% higher than what it received in July 2019, and its $1,343,152.11 for the year to date is 9.88 % higher than a year ago.
Port Neches is experiencing a large increase in its sales tax allowance from the Hegar office. The city receives $178,160.34, which is 62.27% more than the July 2019 distribution and nearly $16,000 more than it received in June this year.
An industrial and manufacturing gases company that is a direct taxpayer of the comptroller’s office is a big factor in such a revenue spike, according to Kevin Lyons, a communications specialist at Hegar’s office. Lyons said he could not name the company.
“This industry is still, obviously, in less impacted parts than other businesses in the city,” Lyons said. “There will always be fluctuations, but sometimes a city will have a big increase in revenue because of it.”
Port Neches’ cumulative total from the controller is $1,336,747.05, an increase of 42.48% from July 2019.
Port Neches Town Manager Andre Wimer said his staff had not yet had time to review documentation supporting the state’s tax revenue, but added it was important to examine monthly trends over a longer period than from one year to the next.
“There has to be a historical perspective when looking at a month,” he said. “There are audit adjustments that are made in the monthly allowances provided by the controller. There are a number of factors that contribute to an increase or decrease. All of this information should be reviewed.