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Home My WebLink AboutIR 10693 INFORMAL REPORT TO CITY COUNCIL MEMBERSNo. 21-10693 October 19, 2021 To the Mayor and Members of the City Council Page 1of 4 SUBJECT: AUGUST 2021 –SALES TAX UPDATE Sales tax revenue represents approximately twenty-twopercentof the City’s General Fund anticipated revenue in Fiscal Year 2021. It is the second largest general fund revenue source,behind only property tax revenue. In addition, sales tax revenue represents the largest revenue source in the Crime Control and Prevention District Fund.Staff is committed to providing regular updates on this important,and sometimes volatile,revenue source. The Texas Comptroller’s Office postedAugust2021(Fiscal Year 2021, Period 11) collectionresults on October 6th, 2021. Actual receiptsare dependent upon the timeliness and accuracy of sales tax payers' returns. This reportprovidesFort Worth’s sales tax collections, a comparison of collections in thesame period last year,andan estimatedimpact on the current year’s budget.The past year has included a change in the method of remitting sales tax to the state comptroller(via legislation),effects ofa global pandemic,andeffects of ahistoricwinter storm. This activity is being closely monitored and will be highlighted if significant impact is expected. A UGUST N ET S ALES T AX C OLLECTIONS (10-YEAR H ISTORY) $15.5 $13.3 $13.1 $12.8 $11.9 $11.1 $10.2 $9.8 $9.6 $8.9 FY2012FY2013FY2014FY2015FY2016FY2017FY2018FY2019FY2020FY2021 The City’s net sales tax collection is up$2,412,117or18.4%,compared to the samemonth last year. As depicted in the following table, the City experienced an increase of $2,464,224or18.8%in current period collections when comparedto the same month last year. Current period collections include activity that was remittedfor the current period that were on schedule within the due date.The State experienced a net collectionincrease of 22.25% compared to the same month last year. ISSUED BY THE CITY MANAGERFORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERSNo. 21-10693 October 19, 2021 To the Mayor and Members of the City Council Page 2of 4 SUBJECT: AUGUST 2021 –SALES TAX UPDATE C OLLECTION D ETAIL FOR C ITY S ALES T AX August 20August 21Variance ($)Variance (%) Current Period Collections$13,111,772$15,575,995$2,464,22418.8% Other Collections* 104,019159,58155,56253.4% Single Local Rate* 101,012163,12862,11661.5% Audit Adjustments 62,115(72,858)(134,973)(217.3%) Service Fee (267,578)(316,517)(48,939)(18.3%) Retainage (1,469)12,65714,126961.5% Net Collections $13,109,870$15,521,987$2,412,11718.4% *O THER C OLLECTIONS ARE PAYMENTS ATTRIBUTED TO NON-CURRENT COLLECTIONS INCLUDING PRIOR PERIOD,F UTURE PERIOD AND U NIDENTIFIED C OLLECTIONS.S INGLE L OCAL R ATE IS COLLECTIONS FROM REMOTE SELLERS WHO HAVE OPTED TO UTILIZE THE STATE’SALTERNATE SINGLE LOCAL USE RATE OF 1.75%.T HIS SINGLE LOCAL RATE CANNOT BE USED BY BUSINESSES LOCATED IN T EXAS.A UDIT ADJUSTMENTS MAYFLUCTUATE BASED UPON S TATE OF T EXAS. RESULTS OF TAXPAYER SALES TAX AUDITS CONDUCTED BY THE C URRENT P ERIOD C OLLECTIONS Change Compared to Same Month in Prior Year 36.8% 32.4% 20.9%19.4% 18.7% 18.8% 5.4% 1.7% 1.5% 0.6% (0.2)% (1.3)% (4.0)% Aug-20Sep-20Oct-20Nov-20Dec-20Jan-21Feb-21Mar-21Apr-21May-21Jun-21Jul-21Aug-21 Augustcollections continue a trend of strong performance after several months of stagnation following the initial response to the COVID-19pandemicin March 2020. The Texas Governor fully lifted COVID- 19restrictions in March2021.Although the revenue trend is positive, we continue to note thepotential volatility in future receipts if the pandemic intensifies and/ornew restrictions are implemented. Fiscal year projectionswill be updated to reflect recent performance. ISSUED BY THE CITY MANAGERFORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERSNo. 21-10693 October 19, 2021 To the Mayor and Members of the City Council Page 3of 4 SUBJECT: AUGUST 2021 –SALES TAX UPDATE The City’s General Fund sales tax collections as of Augustare 110.5%to budget,andat112.0% throughthe same monthlast year.The City’s Crime Control and Prevention District Fund (CCPD) sales tax collections as of Augustare109.7%to budget,and112.9%throughthe same monthlast year.The monthly budget is based on a historic three-year collection trendby month. Fiscal years 2017, 2018 and 2019 were included in this calculation—fiscal year 2020 was excluded due to the irregularity caused by the pandemic. C ITY O F F ORT W ORTH YTDN ET C OLLECTIONS C OMPARISON Current Receipts FY2020 Receipts Budget as of AugustThrough AugustThrough August CITY OF FORT WORTH GENERAL FUND $152,772,471$168,757,816$150,627,675 CRIME CONTROL AND PREVENTION DISTRICT73,858,28481,017,68471,746,663 TOTAL $226,630,755$249,775,500$222,374,338 C ITY OF F ORT W ORTH B UDGET C OMPARISON –FY2021 Projected Variance to Amended AdoptedAmendedFiscal Year BudgetBudgetProjections($)(%) CITY OF FORT WORTH GENERAL FUND $168,248,455$168,248,455$179,600,000$11,351,5456.7% CRIME CONTROL & PREVENTION DISTRICT$79,213,635$79,213,635$86,200,000$6,986,3658.8% The City anticipates collecting $179,600,000in the General Fundby fiscal year end,which exceeds original estimatesin the FY2021adopted budgetby 6.7%.This is an 8.4%increaseover fiscal year 2020 actual collections.The City’s Crime Control and Prevention District Fund (CCPD) anticipates collecting $86,200,000by fiscal year end, which exceeds the original estimates in the FY2021 adopted budget by 8.8%. This is a 9.5% increase over fiscal year 2020 actual collections. Staff will continue to provide regular updates as financial analysis continues for sales tax impacts due to COVID-19. ISSUED BY THE CITY MANAGERFORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERSNo. 21-10693 October 19, 2021 To the Mayor and Members of the City Council Page 4of 4 SUBJECT: AUGUST 2021 –SALES TAX UPDATE The chart below indicates how current year sales taxnetcollections in Fort Worth and other select cities in the statecompare to FY2020collectionsfor the same period. C ITIES C OMPARISON–N ET COLLECTIONS FY2021vs. FY2020 City1st Quarter2nd Quarter3rd QuarterAugustYTD ARLINGTON 104.9%115.9%144.2%145.3%127.7% AUSTIN 96.7%103.8%131.0%133.8%113.1% FRISCO 108.9%116.2%135.3%124.8%121.5% HOUSTON 93.5%103.8%124.4%123.5%108.8% GARLAND 100.7%112.3%128.5%123.0%114.8% DALLAS 96.2%104.1%131.9%121.2%111.7% GRAND PRAIRIE 106.0%108.1%113.6%119.4%111.4% MCKINNEY 109.7%114.1%116.5%119.3%114.0% FORT WORTH 101.9%109.1%120.4%118.4%112.0% PLANO 96.0%97.8%122.2%117.8%106.7% EL PASO 100.0%117.3%127.9%116.4%114.9% SAN ANTONIO 100.6%110.1%123.6%115.2%112.1% IRVING 97.3%94.5%118.9%114.8%105.6% STATE TOTAL 96.1%104.5%120.2%189.1%114.4% Source: Allocation Payment Detail and Monthly All Fund Revenue Report, Texas Comptroller of Public Accounts If you have any questions, please call Mark McAvoy, Director of Planning and Data Analytics, at 817- 392-6222. David Cooke City Manager ISSUED BY THE CITY MANAGERFORT WORTH, TEXAS