The URL can be used to link to this page

Home My WebLink AboutIR 23-1767 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 23-1767 To the Mayor and Members of the City Council December 5, 2023 �s ad?? Page 1 of 4 I! SUBJECT: SEPTEMBER 2023 — SALES TAX REVENUE UPDATE "+qrF rn Yg7'3 Sales tax revenue is 23% of the City's General Fund FY 23 revenue, making sales tax the second-largest General Fund source of revenue following property tax (which is 58% of total). In addition, sales tax revenue represents the largest revenue source in the Crime Control and Prevention District (CCPD) Fund. Because sales tax represents a significant revenue source for the City and can sometimes be a volatile revenue stream, it is important for the City to closely monitor and report on monthly sales tax receipts. The Texas Comptroller's Office posted September 2023 (Fiscal Year 2023, Period 12) collection results on November 8, 2023. Actual receipts are dependent upon the timeliness and accuracy of sales tax payers' returns. Recent years have witnessed significant swings to the economy and retail sales including legislative reform on remitting sales tax to the state comptroller, effects of a historic winter storm, and the effects of a global pandemic. The FY2023 Adopted Budget for sales tax were estimated based on higher than expected recovery from the pandemic and the possibility for an economic recession. Due to the potential fluctuation in the revenue source, the City takes a conservative, yet realistic, approach to estimating sales tax. CITY OF FORT WORTH YTD BUDGET& NET COLLECTIONS COMPARISON Adapted Amended Budget YTD Budget to Actual YTD Actual to Budget Budget As of September Adopted % As of September Adopted °ffl CITY OF FORT WORTH GENERAL FUND $212,147,461 $212 147,461 $212,147.461 100.0% $232.607.608 109.6% CCPD $102.073,793 $102.073,793 $102.073.793 100.0% $111.371.190 109.1% Total $314,221,254 $314,221,254 $314,221,254 $343,878,798 CITY OF FORT WORTH BUDGET COMPARISON —FY2023 Projected Adopted Amended Fiscal Year Variance to Adopted Budget Budget Projections �110 CITY OF FORT WORTH GENERAL FUND $212.147.461 $212.147.461 $235.300.000 $23.152.539 10.9% CCPD $102.073.793 $102.073.793 $112.857.921 $10.784.128 10.6% Total $314,221,254 $314,221,254 $348,15,7,921 $33.936,667 10.8% *THE AMENDED BUDGET HAS NOT CHANGED FROM ADOPTED BUDGET FOR THE SALES TAX REVENUE • Both the General Fund and the CCPD Fund FY2023 Adopted Budgets are a 16.0% increase over the FY2022 adopted budget • The total of General Fund and the CCPD Fund collection at fiscal year-end is $343,878,798. This exceeds the adopted budget by $29,657,544 or 9.4%, however it is below the projection by $4,279,123 or (-1.2) %. ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 23-1767 To the Mayor and Members of the City Council December 5, 2023 �s ad?? Page 2 of 4 SUBJECT: SEPTEMBER 2023 — SALES TAX REVENUE UPDATE iv, Yg7'3 COLLECTION DETAIL FOR CITY SALES TAX(FY2022 TO FY2023) General Fund September 22 September 23 Variance( ) Variance(%) Current Period Collections $20,699-537 $20,768,496 $68,960 0-3% Op Other Collections* $296.803 ($79,586) (375,389) (126-9%) Single Local Rate* $224,400 $185,040 (39,360) (17-5%) Audit AdjLlStments ($146,331) ($294,560) (148.229) (101.3%) Service Fee ($421,468) ($411,588) 9,880 2-3% Retainage (536.225) ($25,359) 10,866 30-0% Net Collections $20,615,715 $20,142,443 ($473,273) (2.3%) CCPD Fund September 22 September 23 Variance ($) Variance ( 6) Current Period Collections 49,663.345 $9,596,924 $33,579 0-4% Other Collections* $142-084 ($49.832) (191,916) (135-1%) Single Local Rate* $103,627 386.374 (18,253) (17-6%) Audit Adjustments ($77,719) (5137,710) (59,991) (77-2%) Service Fee ($194,627) (5189,895) 4-732 2-4% Retainage ($8.360) (S5 4701 2.891 34-6% Net Collections $9,528,350 $9,299,391 ($228,959) (2.4%) + *OTHER COLLECTIONS ARE PAYMENTS ATTRIBUTED TO NON-CURRENT COLLECTIONS INCLUDING PRIOR PERIOD, FUTURE PERIOD AND UNIDENTIFIED COLLECTIONS.SINGLE LOCAL RATE IS COLLECTIONS FROM REMOTE SELLERS WHO HAVE OPTED TO UTILIZE THE STATES ALTERNATE SINGLE LOCAL USE RATE OF 1.75%. THIS SINGLE LOCAL RATE CANNOT BE USED BY BUSINESSES LOCATED IN TEXAS. AUDIT ADJUSTMENTS SEPTEMBER FLUCTUATE BASED UPON RESULTS OF TAXPAYER SALES TAX AUDITS CONDUCTED BY THE STATE OF TEXAS. September collections are lower to the same month last year. • The General Fund net sales tax collections as of September are 109.6% compared to the adopted budget, and 97.7% compared to the same month last year. • The CCPD Fund net sales tax collections as of September are 109.1% compared to the adopted budget, and 97.6% compared to the same month last year. ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 23-1767 To the Mayor and Members of the City Council December 5, 2023 Page 3 of 4 0YA SUBJECT: SEPTEMBER 2023 — SALES TAX REVENUE UPDATE fie The following chart indicates how FY2023 net sales tax collections in Fort Worth and other select cities in the state compare to FY2022 collections for the same period. CITIES COMPARISON—NET COLLECTIONS FY2023 vs. FY2022 City 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter GARLAND 18.4% 8,4% 11.4% 38.6% MCKINNEY 7,2% 3.7% 3.4% 6.7% ARLINGTON 3,2% (0,1%) (10.7%) 4,2% HOUSTON 9,2% 10.8% 3.7% 2.7% PLANO 8,0% 10.4% 1 ,5% 2,4% DALLAS 10.4% 6,6% 0,4% 1 ,0% GRAND PRAIRIE 5.9% 6,8% (4,6%) 0,9% I RVI NG 10.4% 14.4% 7,1% 0.8% EL PASO 5,1% 6,1% 3,8% 0,5% SAN ANTONIO 4.5% 5.5% 1 ,1% 0.5% FORT WORTH 12.4% 11 .4% 4,1% 0,2% AUSTIN 11 .1% 8,2% 2.7% (2,8%) FRISCO 14.4% 0,9% (5,8%) (4,2%) STATE TOTAL 9,4% 8,8% 4,5% 2.7% Source:Allocation Payment Detail and Monthly All Fund Revenue Report,Texas Comptroller of Public Accounts According to the Texas Comptroller of Public Accounts website, Texas Comptroller Glenn Hegar announced on Nov 8, he will send cities, counties, transit systems and special purpose districts $1.2 billion in local sales tax allocations for November, 1.9 percent more than in November 2022." ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 23-1767 To the Mayor and Members of the City Council December 5, 2023 �s ad?? Page 4 of 4 I! SUBJECT: SEPTEMBER 2023 — SALES TAX REVENUE UPDATE "+qrF rn Yg7'3 Sales tax is collected on a variety of transactions besides the traditional retail industry and it is important to understand the various sources in order to anticipate any fluctuations. The following chart indicates the top five industries for sales tax performance over the past three years in Fort Worth, on a rolling 12-month period. TOP 5 PERFORMING INDUSTRIES 200,000,000 180,000,000 160,000,000 140,000,000 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 Sept2#AugZ1 Sept21-Aug22 Sept22-Aug23 Department Stores —Othe-No-iso-eReta'e-s —Limited Service Eating Places BuildirgMaterialvstores ■Electric Utilities Source:ZacTax(September 2023 data has not been released yet and will be updated once available) If you have any questions, please contact Clay Pearson, Interim Chief Transformation Officer, FWLab, at 817-392-6222. David Cooke City Manager ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS