FAIRHOPE — After the impacts of Hurricane Sally and COVID-19 in recent years, Fairhope finances have improved in the first six months of the 2022 fiscal year, city officials said Monday, April …
FAIRHOPE — After the impacts of Hurricane Sally and COVID-19 in recent years, Fairhope finances have improved in the first six months of the 2022 fiscal year, city officials said Monday, April 25.
During a budget review for the first half of the fiscal year, Kim Creech, city treasurer, said the city's revenue and cash balance are ahead of goals for the budget.
The total cash balance for the city is $25.78 million as of March 31. At the same time in 2021, the cash balance was $13.53 million. On March 31, 2020, the amount was $15.47 million.
"Our cash balances are pretty healthy right now," Creech said.
The 2021 budget year began Oct. 1. 2020, just after Hurricane Sally struck in September. Creech said the expenses from the storm affected the previous year's budget.
"At the point on March 31, we had spent on debris right at $10 million and so we had a line of credit," Creech said. "I paid the line of credit off."
Total revenue for the city in the first six months of the 2022 fiscal year were about $21.95 million, up from $17.76 million at the same time in the 2021 budget, she said.
In the first half of the current budget, total city revenues are about $21.95 million, while expenses are about $14.03 million, leaving an excess of $7.92 million.
In the first six months of the 2021 fiscal year, expenses hit by Hurricane Sally exceeded revenue by $5.62 million, Creech said.
Creech said that one reason some expenses are down is that some budgeted purchases have not been made due to shortages and back orders.
"The total projected revenue in the 2022 budget was $33.59 million for the entire year, meaning that the city is short 34.7% of projected collections for the entire year," Creech said.
Councilman Jack Burrell said that while revenue is up, almost all property taxes are collected by this time in the budget, so little more income will be collected from that source.
"We only have 34.7% remaining, but property tax is a huge part of that, but we only have 8% left of that," Burrell said.
Creech said collections are up overall from most sources. Business license increases are a sign that the economy in Fairhope is improving.
"We collected over $100,000 more in business licenses than what we budgeted," she said. "That was huge there."
Council President Jimmy Conyers said city finances are in good condition so far in the fiscal year. He said officials should still be cautious in making financial plans.
"We're definitely up at the six-month point," Conyers said. "We're up a lot at the six-month point. You're having a great revenue year. You don't necessarily want to build the budget based on 100% of what we did in a really good year for revenue."
After being hit by COVID, sales taxes began increasing in 2021 and have continued to improve, Creech said.
"Last year, our increases in sales taxes were 14.6%," Creech said. "Six months into this year, they're at 16.1% increase."
One big increase is the Simplified Sellers Use Tax charged to purchases made online. Creech said the fee is sometimes knows as the "Amazon Tax." She said that tax was up 38.9% in 2021 and up another 60.8% in the first six months of the current fiscal year.