The August Financial Report was released, and it seems we collected $2 million dollars less in retail taxes in August 2009 then we did in August 2008. If this trend continues we could see us almost -4% from 2008.
Let’s put our rose colored glasses on, raise water and sewer rates, raise retail taxes, raise property taxes, raise vehicle registration, and over budget for deficit spending in 2010. We’ll pull out;
The foundation commissioned a national poll that surveyed 4,004 people between June 18 and July 13, including 400 South Dakotans. The poll has a margin of error of plus or minus 3.5 percentage points. Among its key findings:
– 29 percent of respondents in South Dakota said they had problems paying their mortgage, rent or heating bills.
-Â 44 percent said they’ve cut back on the amount they spend on food; 45 percent have cut back on saving for retirement.
-Â Â And 22 percent have had a friend or relative stay with them because of a lack of money.
“That 22 percent may be the single most striking figure in the survey data for me,” said Kevin Walker, Northwest’s chief executive officer. “That tells me one out of five South Dakotans have provided emergency or transitional shelter. That really brings home the impact of the recession on families and communities.”
Having trouble keeping up? Stop whining and move in with a friend, we gotta city to build God Dammit!
Construction values are 50% of what they were last year at this time;
The number of building permits issued in Sioux Falls through August this year is up from the same time in 2008, though the value of that construction is down significantly.
Sioux Falls has issued 4,308 permits this year, up from 4,242 in 2008 but still down substantially from the 4,564 permits issued in 2007, according to city records.
But the total construction value in 2009 of $176.7 million is down from 2008, when the numbers through August were at $294.1 million.
There have been 681 new single-family, two-family and multiple-family permits issued in 2009 at a value of $71.3 million.
That compares to 1,016 new residential permits approved through August of 2008 at a value of $114.6 million.
This is no surprise to me, if you have been following the local economy as I have since last fall, you could have seen this coming a mile away. But city hall put their blindfolds on and approved a tax increase to build new roads anyway. While this is bad news for our local economy, it is good news to taxpayers. It means we can hold off on building new roads until it picks up, therefore saving us millions in the CIP budget, money we can either put in reserves or use on infrastructure upgrades (which should be the priority anyway). If developers can’t pony up their 50% towards new roads, taxpayers shouldn’t pony up either. According to the July financial report, taxpayers have put in $1.6 million into the new fund this year while developers have put in a whopping $90,000. Yes, we have put in 17x more money then the devolpers. Yet, the SD MSM doesn’t see a story here? Go figure. Of course this would require a new council that isn’t spend happy. In the informational meeting on Monday, councilor Beninga had a pity party about not having enough time to offer amendments to 2010’s budget, which probably means he will offer very few if any at all. The funny part of the conversation was when clerk Owen informed all the councilors that Staggers already turned in his (he was absent from the meeting). They seem shocked, and one councilor joked, “He has been probably working on them for a year.” Not quite. Then they asked if they could see them, and she replied that she would have to get permission from Staggers to show them. The city attorney’s office apparently is unaware of the new open records bill that started July 1. Quen Be De also got on her soapbox about wanting to raise the retail tax by a penny, and joked that not all the wisdom in the state resides in Pierre in the winter. While I do agree with her statement, I would have to say most legislators probably have more intellect in the tip of their little toe then she has in her whole body.
I can’t wait for the retail tax increase legislation to fail. Maybe I will throw a party.
We also should have been spending more money on maintaining existing infrastructure instead of squandering it on $3 million dollar streets to nowhere;
The next mayor of Sioux Falls could face some tough decisions unless sales tax revenues begin growing at a healthy pace by next year.
Even rosy revenue forecasts call for the city to use a generous amount of reserve funds over the next several years to keep up with growth in the city’s general operating fund, which pays for basic services such as public safety and snow plowing. A new mayor takes office next spring.
And Finance Director, Eugene ‘Montgomery Burns’ Rowenhorst wants to give his advice to the next mayor;
The city’s revenue forecasts call for a 4 percent rate of growth in sales taxes next year, and 6 percent each year following 2010. Absent that type of growth, city Finance Director Eugene Rowenhorst predicts the next mayor will be forced to find “expense controls.”
Kyle Helseth, deputy director of the Minnehaha County Equalization Department, notes that there is an upside to slower growth in building permits. The city would have to spend less on new streets and utilities.
the next mayor, who will be elected in April, could face the prospect of making painful cuts.
Remember when local economist Mark Weber warned Sioux Falls about the economy and preparing for the worse? Well guess what, they were not listening, once again;
Sales tax collections in Sioux Falls through July are down 0.4 percent from last year, causing some city councilors to worry that a projected sales tax growth of 4 percent in 2010 is too optimistic.
Eugene Rowenhorst, the city finance director, told the City Council during a budget hearing Monday that sales tax revenues did not grow at all in the first seven months of the year. The council originally had budgeted for a 6.5 percent increase this year, but that later was modified to a projected 2 percent increase.
It’s not like you couldn’t see this coming for months and months. It was pretty obvious that SF was not immune to the recession, but it doesn’t stop Eugene from spinning it even more;
But the fact that the tax revenue is down this far into the year has some councilors worried about next year. During the budget meeting, council member Kermit Staggers questioned why the 2010 proposed budget projects a 4 percent increase in sales tax.
Rowenhorst’s answer was that the economy is expected to improve by next year, and the 4 percent increase is a middle ground between the 2 percent growth that eventually was projected for 2009 and the historic 6 percent to 7 percent increase in sales tax receipts.
“We’re coming out of the recession and getting back to a more normal growth phase,” Rowenhorst said.
Sorry, Eugene, I have trouble taking the word of a man who basically ignored economic trends by not preparing for the worst. I believe Munson did not care what happened with the economy, it is his last year in office, and he had a legacy to build. How do you justify cutting the budget when you can ‘pretend’ everything is going to be fine down the road. I have often been told by many people that Munson is a positive man, and I believe that, but IMO, lying to yourself and the public to get what you want is very negative, very negative indeed. I have been saying it for years that Munson has put his priorities above the public’s best interest, and while McKennan Park residents will be enjoying a new $170,000 shitter and the Rhino’s at the zoo have a new shed to sleep in the rest of us and the next mayor are going to have to figure out how to fix this shortfall and overspending by Munson.
The first thing the next mayor needs to do on day one is fire Eugene and anyone who is loyal to him in the finance office, and employ someone who is in touch with reality.
l3wis