Projections show most municipalities will be looking at sales tax revenue shortfalls in the 20-40% range. The City of Scottsbluff is bracing for that reality when April’s numbers come in.
March was down 4.6%, according to information interim city manager Rick Kuckkahn presented to the city council Monday night. State sales tax figures are announced two months in arrears, so May’s reporting reflects March numbers.
“Next month, we’ll receive additional data from the state and try to focus in on what the impact will be,” Kuckkahn said.
Hotel occupation tax reports for April, reflecting March stays, were down 50%.
“Revenues for April and May are projected to be down approximately 90%,” Kuckkahn said. “That’s based on an informal poll we’ve done at local hotels, and I think it’s pretty obvious that is the case. There aren’t very many cars in the parking lots. This amounts to about $300,000 in our occupation tax.”
Fuel tax receipts in May were consistent with prior years. Kuckkahn said projections are for fuel tax revenues to be down about $200,000 from the projected $1.8 million.
Utility receivables remained strong for the month.
“Currently, past-due receivables are only 6.2% of our outstanding receivable balance,” Kuckkahn said. “Through April 30, our customers were keeping up with their utility payments, and I think that’s really good news. It indicates that our economy, while it may be affected, appears to be healthy enough to support payments of those bills.”
The city is currently not assessing late charges or implementing shut-offs for any non-payment of any of its utility services.
“Obviously, people have to wash their hands, they have to have water to do that,” Kuckkahn said. “To effect that billing at this point in our minds is not something that we need to be doing, but we’ll have to take a careful look at that down the road. We’re trying to be flexible.”
April electric use franchise fees from Nebraska Public Power District were up 7.16% compared to 2019 for Scottsbluff as opposed to figures statewide being off 8-12%. The city’s general fund receives approximately $2.7 million from NPPD franchise fees annually.
On the expense side, Kuckkahn has asked his department head to be especially frugal, even as the city nears the end of the budget cycle.
“At the end of the year, typically in many cases, cities find themselves purchasing things that are maybe 'nice-to-haves,'” Kuckkahn said. “There is a tendency to wait until the end of the year to purchase those kinds of things, and what I’ve told the department heads this year is, ‘Don’t. Save it.’ We’re trying to preserve all the cash we possibly can. We need to keep some dry powder here. We don’t know what’s going to happen down the road, so spend very carefully.
“It’s not a siege and we’re not hunkering down mentally. That stifles innovation and productivity. It creates panic and uncertainty, and that’s certainly not the intent here. We’re simply trying to preserve what we have in place.”
Kuckkahn said the city is currently working on issuing bonds for a chip-seal street project coming up this summer. He said there has been good news for the city from the bond underwriter.
“He’s reached out to potential buyers, and our bonds are very attractive, even at this time,” Kuckkahn said. “First of all, they are short-term, general obligation bonds, and we are in a very good financial position with very little outstanding debt. Our debt service fund is incredibly healthy. He said we should have no concerns about our ability to sell those bonds.”