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Published: Monday, 2/17/2003

November sales tax revenue plummets

BY DALE EMcH
BLADE STAFF WRITER

Two weeks after passing a conservative annual budget, the Lucas County commissioners are in the hole by $513,000.

The deficit is the result of a dip in sales tax receipts from November that showed up only this month. That amount is $677,000 less than sales tax receipts were for November, 2001.

John Zeitler, the county's budget chief, said the low collections dealt a blow. He said the county didn't count on sales-tax growth this year, but the budget didn't anticipate losses.

“It's only the second month of the year, but it was a devastatingly low month,” Mr. Zeitler said. “We haven't hit the Christmas collections yet, so we'll have to wait and see what happens.”

Sales tax figures aren't reported to counties until a few months after they're collected.

Their fluctuations make them the most uncertain part of the county budget. Sales tax revenue accounts for about 53 percent of the county's $137 million general fund.

Mr. Zeitler said low collections for one month won't trigger a revamping of the budget.

He said he won't suggest any adjustments until the end of April because he needs more information.

“That way you can start to see a trend,” he said. “You need a couple months to see a pattern.”

Harry Barlos, president of the commissioners, said he's concerned that a dip in sales tax revenue could be made worse by cuts in money the state government returns to the county.

Gov. Bob Taft plans to cut $30 million in local government spending to help offset a $720 million deficit this fiscal year. If approved by the legislature, the county estimates it will lose $215,000 this year.

“The county has projected a zero-growth budget,” Mr. Barlos said. “And after the first two months we're already $513,000 in the red.”

Sales taxes generated about $5.9 million for Lucas County in November, 2001. In November, 2002, the collections dropped nearly 12 percent to about $5.2 million. Mr. Zeitler said the 2002 figure is lower than the $5.4 million the county collected in 1997.

Commissioner Tina Skeldon Wozniak said she wants to wait until more information comes in before the county board talks about adjusting the budget.

“I'm glad we were conservative [on the annual budget],” Ms. Wozniak said. “We may have a lower bottom line than we anticipated.”

Mr. Zeitler doesn't know why the sales tax dipped. He said people could have been waiting for Christmas sales before they hit the stores last year. He plans to contact budget managers in other large counties this week to see whether they had a similar drop.

There may not be much of a rebound next month when the December figures are reported. Doug Putnam, research and information manager for the County Commissioners Association of Ohio, said Christmas sales lagged.

“The state sales tax revenues that came in weren't good,” Mr. Putnam said. “People were hoping for a big Christmas season to bolster the sales tax performance and that didn't happen. . . . The bottom just fell out toward the end of the year.”

Commissioner Maggie Thurber was out of town and unavailable for comment.



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