Auto sales bolster county tax receipts

10/20/2005

Robb Brown said there's no question the auto industry did its part to bolster Lucas County's sales tax collections. By how much, he's not quite sure.

The executive vice president of Brown Motor Sales Co., Mr. Brown said the industry has experienced record sales over the last three or four years.

Those numbers, as well as an overall growth in sales, are being reflected at the county's budget office.

To date, the county has collected about $60 million this year in sales tax - higher than the $57.9 million collected this time last year and the $55.3 million collected in 2003.

"There's no question there have been some very aggressive marketing campaigns by the [auto] companies," Mr. Brown said. "That probably has fueled some of these record years."

Sales tax revenue makes up slightly more than half of the county's $135 million general operating fund budget. It is the most volatile of the county's revenues because, unlike property taxes, it can fluctuate dramatically based on how much people spend.

In Lucas County, the sales tax is 6.75 percent - the county's share is 1.25 percent.

John Zeitler, the county's budget chief, said eight of the last nine months have shown sales tax revenue coming in higher than projected. If the trend continues, he said the county will collect $2.5 million more this year than was projected.

Although taxpayers apparently are doing their part to bring money into the county's coffers, they won't see a return in the form of tax breaks or additional services. Instead, the county plans to use the unexpected money to balance its budget without pulling as much from its reserves.

Instead of using $3 million from the $25.4 million county reserve fund, only about $1 million would be needed, Mr. Zeitler said.

County Commissioner Pete Gerken said 2005 has been "a year of coming back." But he remains cautious because even though sales tax collections are up, so are other costs, such as the county's energy bills.

"You look at a strong sales tax, that's great. But our costs are rising as well," he said. "It's almost addition by subtraction here. You add the number on one hand, but you subtract on the other."

Contact Erica Blake at:

eblake@theblade.com

or 419-724-6076.