March sales tax bonanza surprises city of Hot Springs - Hot Springs Sentinel

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The city did a double take when it received March collections of its 1% general fund sales tax from the state revenue agency earlier this week.

The $1,580,011 payment was $383,628, or 32.07%, more than the previous March, when the local economy was beginning to feel the effects of the coronavirus pandemic. But the full effect wasn't borne until April, when collections fell $206,846, or 15.91%, from the previous April.

March 2020 collections trailed March 2019 by $13,162, or 1.09%, and were $68,834, or 5.44%, short of the 2020 general fund budget's monthly revenue forecast. So the windfall the city received earlier this week is relative to a period when headwinds from public health directives and changing consumer patterns had yet to take full effect on the retail and service sectors of the economy.

March 2021 collections surpassed 2019 and 2018 by $370,466, or 30.62%, and $281,803, or 21.66%.

"After putting this number in my spreadsheet, I went back and checked it at least two times, so this is the number that came back from the state," Finance Director/Treasurer Dorethea Yates said in an email to the Hot Springs Board of Directors and local business leaders. "Things were hopping downtown in March with spring break and things starting to get back to normal, but this is a big number. We'll take it."

March collections beat the city's revenue forecast by $248,458, or 18.66%, putting the $3,837,441 collected during the first quarter $307,890, or 8.72%, ahead of first quarter revenue projected by the 2021 general fund budget. First quarter collections outpaced 2020 by $428,958, or 12.59%.

The 2021 general fund budget projected $15,070,541 in revenue from the 1% sales tax. The tax collected $14,960,641 last year, a $700,573, or 4.91%, increase from 2019.

March collections of the 3% sales tax the Hot Springs Advertising and Promotion Commission levies on prepared food and lodging in the city were up $380,423, or 101.51%, compared to the previous March. The $755,187 the tax collected in March surpassed 2018 and 2019 by $81,274, or 12.10% and $67,524, or 9.82%

The U.S. Bureau of Labor Statistics' preliminary jobs report for April showed the Hot Springs Metropolitan Statistical Area gained jobs for the first time since March 2020. The local economy gained 5,100 jobs compared to the previous April, when the number of jobs fell by 6,800, or 16.91%, compared to April 2019.

The 38,500 jobs reported in April trailed 2018 by 1,000 jobs, or 2.53%, and 2019 by 1,700 jobs, or 4.24%.

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