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DISCUSSION OF MAJOR REVENUES <br /> <br /> Property Taxes <br /> <br />The City has received only unsecured property tax dollars to date <br />from the County. These receipts are about $75,000 under target <br />with projections. <br /> <br />Secured and supplemental property tax dollars will not be received <br />until later this fiscal year. When the original property tax <br />projections were prepared, staff used estimates of assessed value <br />made by the County in April 1994. Staff was notified of the actual <br />assessed values in August (1994). However, the County does not <br />generally provide us with an estimate of delinquency rates and <br />supplemental taxes until February (1995). Therefore, staff will <br />update the projections again at Midyear. <br /> <br />Sales Tax <br /> <br />Sales tax revenues in the first quarter of 1994-95 are comparable <br />to the same quarter in 1993-94. However, the second quarter, the <br />Christmas quarter, is the critical quarter when about 1/3 of the <br />annual tax is collected. The City won't receive a final accounting <br />from the State until March 1995 for the Christmas quarter. <br />However, from newspaper accounts, this was a good retail season for <br />this area. Sales tax revenues exceeded projections by $475,000 <br />last year, some of which should be sustainable. Therefore, staff <br />believes the 1994-95 projections need to be amended, but would <br />recommend that we wait until midyear, when more information is <br />available. <br /> <br />Appendix F contains some sales tax trend information and a letter <br />from the City's contract sales tax auditor. As the auditor <br />indicates, much of the City's sales tax revenue comes from <br />"business to business" transactions. These types of transactions <br />are very volatile, and therefore hard to project. Therefore, sales <br />tax revenue projections will continue to require close analysis <br />each quarter. Staff will continue to update Council when more <br />information becomes available. <br /> <br />Hotel/Motel Tax <br /> <br />The first quarter hotel/motel taxes are not due until the end of <br />October, so no revenue had been received by September 30. However, <br />looking ahead to October receipts, the City received $472,000 for <br />the first quarter, compared to $429,000 for the same quarter a year <br />ago. Staff recommends that we not make any adjustments to <br />projections until at least midyear. If the upward trend continues, <br />the revenue projection may need to be increased. <br /> <br />SR95:26 <br /> 3 <br /> <br /> <br />