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Hoover finance director reports modest revenue growth; lodging tax lags year-to-date
Summary
City finance staff reported sales-and-use-tax and online marketplace (SSUT) collections are up year-to-date through the seventh period, while lodging tax lags slightly behind the portion of the fiscal year elapsed. Staff attributed April SSUT weakness to a marketplace settlement omission that ADOR later confirmed.
City finance staff gave the Hoover City Council an update on revenues through the seventh accounting period of the fiscal year, saying overall collections show modest growth but that some categories display volatility month to month.
Presenting the report, Miss Cornett said sales-and-use tax and the state-collected marketplace facilitator tax (SSUT) are the city's largest revenue streams and that combined they are up about 3.5% for the first seven months compared with the prior year. "Sales and use is up 2.8% ... SSUT is up 12.5% for the first 7 months," she said, adding that combined they are a little over 3.5% above the previous year-to-date.
Cornett noted lodging tax collections lag the portion of the fiscal year elapsed: "We are 58% of the way through the year and there is one revenue item, it's the lodging tax that lags behind that at 53%." She also explained an April SSUT drop of almost 3% was due to a major marketplace facilitator being omitted from the April settlement; the Alabama Department of Revenue confirmed the omission and Cornett said SSUT settlements are typically reported about two months behind the sales activity they reflect.
Other itemized notes from the presentation: real-property taxes showed large month-to-month variability (one April comparison was up 43% year-over-year but Cornett cautioned monthly comparisons can be misleading), license and permit revenues were essentially flat year-to-date, gross receipts and franchise taxes were up about 3.1% for the first seven months, and some license revenues might increase after second reminder notices issued in April.
Councilors asked no substantive questions during the presentation; Cornett concluded the city's near-term revenue picture showed positive trends overall but with notable variability in several categories.
