Macon-Bibb County officials arent legally required to cut their current or upcoming annual budgets, but shrinking sales tax receipts and an expected drop in property taxes will force major belt-tightening anyway.
For the second year in a row, receipts from the 1 percent local option sales tax, or LOST, which fuels the Macon-Bibb County general fund, are down substantially. Thats separate from the additional 1 percent special purpose local option sales tax, or SPLOST, that voters approved in November 2011.
By the start of 2014, sales tax receipts to the general fund were down $3.6 million from the same time last year, with six months left in the fiscal year, according to figures from Megan McMahon in the Macon-Bibb County Finance Department.
That will impact the next budget, which is now starting to be developed, but it probably wont require last-minute cutbacks like a similar decline last year, said County Manager Dale Walker via email.
Well probably ride it through to the end of the year, he said.
Local shoppers pay 7 percent sales tax altogether, of which 4 percent goes to the state and 1 percent to Bibb County schools, McMahon said. Another 1 percent goes to the Macon-Bibb County governments general fund, and the final 1 percent is the special purpose local option sales tax that voters approved in 2011, McMahon said.
A decline of $3.6 million in the 1 percent that goes to the Macon-Bibb general fund indicates that SPLOST revenue, school taxes and state revenue will decline as well -- for a total drop of about $25 million, though the bulk of that loss will be to state coffers.
A comparable drop in the previous years city receipts led Walker and Mayor Robert Reichert to freeze hiring and major purchases during the first half of 2013.
In calendar year 2012, Macon and Bibb County together collected $31.2 million for their general funds from the 1 percent LOST, McMahon said. In 2013, that fell to $27.6 million -- a decline of about 12 percent.
Weve got some holes to fill, and thats one of them, said Gary Bechtel, the newly chosen chairman of the Macon-Bibb County governments Operations & Finance Committee.
Bechtel, whose committee will soon review the staff-prepared budget which must be passed by the commission by June 30, said he was surprised that sales tax numbers were down again.
It just makes our job of balancing this budget that much more difficult, he said.
And there will be an even bigger hole in the upcoming budget: the loss of about $19 million in city property tax income, which Bechtel said finance officials have told him will come during the next fiscal year.
Homeowners in the city are expecting a property tax decrease, because the city property tax ... was done away with due to consolidation, he said. Were going to have to do some considerable thinking about where we go long term.
Walker said its a tough job to combine the former city and county government budgets; as jobs and offices are still reshuffling -- some major personnel decisions will wait until the end of March -- its hard to nail down exactly what theyve got to work with.
We are working on revenue projections for the next fiscal year, he said. Once we get those numbers, we can have a clearer picture.
It will be a tough job to select priorities for spending in the general fund, capital projects and SPLOST work, but commissioners are already working with Walker and finance staff, Bechtel said. As for where to cut in compensation for tax revenue losses, Bechtel said he has all the confidence in the world that city-county staff will have solid proposals by the start of May.
We know its a priority. We know the budget staff ... (are) working on this, but we havent had any updates on their progress as of yet, he said.
Telegraph writer Wayne Crenshaw contributed to this report. To contact writer Jim Gaines, call 744-4489.