Road work takes place Monday along U.S. 90 in the Bayou Vista-Berwick area. St. Mary Parish officials say construction on U.S. 90 may have helped contribute to an increase in sales and use tax collections in July, particularly for St. Mary’s hotel tax with workers staying in area hotels. (The Daily Review/Zachary Fitzgerald)
Sales tax collections surge in July
For the first time in many months, St. Mary Parish sales and use tax collections soared during July, rising over 28 percent from July 2016.
Though the bump in collections is a welcome sight nearly three years into the dip in oil prices, officials say they need to see a trend of a few months of climbing collections to be confident the area’s economy is improving. Also, much of the increase was due to several, large, one-time collections.
Parish sales tax collections totaled $3.53 million in July, a 28.5 percent increase from the $2.75 million collected in July 2016. Officials collected $82,142 as a result of financial audits during July compared to $8,777 collected in the same month of 2016. Excluding collections from audits, collections rose 25.9 percent.
Hotel tax collections rose substantially, too, going from $40,489 to $49,875, a 23.2 percent jump from July 2016 to July 2017.
“It feels good to report an increase for a change,” Parish Sales and Use Tax Director Jeff LaGrange said in an email.
But LaGrange is hesitant to say whether the spike in collections may indicate the start of an economic recovery.
Once he begins to see an upward trend of several months of collections, he’ll be more comfortable saying the economy is taking a turn for the better, he said.
In September 2016, the parish snapped a 22-month streak of continuously declining monthly total collections compared to the same month of the prior year. October 2016 started a new decline in sales tax collections, and that streak reached seven months.
“We enjoyed a nice surge in collections in July,” LaGrange said.
Over half of the increase was because of one-time tax payments. The sales and use tax department had a “very large” one-time payment from an industrial company and several other payments from industrial entities of $15,000 to $20,000 over the amounts each of those entities usually report, LaGrange said.
Most of those entities aren’t locally based companies but do business in St. Mary Parish, he said.
“Nonetheless, there were small increases in collections across the board in many business categories, and our audits produced a decent return as well,” LaGrange said.
Carrie Stansbury, executive director of Cajun Coast Visitors and Convention Bureau, said hotels have been doing and getting business with the construction and a “variety of different things going on around the area.”
Some workers who came into the parish to do road work on U.S. 90 stayed in area hotels, Stansbury said. There were also other construction projects that translated into increased hotel stays, she said.
The latest employment statistics were encouraging, too. In June, the parish’s workforce totaled 20,586 people, up from the May workforce of 20,389 people. In June 2016, St. Mary’s workforce included 22,586 people, according to a news release from the Louisiana Workforce Commission.
The number of people employed in St. Mary Parish rose from 18,547 in May to 18,744 in June, while the number of people unemployed remained the same at 1,842.
St. Mary Parish’s unemployment rate in June was 8.9 percent compared to May’s 9 percent unemployment rate. The June 2016 unemployment rate was 10.5 percent, the release stated.
Second-quarter sales and use tax collections totaled $9.03 million, a 2.5 percent increase from the $8.82 million collected in 2016’s second quarter. Without collections from financial audits, second quarter collections dipped 0.5 percent.
Officials collected $336,729 from audits in the second quarter compared to $78,410 collected during the second quarter of 2016.
St. Mary’s hotel tax accumulated $120,580 for the second quarter, a 3.1 percent decline from the $124,494 collected in 2016’s second quarter.
During July, Morgan City’s road royalty tax brought in $65,614 in net collections, bringing the seventh-month total collections for that tax to $508,359.
Municipalities issued the following occupational licenses in July: Morgan City, $7,870; Franklin, $1,152; St. Mary Parish, $837; Patterson, $323; Baldwin, $200; and Berwick, $66.