Revenues down as city council works on budget

Revenues down as city council works on budget by David Lias The Vermillion City Council has begun holding budget workshops to work on the city�s finances for the next year.

It�s a process that could be a bit more challenging this year than in recent years.

It appears that, according to information from the South Dakota Department of Revenue, total sales activity subject to being taxed by the city�s first and second penny sales tax was down significantly in certain economic categories in 1998 compared to 1997, especially in the area of wholesale taxable sales.

Total taxable sales in Vermillion in 1997 was $79,100,349. The total for 1998 taxable sales in the city is $77,284,531.

That�s a reduction of $1, 815,818.

According to a memo from City Finance Officer Mike Carlson to Vermillion City Council members, state Department of Revenue officials have concluded that 1997 sales were up from construction projects in the city.

A breakdown of economic activity in the community shows an increase in some sales areas in 1998 compared to 1997.

Those increases, however, aren�t enough to make up for losses in other areas.

In the category of agriculture, Vermillion taxable sales totaled $206,181 in 1997, compared to $205,302 for 1998 taxable sales. That�s a decrease of $879.

Taxable sales in mining also were down a total of $2,212, from $104,687 in 1997 to $102,475 in 1998.

Construction activity was up significantly, however, from $250,933 in 1997 to $505,116 in 1998.

There was an increase in manufacturing in Vermillion from 1997 to 1998. The �97 manufacturing taxable sales figure is $1,087,550. That jumped to $1,115,929 in 1998, an increase of $28,379.

Vermillion experienced a decrease in transportation taxable sales, from $10,046,750 in 1997 to 9,930,022 in 1998. That�s a decrease of $116,728.

The city�s biggest blow in sales tax collections comes in wholesale category. Wholesale taxable sales in Vermillion in 1997 totaled $8,538,750. In 1998, however, that figure tumbled to $5,088,982. Collections in this category decreased by $3,449,768.

Retail taxable sales in Vermillion increased in 1998. The total in this category for 1997 is $48,591,120. In 1998, the taxable sales total in this category was $49,227,330. That�s an increase of $632,210.

Vermillion�s finance taxable sales experienced growth from 1997 through 1998. Sales taxes in this category totaled $798,289 in �97, and grew to $976,797 in �98. That�s an increase of $178,508.

The service category in Vermillion also experienced significant growth. Taxable sales in this category totaled $9,470,416 in 1997. That total grew to $10,126,070 in 1998, showing a growth of $655,654 in taxable sales in this portion of the city�s economy.

Figures show slight growth in the city�s public administration category. It totaled $5,673 in 1997 and $6,508 in 1998 � an increase of $835.

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