Leader Blues

Tuesday, November 18, 2008

TOP STORY > >Tax collections above projections

Leader staff writer

Jacksonville will take in almost $200,000 more than it projected in taxes for the city’s advertising and promotion commission by the end of the year.

The recession has not hit the city’s restaurants or motels based on the latest tax-collection figures presented at the Jacksonville Advertising and Promotion Commission meeting Monday night.

City Finance Director Paul Mushrush had predicted that the two-cent hotel-room tax, along with the two-cent prepared-foods or hamburger tax would bring in $619,900 during 2008 for the commission to use on marketing, advertising and events that promote the city. Now, the tax collections are predicted to hit $808,500.

Mushrush told commissioners that the next few months will be very interesting. “We usually get a big decline in hotel receipts the last quarter of the year,” he said.

“But the September take was strong, and the October figures, with the air base open house, should also be strong,” Mushrush explained.

He said just about every month in 2008 has been a record setter for the hotel-room tax.
The 2 percent hotel- room tax has been collected since 2005, but the prepared food tax, also known as the hamburger tax, is still in its first year.

For September, the latest month available, the hotel-room tax brought in more than $9,800 and the 2 percent hamburger tax brought in more than $62,500.

Based on restaurant-tax collections, Chili’s Grill and Bar has taken in more than $3 million in annual sales. The three McDonald’s combined have taken in more than $2.5 million so far this year and Western Sizzlin comes in at $1.6 million.

A two-cent tax from just those restaurants comes to $142,000 a year.

Restaurants doing about $1 million in gross sales include New China, both Sonics, Taco Bell and Wendy’s.

Those that have brought in about $500,000 to $900,000 in gross receipts include Chicken Country, KFC, Little Caesar’s, Mexico Chiquito, Papa John’s Pizza, Papitos Loco Club, Pizza Hut, Popeye’s Chicken, Rally’s, Crooked Hook Catfish Restaurant, Burger King, Starbuck’s, Subway, Arby’s, Cici’s Pizza, Waffle House and Wal-Mart Supercenter.

Even though the tax numbers don’t show it yet, Mushrush is worried about the recession.

“A recession affects discretionary income, which is your hotels and restaurants,” the finance director said.

With that in mind, he presented what he called a conservative rough-draft budget for 2009, calling for revenues to come in at $810,000, well above this year’s original projections.

The parks and recreation department, by ordinance, gets 50 percent of whatever comes in. That would leave about $400,000 for the commission to pay its advertising and marketing agency, the Sells Agency, and to fund a variety of special projects.

Commission chairman Mar-shall Smith expects the commission to spend about $150,000 with the Little Rock agency.

Take away other administrative expenses, and that leaves about $200,000 for projects and activities, such as the military museum, Wing Ding, the Patriotic Spectacular, Reed’s Bridge Civil War Battlefield Park, Keep Jacksonville Beautiful and other projects.

The commission will finalize its 2009 budget at its Dec. 15 meeting and that will allow commissioners to see another month of tax collections and also give the Sells Agency an opportunity to present marketing ideas for next year.

So far this year, the agency designed a new logo for the city, “Soaring Higher,” rented billboards south and north of the city to promote various activities, event and images.

Currently, the billboards push the fact that the city has 10 hotels and 60 restaurants.