Charleston $800K short in its budget
CHARLESTON, W.Va. -- The city of Charleston is starting off the new year with $800,000 less in revenue than projected.
City Finance Director Joe Estep reported a $500,000 shortage in October. The city wasn't able to close that gap as business and occupation tax collections fell short by $300,000 last quarter.
"It's a hit," Estep said. "There's no question about it
The city generally estimates a 3-percent to 3.5-percent growth in B&O revenue, but the first six months of this fiscal year show an increase of only 6/10 of 1 percent. That's about $115,000, Estep said.
These latest business collections are from July, August and September, so the holiday season isn't represented.
A full analysis of B&O revenue should show where the deficit lies -- it could be in one area or across the board -- but those numbers won't be available for a few weeks.
"We're only one day beyond the period of collections," Estep said of the recently closed quarter.
B&O taxes are paid by individuals and entities that do business in the city. Those funds make up about half of Charleston's $87 million budget.
As of Jan. 1, the city no longer is collecting the manufacturing portion of the B&O tax, which brought in about $350,000 annually, according to Estep. The elimination was approved at the same time as the city's 0.5 percent sales tax, which was implemented in October.
Revenue from the new sales tax is set aside to pay for upgrades to the Charleston Civic Center.
It is unclear if the downturn will be made up by another revenue stream.
"Maybe it'll rebound," Estep said, "but if it's clear it's not going to, I think we really have to start getting our ducks in a row about how we can finish the year on a positive basis."
Reach Rachel Molenda at email@example.com or 304-348-5102.