Towns in Warren County continue to see sales tax incomes that outpace conservative estimates set six to 12 months ago during ongoing concerns for the economic impact of COVID-19.

Warrenton city finance officer Dana Belaska told city leaders this month that a surplus of sales tax revenue propelled significantly better financial performance over the past year compared to what was predicted for Warrenton’s 2020-2021 budget. 

According to a financial report provided to the city’s board of aldermen on Aug. 3, Warrenton took in almost $2.9 million in sales taxes for its general operating fund between July 2020 and June 2021. Sales taxes were $316,000 more than what was predicted in the July 2020 budget.

“We budgeted very conservatively with COVID concerns this past year, and we ended up a little better than we thought we would,” Belaska commented.

When asked how that unexpected funding might affect city operations, Warrenton City Administrator Brandie Walters said it’s helping to patch holes in other parts of the city’s revenue that were deeply affected by COVID.

“The increase in sales tax is helping to offset the reduced court and police fines, pool receipts and other reduced revenue during the year,” Walters said. 

Throughout much of the pandemic, the municipal court system where cities can assess fines for things like traffic violations was shut down, and Warrenton maintained tight occupancy limits at its aquatic center. Revenue from both those sources is normally used to offset some of the city’s operating costs.

In neighboring Wright City, Administrator Jim Schuchmann said booming sales taxes won’t necessarily change the city government’s spending. Although Wright City is in the midst of several large street and facility projects, the town already had a significant cash reserve to pay for those projects.

Still, Wright City’s sales tax collections as of July are about 15 percent higher than expected for this time of year, Schuchmann said. He speculated that the strong performance of local sales tax might show that COVID had the opposite impact to what was forecasted. 

In normal times, a lot of Warren County residents commute to work in other counties, Schuchmann said. That means they often bought anything from gas to groceries in outside areas as well. But with many people working from home, that spending stays local.

“They end up buying that hamburger at lunch time here locally, they buy that coffee here, they buy their items for dinner here. I think that was a huge part of it, the fact that people were spending time here in the county as opposed to leaving,” Schuchmann explained.

Eventually those trends are going to go back to normal, so Schuchmann said city leaders should be a little pessimistic about future tax revenue. But with continued population growth in the area, he also predicts taxes won’t take a sharp enough drop to affect the city’s budget.

Even the smaller towns of Marthasville and Truesdale showed better-than-expected sales tax collections over the last year. According to Marthasville budget documents published in June, the city’s sales tax funds for streets and capital improvements took in $25,000 more than expected. Information from Truesdale shows a similar surplus.

Although Truesdale is less dependent on sales taxes for its budget, City Administrator MaryLou Rainwater said the strong financial performance will buoy the city’s new sales tax fund for street projects. She said COVID’s biggest financial impact on the city so far has been on the cost and available of supplies for Truesdale’s ongoing facility projects.