Lawrence sales tax collections fall in latest month; totals for year just slightly above 2017

photo by: Nick Krug

A cashier hands a receipt back to a customer after a purchase at Lawrence's Sunflower Outdoor and Bike Shop in this file photo from July 6, 2017.

Maybe you were glued to the TV watching all the political advertisements. Maybe you were pondering whether the key to life is periodically stating your name and saying “and I support this message.” Whatever you were doing, it appears you didn’t spend October shopping and spending your money. The latest sales tax numbers show spending levels fell in Lawrence and elsewhere as campaign season came to a close.

The city of Lawrence recently received its November sales tax check from the state, which was for taxes collected largely during October. Monthly sales were down 2.6 percent compared to the same month a year ago. While not good, that performance was better than in many other markets. Overland Park saw a drop of 4.5 percent for the month, Topeka was down 4.6 percent and Kansas City, Kan., was off 6.3 percent.

The decline puts Lawrence in more jeopardy of falling short of its sales tax projections for the 2018 budget. City officials haven’t put out a new report for November, but last month’s report showed that the city’s general fund was on pace to fall about 1 percent — or about $300,000 — short of its budgeted amount for sales and use taxes. This latest report likely won’t help the matter.

For the year, Lawrence has seen sales tax growth of 1 percent compared to the same period a year ago. If you are having trouble following along, that means Lawrence has seen sales tax growth, but it hasn’t been as robust as city budget-makers had projected.

Indeed, 2018 has been the year where shoppers have tapped on the brakes a bit. At 1 percent growth, that is less than the rate of inflation, meaning increased tax collections may be coming from a rise in prices rather than more people buying more stuff. The 1 percent level is far below the growth rates of the past several years. From 2014 to 2016, Lawrence averaged sales tax growth of more than 4.5 percent. Last year, sales tax growth began to slow some, but still finished at a respectable 2.2 percent.

While Lawrence sales tax collections have grown 1 percent for the year, it is worth noting that a good part of that growth came in the first half of the year. Since July, Lawrence’s sales tax collections have grown only by 0.3 percent. That may be a trend to keep an eye on for 2019.

Here’s a look at how Lawrence’s 2018 sales tax collections compare to several other major retail markets in the state:

• Lenexa: up 11.2 percent

• Overland Park: up 4.5 percent

• Kansas City, Kan.: up 3.0 percent

• Olathe: up 2.5 percent

• Sedgwick County (Wichita): up 2.8 percent

• Shawnee: up 1.8 percent

• Topeka: up 1.5 percent

• Lawrence: up 1.0 percent

• Salina: up 0.8 percent

• Riley County (Manhattan): up 0.1 percent

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