Lawrence sales tax collections still up for 2015, but beginning to slump to close out the year
Lawrence sales tax collections are a bit like the Kansas City Royals these days: They’re still in good shape, but concern is starting to grow that I shouldn’t have ordered 150 pounds of bean dip for the World Series party. In other words, both are in a bit of a slump.
The latest report from the Kansas Department of Revenue shows that Lawrence’s sales tax collections for the year are still 4.2 percent above last year’s collections at this point in time. But the report shows that most of that growth came early in the year, and now sales tax collections are coming in slightly behind last year’s total. For the August reporting period, the city’s sales tax collections were down 1 percent.
A slight drop in sales tax revenue for a single month isn’t that concerning. But what is more noteworthy is that city officials are continuing to express some concern that the 2015 sales tax total may fall short of budget. The city staff had been projecting that sales tax revenues would grow by 5 percent over 2014 totals. Staff members are now not confident such growth will occur.
“Our 5 percent revised budget doesn’t appear as conservative as we once thought,” staff of the city’s finance department wrote in a memo to the city manager’s office. “Staff will continue to monitor sales and recommend adjustments to the budget if it appears projections through 2015 continue to drop below the the 5 percent revised budget amount for the year.”
As we previously have reported, the city may find itself making some spending adjustments in 2015, in part because it wants to enter 2016 with a certain amount of cash reserves. If sales tax grows less than expected in 2015, that means sales tax collection in 2016 will have to grow more than expected in order to meet their budgeted amount.
We’ll see how the rest of the year goes. This most recent report was for the August period, but because of a lag in the sales tax reporting process, the report reflects purchases that were made in the mid-May to mid-June time period. Lawrence traditionally sees a spike in sales tax collections when students and their families prepare to return back to school. When the state issues its next couple of reports, we’ll know how big of a bump the city got this year from back-to-school activity.
As for how Lawrence compares to other large retail communities, it is a bit of a mixed bag. The latest report shows that Lawrence is lagging while several other communities are picking up steam. Of the eight major retail markets we track, only Sedgwick County posted a decline of more than 1 percent (down 1.7 percent) for the August period. Johnson County, on the other hand, posted a 1.4 percent gain in August, and Topeka was up 0.5 percent. Manhattan was up 1.1 percent and Salina up 1.9 percent.
But when you look at the year-to-date numbers, Lawrence is still doing well, thanks in part to a very hot start at the beginning of the year. Here’s a look at how Lawrence’s year-to-date growth rate of 4.2 percent stacks up to several of the other large retail centers in the state:
• Johnson County: up 1.3 percent
• Kansas City: up 3.9 percent
• Lenexa: up 4.1 percent
• Manhattan: up 2.4 percent
• Overland Park: down 1.9 percent
• Salina: up 3 percent
• Sedgwick County: up 1.7 percent
• Topeka: up 0.8 percent
On that list, Lawrence is still having the best year of any of the other retail areas.
So, maybe the bean dip order will be all right after all. But I’ve become convinced that I definitely should not have practiced the championship celebration in the living room — at least not with Gatorade that didn’t match the carpet.






