Columbia braces for leaner budget, decreased sales tax revenue

Columbia City Manager Mike Matthes is projecting a difficult fiscal year ahead for the city.

Despite being one of Missouri’s fastest-growing cities, according to Matthes, Columbia is expected to lose an additional $931,000 in sales tax revenue in fiscal 2019, due in large part to increased online retail driving a loss in sales tax revenue.

The U.S. Supreme Court ruled in June that states can decide whether to charge tax on internet sales, which Matthes has said would help Columbia. He also has expressed hope that Columbia can become less reliant on sales tax and generate more revenue by increasing property taxes.

Matthes’ proposed budget for Columbia’s new fiscal year, which begins Oct. 1, projects total spending of about $453 million, a 1.9 percent drop from this year. The budget forecasts revenue of about $432 million, a 1.1 percent decrease.

Under Matthes’ proposal, Columbia residents are likely to see increased utility rates and less public transportation. On average, utility rates would raise by about $2.93 a month per customer under the proposed budget, and public bus services would end an hour early on weekdays.

But city employees would see a pay increase under the new budget. Since every city department is 30 percent under-staffed, Matthes said, he proposed a 25 cent citywide pay increase for city employees, and an extra official paid holiday after Thanksgiving.

Read more: Columbia Missourian


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