Pandemic has cost Huntsville $15M-$20M in revenue

Updated: May. 20, 2020 at 8:47 PM CDT
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HUNTSVILLE, Ala. (WAFF) - $15 million to $20 millions lost in revenue for the city of Huntsville. That’s the estimated impact of the coronavirus on the Rocket City.

The biggest losses for the city have come from the liquor and lodging tax.

Less people in hotels also means less traveling and it kind of spirals from there.

“We are down by over 50 percent for the month of April, remittances that reflect March sales,” said chief financial officer Penny Smith.

A lot of businesses were closed for more than a month because of the pandemic. But you might be surprised to learn 50 percent of the city’s budget comes from sales tax, and employees at Huntsville City Hall say they have seen an increase for the month of March even during the pandemic.

“We were up just very slightly on sales tax and that’s a good thing,” said Huntsville Councilwoman Jennie Robinson.

While restaurants went to curbside pickup and less people ordered, some stores saw long lines and broken records.

“The very slight increase came from grocery stores and home improvement stores. People were home so they were cooking at home and they were doing projects at home and they were cleaning up the yards, and that reflected very well for us in the slight increase in sales tax,” said Robinson.

But some tax revenue is taking a hit. Liquor and lodging taxes stick out with a loss of about 50 percent.

Right now, lost revenue is upwards of $15 million to $20 million, and some programs are being forced to make big decisions.

“Those funds support a lot of our agencies that we see arts and culture in our city from the Von Braun Civic Center to the art museum, etc,” said Smith.

Training, travel, fleet expenditures, some hiring decisions, those all have been suspended.

Robinson chairs the city finance committee. She says the next meeting to discuss next year’s budget will be in July.

She says there are no plans to cancel projects already announced.

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