SIOUX FALLS, S.D. (AP) - Sioux Falls is preparing for a possible $1.2 million budget shortfall this year as city officials cut their spending plans in response to sluggish sales tax revenues.
March sales tax revenue growth for the city came in at 2.5 percent, less than the 4 percent increase projected when the 2017 budget was adopted, the Argus Leader (https://argusne.ws/2pGNev4 ) reported.
Sioux Falls finance director Tracy Turbak said if the rate stays the same throughout the year, the city will need to reduce the budget by $1.2 million to avoid using reserves to cover the gap.
“If that rate fell to zero, by the end of the year that would be a shortfall of about $2.7 million,” he said.
Turbak said the city’s 12 department directors are trying to counter the slow growth by looking for places in their budgets to cut expenses, including limiting overtime hours, use of part-time employees and reducing out-of-state travel. The only out-of-state travel being allowed for city staff are trips necessary to maintain professional certifications, though if in-state or online options are available, they go that route instead, Turbak said.
Turbak said Tuesday the directors expect economic indicators to worsen, with contingency plans prepared to reduce budgets by 5 percent. Details on the budget cuts were not provided.
“Two-point-five percent growth is not bad,” he said. “It’s not great but, by gosh, things could get a lot tougher.”
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Information from: Argus Leader, https://www.argusleader.com
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