The city of Cordell closed out calendar year 2020 with solid sales and use tax numbers and is well on its way to meeting projections for its 2021 budget year.
The city’s budget year runs July through June.
Each tax was only down in one month (December for sales and November for use) when compared to the prior year, said JC Moser, city administrator.
“The sales tax revenue for the city is doing very good this year,” Moser said.
The city collected almost $490K in sales tax from July through January, up from $462K in 2020. That represents an increase of about 6 percent. That increase would have been better, but collections for the month of
December were down city about $6K.
In November, the city’s use tax was down only $387.50 from prior year. At the same time, total use tax collections was up almost $17K from prior year. The collected $44K more in combined sales/ use tax than in 2019, and 2019 was the biggest collections the city had in the past four years, Moser said.
The biggest contributor to the use tax numbers has been online shopping from home, he said.
“When something is bought and delivered to a Cordell address, the sales tax is paid to Cordell. So when people shop online and have it delivered via US mail, UPS or Fed Ex, the city of Cordell gets their portion of the sales tax. When someone goes to an out of town store and shops, the other town gets the sales tax,” Moser said.
The sales and use tax are important to the city’s bottom line.
The city’s general fund relies on the sales and use tax for about 58 percent of its budget income.
That money covers expenses from police, fire, ambulance, parks, streets and swimming pool, Moser said.
Many residents may not know that the state of Oklahoma is the only state in the United States to make its cities rely solely on sales/use taxes for their revenue stream, Moser said.
“Other states have other sources of income to help supply the funds to operate these various departments where Oklahoma only allows sales and use tax,” Moser said. “Most other states allow the cities to use a portion of property taxes or income taxes, but Oklahoma does not allow that option unless the voters of the cities vote to allow a property (ad valorem) tax for a specific project.”
Moser said an example of this would be if Cordell asked voters to replace all the curbs in the city. If that vote passed, the cost of that project would be added to homeowners’ yearly property taxes until it was paid for.
“Sales tax is very vital for the city if we want the police, fire, ambulance, parks, streets and swimming pool to operate in our city,” Moser said. “Shop at home when possible to support the local businesses that are working hard to keep their doors open and support the departments of the city. If you need to shop elsewhere, do it online so the tax will come back to our city.”