By KAREN LA PIERRE
The city of Hays sales tax receipts have been relatively flat during the past three years, showing a slight decrease since 2012 -- which has city leaders puzzled about the cause.
In 2010, the sales tax receipts were $6,328,789. In 2011, they were $6,959,478; in 2012, $7,313,534, and in 2013, $7,302,200. Projections for 2014 indicate they will be slightly down.
"Just normal price inflation. If you kept sales the same, you would see revenues increase a little bit through inflation," said Toby Dougherty, Hays city manager. "Seeing the flattening trend indicates that there are less sales.
"As to cause, we haven't been able to put our finger on that at this point. When we look at sectors, there's no consistency. One month one sector is down, and the next month it will be up. There is really no long-term trend that says this is the sector that is dragging everything down."
The city manager has considered several factors that might be playing into the flattening sales tax.
"We had a pretty prolonged drought that we are not out of yet that could be playing into people's spending habits," he said. "When the weather becomes a little severe, people that depend on the weather, the farmers, they'll naturally tighten up a little bit.
"I think living in an ag community, everybody naturally tightens up a little bit even if it doesn't directly affect you."
Dougherty presented another possibility.
"Maybe wage growth hasn't really caught up," he said. "There's a lot of state agencies in town, like the school district and university, and if they have gotten raises, they haven't been very much. So, if their wages aren't increasing, they are probably not going to be spending a lot of money.
"I don't know how our wages compare over a trend overall with the cost of living. It is simply a matter of economics. I'm not an economist, but I have read studies that the Consumer Price Index isn't always entirely accurate because it doesn't take into account health care and certain things that are increasing than regular prices."
The economies of other communities in the area also affect Hays.
"We are a regional shopping center," Dougherty said. "We're consistently the No. 2 retail pull factor in the state. Fifty percent more people than live here shop here on a consistent basis."
In addition, he thought the frequent media stories about the disparity between the rich and every one else might play a role.
"We get bludgeoned with all this information that the only groups doing well are the wealthy and everybody else is just struggling to survive," he said. "Whether it's true or not, if you get hit with that enough, you're going to say, 'I better watch out where I spend my money.' "
Kim Rupp, Hays finance director, is the only person in the city who can actually look at the sales tax reports because there is confidential information about businesses.
Rupp was also puzzled by the decline.
"It does affect the budget," Rupp said. "We have to be careful in 2015 to try to project and guess as best we can."
The 2015 budget is projected based upon what city leaders think 2014 will end at.
The sales tax funds city services, parks, police, fire department, public works, buildings and grounds, the swimming pool and the sports complex.
The total sales tax in Hays is 8.4 percent, with variations for CIDs and TDDs. The city portion is 1.75 percent, the state receives 6.15 percent and the county gets 0.5 percent.
In good news, the 2013 numbers were higher than the 2010 numbers. In 2010, the total collection amount was $6,328,789.
"We're trying to keep our thumb on it and do a little trending to see what happens here in the next few months," Rupp said. "Certainly we have the capability to reel back in if we see it diving. We're keeping a sharp eye on it."