City’s income tax decline lessening
YOUNGSTOWN — The city is showing slow signs of an economic recovery after seeing its income tax collections plummet during the early part of the COVID-19 pandemic.
The city’s income tax collection for July was $88,000 below its projections for that month, Kyle Miasek, interim finance director, said Tuesday.
The city received $3,477,000 when it had budgeted $3,565,000 for the month, he said.
Miasek had anticipated collections to be about $200,000 to $225,000 short for July and every other month for the rest of this year.
“It points to a solid leveling out of below expectations, but not as severe as” earlier this year, he said. “We just haven’t fully recovered, but we are definitely moving in the right direction.”
The July income tax collections were reported Tuesday. Those payments were made this month with businesses having 30 days to give the taxes to the city.
The city’s collections for June were the first month since January that exceeded projections.
The city collected $3,776,200 in June when it budgeted $3.73 million. But Miasek acknowledged the city did better than budgeted because most individual annual income tax filings, which were moved from an April 15 deadline to July 15 — just as it was for state and federal filings — came in by June 30.
Without that revenue, the city would have been $275,000 short of its projections for June, he said.
But the city is showing signs of recovering from the pandemic. For example, the city was $689,000 under projections in March and $904,500 under budget in April.
The city’s income tax is currently $1,990,000, or 5.6 percent, under budget.
Through the end of July, the city has collected $33,580,000 when it had budgeted $35,570,000 for that time.
The 2.75 percent income tax raised $46,664,000 last year and was budgeted to bring in $46,214,000 this year.
The city could finish with about $2.5 million less in income tax than budgeted.
The city’s general budget — and the funds it subsidies including police and fire — will soon be in better shape because of $2,922,024 the city is receiving in federal COVID-19 relief funds, he said.
Miasek is reviewing the city’s payroll and other expenses to determine how much of that money will reimburse the general fund for COVID-19 costs.
About 15 to 20 percent of salaries of several departments, and about all of the health department’s expenses, went toward COVID-19-related expenses and the federal money will be used to offset that, he said.
Also, he anticipates an additional $2,359,224 in federal COVID-19 funds to be awarded to the city to pay for expenses related to the virus, which Miasek said is largely responsible for Youngstown’s struggling financial situation.
The city also will use a workers’ compensation premium refund to help the general fund, he said. The city received a $700,000 refund with $500,000 for workers paid through the general fund and the rest for water, wastewater and environmental sanitation workers.
The general fund also saved about $200,000 to $300,000 as a result of employee furloughs between late May and late July.