Feb 042015

By Naomi Hatch

Snowflake Finance Director Brian Richards made his quarterly report to the town council Jan. 27, noting that, “Government accounting is a little different than normal accounting in the private sector.”

He gave a brief overview of governmental accounting, then reviewed the trend so council members could see where the town has been and where it is headed regarding revenues.

General fund revenues from December 2011 to December 2014 reflect a trend of collection of sales tax, grants, fines and fees up approximately $90,000 more by Dec. 31, 2014, than the previous year at that time.

“We’re looking good as far as budget-wise,” said Richards, noting that total revenue is up seven percent from the previous year.

Total expenditures through that period were lower by 9.7 percent. “I don’t see any alarms, except for the golf course; we ought to be cognizant of that,” he said.

“The League of Arizona Cities and Towns is our friend,” said Richards, noting that each year the league provides information that tells a little about Arizona state shared revenues budget estimates, explaining that these funds are distributed based on population.

State shared revenues come from vehicle license tax, the Highway User Revenue Fund (HURF) and state sales tax, which is approximately 4.6 percent higher than the estimated amount that was given in the report last year, but may be subject to revision later in the year.

Snowflake had a population of 5,590 in the 2010 Census. The league estimates Snowflake will receive $305,152 from vehicle license tax, $668,503 from HURF, $505,103 from sales tax and $676,664 from state income tax.

“We don’t have any control over state shared revenues unless the population increases,” said Richards. “What we do have control over is city sales tax.”

Richards gathered information that shows Snowflake’s economy in relation to its peers regarding city sales tax collected.

He explained that 25 of the 91 cities and towns in Arizona have a population between 4,000 and 11,000, and he had statistics on them. Snowflake ranks 13th and Taylor ranks 24th among those 25. In Navajo County, Snowflake ranks fifth and Taylor, sixth, in city sales tax.

Snowflake collects $965,144 in city sales tax compared to $9,875,444 collected in Show Low, which ranks first in the county and third in the state. Taylor collects $635,675 in sales tax.

“This is just to show you economically where we’re at on the food chain,” said Richards. “We do the best we can with what we have. It’s not doom and gloom, just for reference.”

“I appreciate the comparisons with the other communities,” said Town Manager Paul Watson. “I think it’s important for the council and community to recognize the restrictions we’re under financially.

“Of those that collect a much higher sales tax than we do, most do not have fire services that they provide, as well. Snowflake is called a full-service community; we provide all the services, but collect a lot less,” he said.

“I firmly believe, for this community, that the track we’re on, which is job creation, (is the right one). Secondary to that our focus has to be recouping our sales tax leakage (which is created when residents shop in other communities).”

Watson noted that Walmart changed Show Low forever, and said he felt that having Walmart in Taylor will be great.

“I think the future has great potential, but it is important for our citizens to realize we have very, very, very limited resources to provide all the services,” said Watson.