Brenda Wade Schmidt
Sales tax collections remained steady in Flandreau in 2018 compared with a year earlier, and the last quarter of the year tallied the strongest jump.
The city collected $723,643 in sales taxes in 2018, compared with $719,500 in 2017, a 1 percent increase, figures show. Sales taxes in Flandreau climbed higher in 2017, compared with previous years when numbers had been a bit sluggish.
In the first three months of 2018, taxes collected by the city fell 4 percent. But by the second quarter of the year, they were down 10 percent. During that time period, Bean and Vine closed and Fajita’s Bar and Grill opened.
During the third quarter sales were flat year over year, but rebounded for a 21 percent increase in the fourth quarter. During that last few months of the year, J&K Building Center had a going-out-of-business sale, and Flandreau Building Center opened in the same location.
Flandreau businesses collect 2 percent in city sales tax which is remitted to the state along with state sales tax. The 2 percent is then returned to the city of Flandreau, which also has a 1-cent bed and booze tax.
For the city of Flandreau, sales tax collections are the largest percentage of its general fund budget at 36 percent, closely followed by property taxes at 32 percent of the general fund, which does not include money from municipal utilities.
The city doesn’t count on sales tax dollars going up each year and plans accordingly, said Jeff Pederson, city administrator. “We budget our revenues conservatively. Even though the sales tax is a major revenue source in the general fund, we don’t project much growth from year to year,” he said.
One of the biggest changes in Flandreau sales tax revenue has been having Tractor Supply Company in town because the store draws in people from outside of town, Pederson said. “It has a lot of things that the rural community needs, and it gives them the opportunity to purchase those things in Flandreau.”
In addition, the purchase of J&K Building Center by Tyler Lumber kept a similar type of draw in town as well, he said. “Had that lumberyard closed, the city would have felt that.”
The community has had several smaller businesses also open recently, including a Wind Street Station, whose owners continue to fix up the historic building to add apartments and other businesses. In addition, the Mexican restaurant Enpaisano opened in December across from the liquor store on Wind Street.
A state report showed that other towns in Moody County also saw increases in sales taxes collected for fiscal year 2018, ending in June. The state uses a fiscal year, while the city of Flandreau was tracking a calendar year, measuring two different time frames.
Egan saw the largest percentage jump at 26.77 percent, going from $37,338 in FY 2017 to $47,333 in FY 2018.
Colman had a bump from $186,402 in 2017 to $229,814 in 2018 or 23.29 percent, the state Department of Revenue annual report showed.
Trent sales taxes collected went from $13,721 in 2017 to $15,409 in 2018, a 12.3 percent increase. During that time, Trent collected 1 percent in sales tax while other communities in the county collected 2 percent. Trent started collecting 2 percent Jan. 1 of this year as a way to increase the town’s budget.
In Ward, the tax went from $17,263 in 2017 to $19,464 I 2018, a 12.75 percent increase.