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Report shows large sales tax increase

POULSBO — No Wal-Mart, no The Home Depot, no problem — at least according to the city’s March sales tax report.

Budget analyst Deb Booher told the city council’s finance/administration committee that last month’s report represents an historic first for the city from a financial standpoint.

“It’s the first time we’ve actually been over $200,000 and we’re doing very well,” Booher said.

The revenues were generated in January, which traditionally ranks as the 11th highest month for sales taxes, she explained.

“We’re up 36.29 percent, or $54,000, over the same period last year,” she said, noting that the revenues are still in line with the city’s projections for the 2006 budget year.

The largest increase was in retail trade, which was up $31,000, and the next greatest increase was in the construction sector, Booher said.

Even though Wal-Mart and The Home Depot opened at the end of January, the construction and inventory of both stores contributed to the city’s sales tax revenues, she explained.

“It’s next month when we’re finally going to start seeing the full impact of them,” said Councilman Jim Henry.

The city is waiting until both stores have been open for a full year before determining anticipated revenue projections, Finance Director Nanci Lien told the committee.

Retailers expect an initial spike in business during the first year of operations and scale down their expectations after that, Lien explained.

However, the city still expects construction revenues in the area to remain high because of the strip mall and medical centers being built, Booher said.

The April sales tax report, which will include the first full month of both major retailers’ impact, is expected at the April 5 finance/administration committee meeting.

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