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Coupeville weathers the economic recession
The national recession has hit Coupeville, but the town was prepared to roll with the punches, Mayor Nancy Conard said in her “state of the town” address Thursday.
She gave her annual address in front of a 20-person crowd attending the Central Whidbey Chamber of Commerce breakfast. Basically, tax revenues are down from recent years, but town officials anticipated the decline when they formed the town’s budget.
Sales tax revenues in the town with a population of 1,900 declined from a high for $476,000 in 2007 to $341,000 in 2008, but still the town is on pace to meet its $300,000 budget.
The high sales tax revenues two years ago stemmed from county, school district and fire district construction projects that took place in town. Those projects caused a spike in revenue that Conard said couldn’t be sustained. She estimated that, by the end of 2009, sales tax revenue will come in between $320,000 and $350,000.
The extra revenue was used to pay for one-time expenses such as equipment purchases and not to pay for any new employees, Conard said.
“This is why we are currently weathering the storm better than the county and most communities throughout the state,” Conard said.
The number of building permits has plummeted over the past two years. In 2007, the town issued 11 commercial building permits and 12 single-family home permits. In 2008, that number dropped to one commercial and one single-family home permit. For 2009, the town has issued two permits for commercial buildings and four permits for single-family homes.
She said the construction activity, both public and private, has pretty much dried up in Coupeville.
Despite the drop in construction, sales tax revenues are meeting predictions. Conard said she was also concerned about the streamlined sales tax effort that recently started. It basically states that a community receiving goods gets the sales tax revenues.
She was concerned revenues would decline as goods are shipped out of the community. However, the reverse proved to be true. The town is seeing more sales tax revenues coming in from the medical goods shipped to the hospital and the lumber materials shipped into the community.
Real estate excise tax revenues are also declining. The town has currently collected $29,000 in REET from home sales this year, well below the $56,000 budgeted. However, the money gained from the excise tax can only be used for capital improvements so it doesn’t affect city services.
The town’s hotel/motel tax collections should meet its $15,000 budget goal, but Conard would like to see that amount climb to $20,000, which would be a similar amount to 2007 and 2008. That amount would show the bed and breakfasts in town are holding their own in tough times, Conard said.