Quote:
Originally Posted by numble
California collects sales taxes for online purchases and the sales tax collections for Metro have not had as large an impact on Metro as was initially expected. Metro received $862 million in the March 2020 stimulus bill, will receive a similar amount from the December 2020 stimulus bill and will probably receive something like $1.3 billion from the upcoming stimulus bill if it passes the Senate in the same form it passed the House. In other words, they will be receiving nearly $3 billion from the COVID relief packages. With an infrastructure bill in the works, and a plan for Congress to allow earmarks again, Metro might receive even more funding.
Meanwhile, as of January 2021, their sales tax revenues have only been down $260 million since the pandemic began. That looks like a lot, but in 5 of the past months, sales tax revenues were actually higher than the year before.
Metro’s finance team itself predicted that total sales tax losses across 3 years will only be around $190 million and that sales tax revenues are expected to be up next year. “ It is anticipated that sales tax revenue will finally exceed the pre-COVID-19 peak set in FY19 and reach $865.0 million per ordinance in FY22, a 2.9% increase from the FY21 Midyear Reforecast.”
https://metro.legistar.com/Legislati...EB0&FullText=1
You are incorrect that the sales tax calculations didn’t account for the pandemic. Of course it doesn’t predict pandemics, but it expects recessions that have a larger impact on Metro’s revenues than the pandemic has had. The sales tax expenditure plans for Measures R and M leaves a huge amount of unallocated amounts to account for things like downturns in the economy. This is why Measure R projects like the Purple Line, Expo Line 2, Gold Line to Azusa, Crenshaw Line, Regional Connector etc. were not affected by the Great Recession, which had a far larger impact on Metro’s budget. For example, in Measure M, they estimate $60 billion in transit and highway funding for 40 years, but only program for about $30 billion. |
Numbers do not lie. While it is true that in 5 of the last months sales tax revenues are higher than the previous year; where you left it as a final thought; what you left out is that it is still true the sales tax revenues still remain below what they projected it would be pre covid.
By how much one may ask, the answer is right there in the charts, just look at the bottom line of the last chart.
I'll repeat it right here so you do not have to take the time to go look:
COVID 19 (% loss)
FY20=$48.3 Million(-5.5%),FY21=$69.2 Million(7.6%),FY22=$72.3 Million(-7.7%)
Of course future projections will not necessarily be the final results, but the important point I wish to point out is that the loses are accruing, seemingly getting larger each following year.
Why are they projecting that? Because they are projecting normal growth and revenues from sales taxes based on top of a new lower starting line.
And that means over the course of accruing over a time period of decades much lower revenues.
The stimulus package passing through Congress will probably make up for the losses for the last year and this year, it will most likely not make up for the accruing loses for the next few decades.