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Edinburg’s economy approaches 19 percent improvement over retail sales during 2004

Edinburg’s retail stores registered the largest yearly increase among the major Valley cities this year in local sales tax revenue, a major indicator  of a strong economy, the Edinburg Economic Development Corporation has announced.
The city’s retail economy, as measured by local sales taxes generated, has posted an almost 19 percent improvement over last year, according to the latest sales tax report released December 9 by Texas Comptroller Carole Keeton Strayhorn.
The latest monthly collection of city sales tax revenue also showed that Edinburg generated more than $913,000 in local sales taxes, up almost 13 percent over the same period last year.
The figures represent local sales tax allocations made by the state to local governments in December.
November state sales tax collections and December sales tax allocations to local governments mainly represent sales that occurred in October.
Edinburg’s annual improvement of 18.63 percent, which totals $11,509,0398.80, compares to $9,701,437.49 sent back from the state to the city treasury in 2004.
Local sales tax figures provided by the state give an accurate idea of how much taxable commercial activities, from retail to manufacturing, are going on in a community.

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In Edinburg, as in most major Valley communities, the local sales tax is two percent, which includes a local one-half cent economic development sales tax.
The one-half cent economic development sales tax in Edinburg is collected by the EEDC, which is the jobs-creation arm of the Edinburg City Council.
Businesses in each city send their local and state sales tax collections to the state, and the state then sends back the cities’ local share as rebates to the respective communities.
On December 9, Edinburg was sent a monthly sales tax rebate of $913,338.39, compared to $810,292.38 during the same month last year, which resulted in a 12.72 percent improvement.
Year-to-date, the local sales tax rebates sent to all cities in Hidalgo County total $98,574,879.44, up 10.17 percent over 2004, which was reported as $89,468,215.25.
On December 9, all cities in Hidalgo County were issued monthly sales tax rebates totaling $7,775,210.46, up 14.57  percent over the same month last year, which reached $6,786,342.06.
McAllen led all Valley cities, reporting a December 9 sales tax rebate of $3,678,824.72, up 12.25 percent over the same month last year, which reached $3,277,247.19.
Year-to-date, McAllen has generated $49,423,884.06 in local sales taxes, up 7.25 percent over last year’s figure of $46,079,088.08.
Pharr placed third among Hidalgo County cities,, reporting a monthly local sales tax rebate of $846,309.39, a 10.07 percent increase from the same month in 2004, when its rebate was reported as $768,818.77.
Year-to-date, Pharr has generated $10,120,118.67 in local sales tax rebates, up 8.28 percent over the 2004 figure of $9,345,484.33.
Mission reported an $777,201.25 monthly local sales tax rebate, up 19.97 percent over the same month last year, which reached $768,818.77.
Year-to-date, Mission has generated $9,030,879.83 in local sales tax rebates, up 8.28 percent over last year’s figure of $8,072,972.49.
Weslaco reported a $594,301.07 local sales tax rebate, up 17.79 percent over the same month last year, which reached  $503,
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654.09.
Year-to-date, Weslaco reports $7,096,507.90 in local sales tax rebates, up 6.27 percent from last year’s figure of $6,677,255.98.
Cameron County saw smaller, but still positive improvements in its local sales tax activities.
On December 9, all cities in Cameron County were sent total sales tax rebates of $3,948,017.53, up 6.46 percent over last year’s monthly report, which reached $3,708,293.66.
Year-to-date, all cities in Cameron County reported total sales tax rebates of $52,326,739.73, a 5.23 percent increase from the same period in 2004, which was reported as $49,725,630.06.
Brownsville’s latest local monthly sales tax rebate was $1,955,106.07, up only one-tenth of one  percent over the same period last year, which was reported as $1,955,053.51.
Year-to-date, Brownsville has generated $26,586,987.31 in local sales tax rebates, up 4.24 percent over last year’s figure of $25,505,440.48.
Harlingen’s local monthly sales tax rebate was $1,341,591.11, up 18.95 percent over last year’s level of $1,127,856.42.
Year-to-date, Harlingen’s local sales tax rebate has reached $16,731,875.84, up 5.41 percent over the same period last year, which reached $15,872,449.34.
Upstate, where Hurricane Rita slammed into the upper gulf coast earlier this year, that region’s economy registered a dramatic improvement, said the state comptroller,
“Some Southeast Texas communities continue to see declines in their sales tax revenue as a result of Hurricane Rita, but overall state and local sales tax revenues are up significantly,” she said.
According to her office:
The state collected $1.58 billion in sales tax in November, up 9.4 percent compared to November 2004. December sales tax allocations to local governments rose by $50.8 million, or 15.8 percent, compared to December 2004. Sales tax allocations are up 19 percent in 22 counties that were declared disaster areas following Hurricane Rita.
“These sales tax numbers tell the story of Texans’ heroic response to hurricanes Katrina and Rita,” Strayhorn said. “They show the generosity of Texans who purchased millions of dollars worth of clothing, household goods and emergency supplies for those in need. And the numbers reflect spending by thousands of evacuees, who were welcomed in cities throughout Texas.
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“The numbers also show that after Hurricane Rita, Southeast Texans immediately bounced back and began to repair, replace and rebuild what they lost,” Strayhorn said. “Also contributing to stronger than average sales tax growth were the mining and utility sectors.”
In the hard-hit Beaumont-Port Arthur area, Beaumont’s local sales tax allocation dropped 9 percent in November, but its December sales tax soared by 43 percent compared to December 2004. Port Arthur’s sales tax allocation dropped 12.1 percent in November, but rose 23.7 percent in December. Orange, whose sales tax allocation declined 12.3 percent in November, saw a 42.8 percent increase in December.
Only 25 local governments in 22 Southeast Texas disaster counties show declines in their December sales tax allocations, compared to 73 local governments whose sales tax revenue dropped in November. Cities, counties, special purpose taxing districts and a transit system located within the disaster area lost about $271,000 in sales tax in December, compared to losses of $2.3 million in November.
Strayhorn’s unprecedented plan to help local governments whose sales tax revenue has declined since Hurricane Rita remains in effect.
“Some towns continue to lose sales tax revenue, because they have businesses that have not been able to reopen,” Strayhorn said. “I am offering local governments an option to help them with short-term fiscal problems caused by a sudden drop in sales tax revenue.
“Local governments in disaster counties can, if they wish, receive additional sales tax allocations for November and December to make up the difference between their November and December 2005 sales tax allocations and the amount they received last November and December,” Strayhorn said.
Strayhorn sent $372.4 million in December sales tax allocations to cities, counties, transit systems and special purpose taxing districts, up 15.8 percent compared to last December.
Texas cities received $252.8 million in sales tax allocations, up
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15.8 percent compared to December 2004. Texas counties received December sales tax allocations of $21.8 million, up 17.2 percent compared to one year ago. The 103 special purpose taxing districts around the state received $10.6 million in sales tax, up 22.5 percent compared to last December. Ten local transit systems received $87.1 million in December sales tax payments, up 14.6 percent compared to a year ago.
For details of December sales tax payments to individual cities, counties, transit systems and special purpose districts, locate the Monthly Sales and Use Tax Allocation Comparison Summary Reports on the Comptroller’s Web site at
http://www.window.state.tx.us/taxinfo/allocsum/compsum.html.
The Comptroller’s next local sales tax allocation will be made on Friday, Jan. 13, 2006.


By DAVID A. DIAZ
Legislativemedia@aol.com
Legislative Media reports on legislative issues that impact South Texans.

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