According to a story by the Associated Press, Columbus could run out of cash by Sept. 30, when the city’s fiscal year 2019 budget ends. With the city likely to spend $14.2 million before the fiscal year ends and only $10.9 million in revenue projected, the debt could add up to $300,000.
This isn’t the first time the city has been in financial trouble.
According to a November 24 story in the Columbus Dispatch, Columbus operated with an $881,000 deficit in fiscal 2018, which ended on September 30.
Since fiscal 2017, the city has run $1.7 million in deficits under the direction of former chief financial officer Milton Rawle. He resigned in February after more than five years in charge of the city’s finances.
Mayor Robert Smith told the AP that it’s not time for city leaders to panic and that he wants a property tax increase to go into effect for the fiscal 2020 budget, which begins on October 1. This would be the second tax increase to hit city residents this year.
The city will also receive a new 2 percent tax on restaurants that was approved by Gov. Phil Bryant earlier this session and goes into effect on Monday.
Another local bill in the legislature would add another 1 percent to the city’s now 9 percent tax on restaurant sales to pay for the second phase of the city’s new $5.5 million Terry Brown Amphitheater.
Passage is unlikely as the legislature’s session is drawing to a close this week.
Columbus isn’t exactly hurting for tax revenue, receiving $26,651,025 in fiscal 2018 alone. That’s more than similarly-sized Starkville ($20,785,798 in 2016), but less than Vicksburg ($31,165,725 in 2017)
Property owners in the city are assessed at a rate of 46.69 mills just to fund the city’s functions. That rate is average among Mississippi cities, with Jonestown in Coahoma County levying the highest rate statewide at 119.94 mills.
Mills are assessed per $1,000 of a property’s determined taxable value and the owner of an average priced home in Columbus ($128,200 according to real estate site Zillow) pays about $1,596 with an annual homestead exemption on the first $7,500 of value.
According to the latest numbers from the Mississippi Department of Revenue, the city received $718,119.46 in sales tax revenue, up $16,499 from this time last year.
Collections for the year so far are up slightly over the same time last year, with the city receiving $6,416,153.72 in sales tax revenue this year so far as compared with $6,421,907.56 last year.
Columbus taxpayers owe $28,550,411 in debt, with the annual debt service payment adding up to $528,868.
Vicksburg’s total debt adds up to $9,876,050, but Starkville taxpayers owe $55,652,465.