The city of Battle Ground is expecting a relatively small hit to its coffers as a result of COVID-19.
City officials are projecting a $1.1 million loss in general fund revenue, Finance Director Meagan Lowery said. The reduction would represent a 7 percent decrease from the original forecast in the city’s annual budget.
Cities like La Center, in contrast, could lose more than 30 percent of general fund revenue. Taxes from temporarily shuttered cardrooms account for more than one-third of La Center’s budget.
In Battle Ground, a large number of businesses are considered essential under Gov. Jay Inslee’s restrictions. Box stores and construction companies, which are common in the city, remain open.
“We’re kind of the retail hub for north county, so we’re probably doing a little bit better than some other jurisdictions in the county,” Lowery said.
The biggest factors in the revenue loss are declines in sales taxes and development activity, Lowery said. Revenue sources that the city shares with the state, like the motor vehicle fuel tax, have also declined.
Lowery said that the projection, made in early April, was conservative and subject to change over the next few months.
Because of a two-month lag between purchases and when the city sees the revenue, the exact impact on sales taxes will not be known for weeks.
“We’re still early in this, so what it’s going to look like in a month or two – depending upon … when businesses reopen and what it looks like as we move forward — we’re kind of taking it as we go.”
The city will receive $645,600 in federal aid through the CARES Act. Local governments must only spend that money on virus-related expenses.
But Lowery said that the funding will allow the city to use money it already had to help cover the revenue shortfall. As of Wednesday, no city employees had been laid off or furloughed.
The city council, at a meeting Monday night, was able to reduce water, sewer and stormwater utility tax rates from 22 percent to 12 percent.
Cuts will appear on city residents’ June statements. But those who are still unable to pay will not have services disconnected or be charged late fees while the citywide public health emergency is in effect.
About $540,000 in reductions to the general fund this year as a result of the council’s decision will be offset by reserve savings, according to the city.