The city of Branson is currently undergoing some budgeting challenges. One of the primary sources of revenue for the city is its retail sales tax. A dollar of city retail sales tax revenue generated in Branson Landing is a dollar of sales tax revenue in terms of pretty reports and colored graphs. It is included in the actual report of sales tax receipts received whether, as last year, records were broken or this year, where things are flat.
Sounds good so far except for one little thing, well maybe it’s not such a little thing after all. For all practical purposes, not one dollar of that retail sales tax revenue can be used by the city to meet its financial challenges or used for anything except to pay off the Tax Increment Financing (TIF) bonds used to finance the Branson Landing Project. Not one dollar will be spent to build or repair a road, pay the cost of any salaries or raises for city employees, give citizens relief on their tax bills, build new water and sewer plants, maintain the level of the city’s park and recreation programs or for any other operational expenses the city may have.
Some might say, “But Seagull, you’re wrong because the TIF is only 50 percent of the city’s retail sales tax. That leaves 50 percent of the sales tax receipts to be used by the city to meet its operational needs and provide services for its citizens.” The reality of the situation is the previous administration obligated 100 percent of the city’s retail sales tax revenues from the Branson Landing Project to pay off the TIF Bonds.
Oh, and it gets better, the city can’t even use a dollar of the city retail sales tax revenues collected at Branson Landing to pay the hundreds of thousands of dollars in Branson Landing operational and maintenance costs for the fountain and other areas the city is obligated to pay under its contracts with Branson Landing. The question might come up, “Why did they do something appearing to be that stupid?”
When analyzing the situation the words of Forest Gump come to mind, “Stupid is as stupid does.” Some, including the Ole Seagull, believe it was done so that State Tax Increment Financing (STIF) could be obtained from the state of Missouri and without the STIF there would have been no convention center.
A few readers might ask, “Is that the convention center forecast to lose over $1 million dollars per normal year of operation? The convention center running a commercial laundry for the primary benefit of two hotels the city doesn’t own? The convention center that didn’t open until after Branson Landing had already opened and proved itself a great success without it? That’s the one!
A few might ask, “Can the revenue from the city’s retail sales tax collected in Branson Landing be used to pay off the yearly operational deficit of the convention center and, if not, where does the money to do so come from? No, it must be used to pay off the TIF bonds. The revenues for the operational deficit at the convention center comes from the same place the hundreds of thousands of dollars in Branson Landing operational and maintenance costs for the fountain and other areas comes from, other tax sources and fees etc. charged by the city of Branson to its citizens, businesses and guests.
The city’s current financial reports show that while the collection of the city sales tax is trending up in Branson Landing and Branson Hills they are starting to trend down in the other retail areas of the city. Should those trends continue it will exasperate Branson’s current financial challenges and Branson’s financial caution light might just change to “Red.”
