Montgomery suffers massive sales tax shortfall - WSFA.com Montgomery Alabama news.

Montgomery suffers massive sales tax shortfall

MONTGOMERY, Ala. (WSFA) -- Heavy foot traffic promised an optimistic outlook for Montgomery's retailers at the start of the holiday shopping season.

It wasn't enough, however, to turn the city's sales tax slump around.

"They're not coming in like we appropriated," explained Lloyd Faulkner, the city's Finance Director.

In fact, the newest numbers show a major shortfall.

The city earned nearly $6.7 million in November.

It's a far cry from nearly $7.8 million in November 2007. A drop of 14% and more than $1 million.

"That's the biggest deficit I've had [. . .] since I've been here.  Since the year 2000," Faulkner said.

The loss already has the city trying to stop the bleeding.

"It's proration but it's not official. We just cut back on spending in certain areas," Faulkner explained.

That means trimming the fat from City departments and an already skinny budget.

"I'm going to put everybody on notice [and say], 'It's a possibility.  Start looking at your budgets.  See where you can come up with 5, 6, or 7 percent if we have to," Faulkner said.

The city's waiting on December's sales tax numbers before they make any major cutbacks, but officials are hoping for tinier losses.

"I'd be happier with a smaller one than what I've got right here.  It can't track at 14% during the year.  That's not going to happen," Faulkner explained.

If the figures don't improve, just how much would the city cut?

"If I had to make that decision today, it'd be 10 [million dollars]."

That's a drastic sum Faulkner admits may not solve the problem.

"We're already pretty raw-boned right now.  So, if we do this another time, we're down to people and services," he explained.

Stay tuned to WSFA 12 News for the latest developments in this story.

Powered by Frankly