As the COVID-19 novel coronavirus pandemic continues to impact local businesses and events, The Woodlands Township is moving ahead with budget preparations to figure out a way to cope with the loss of revenue from sales tax and hotel occupancy taxes.

On Thursday, April 2, during a virtual meeting, the township Board of Directors approved a timeline for the newly formed budget task force to begin work on gathering data, analyzing financial numbers and coming up with different budget options before the official process begins in late July as usual.

The new task force is composed of directors Bruce Rieser, John Anthony Brown and Bob Milner.

Budget timeline

Monique Sharp, the township’s assistant general manager for financial services, updated the board on the newly formed task force and the timeline that she and staff had been working on. She said the committee will, “review and prioritize options to address a range of budget” issues.

By May 21, the committee would ideally recommend their plan for coping with funding gaps for the 2021 budget. There would be more meetings in June and July before the Aug. 3-7 budget planning week, when directors spend an average of eight hours a day for a whole week doing the next year’s budget.

“This would give staff a road map to follow as financial impacts are known,” Sharp added.

Following that report, the budget task force would meet twice more in July before the township’s official budgeting preparation week begins, scheduled for Aug. 3-7 this year. From July 6-10, township financial staff would present to the three member task force a initial draft of the 2021 “base budget.” Then, from July 13-17, they would meet again to review draft number two of the 2021 “base budget,” which would be used by the full township board during August budget planning sessions.

Forecasting revenue drops

The specifics of what data will be gathered were detailed in a document made available to township directors on April 2, in which Sharp said officials will probe several scenarios and provide expected budget outcomes. Among those were predicted drops in sales tax of 20 percent, 30 percent, 40 percent, 50 percent and 60 percent. The staff will also examine possible hotel occupancy tax revenue decreases of 30 percent, 40 percent, 50 percent, 60 percent and 70 percent. There will also be a list of possible cuts or reductions of other services to cope with the financial shortfall.

The township’s is bracing for a significant impact to its annual revenue streams, notably sales tax and hotel occupancy tax. The township generates millions of dollars in sales taxes each year, but with virtually all local businesses closed due to a declaration of disaster order in both Harris and Montgomery counties that shuttered bars, restaurants, gyms and non-essential businesses, those sales taxes are at the moment almost non-existent.

Many restaurants are selling food togo or for pick-up, and grocery stores are seeing record levels of shopping as residents stock up on various items, however the closure of Market Street and The Woodlands Mall has caused a massive dip in sales tax revenue. One bright spot, though, is thought to be online-generated sales tax, which the township and other municipalities in Texas began to receive in December.

Another factor for the township is the loss of hotel occupancy taxes, which help fund a wide range of things through Visit The Woodlands, the township’s tourism and convention and visitors arm. With the cancellations of a massive lunar and planetary sciences conference in mid-March, an estimated 1,600 attendees who spend an average of two to three nights in hotels for the event, the HOT tax revenue has dropped by significant amounts. Add in the postponement of massive community events such as The Waterway Arts Festival and the Ironman North American Championship Triathlon, both slated for April, and the prospects of a rebound soon are slim, officials have warned.

During a March 18 meeting of the Visit The Woodlands board, township Director Bruce Rieser, who is also on the Visit The Woodlands board, issued a stark warning.

“The travel and hospitality industry is going to bear the brunt of the measures that have been put in place. Hopefully the virus will die out a little faster than expected and we can get these businesses back up on their feet,” Rieser said on March 18. “It would be great if the community would do everything possible for those businesses that have been closed. Order to-go food, buy gift cards…if you can shop online locally, do that. We need to help these businesses.”

jeff.forward@chron.com

Original Article from: https://www.yourconroenews.com/neighborhood/woodlands/news/article/Woodlands-Township-plans-out-budget-response-to-15182704.php