Rough start to the year for Lufkin due to low sales tax revenue

LUFKIN, TX (KTRE) - The city of Lufkin has seen a downward trend in tax revenue over the last six months. Officials say five of those have seen a decrease in sales tax revenue, causing the city to take measure to offset the lost.

Wanda Wesch owns "Mama Tried" in downtown Lufkin and says she has seen a steady flow of traffic.

"I feel very certain of the people that come in here and that I am doing well with them," Wesch said. "I am excited about the sales that I have."

But city officials say not all business owners are so lucky. There's been a 6% drop in sales tax revenue over the last six months.

The drop is so alarming that it's bringing back bad memories.

"It is a little concerning to us," Lufkin Deputy City Manager, Keith Wright said. "We haven't seen these types of figures since 2008."

After the 2008 recession, Lufkin saw an increase in revenue from businesses, but this year's dip is causing city leaders to take action.

"We have cut our budget so much in the past that there are not a lot of fat," Wright said. "There's not a lot of things you can cut."

Wright said the main thing they are doing is delaying hiring by 2 months, unless it is a high priority position, like the police chief position that was recently vacated when former chief Steve Marcotte retired.

"In each department, we are looking at those positions and if it needs to be replaced we are replacing it," Wright said. "If we can safely delay that for two months, that's what we are doing."

It's not just hiring though. The city is considering cutting a significant amount of road projects, but Wright said that decision will come at a later date.

Wright blames fuel costs and weather as possible reasons the city has seen the decline.

After a cold winter, business owners and shoppers are hoping nice weather like today will help solve part of the deficit.

"When the weather starts moving around and getting warmer, I really feel things will get so much better," Wesch said.

"When you get out and look around, nice weather definitely makes it easier to do," shopper Sherry Hughes said.

No matter the route taken, everyone agrees something has to change.

Nacogdoches has also seen similar activity. The city is currently sitting at a nearly 11% decrease from last year. They are also watching their hiring practices as a way to lessen the sting of the loss.

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