City may cut funding for tourism lures

By Anna M. Tinsley, Star-Telegram Staff Writer
Copyright 2001 Star-Telegram Newspaper, Inc.
Article date: November 14, 2001
 

FORT WORTH - Some of the city's biggest tourist attractions - including museums and the Fort Worth Herd - may lose significant funding as the national economic slump continues to be felt locally, city officials said Tuesday night.

City administrators said that revenue from the so-called hotel/motel bed tax, which is paid mostly by travelers, may drop by about 15 percent this fiscal year, which began Oct. 1.

As a result, a half-dozen possible cutbacks - including postponing a new Sister City search, eliminating payments to the Modern Art Museum and cutting furniture and equipment funding for the Fort Worth Convention Center by nearly $150,000 - were proposed  Tuesday by the city staff. This is in addition to steps approved last month to delay about  $8 million in spending on projects such as extending library hours and filling vacant city jobs.

"We're concerned about the situation," Mayor Kenneth Barr said. "At the same time, historically in Fort Worth, we've been conservative about our budgeting. I'm sure we have the ability to manage the projected shortfalls."

There's good news and bad news in the financial forecast, Assistant City Manager Charles Boswell told the council.

The bad news is that the local economy has been hurt by airline cutbacks, a travel industry slowdown, layoffs and corporate downsizing. But the economy has been helped by strong home construction and Lockheed Martin's coup in landing the joint strike fighter contract, the largest military contract ever.

Bed tax revenue started strongly this year, but by July it was dropping. Revenue from the quarter ending in September was 10 percent lower than for the same period last year, and officials say the next quarter could be worse.

If budget writers' projections prove true, the bed tax could provide $1.8 million less than projected for the 2001-02 budget year, Boswell said.

"It's part of the general economy slowing down," he said. "People are staying home rather than traveling."

Councilwoman Becky Haskin said the attractions that draw people to Fort Worth are taking a double whammy: They are being hit directly by the tourism drop, and now they may lose city funding.

"They are getting hit one way and now another," she said.

On another tax front, sales tax figures released last week show that retail sales were steady across Tarrant County in the quarter that ended in September. Countywide, sales tax figures were up 2.7 percent compared with the same quarter a year ago. In Fort Worth, sales tax receipts were nearly flat, according to state comptroller
estimates.

That was the last quarterly payment for fiscal 2000-01; it is 1.21 percent above the previous year's revenue, but $2.5 million below budget.

"We were very anxious about September's numbers," Boswell said. "This is not as bad as we had feared. Many cities had bigger hits than we did."

The $670 million city budget for 2001-02 went into effect Oct. 1.

By February, budget writers are expected to have a better picture of how the fiscal year will shape up financially. That's when they'll know how much holiday sales tax was collected. Also, the final date to pay property taxes with no penalty is Jan. 31. More than 70 percent of Fort Worth's general fund comes from property and sales taxes.

"We won't know the full picture until we get through Christmas," Boswell said. "We need to keep watching the sales tax and stay the course.

"We're really going to have to live within our means this budget."
 

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