Ahead of schedule
WORTHINGTON -- During the election in 2008, the citizens of Worthington passed a half-cent sales tax to pay for renovations to Memorial Auditorium and the construction of an event center.
Forty-three months since the start of the collection, the funds are ahead of schedule.
"There is a natural inflation factor built in to the collections we're seeing," City Administrator Craig Clark said. "But you don't want to overbuild something, so it's best to take a conservative approach.
"What's happened in a lot of areas in the country could have happened here. But since we have a strong ag economy, our retail sales have stayed strong. We have seen increases rather than declines, which is great news."
The tax was to be collected for 10 years or until a $6 million goal was met.
At the end of 2012, the city is well on its way to collect that amount ahead of schedule.
"It's encouraging to see the resilience of our local economy and businesses recover from the recent recession," Worthington Area Chamber of Commerce Executive Director Darlene Macklin said.
"Thanks to the citizens of Worthington for passing the additional sales tax to help finance the new event center, it will be a wonderful addition to Worthington generating increase business for our local economy," she added.
The tax has accumulated more than $2.5 million for the city.
"This is another indication of a good, strong ag economy and I think a solid base economy," Clark said. "A solid foundation for our business community and a strong ag economy is contributing to a very healthy sales tax collections."
If the current trends continue, the $6 million will be raised in 2017 -- about a year and a half early before the 10-year time frame.
"We figured it would be paid off in about eight and a half years, based on current collection projections, which is not a guarantee," Clark said. "We would say mid-2017. You don't know what the future may hold, so you want to take the conservative approach. We don't want to build something we can't afford and then have additional burden for the taxpayers.
"Understanding that, the structure we projected has happened and more than happened as far as collections have outpaced our estimates," Clark continued. "That's a better problem to have than the other way around."
The city received $344,639.52 in collections in 2009, which began in June. Another $670,902.05 was collected in 2010 and $748,427.80 in 2011.
With the projected December numbers for 2012, last year the city received $771,932.80.
"Worthington has a very strong economy, especially in light of the broader state and national economy," Clark said. "Look at our unemployment rate. We have a strong local economy, no doubt about it. This is just another component to that."
Memorial Auditorium accounted for $1.9 million for renovations, which have been completed.
"The money doesn't go out that way -- for all intents and purposes, Memorial Auditorium is already paid for," Clark said. "If you look at it in that light, one of the two projects is already paid for. That's the smaller of the two projects, obviously, and as a practical matter, they are not allocated that way."
Another $3.75 million will go toward the event center, which will be completed in the spring. The rest will be added for additional costs as needed to the projects.
"It shows what we can accomplish as a community when the community rallies around two clearly identified priorities," Clark said. "The voters supported the half-cent sales tax, and look at what we're getting to show for it. It's not just exciting that we're having an event center, but it will be a nice event center.
"Our community will have every reason to be enormously proud of these facilities. It's through their provision that we will have those. It's so exciting, it's great."
Given the success of the collections, along with the favorable interest rates the city was able to get on its bonds, Clark hasn't ruled out putting a half-cent tax on the ballot in the future.
"For the right type of project, it's a fair revenue source," he said. "You have to have legislative authority at this time to pursue a vote of the people to do a half-cent sales tax. ... Would we ask the legislature again in the future to look at that? I think that's certainly something we would. What that might be, we haven't identified.
"We have the luxury of time on our side. When we have Memorial Auditorium and the event center paid off, then we can move forward from there."
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Coordinator Aaron Hagen may be reached at 376-7323.