Round Rock economy returning to pre-COVID levels, City CFO says
The local economy is returning to pre-COVID levels, and fiscal year revenues to the City are higher than projected, Chief Financial Officer Susan Morgan told the Round Rock City Council at its May 13 meeting.
“This presentation of the second quarter report is a lot more fun than what I had to present at this time last year,” Morgan said. “As far as overall economic conditions, we have seen a huge improvement over the past few months.”
During her quarterly financial update, Morgan reviews economic indicators and reports on fiscal year to date revenues. You can watch Morgan’s full presentation here.
The unemployment rate in Round Rock was 4.8 percent for March 2021. Williamson County unemployment claims are down significantly compared to March last year, but still well above pre-pandemic levels:
- March 2019 – 824
- March 2020 – 9,991
- March 2021 – 4,969
With the COVID-19 vaccine now widely available, Morgan anticipates employment numbers to continue to improve.
National and state consumer confidence has increased, Morgan said, and the State of Texas’ revenue estimates continue to improve as the overall economy, as well as the oil and gas industry, rebounds.
The travel industry was among the hardest hit by COVID. All Round Rock hotels are open, and other local businesses have reopened as well, Morgan said.
Hotel occupancy rates are trending strong, including at Kalahari Resorts, which opened in November. Still, hotel occupancy tax revenues are down 9.9 percent over prior year to date, Morgan said.
The Dell Diamond hosted the Round Rock Express 2020 season home opening series May 6, more than 12 months after the ballpark went quiet when last year’s minor league season was cancelled due to COVID.
The pandemic’s impact on the City budget hasn’t been as severe as anticipated, Morgan said. Expenses are within budget, and revenues are higher than expected.
Year to date, overall sales tax revenues are up nearly 24 percent over budget, or $7.6 million, which is welcome news, Morgan said. In Round Rock, sales taxes fund major transportation improvements and help keep pressure off the property tax rate, as well as pay for general government services. Of concern, Morgan said, is sales tax revenue from Dell Technologies is down nearly 10 percent year to date, and the City continues to monitor that important revenue source closely.
Property tax revenues are strong and within budget at $68.4 million. Utility revenues are also strong and within budget.
Hotel occupancy tax (HOT) revenues, as expected, were hardest hit by the pandemic. HOT and venue tax collections year to date are down 9.9 percent over the prior year. The good news, Morgan said, is that hotel occupancy rates have increased from 22 percent to 79 percent since last April, giving her reason to be cautiously optimistic they will rebound to pre-pandemic levels soon. There are 551 hotel rooms currently under construction in Round Rock, she said.
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Source: City of Round Rock