The Oklahoma Tax Commission released its figures for El Reno’s April sales and use tax collections and the numbers have Matt White worried.

White is the mayor and acting city manager for El Reno.

The figures are for February collections as well as the projected sales for the period of March 1-15, the early stages of the COVID-19 outbreak in Oklahoma.

“We have not seen the worst and it’s pretty bad now. The numbers are before all the big COVID-19 shutdowns hit. We feel like next month it's going to be in the $500,000 to $600,000 range and that is half of our budget,” said White.

The city of El Reno’s fiscal year of 2019-20 runs through the end of June and White said the budget was based off collections of $950,000 per month in sales and use tax collections.

“Just under a million dollars a month is what we have to meet and that is obviously going to take a hit. The numbers we have now are actually a month behind,” said White.

April's check from the state was $772,953.76 for sales tax collections, which is down $36,605.09 from the previous month of $809,558.85. It was the second month in a row for a drop and the fifth out of the last six months.

The April 2020 figure was down dramatically from the same period in 2019 when the city pocketed $1,081,849.89 in sales tax, a drop of $308,896.13.

El Reno’s use tax for April of 2020 was $264,669.23, which was an actual increase of $23,942.43 over the previous month. However, this month’s figure was down $348,258.87 from the amount collected in April of 2019.

According to the OTC, use tax must be paid on tangible personal property purchased and brought into the state for storage, use or consumption. If the property is brought into a county or municipality that also levies a use tax, the applicable county or municipal use tax must be paid.

White said the city’s budget for the fiscal year will be balanced, by law, but there could be a shortfall that will have to be covered by the city’s reserve fund.

“I expect we will have to dip into the reserve fund. We don’t know how much yet,” said White.

To try and limit a deep dive into the reserve fund, White is proposing a first round of cost-saving measures to the city’s daily expenses. He said the cuts would not harm basic services. The cuts include:

▶ Reduce the use of unscheduled overtime by city employees which will save $135,178.87.

▶ Freeze all hiring for a savings of $116,000.

▶ Discontinue on-call pay that will save $59,315.

▶ Take advantage of federal Covid-19 leave at a savings of $80,000.

▶ Close the city pool for the 2020 season to save $50,000.

▶ Decrease non-union pension contributions of $28,882.00.

▶ Cancel Mayor’s Youth Employment Program set at $20,736.

The seven cuts will save a total of $390,111.87, but White expects more cuts will be needed. The proposed cuts are all non-union. White said he is planning to meet with union leaders in the coming weeks to see what other savings can be made. Police and fire are the only municipal departments that have union representation.

“There are more cost-savings ideas coming and that is inevitable. We are just like your household budget and if you are counting on $1,000 per month and you have got $500 in your pocket, you have got to adjust to keep things going,” said White.

The current and future shortages in tax collections are tied to the virus and the fear of the unknown as to how long the pandemic will last and the time it will take for an economic rebound, White said.

“People go out to the stores and see they are busy, but our collections are not just on that. It’s on everything from cars to luxury items that people are just not buying right now. They’re holding on to their money to see what will happen and we get that but we have still got to be able to provide services like fire, water and police to keep everyone safe,” said White.

White said he is trying to keep from recommending staff cuts at this point.

“I think that everyone is expecting there will be some cutbacks in hours but our main goal is not to do layoffs. I hope people understand that this is not a sprint but a marathon and we have got to look down the road to make sure we have the staff in place to provide basic services,” said White.

The recently passed $2 trillion Coronavirus Stimulus Package will provide funds to each state which can be handed out to local governments. White said the city is in the process of trying to gain some of those funds, but how long that takes is unknown.

“We think we might get some help but that might take months if not longer to get here. We are still waiting on some of the money from the tornado last year. So we might not see that stimulus money for a year and we have got to deal with the budget now, next month and for the next six months,” said White.