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COVID Impact on Tourism Leads to Investment Opportunity

If you work in government in a tourism town, the pandemic was a nightmare come true.

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But what happens when the tourists don’t stop coming?

That’s exactly the situation Jess Knudson, a City Manager from Lake Havasu, AZ, found himself in last year. He joined the show to share how he tackled the issue.

We discuss:

  • The initial dropoff and later surge of tourism in Lake Havasu
  • How Jess helped navigate budgeting and allocating resources to tackle the problem
  • The challenge of navigating government financial support in the wake of the pandemic
This discussion with Jess Knudson was taken from our show Local Government Insights: Modernizing Government Leadership. If you want to hear more episodes like this one, check us out on Apple Podcasts or Spotify.

 

If you don’t use Apple Podcasts or Spotify, you can find every episode here.

How Florence, Alabama Found Millions in Sales Tax Revenue

With just over 40,000 residents, Florence is Alabama’s 11th largest city. Home to the University of North Alabama, this vibrant and welcoming town also hosts the state’s most popular renaissance festival, held annually each October.

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Bob Leyde, beloved City Clerk for the City of Florence, Alabama, is a pillar of the local community as well as a talented and innovative administrator. He wisely utilized Avenu’s vast capabilities to generate up-to-the-minute analytics for more accurate projections of sales tax revenue during the COVID pandemic and increase the efficiency of his administration staff.
Here’s a sneak peek:
  • Detailed reporting helped Bob overcome budgeting challenges and increase compliance.
  • Accurate and real-time information about current business opportunities and revenue collection is crucial to his decision-making process.
  • Avenu streamlined the city’s tax administration with a laser-focused audit process.
  • Bob encourages leaders of cities of any size to see how Avenu’s technology can optimize operations and maximize revenue generation.

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

UCLA Anderson Forecast July Economic Outlook

Avenu in partnership with the UCLA Anderson Forecast collaborates to provide both micro and macro level views of the economic health of California at the state and local levels. The following economic information has been provided by our colleagues at UCLA Anderson Forecast. We’ve also attached our recent sales tax forecast assumptions.

Read the full July Economic Forecast Here.

Sales Tax Forecast Assumptions

COVID-19 Impact on City of Pasadena, CA

COVID tested localities in new in challenging ways. While we are coming out of the pandemic, we can learn from different jurisdictions as we prepare for the future.

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Matt Hawkesworth, Finance Director for the City of Pasadena, CA about the different areas of impact COVID-19 has had on the City and how his team has shifted priorities to help balance ever increasing budget deficits.

In this show we discuss:

  • Top areas the City of Pasadena was affected over the past 12-18 months
  • The approach to using reserves during the process
  • The impact of restaurant closures in a city with one of the largest number per capita
  • The American Rescue Plan
  • The importance of resiliency

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

Local Governments Today Have an Opportunity to Build Trust: Smarter Digital Transformation is Key

When government doesn’t deliver the same level of digital services citizens have come to expect from their private-sector interactions, they lose an opportunity to build trust in their communities.

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In this episode, we talk with Lou Schiavone, Chief Customer Officer at Avenu Insights and Analytics. For the past 20 years, he has focused on serving state and local governments nationwide, leading the sales, development and delivery of a diverse set of innovative solutions. Our discussion delves into:

  • How governments can instill trust in their communities through digital transformation
  • Government’s overreliance on paper driven processes
  • Tax collection processes that are efficient, digitized, and automated
  • Ways government can improve communication and build trust
  • Key takeaways for government leaders looking to instill trust in their community

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

How Local Governments Can Navigate Budget Shortfalls

Local governments are working harder than ever over the last year to manage budget shortfalls. Changes in revenue can impact key services for the community. Accurate forecasting and revenue maximization is key during these uncertain times.

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In this episode, we talk with Paul Colangelo, the CEO of Avenu Insights and Analytics. He brings a wealth of experience to the conversation having over two decades of experience working with local governments. Our discussion delves into:

  • Untapped revenue for local governments during the economic downturn
  • Conducting a business license discovery and recovery review and how it helps with revenue enhancement
  • Preparing for fluctuations in revenue streams as the economy recovers
  • The long term impacts of the COVID pandemic.

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

How Digital Technology is Giving Old Documents New Life

For local governments, moving beyond fear of digitalization is essential to making their products and services more accessible for constituents.

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In this episode, I talk with Alfredo Frauenfelder, Client Executive at Avenu Insights & Analytics, about how digital technology can give old documents new life and what that process looks like for local governments.

What we discussed:

  • Why preservation of documentation for future generations is critical
  • How to capture, store, and publish handwritten documents
  • The current state of historical documents for most governments
  • What challenges Local Governments face starting these projects
  • How digitalization can actually pay for itself over time

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

Budgeting Sales Tax Revenue

Local governments can fine-tune their budget forecasts by understanding the tremendous impacts that and state and federal programs have had on Sales Tax Revenue over the past year.

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In this episode, we talk with Mark Bryson, Senior Economic Analyst at Avenu, who works with California jurisdictions and is an expert in helping them navigate the changes COVID has brought to revenue forecasts. Our discussion delves into:

  • Key concepts relevant to understanding and properly budgeting for future Sales Tax Revenues
  • Why these basic Sales Tax concepts are important to the budgeting process
  • 5 things that occurred in California that have never happened before that impact Sales Tax Revenue
  • What jurisdictions throughout the country should be thinking about when they are budgeting Sales Tax Revenue these days

This discussion was taken from our show Local Government Insights. If you want to hear more episodes like this one, check us out on Apple, and all your other favorite podcast platforms. Take a moment listen on your favorite platform. We would appreciate your reviews and feedback as we continue to release upcoming episodes.

Changing Tax Landscape Requires Prioritizing New Compliance Efforts

By Kennon Walthall, Avenu Senior Vice President

In almost no time at all, COVID-19 has transformed both society and the economy. A rapid shift to remote work and the emergence of more digital-first services, combined with new social distancing and safety protocols, have altered everything from our work patterns and office practices to our home lives and shopping schedules.

While many of these changes hold promise for the future, they come at a cost. This is especially true for state and local governments whose tax revenue  has dramatically been impacted the pandemic, and many are facing   a severe budget crunch. From March to August of last year, as the coronavirus pandemic first took hold, total tax revenue at the state level declined by 6.4%, and state governments were suddenly facing hundreds of billions in lost revenue across the board.

Better revenue management will have to be a top 2021 priority for state and local governments looking to thrive in the post-COVID era. That’s because COVID-19 hasn’t just hurt the budgeting bottom line by depressing tax revenues; COVID is changing how tax revenue comes in and where can it be found, with previously reliable tax revenue streams drying up, while others grow. To stay on top of their revenue streams, governments will need to adopt the data-transparent, cost-efficient and effective technology tools and practices that maximize tax compliance in the new COVID-19 tax landscape and ensure that no tax revenue source goes untapped.

Tax revenue has always been a huge part of our economy, with state and local tax revenue accounting for about 9% of our national GDP. But taxes come in all shapes and sizes, and not every tax contributes equally to total tax revenue across every municipality and all 50 states. That means a major disruptive event, like the coronavirus pandemic, can shift the way tax revenue comes in, creating a disparate economic impact and changing the way taxes ought to be collected.

Take sales tax, for example. In 2017, state and local governments took in about $389 billion in general sales tax revenue, amounting to about 12% of overall revenue. In 2020, COVID-19 reduced sale tax revenue by about $50 billion, mostly by reducing the emphasis on what and how much people bought from heavily-taxed goods and services like restaurants and hotels.

But that overall decline in revenue doesn’t tell the whole story, because the impact from COVID-19’s effect on sales tax revenue wasn’t felt equally across the country.

Only 46 states collect general sales tax, and of those 46 states, some rely on sales tax more heavily than others to balance their budgets. These differences in revenue management led to significantly different COVID-19 outcomes; new research has found that the more a state or local government relied on sales tax income, the higher its unemployment rate for government employees during the pandemic.

But at the same time that sales taxes have gone down, other tax revenues may start to go up. As more people leverage the freedom of remote work to relocate from urban to rural areas, property taxes in some municipalities will rise. And as more people order take-out and use online delivery services, these digital platforms like Uber and DoorDash present yet another lucrative tax revenue stream.

A similar story can be told about a plethora of different tax revenue streams. With stagnant business growth in 2020 and many offices retooling their employees for remote work, business licensing taxes and occupational taxes are likely to decrease. At the same, alcohol sales have increased dramatically and alcohol taxes have grown with them.

What we see across revenue streams, industries, municipalities, and states is a shifting tax landscape, where previously reliable revenue streams are drying up while others are widening and increasing. The key for governments will be their ability to comprehend this changing tax landscape and tap into it effectively by maximizing compliance.

There’s a lot that governments can do, but maximizing compliance will start with an internal audit. As tax revenue streams shift and change, governments need assurance they’re getting what is owed to them. But all too often, cumbersome paper processing, opaque data, and an over-reliance on manual work can hamstring a government’s capacity to get a clear overview of patterns of compliance or noncompliance, especially when tax realities are rapidly changing. A comprehensive, internal audit can ensure that doesn’t happen.

In the same vein, governments must prioritize adopting technology that streamlines tax collection and administration. An automated tax management system, for example, can make sure governments get their tax revenue quickly, easily, and with a minimum of human error. Many of these systems are cloud based and can be quickly and easily implemented for a jurisdiction. Meanwhile, citizens are expecting and often times demanding  an easier and more convenient way to meet their obligations  So, if governments don’t have the digital portals and online payment options that facilitate paying taxes, licensing fees, and fines, then a lot of revenue will potentially get lost in the confusion and upheaval.

These are just a few examples, but the list goes on. The main idea is that better administrative practices and new technology can help governments enhance tax compliance by making tax collection and payment easier and more efficient for both governments and citizens, while also rooting out noncompliance. By doing so, state and local governments can unlock their 2021 revenue streams and face the future of our changing economy and society with strength and success.

Avenu’s Jonathan Gerth Shows Alabama how to Get the Most out of Its Sales Tax

Avenu’s Vice President of Tax and Auditing Services, Jonathan Gerth, is bringing his expertise to Opelika, AL on Aug. 15 for a one-day business workshop in partnership with the Opelika Chamber of Commerce. Titled “Everything You Want to Know About the Collection of Sales Tax in the City of Opelika,” the one hour seminar is designed to educate local chamber members and potential chamber members on topics such as municipal business licenses requirements, how municipalities apply rental taxes, and the Supreme Court’s ruling regarding sales & use tax. Interested parties are encouraged to register online. Registration is $10 for Chamber members and $15 for prospective members. Lunch will be provided.