Saturday, May 31, 2008

Benefits reaped from KU title run

Sales tax collections up 9 percent

The city of Lawrence appears to be reaping another benefit from KU basketball's National Championship run.



Self-made Champions

The Lawrence Journal-World looks back at the men's basketball season of 2007-2008, in which the Jayhawks claimed the NCAA championship title for the first time in 20 years and its third ever.

You may not have worked it off yet, but those series of March Madness celebrations are beginning to pay off for the city's coffers.

Sales tax collections for the late March and early April period - the heart of the Jayhawk's National Championship run - were more than $160,000 higher, or about 9 percent greater, than they were a year ago, city leaders recently learned.

How much of that boost is directly attributable to the mass quantities of T-shirts, snacks, beverages and other party supplies isn't known, but leaders said there's no doubt the celebration added to the city's finances.

"It's definitely more than it would have been otherwise," said Ed Mullins, the city's director of finance who oversees the sales tax figures.

Bar and restaurant owners in the city are happy to take credit for some of the increased business. Doug Holiday, owner of Bigg's BBQ, said his south Lawrence restaurant had record-setting sales during the tournament.

"Our sales were over last year's total by a lot," Holiday said. "And the best news is: I think it is going to carry over through the summer. I think all this sports success has really put us on the map. I think there are people who want to come back and check out Lawrence again."

An even clearer sign of how much the National Championship celebrations added to the city's economy may come next month. That's when the city is expected to receive its drink tax check, which is the city's share of taxes collected on alcohol sold at bars and restaurants.

For the time being, though, the sales tax collections are enough to keep city leaders smiling. The most recent sales tax check continues a surprisingly strong year for the city's sales tax collections. For the first five reporting periods of the year, the city's collections are up $524,000 - or 5.9 percent - compared to the same period a year ago.

Questions remain, though, about whether such growth will continue.

"I still think it will be difficult to maintain that type of increase with the pressure that is being put on consumers," Mullins said.

Mullins said he continues to be concerned about how consumers will react to rising fuel prices and a weakening real estate market that has nearly ended the trend of using home equity to make purchases. Mullins said recent news about auto manufacturers reducing their outlook for sales also could be bad news for sales tax collections.

"I always say you have to buy a lot of T-shirts to make up for one less vehicle being sold," Mullins said.

But some retailers are holding out hope. Holiday said he thinks Lawrence entertainment-oriented businesses may see larger sales as the result of the economic slowdown. He said people may be less willing to travel, which means they may spend more of their entertainment dollars locally.

"Maybe they'll go to Clinton Lake instead of the Lake of the Ozarks or something like that," Holiday said. "I think they'll still do something. You can't just go hide under a rock. You've still got to have some fun."


Ben Kane 11 years, 6 months ago

haha, very true sevenyear... However, i still think they should move the game back to Lawrence. Supporting the local business should be an after thought to keeping tradition, being able to show off our new facilities on (hopefully) national tv, not requiring students to drive an hour to a HOME game against our biggest rival, effectively destroying any home field advantage, and decreasing our enemy's travel time and weariness...

sevenyearhawk 11 years, 6 months ago

I'm currently reading the book Rivals about KU and MU ...The game was in Kansas City for something like 20-30 years, I'll have to go back and check.It was actually kept "halfway" between the schools in Kansas City to help with travel costs because of the World Wars, wonder how soon this may become a concern again?Students are going to have to travel regardless, the game is during Thanksgiving break ... so that argument is moot.I like the possibility of taking the money made from the Border War in KC to upgrade and assist the other programs: women's basketball, baseball, softball, etc.Once they attain a certain level of success, they should hopefully be able to support themselves.They all have a long way to go ...

bcspoon 11 years, 6 months ago

Just think of the revenue that could have been generated if businesses like Keno's paid their sales tax. After all, when we paid them for the pizza, we were charged sales tax. The tax was already paid by their customers, they just choose to keep it and use it on other things. People tend to forget that a percentage of the taxes that are collected come right back home to Lawrence.

Chicago_JHawk 11 years, 6 months ago

DanBand- He's referring to Papa Keno's Pizza, which was just shut down for not paying sales tax revenue to the state. I loved posting this because now I feel so much smarter than you...

DanBand 11 years, 6 months ago

I know what he was talking about....just don't know why it mattered...As if the $250ish in city taxes really would have made a huge difference....or that Papa Keno's would have seen any of that money again "People tend to forget that a percentage of the taxes that are collected come right back home to Lawrence."I understand a lot of little things add up to a big thing...but seriously.....another example:Marvin Barry's Cousin's comment:"and decreasing our enemy's travel time and weariness..."Seriously? 1 hour in a bus? Can we get off the topic of complaining about the game in KC? It was the right decision when it was made, and any statement that says that we would have won that game if it was in Lawrence is total speculation, and not basis for this argument.Let Lew make the decisions, and win us National Championships.

DanBand 11 years, 6 months ago

BCSpoon what the hell are you talking about. Great first post.You are right, the store just gets to choose if they are going to pay taxes, or just keep the money.I love reading the comments more than the articles because i feel so much smarter than you. Kind of like going into a dive bar or Wal-mart and people watching.Sometimes I wish most of you were K-state fans.

Larry Smith 11 years, 6 months ago

chuckberry, what do you think about students having to drive a hour to an away game and not having to go to columbia? and actually being able to get tickets?

sevenyearhawk 11 years, 6 months ago

I'd say to those businesses that were griping about the Border War getting moved to Kansas City:"You'll get nothing and like it!"Don't give them squat - I'm looking at YOU Red Lyon ...

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