By Jared Putnam
Staff Writer
The financial impact of the COVID-19 pandemic has rippled across a wide variety of industries over the past 18 months. With life as Americans knew it dramatically altered almost overnight in March 2020, state and local governments faced significant uncertainty about a key source of revenue — sales tax distributions.
A year and a half later, in spite of coronavirus and a variety of pandemic-related restrictions, sales tax numbers for Clay County and many other areas have remained largely unaffected by the changes. After generating approximately $3.03 million in sales tax revenue in 2019, Clay's numbers rose to more than $3.48 million in 2020. Those figures have continued to climb in data available through May this year, putting the county on track to see additional growth in 2021.
“We were certainly concerned initially how the pandemic would affect our revenue streams, especially knowing the increased cost to implement certain control measures, but we were pleasantly surprised that sales tax revenue actually increased," said Dr. Rob Peck, Chairman of the Clay County Board of Commissioners. “That increase, coupled with our wise use of CARES money and aggressive pursuit of grants, actually put us in a pretty positive position which allowed us to continue to operate effectively throughout the pandemic while still taking on several capital improvement projects.”
Clay County collected $323,198.59 in May alone, up from $258,399.95 a year earlier in May 2020. Perhaps more surprising is the fact that May 2020 was the only month in which the county saw a decline in monthly sales tax revenue from 2019, prior to the pandemic. Even then, it was a modest dip of less than $2,000 from the $260,314.46 earned in May 2019.
In early July, the North Carolina Association of County Commissioners forecasted ongoing optimistic numbers for the state as a whole.
"North Carolina local governments are expected to receive $383.5 million in sales tax distributions, a 40 percent increase statewide compared to last year," NCACC said in a press release. "July 2021 distributions reflect April 2021 sales; the state was no longer operating under a stay-at-home order. Similar to last month, this significant year-over-year increase again reflects $100 million more in local sales tax revenue compared to the same month last year, when the economic impact of the pandemic took the largest dip, percentage-wise."
North Carolina's unemployment rate was 4.4 percent in July, continuing an ongoing downward trend since September 2020, when the rate was 7.1 percent. The state boasted a 3.4 percent mark in February 2020, prior to the start of the pandemic in the United States a month later. By May 2020, North Carolina's unemployment rate had spiked to a pandemic peak of 13.7 percent.
North Carolina's numbers are ahead of the current national unemployment rate of 5.2 percent, though the recovery is not uniform across all industries or regions of the state.