Trusted local news leader for Kingman, Arizona & Mohave County
Wed, Oct. 16

Kingman economy strong, growth slower

Three economic indicators show the Kingman economy continues strong with room tax revenue growing, retail sales steady and employment high.

Room tax revenue, a city tax on hotel room rentals, could reach the highest total in the past nine years if current increases continue through July 2002, according to city reports.

"The revenue is up nearly 7 percent for the first five months of the fiscal year beginning July 1," Kingman Financial Services Director Coral Loyd said.

November receipts of $19,097 were up from $18,876 last year.

Reports run a month behind actual reporting to the city.

The November figures reflect travel and overnight motel stays in September.

The effects of the Sept.

11 terrorist attacks may not be shown until the December report.

The highest annual room tax revenue was collected in 1995-96 at $219,344 and the lowest was in 1998-99 at $180,621.

Through the first five months of the fiscal year that started July 1, the revenue reached $105,611 and would total $229,607 by the end of June 2002 if the trend continues.

The room tax is 2 percent of the room rate for stays in Arizona motels, hotels and campgrounds.

The tax collections are a measure of the health of the travel industry.

Loyd said the local sales tax has remained steady during the same period of time, running about 1 percent above sales tax collections of the same period in 2002.

Sales tax collections indicate Kingman businesses are doing the same sales volume as a year ago.

However, sales tax collections have shown an annual growth of 6 to 8 percent for the past several years.

The local, county and state governments had been budgeting based on expectation of a growth in sales tax revenue of at least 6 percent.

Last spring, Kingman adopted a budget based on 4 percent growth in revenue for sales taxes.

That conservative estimate will not be met if the current 1 percent rate continues.

"At the current 1 percent (rate for) flat sales tax collections, Kingman will have a shortfall of $300,000 to $400,000 by June 30," Loyd said.

She estimated total sales tax collections in the budget at $8.5 million.

The $8.5 million in sales tax is part of a $20 million budgeted revenue estimate for the general fund.

Contingency funds and other budget adjustments or reduced spending would cover the shortfall.

Another measure of the Kingman economy, the employment rate, remains strong.

The Arizona Department of Economic Security reported a labor force of 9,648 in Kingman during September, with 9,375 people employed.

The unemployment rate has averaged 2.8 percent for the year and was right at that level in September and October.

More jobs are being created at existing companies.

Citizens Communications held an open house Dec.

1 in the first step toward hiring 90 to 100 new employees at the call center on Stockton Hill Road.

American Woodmark is undergoing a $14.3 million expansion scheduled for completion in February 2002.

An additional 120 to 150 jobs are expected.

"We will be accepting applications in late spring or early summer," Plant Manager Tom McLarty said when the expansion began.

Expansion should add more jobs than have been lost with the reduction in the work force of about 160 at North Star Steel.

Good experience with employees and the Kingman workforce helped American Woodmark decide to expand at the Kingman Airport and Industrial Park and encouraged other companies to relocate to Kingman, said Tom Carter, executive director of Kingman 2005.

The entity is the economic development arm of the city and the industrial park.

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