The budget Owensboro City Commissioners were presented with last week does not include any tax increases, adds additional funds for street paving and sidewalk repair, and allocates funds to other projects and events across town.

Mayor Tom Watson said the city should pay for such initiatives, a year after the COVID-19 pandemic shuttered much of the nation’s economy for months, because local businesses managed to continue operating during the pandemic.

“Without the business community and all the commerce it has created, we wouldn’t have the money to do what we are doing,” Watson said last week.

The health of the city and its businesses is reflected in the city’s occupational tax revenue. Owensboro Finance Director Angela Waninger said occupational tax revenues are $641,000 more than they were at this time in 2020.

Occupational taxes make up 32.2% of the city’s general fund, the largest share compared to other city sources of revenue.

“A lot of other cities saw huge declines in their occupational taxes,” Waninger said.

By the end of the fiscal year, city officials estimate the city will have collected $19.308 million in occupational tax revenue. That is forecast to be less than fiscal year 2019-20, when $19.455 million was collected because the city is now returning some occupational tax revenue collected in the Gateway Commons TIF district to Gateway Commons developers, Waninger said.

Occupational taxes are paid by people who work inside the city, regardless of where they live. Waninger said businesses in Owensboro found ways to avoid layoffs last year and Owensboro was the only city in the U.S. to receive recognition for having its unemployment rate decline during the pandemic.

“Typically, when the rest of the world is in recession, Owensboro seems to fare well,” she said.

“Our hospital is our biggest private employer, and our hospital didn’t lay people off, like (hospitals) in other cities,” Waninger said. Also, large retail outlets like Walmart and Meijer didn’t close their Owensboro stores during the major months of the pandemic last year.

In June 2019, the city had an unemployment rate of 4.4%. In June 2020, the city’s unemployment rate was 4.2%.

Owensboro’s economy also benefited from its variety of employers, Waninger said.

“We don’t have any heavy reliance on one industry,” she said.

When restaurants had to halt indoor dining, they transitioned to carry-out operations and found other ways to keep workers employed.

“They were creative in keeping things doing,” Waninger said. “... We were just very fortunate.”

City officials forecast city revenue from occupational taxes will increase to $19.878 million in fiscal year 2021-22.

Watson said Monday officials owe a debt of gratitude to the local business community.

Watson said he thanked city staff last week for preparing the 2021-22 budget during a Thursday work session, but, “I failed to talk about how lucky we are to have a business community doing so well.

“If they don’t do well, we don’t do well,” Watson said. “I think they need a pat on the back.

“We are appreciative, and should be more appreciative,” Watson said. “We need to be more grateful. They allow (the city) to do the things we do.”

James Mayse, 270-691-7303, jmayse@messenger-inquirer.com, Twitter: @JamesMayse

James Mayse, 270-691-7303, jmayse@messenger-inquirer.com, Twitter: @JamesMayse

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