Measure J tax revenue climbing; finance officials cautiously optimistic about coming months
Sales tax returns for the city’s Measure J fund are up 6% so far this year, though city leaders warn that the biggest revenue months for the tourist destination are still on the horizon.
Measure J tax revenue is trending upward as the city enters the heart of its tourism season, with officials reporting a 6% year-over-year increase in collections through January.
According to data presented during the Measure J Oversight Commission meeting on Thursday, cash receipts for the current fiscal year have reached $8.07 million, compared to $7.6 million during the same period last year. The monthly returns on the tax showed some volatility, ranging from a 22.4% spike in November to a 3.2% dip in December.
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Palm Springs Director of Finance and Treasurer Kristopher Mooney described the department’s stance as one of cautious optimism.
“It is very early,” Mooney said during the meeting. “We collect about 60% to 70% of our revenue in the second six months of the year. So it is very early. Indications seem like the first quarter could be pretty good. We hear some good things”.
The Measure J tax, a 1% sales tax approved by voters to support local improvements and public safety, is currently fueling several high-profile infrastructure projects. Among them, the city reported that construction is underway for new pickleball courts at Demuth Park, with $455,000 already spent.
Despite the uptick in revenue, the Measure J fund is projected to run a deficit for the current fiscal year as the city accelerates its project spend. Financial reports show a year-to-date deficit of approximately $1.4 million, a figure that is expected to grow as major construction continues.
Finance officials emphasized that this is not a sign of fiscal instability, but rather the result of intentionally deploying built-up reserves to complete long-awaited community improvements.
“I wouldn’t be surprised with all the project spend that we have going on if we do run a deficit for the entire year,” Mooney told the commission. “It would actually be good for Measure J because we’re getting some of these projects completed and spending a lot of money on these projects”.
Officials confirmed that the city has begun cutting checks for a variety of local non-profit and community projects that were approved in previous cycles.
Recipients of recent payments include the Boys and Girls Club of Palm Springs and the Mizell Center, which each received $125,000 — the first of four payments that will total $500,000 for each group.
“I think you’ll begin to see these lines fill up with first payments to a majority of these projects,” Mooney said. “We have met with most everybody, and we have got grant agreements for the grantees.”
The commission is expected to meet again in March to review updated revenue figures as the peak festival and tourism season begins.
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