The city’s revenues are coming in above projections and spending remains on target, City Administrator Leeann DeMouche reported to the St. James Board of Aldermen on April 13 while giving her Fiscal Year 2026 Second Quarter Report.

Since the city is halfway through its fiscal year, it uses a target benchmark of 50 percent to guide where revenue and spending should be.

DeMouche reported that the city has exceeded expectations by collecting 64 percent of its estimated revenue and has spent 48 percent of its expenditure budget, which is right on target.

“Compared to last year, our general fund is doing extremely well,” DeMouche said. 

The successful revenue numbers are largely driven by a surge in the city’s sales tax collections. Compared to this time last year, sales tax revenue is up by 20 percent and has reached 55 percent of its annual budget.

“Our sales tax is coming in very strong,” DeMouche said. “Probably a lot of that is because of the construction that’s going on in the city. A lot of people are coming in, visiting, doing the construction, probably going out to eat… and buying stuff locally.”

Revenue from the use tax is down by four percent compared to the same period last year. DeMouche noted that last year at this time, the situation was the opposite: the use tax was up and the sales tax was down. She said this flip could indicate a shift in consumer behavior, where more people are choosing to shop locally rather than online.

Business license revenue has increased by 25 percent since last year, already fulfilling 58 percent of its annual budget and signaling new business activity in the town.

The street fund, which is supported by a gas tax, is also performing well at 56 percent, likely due to high fuel prices.

Budget adjustments are needed for building permit revenue and solid waste revenue, both of which were underestimated. DeMouche will bring the adjustments to the council next month.

While the general fund is outperforming, the city’s utilities, especially electric, are under some pressure.

The electric fund has brought in $3.1 million in revenue, but expenditures have already reached $3.6 million, creating a deficit. Revenue is almost the same as it was this time last year, but spending is up by over $600,000.

DeMouche also said that revenue from the electric fund’s service availability fee is supposed to go toward capital projects, but because of the deficit, is currently being used to cover the electric bill.

“We have a lot of new construction,” DeMouche said. “Once these companies get built, and once they start using the electricity, and once they start using the water, then you’ll start seeing that benefit in there.”

Toth and Associates is conducting an electric rate study for the city, with potential increases coming this summer.

“We’re a little bit behind in our electric rates,” DeMouche said. “I hate to (increase rates), but as you can see, the numbers, it’s just going to get worse.”

She anticipates information about new rates could be brought to aldermen for public hearing and possible approval in May or June.