Tri-Cities sales tax collections make tepid September showing

Retail sales tax collections slipped for the third straight month in September while Kingsport-Bristol saw its second month of improvement.

If Tri-Cities September collections sound a little tepid, you’re right. But it wasn’t just the seven-county Tri-Cities region. The year-over-year performance in the Knoxville and Morristown Metropolitan Statistical Areas (MSA) lagged well behind the state’s 4.8% benchmark.

Here how the four Northeast Tennessee metro area’s looked compared to September last year. Remember 4.8% is the state benchmark.

Morristown – up 2%.

Kingsport-Bristol – up 1.6%.

Knoxville – up 0.4%.

Johnson City – down 2.4%.

Those numbers are in the Middle State Tennessee’s September seasonally adjusted sales tax collection report .On the month-over-month comparison, Morristown is a statewide rock star, and Kingsport-Bristol made a strong showing. Knoxville and Johnson City managed tepid improvements over the August totals.

Morristown – up 8.7%.

Kingsport-Bristol – up 2.3%.

Knoxville – up 0.3%.

Johnson City – up 0.3%.

Statewide, September’s collections were 1.6% better than August.

Nationwide consumer spending was up 1.5% in September. Spending was led by a surge in car purchases to replace those damaged or lost during hurricanes Harvey and Irma. A spike in gasoline prices also contributed to the increase.

Excluding gasoline and auto, retail sales posted a modest 0.5% increase. But remember we’ve switched to retail sales numbers, and the Tennessee report is for retail sales tax collections. Local and regional retail sales numbers haven’t been posted since Dr. Steb Hipple retired and dropped his month’s labor market and retail sales reports. So far, the East Tennessee State University Bureau of Business and Economic Research has not signaled that the department would continue the localized economic reporting on those topics.

While retail sales and the collections of taxes on those sales can be volatile, there are signs of stability in the Tri-Cities’ numbers. Johnson City’s collections tend to be less volatile than Kingsport-Bristol and continue to look that way. However, the three-county area has seen two straight months when the year-over-year collection underperformed this year’s trend line. Kingsport-Bristol collections equaled the trend line in August and outperformed it in September. Johnson City’s share of collections has also slipped to 47.9%, which is 2% lower than it was in August. It was also 1.1% below the long-term median 49% share the Johnson City metro area has claimed since 2010.