McAllen posts largest sales tax gain of five-month uptick

After nearly two years of experiencing declining numbers, the city of McAllen has for the fifth consecutive month posted sales tax increases.

McAllen saw its greatest gains of the period in February, with a $327,814 jump from February 2017. This is an 8-percent increase after having collected $4,548,115.57 this February compared to $4,220,301.45 during the same time last year.

City leaders point to the recent $50 million expansion at La Plaza Mall, which has lured shoppers from Mexico and Texas. But the economy in general has been healthy, they said, so it is not exclusive to the mall.

“I think that’s part of it,” Mayor Jim Darling said. “Talking to people, I think the mall numbers are up significantly, and that’s a shopping venue that’s been huge and will be huge for South Texas. But I think numbers are up not only at the mall, but the whole city.”

Darling and City Manager Roel “Roy” Rodriguez dealt with having to answer for 22 months of declining sales tax revenues before October 2017 finally swelled. But Rodriguez predicted a year-and-a-half ago that after the mall expansion was complete, revenues would increase.

Economists are also predicting continued growth in the McAllen area.

“I am projecting that around 29,700 jobs will be added to the McAllen-Edinburg-Mission area over the next five years at an annual rate of 2.10 percent,” wrote Ray Perryman, president of the Perryman Group, an economic research firm based in Waco, on Wednesday. “Most of this employment growth will come from the services, trade and government sectors.

“Although countless issues could alter the court of the economy in a heartbeat, I am optimistic about what lies ahead for the U.S., Texas and Rio Grande Valley.”

For a stretch, city officials were not convinced. City commissioners at summer budget hearings cautioned about city spending. But Rodriguez was optimistic about an eventual upturn.

“I see it continuing, but I’m not gonna call it a trend yet,” Rodriguez said. “It’s a great five months, but we had 22 in the red, so I’m gonna take that into consideration and be cautious going forward.”

The Valley’s other major cities also saw increases. Harlingen was up 9.77 percent over the previous February and Brownsville was up 6.06 percent.

Edinburg was up 11.09 percent for the month (up 4.89 percent for the year), Pharr was up 9.28 percent (up 10.10 percent for the year) and Weslaco was up 3.33 percent (up 2.94 percent for the year).

Only Mercedes showed negative numbers for February sales tax allocations, down 3.58 percent over a year ago. For the year, Mercedes is down 4.81 percent.