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Which Way is Up?

Which Way is Up?. Addressing what you know and what you don’t know when forecasting sales tax. Local Government Revenue. Nationally: #1 source = property tax (Tax Foundation) Arizona primarily sales tax. Community Identity. Who are you? What do you do? Who do you serve?.

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Which Way is Up?

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  1. Which Way is Up? Addressing what you know and what you don’t know when forecasting sales tax

  2. Local Government Revenue • Nationally: #1 source = property tax • (Tax Foundation) • Arizona primarily sales tax

  3. Community Identity • Who are you? • What do you do? • Who do you serve?

  4. Where does the money come from? Communication Retail Construction Lodging Commercial Rental Mining Restaurants Transportation Printing

  5. Perspective • Internal experts • External experts • Both matter

  6. Identifying Assumptions for Financial Models • Historical data • Personal view • Instinct (or intuition) • Experience • Divine inspiration Source: Does the past predict the future? December 23, 2009

  7. Using the Past to Predict the Future • Objective – based on fact • Context – how far back to go • http://www.gfoa.org/downloads/GFOAGFRoct12revenueforecasting.pdf

  8. Policy Question: GFOA Government Finance Review, October 2012

  9. Timing is everything… • Economic cycles • Growth • Local political climate • Legislative climate • What level of revenue is sustainable?

  10. Retail

  11. Construction

  12. Summary Regional to local to regional again • State law: What are the rules of the game? • Community identity • Who are you? • What do you do? • Who do you serve? • Local policy: Conservative or objective? • Local environment: What has changed or is likely to change? • Regional/national environment: What is going on in the world around?

  13. Questions

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