2009 RETAIL SALES SLIDE 11.6 PERCENT
After climbing steadily since 2002, retail sales slid 11.61 percent last year, falling from $5.4 billion in 2008 to $4.8 billion. December 2009's $466 million in sales represents a 14 percent drop from December 2008.
Unlike much of the rest of the country, which suffered declining retail sales when the national economy took a dive in 2008, Lafayette Parish's taxable sales increased 3 percent in 2008. Just about everyone breathed a collective sigh of relief at the slight uptick in this barometer of economic activity, but the optimism quickly faded, as the decline of 2009 was right around the corner. When January's totals came in, they were down 6 percent. And while February bounced up ever so slightly, same month sales comparisons consistently showed declines through the remainder of the year. The biggest disappointment came in October 2009, which plummeted $97 million, or 21 percent, from October 2008.
Those tax reductions mean less money for local government - for both capital funds and the general fund. "There is no denying that the economical plight of the country has affected Lafayette," City-Parish President Joey Durel said in his Feb. 2 State of the Parish address. "Our sales taxes continue to decline, and if there isn't a leveling off in the next few months, we will be forced to make some difficult decisions as it relates to cutting our budget."
Chief Administrative Officer Dee Stanley says officials saw the handwriting on the wall and made a mid-year budget revision last year, correcting the shortfall at that time. They are now looking at monthly 2010 numbers, including November-December 2009, and will make recommendations for a budget amendment if necessary. "The year-to-date shortfall [November, December and January collections, as local government runs on a Nov. 1 to Oct. 31 fiscal year] to the city is $1.8 million, for the parish it is approximately $727,000, so there is no need for an adjustment at this time," Stanley says. "Christmas sales in the city were only down 1.8 percent from 2008, and that is good news."
Though certainly unrealistic to believe the parish's record-breaking retail sales streak could continue, the decline is cause for concern. But it certainly is no reason to panic, as the 2009 total is right up there with 2005's sales, a big year of growth even before hurricanes Katrina and Rita brought an influx of shoppers to the area and federal incentives that spurred a construction boom and sent retail sales beyond the $5 billion mark for the first time. "I'm not going to pretend that it's as good as it was, but this is on pace with pre-hurricane years," says LEDA's Gregg Gothreaux. "You don't build your business plan based on your best year. You build your business plan based on indicators for the past five years, more if you can," he adds.
"Obviously the boom has curtailed, and we're feeling the results of the national recession and what's going on in Washington. It's certainly affecting the oil and gas industry - they're waiting on Washington's attitude toward the energy business," Gothreaux continues. "The one thing business can't handle is uncertainty. That holds true not just for the oil and gas industry but for all businesses."
JINDAL, ROVE HEADLINE LOGA'S ANNUAL MEETING
Gov. Bobby Jindal will give the keynote address at the 2010 Annual Meeting of the Louisiana Oil & Gas Association on March 23 at L'Auberge du Lac in Lake Charles. The three-day meeting, March 22-24, includes a golf tournament and a silent auction.
"With the legislative session starting less than a week later, we think this will be a great opportunity for Gov. Jindal to discuss in detail the administration's priorities and, hopefully, provide a more solid outlook on the state's budget situation," says LOGA President Don Briggs.
Karl Rove, former deputy chief of staff and senior adviser to President George W. Bush, will also address the crowd and sign copies of his new book, Courage and Consequence.
LOGA is offering a limited number of one-day passes for $200 for those who want to attend only the business sessions and speakers. "We want as many of our members, friends, business partners, employees, community and state leaders to be able to participate in the oil and gas meeting of the year for Louisiana," Briggs says. Other speakers include Bruce Vincent of Swift Energy Co., who is IPAA chairman; and Regina Hopper, president and CEO of America's Natural Gas Alliance; Louisiana economist Dr. Loren Scott; Department of Natural Resources Secretary Scott Angelle; Department of Environmental Quality Secretary Peggy Hatch; Commissioner of Conservation Jim Welsh; and Department of Wildlife and Fisheries Sec. Robert Barham.
Registration is limited to 300. For more information, visit www.loga.la.
Compiled and edited by Leslie Turk; e-mail her at [email protected].