City of Raleigh adapts to drop in sales

Raleigh City Manager Russell Allen said this week that the city will continue to rein in spending as it braces for a decline in sales-tax revenue.

"We don't know what the trend in sales tax is going to be," Allen said. "We don't know how the state's going to deal with their budget and whether or not that's going to have any impact on us."

The latest sales-tax revenue numbers will be released Friday and will include most purchases made in September. During the current fiscal year, which began July 1, Raleigh's sales tax revenue has increased about 5 percent over last year, which is what the city's 2009 budget projected.

But Allen and other city leaders expect those numbers to get worse before they get better.

The U.S. stock market declined 17.7 percent in October, its worst month since a 23 percent drop in October 1987. And the jobless rate for Durham, Johnston, Orange and Wake counties climbed to 5.6 percent in September, the highest since June 2003.

"We're being cautious right now," Mayor Charles Meeker said. "We're waiting to see if this is going to be a real big downturn or a small bump in the road."

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