The city will lose two-thirds of its beer and wine revenues after the state approved its budget last week, Roanoke Rapids Finance Director MeLinda Hite said today.

That equals $44,646.

“The municipal share, distributed in May 2010, will be reduced by two-thirds, and cities and towns should reduce their expected beer and wine tax revenues by two–thirds for 2009-2010 to reflect this reduction,” she wrote in a memo for department heads. “The distribution formula for beer and wine tax revenue distribution will be adjusted for 2010-2011, and the funding level will be restored for the May 2011 distribution.”

The state took away those funds to help combat its own budget deficit.

“That hurts,” Hite told The Spin. That was money already budgeted that must now be pulled from the city’s budget.

The city must also try to make up that money, Hite said. She said the city will wait for new City Manager Paul Sabiston to come onboard before investigating how to make up that money.
The city has made significant strides in improving its fund balance since the end of last fiscal year.

Measures taken by council when the city learned in February it faced a $664,000 shortfall mean when it closed the books at the end of June, its fund balance increased 8.9 percent for a total of 17.2 percent. That represents a $1.9 million unreserved fund balance. Fund revenues for the year are expected to increase by more than $900,000.

The money is revenues which come from the sale of beer and wine in the city.