“Loyal to Lakeway”: City program seeks sales tax boost From the cover
Benefits of shopping local
About the program
The overview
Keeps dollars in the community to fund infrastructure and operations
Loyal to Lakeway seeks to build synergy among local businesses, Assistant City Manager Ashby Grundman said. “If the city had any ability to create some sort of opportunity for local business owners to network better together, I think that would be tremendous,” said Andrew Rincon, owner of Hops & Thyme and co-owner of CraigO’s in Lakeway. Supporting local businesses helps keep money circulating locally, Eco Estate Jewelry owners Eric Hoffmaster and Alida Tallman said.
Loyal to Lakeway aims to promote local businesses by fostering economic growth and a greater sense of community in Lakeway. Shopping in-person brings in sales tax, but so does shopping online, City Manager Joseph Molis said. Online sales tax is determined by the item’s destination, meaning purchases from places such as Amazon also result in sales tax revenue. The issue is when people travel to other cities to shop, Molis said. “That money’s being spent anyway, but it’s being spent by people leaving the city and giving that money to the surrounding community,” Molis said. “The idea is to bring that money back into Lakeway.” The program also aims to limit property tax increases. As the city keeps growing, more money is needed to maintain city operations. “Those sales tax dollars ... really help us to provide the services you need,” Mayor Tom Kilgore said in a city update Nov. 14.
Provides opportunities to support community groups Supports businesses that employ local residents
Saves gas and time
Generates greater impact than buying from national chains
SOURCE: CITY OF LAKEWAY/COMMUNITY IMPACT
How we got here
in recent years, Molis said. “It’s not one-for-one, but the better we can do at having local purchases and online purchases, the better it is for us as residents and city gov- ernment,” Kilgore said in the Nov. 14 city update. “It’s easier to get that revenue than it is raising property taxes.”
The city has traditionally relied on new prop- erty growth to fund increasing operational costs, but as a land-locked municipality, the room for growth is running out, Molis said. With Bee Cave to the south and state laws now limiting the city’s ability to annex new property, city growth has already started the process of plateauing, signified by a downtick of new building permits
Sales revenues
1.75% of sales tax on local purchases goes toward the city of Lakeway 65% of retail dollars spent by Lakeway residents are spent outside of the city $14.9M lost sales tax revenue as a result of outside purchases 28.7% of city revenues come from sales tax SOURCE: CITY OF LAKEWAY/COMMUNITY IMPACT
10% 8% New property tax revenue vs. inflation
New property tax % of revenues Inflation High inflation has surpassed the amount of new property taxes the city has brought in since 2021, data shows.
0% 2% 4% 6%
2019
2020
2021
2022
2023 2024
SOURCE: CITY OF LAKEWAY/COMMUNITY IMPACT
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