The monthly financial report didn’t contain the good news city officials were hoping for.

Sales tax revenue for June was down across the board. Projections based on the sagging numbers put the city nearly $80,000 in the hole by year’s end. If the trend continues, the city will have to dig into its reserves to meet operational costs, officials said.

The city has enough reserves to cover the shortfall this year, Finance Director Bruce Nelson said, but the real impact will be on next year’s budget.

“Hopefully, something will stimulate the economy now,” he said. “We do have to be concerned and watch these numbers when we’re budgeting for next year.”

The city collected $207,128.23 on sales for the month of June, 7.96 percent less than the $225,000 budgeted. This is the fourth of seven months this year that revenue hasn’t been up to par.

The city adopted a flat budget for 2004, meaning anticipated revenues were set at nearly the exact amount collected last year. The city gets a portion of the countywide sales tax, and that revenue also is less than expected for the second month in a row.

Countywide sales tax brought the city $77,087.95, which is $8,512.05 less than budgeted.

Higher-than-expected revenue in other months puts the city fairly even with year-to-date revenue budgeted, but a few more bad months could make it difficult.

“It is a problem,” City Manager Jim Ferree said.

City officials speculate that the temporary workers brought in as part of the power plant’s environmental retrograde pumped enough into the local economy to keep revenue stable and now that the project is finished, numbers are falling.

“Maybe hunting season will help,” Ferree said.

A declining, or even stable, revenue base forces the city to cut capital projects and purchases to maintain personnel and operations. The city has not added any new positions in several years and the City Council generally provides employees a cost-of-living increase.

City officials are in the midst of their budgeting cycle. The council should see a copy of the draft 2005 budget next month. A daylong budget workshop is Sept. 30.