Brownsville Community Improvement Corporation President and CEO Josh Mejia, in a recent interview about BCIC’s just-released fiscal year 2021 annual report, said that despite the year’s challenges due to the ongoing pandemic, the organization is in a good place financially as it heads into 2022.
That’s partly because of a big surge in sales tax revenue. Despite the pandemic and the closure of international bridges to non-essential travel from Mexico most of the year, the city’s sales tax increased nearly 19 percent in 2021. BCIC’s operations and business-assistance programs are funded by a half-cent sales tax. A few things are behind the increase, including a return to restaurants and shopping last year as people who held back on spending in 2020 indulged the urge to get back to normal, Mejia said.
Brownsville also saw the usual “retail leakage,” what they call it when residents go out of town to shop mitigated to some extent as locals moved toward shopped local, he said. Inflation has also helped push sales tax higher, since things cost more, as has a certain rocket company and it’s 1,500 or employees whose spending power is being felt from Rancho Viejo to downtown Brownsville, Mejia said.
“We can’t deny that SpaceX’s presence and continued growth has also triggered an increase in salestax revenue,” he said.
As for the bridges, when they were reopened to nonessential travel on Nov. 8, the long lines of northbound shoppers formed quickly, a situation that persists, Mejia said. He predicted the growth in sales tax revenue will continue in 2022, perhaps not in double digits like 2021 (18.8 percent), exceeding expectations, but certainly in the single digits.
“We started strong already,” Mejia said. “That extra cash is also helping the organization have a much better financial position to not only grow but also be able to directly (impact) the community programs, and that’s really what our focus is.”
For example, BCIC’s Business Improvement and Growth (BIG) program got a big boost through a $2 million donation from the Musk Foundation, significantly advancing BCIC’s goal of getting businesses back into empty buildings downtown, he said.
“That helped bring close to 20 projects in the pipeline for downtown with the intended purpose of reactivating buildings and having new tenants come in,” Mejia said.
That progress was slowed somewhat by the pandemic last year, he said, noting that while there’s plenty of interest in investing downtown, many investors held off on taking the leap in 2021 out of an abundance of caution. Mejia said he hopes to get more new downtown business “across the finish line” this year.
“Hopefully people will be a little less cautious,” he said. “That’s what I’m really looking forward to.”
BCIC’s bottom line going into 2022 is “looking pretty good,” with projected reserves of nearly $11 million and a $2 million unrestricted balance, Mejia said. The organization’s projected operating revenue for the fiscal year is $10.4 million, compared to a little over $9 million in 2021.
The 2022 numbers include a $900,000 grant from the Economic Development Administration, on top of a $2 million EDA grant last year, for the eBridge Center for Business and Commercialization, a business incubator in the former La Casa de Nylon building, currently undergoing an extreme makeover.
BCIC also has more money to spend on its community programs in 2022 — about $7.5 million, Mejia said.
“That’s thanks to private contributions, through grants and partnerships we’ve established with the U.S. Department of Commerce, and the fact that we’ve been leveraging and being a bit more strategic in terms of how we utilize our funding to ensure that we continue to see economic growth,” he said. “That’s something that I’m delighted about, because that took about 36 months to be able to accomplish and almost double the amount of funding that we use to impact the community directly.”
Read the full BCIC 2021 annual report here: brownsvilleedc.org/transparency2021
