MITCHELL, SD (Mitchell Now) — City budget concerns in Sioux Falls appear to be easing as the year draws to a close, according to an update from City Finance Director Shawn Pritchett.

While sales tax receipts remain slightly below budget projections, Pritchett told city councilors the trend is improving. Through November, sales tax revenue growth is running at about 2.6 percent, compared to roughly 1.5 percent growth at the same point last year.

Construction activity is providing the most encouraging news. Housing construction is down compared to last year, but commercial construction has surged.

“We are still on track, obviously, for our second-best year on record,” Pritchett said. “Through November, the city has issued $1.25 billion in building permit valuations, which is about $217 million more, about 21 percent more than this time last year.”

Pritchett said building permit valuations are on pace for the second-highest total ever recorded in Sioux Falls.

He also expressed optimism about the city’s snow removal budget, noting approximately $4.5 million remains in that budget line with only the final weeks of the year remaining.

Overall, the city has received about 93 percent of its budgeted revenue through November, which is slightly below estimates. However, Pritchett said expenses are also running behind projections, helping offset the slower revenue pace.

City officials say the combination of strong commercial construction, improving sales tax trends and controlled spending is helping stabilize the city’s financial outlook heading into year-end.