WESLACO, TEXAS – A shift in shopping habits brought about by the coronavirus pandemic has boosted sales tax revenues for smaller communities in the Rio Grande Valley.

Matt Ruszczak, executive director of Rio South Texas Economic Council, analyzed these developments in an 2020 end-of-year report. His report was based on information released by the Texas Comptroller’s Office.

“The COVID shift, looking at these numbers, is definitely real,” Ruszczak said. “The fact that people have changed their shopping habits reverberates in these numbers. The fact that they are spending their money in these secondary and tertiary markets, and not as much in the primary markets, gives value to these numbers.”

Matt Ruszczak

The top ten Valley communities as measured by the percentage growth in sales tax revenues were: Bayview, Santa Rosa, Edcouch, Alton, Combes, Penitas, La Grulla, and Rancho Viejo.

McAllen, the Valley’s No. 1 destination for shoppers, saw its market share from 1.3 percent to 24.6 percent. The city suffered in part because Mexican shoppers have been prevented from crossing in the United States since March. The travel ban was put in place to stop the spread of COVID-19.

Ruszczak said he will be interested to see if shoppers return to destination cities once the pandemic has receded. 

“As we normalize, will we revert back to old habits or are we going to retain our closer to home shopping habits, or our online shopping habits?” 

Ruszczak said analyzing the money shift per capita was fascinating. Alton’s was up $850. Weslaco’s was up $891. Santa Rosa’s was up $896. Combes’ was up $958. Granjeno’s was up $997. La Grulla’s was up $1,039. Edcouch’s was up $1,100. Alamo’s was up $1,167. Rio Grande City’s was up $1,196. San Benito’s was up $1,299. Bayview’s was up $1,718. Donna’s was up $1,038. Palmview’s was up $2,325. Penitas’ was up $2,917. And Palmhurst’s was up $4,158.

“I think a lot of these secondary and tertiary communities really tasted the opportunities a strong retail and hospitality market brings to their communities. I think this will mean we will have a lot more players in this region competing for investment. Which could be great,” Ruszczak said.

“Businesses go where the market is growing. The Rio Grande Valley market grew as a whole through this very challenging year and particularly grew very strongly in these secondary and tertiary markets. It will be exciting to see how these communities embrace these opportunities in the months and years to come.”

Ruszczak said if he was representing such communities he would have a great story to tell at trade shows.

“They could leverage this data, you could participate in trade shows. You could say, ‘you may not have heard of us, but we grew. We outperformed the region by a factor of ten. We are very motivated to attract investment, we have more land, etc.’”

Ruszczak said the Valley’s smaller communities have always had potential. 

“Now they have hard numbers. They can say, ‘you have heard of these markets, well we outperformed them.’ A really strong story that can be leveraged.”

Here is a podcast of Ruszczak’s analysis:

Editor’s Note: This is the first of two podcasts focusing on Matt Ruszczak’s end of year report on sales tax revenue collections. Part Two will be posted in our next edition. 

Editor’s Note: The main image accompanying the above news story shows a strip mall on Conway Avenue in Palmhurst. (Photo: Steve Taylor/RGG)

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