Sales tax collections decline

Phil Castle, The Business Times

Mesa County officials have revised downward their projection for sales tax revenue after collections dropped on a year-over-year basis for a fourth consecutive month.

Combined sales and use tax collections for the City of Grand Junction have declined for three straight months.

Year-to-date tax collections for the county and city in 2012 continue to outpace 2011, although the difference is shrinking.

While uncertainty surrounding the presidential election and economic outlook could be a factor, county and city officials can’t pinpoint the cause of what’s been decline in sales in most industry sectors.

“The last few months have been sort of bumpy,” said Marcia Arnhold, finance director for the county.

According to its October report, Mesa County collected a total of $2.19 million in sales taxes for its capital improvement and general funds. Another $832,000 in taxes were distributed to cities and towns in the county, including Grand Junction. Those numbers constitute a 2.4 percent decrease from collections reported for October 2011.

Since tax reports lag a month behind, October reports reflect September sales.

After average gains of nearly 8.9 percent through the first six months of 2011, county sales tax collections have dropped an average of 2.2 percent over the past four months.

Arnold said she’s revised downward the projected increase in sales tax collections for the county for 2012 from 4 percent to 3 percent. That difference amounts to about $200,000 in revenue for the capital improvement fund and $100,000 for the general fund.

According to reports for the first 10 months of 2012, the county has collected more than $22.6 million in sales taxes for its capital improvement and general funds. Almost $8.6 million in sales taxes have been distributed to cities and towns in the county. Those figures still remain almost 4 percent over what was reported for the same span in 2011.

While sales tax collections have declined, they still exceed what was budgeted, Arnhold said.

Moreover, Arnhold said she continues to forecast a 4 percent increase in collections for 2013.

According to its October report, the City of Grand Junction collected a total of almost $4.2 million in sales and use taxes. That’s a decline of 3.4 percent from collections reported in October 2011.

Sales tax collections within the city limits as well as the share of collections the city receives from the county both declined compared to last year. Use tax collections increased 20 percent to just over $300,000.

Jodi Romero, financial operations manager for the city, said sales tax collections have declined in recent months for most industry sectors, although she can’t precisely explain why.

Still, sales and use tax collections for  2012 still exceed 2011. For reports for the first 10 months of 2012, the city has collected a total of almost $41.5 million in sales and use taxes. That’s a 1.7 percent increase over the same span in 2011.

Phil Castle is editor of the Grand Valley Business Times, a twice-monthly business journal published in Grand Junction. Castle brings to his duties nearly 30 years of experience in editorial management positions with Western Colorado newspapers. In addition, his free-lance work has appeared in a variety of publications, including the Washington Post. He holds a bachelor's degree in technical journalism from Colorado State University.
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Posted by on Nov 20 2012. Filed under Business News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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