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Sales tax collections up, but will they match 2012?

Phil Castle,The Business Times

Sales tax collections continue to rise in Mesa County, buoyed in part by increased spending for building materials, automobiles and restaurant meals.

It remains to be seen whether collections will rebound enough in 2013 to match those in 2012, but the trend is headed upward.

“We seem to be moving in the right direction,” said Jodi Romero, financial operations director for the City of Grand Junction.

Marcia Arnhold, finance director for Mesa County, agreed. “We’re encouraged, obviously.”

City and county tax collections, an indicator of retail sales, have increased on a year-over-year basis for three straight months following a nearly year-long slide.

The city reported collecting a total of $3.89 million in sales and use taxes in August, up six-tenths of a percent over the same month last year. A 1.7 percent increase in sales tax collections more than offset a 19.4 percent drop in use tax collections.

Mesa County reported collecting a total of almost $2.25 million in sales taxes for its capital improvement and general funds — nearly 4.9 percent more than what was reported for August 2012 and the biggest year-over-year gain since the November.

Because tax reports lag a month behind collections, August reports reflect July sales.

According to reports covering the first eight months of 2013, the city collected a total of almost $32 million in sales and use taxes. That’s 2.9 percent less than what was collected during the same span in 2012 and 5.5 percent less than what initially was budgeted. Use tax collections alone dropped almost 22 percent below last year, a reflection of declining energy development activity.

According to a separate report just for the second quarter of 2013, gross retail activity in the city increased 4.7 percent over the second quarter of 2012. Gross retail activity includes taxable sales, but also the nontaxable sales of food, medicine and gasoline.

Overall city sales tax collections declined three-tenths of a percent in the second quarter of 2013 compared to the same quarter in 2012. But there were increases in three categories: construction, restaurants and bars and liquor stores.

Tax collections in the miscellaneous retail category, the single largest category by collections, held steady. But collections in the general merchandise category fell 3.9 percent.

Measured geographically, sales tax collections increased in seven city districts, fell in four districts and remained unchanged in two districts during the second quarter of 2013 compared to the same quarter in 2012.

Tax collections increased 4.8 percent in the district along U.S.

Highway 6 & 50, while edging up nine-tenths of a percent at the Mesa Mall and along 24 Road. Collections held steady along North Avenue and in downtown Grand Junction.

While Romero said she hopes sales tax collections continue to climb through the remainder of the year, the city already has cut expenses in the expectation collections will remain flat. The budget for 2014 will reflect a similarly conservative approach, she said.

Arnold said she’s going to wait another month to revise her budget projections for Mesa County to determine if sales tax collections continue to increase.

Through the first eight months of this year, the county has collected a total of almost $17.8 million in sales taxes for its capital improvement and general funds, down 1.8 percent from the same period last year.

Arnold said sales of home improvement merchandise and furnishings as well as automobiles have climbed to their highest levels in five years, as have hotel and restaurant sales.

 

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 Sep 16 2013. 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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