Gains in sales tax collections end nearly year-long slide

Phil Castle, The Business Times

A nearly year-long slide in sales tax collections in the Grand Valley is over — at least for a month.

The City of Grand Junction and Mesa County both reported year-over-year gains in June, offering a measure of hope among government administrators a source of funding and indicator of retail activity will rebound during the second half of 2013.

“I hope that we’ll see a turnaround,”  said Jodi Romero, financial operations director for the city.

Eleanor Thomas, budget manager for Mesa County, agreed. “I hope this will continue.”

The city reported collecting a total of nearly $4.1 million in sales and use taxes, an increase of 1.1 percent over the same month last year.

The county reported collecting a total of more than $2.3 million in sales taxes for its capital improvement and general funds,  a 3.6 percent increase over last year.

Because reports lag a month behind collections, June reports reflect May sales.

Romero said the numbers in the June report reflected an increase in sales of building materials and other goods at home supply stores, but not more widespread gains in retail activity.

Until the latest report, city sales and use tax collections had dropped on a year-over-year basis in nine out of the previous 10 months.

For reports through the first half of 2013, the city has collected a total of almost $23.8 million in sales and uses taxes. That’s still 3.4 percent less than what was collected during the first half of 2012 and 6.1 percent less than initially was budgeted.

Romero said the city has been able to accomodate declining revenues so far mostly through savings in salaries associated with unfilled job openings.

With seasonal construction and tourism business now fully under way, Romero said she hopes increased sales will result in increased sales and use tax collections.

For Mesa County, the increase in sales tax collections ended a year-over-year drop in 10 out of the last 11 months.

Thomas said the June report reflected a “big spike” in collections from the mining sector, which includes natural gas and oil development and  support business. Sales of building materials and automobiles also were up, but didn’t contribute as substantially to the increase, she said.

For reports through the first half of 2013, the county collected a combined $13.1 million for its capital improvement and general funds, a nearly 3.4 percent decline from the same span in 2012.

Lower tax collections have forced county administrators to adjust the budget, particularly for capital improvement projects. Some projects have been delayed, Thomas said.

Given that tax collections going forward will be compared to a nearly year-long decline, Thomas said she’s hopeful the numbers will improve.