Phil Castle, The Business Times
Tax collections continue to increase in the Grand Valley on higher sales of automobiles and other goods.
Officials say the trend bodes well not only for an important source of government revenue, but also a key economic indicator.
“I think it continues to show that our economy is improving,” said Jodi Romero, financial operations director for the City of Grand Junction.
The city reported a 12.6 percent increase in combined sales and use tax collections in October compared to the same month last year. Mesa County reported an even larger proportional gain with a 15 percent increase. October collections reflect September sales.
Combined sales and use tax collections have increased on a year-over-year basis for seven consecutive months for the city and eight straight months for the county.
For October, the city reported collecting a total of nearly $5 million in sales and use taxes. That’s an increase of $553,326 over the same month last year. Sales tax collections rose 13.8 percent, more than offsetting a 2.8 percent decline in use taxes, a far smaller and more volatile source of revenue.
Romero said the numbers increased in each of the top five categories that together account for about 75 percent of city sales tax collections, with the automobile and construction categories leading the way.
Mesa County reported collecting a total of more than $3 million in sales and use taxes. That’s an increase of almost $395,000 over the same month last year. Sales tax collections rose 12.8 percent. Use tax collections jumped 37.7 percent on increased sales of automobiles purchased outside the county, but used in the county.
Eleanor Thomas, budget manager for Mesa County, said increased automobile sales in and out of the county constituted the biggest driver of the overall increase.
But there were gains in other industry sectors, Thomas said. Sales tax collections in the telecommunications sector rose 45.3 percent, while collections in the home improvement category increased 10.3 percent. Collections in the retail category advanced 11.4 percent.
The latest numbers bring year-to-date sales and use tax collections for the city to nearly $44.2 million. That’s a gain of almost $2.7 million and 6.4 percent over the same span last year.
Sales tax collections increased 6 percent, while use tax collections rose 23.2 percent. Tax collections have outpaced the budget for 2017 by 6.1 percent.
Romero said tax revenues collected above budgeted spending in 2017 will go into the fund balance for 2018.
For Mesa County, year-to-date sales and use tax collections totalled nearly $27.7 million. That’s an increase of more than $1.9 million and 7.6 percent over the same span last year. Sales tax collections increased 7.4 percent, while use tax collections rose 9.7 percent.
Thomas said sales taxes are projected to increase 6 percent for 2017, with another 2 percent gain forecast for 2018.
It’s likely Mesa County will have to refund some of its 2017 tax revenue under the terms of the Taxpayer Bill or Rights, the state constitutional amendment that restricts government taxing and spending. TABOR limits increases in tax revenues according to a formula that takes into account inflation and population growth. If a refund is required, the county likely would do so through lower property taxes, Thomas said.
Meanwhile, lodging tax collections also continue to increase in Grand Junction.
For October, $172,055 was collected. That’s an increase of $7,350 and 4.5 percent over what was collected during the same month last year. October collections reflect hotel and motel stays in September.
The October numbers bring year-to-date lodging tax collections to more than $1.3 million. That’s an increase of $29,373 and 2.4 percent over what was collected during the same span last year.