Rising tax collections seen as encouraging indicator

Phil Castle
Phil Castle

Phil Castle, The Business Times

Rising sales tax collections in Grand Junction and Mesa County indicate what local government officials see as improving economic conditions.

Officials say they remain cautiously optimistic in their expectations for how long the trend will continue.

“I think we are seeing an improvement,” said Jodi Romero, financial operations director for the City of Grand Junction.

Frank Whidden, deputy administrator for resource management at Mesa County, agreed. “We don’t see any negative indicators.”

The city reported collecting more than $3.9 million in sales taxes in June, an increase of almost $31,000 and seven-tenths of a percentage point over the same month in 2014.

With a nearly 43 percent drop in the more volatile use tax collections, however, total sales and use tax collections of slightly more than 4 million for the city fell almost $48,000 and 1.2 percent on a year-over-year basis.

Mesa County reported collecting a total of nearly $2.64 million in sales and use tax collections in June, an increase of more than $39,000 and 1.5 percent over the same month last year.

Both the city and county have reported year-over-year increases in sales tax collections for eight out of the last nine months.

For reports covering the first half of 2014, the city reported collecting a total of slightly more than $24 million in sales and use taxes, an increase of more than $313,000 or 1.3 percent over the first half of 2013.

First-half tax collections for the city also were higher than those for 2010 and 2011, but slightly below those for 2012.

Mesa County reported collecting a total of more than $14.8 million in sales and use taxes during the first half of 2014, an increase of almost $212,000 or 1.4 percent over the same span in 2013.

While June tax collections for the county were the highest for that month since 2010, first-half collections remained slightly slower than those for 2012.

Since tax reports lag a month behind, the June numbers reflect May sales. Reports for the first half of the year reflect sales from December through May.

Romero said the latest tax collections numbers as well as the long-term trend reflect increased sales and generally improving economic conditions. Moreover, year-over-year increases in lodging tax collections in Grand Junction indicate a stronger summer tourism season. The trends constitute encouraging news for businesses as well as the city, she said.

Consumers remain somewhat cautious, though. And a smaller work force in the area contributes less to the economy, Romero said.

In addition, a number of proposed measures that could appear on the general election ballot in November might affect the economy if they’re approved by voters, she added.

Whidden agreed with Romero in that rising tax collections are no anomaly. “I don’t see any way to interpret these numbers as negative.”

But halfway through the year, Whidden isn’t yet ready to project increased tax collections for Mesa County for 2014 or 2015. He said a clearer forecast should emerge within a couple of months even as work begins in earnest on the county budget.