Sales tax collections rebound

Phil Castle, The Business Times

Sales tax collections have rebounded in Mesa County with the largest year-over-year gains so far in 2013.

While the latest monthly tax reports offer some encouragement of more sales for retailers and more revenues for governments, it remains to be seen whether total sales tax collections for 2013 will match 2012. But at least what’s been seesawing fluctuations in collections has swung back up.

“We’re hoping that this is a good sign,” said Jodi Romero, financial operations director for the City of Grand Junction.

Marcia Arnhold, finance director for Mesa County, put it this way: “It’s looking better.”

The city reported collecting a total of nearly $4.16 million in sales and use tax revenues in October.

Sales tax collections were up more than 139,000, or 4.1 percent, over what was reported in the same month last year, by far the biggest of four increases so far in 2013. However, use taxes revenues tumbled more than $170,000, or almost 57 percent.

Combined sales and tax revenues reported in October decreased 0.9 percent compared to the same month last year.

Mesa County reported collecting a total of more than $2.3 million in sales taxes for its capital improvement and general funds in October.

With a 5 percent increase over the same month last year, the gain was the largest for the county this year.

Because tax reports lag a month behind collections, October reports reflect spending in September.

Romero said it’s difficult to attribute the gain in sales taxes to any one sector, although sales of building materials have increased along with residential construction activity. The decline in use taxes collected on the sales of equipment and construction materials reflects decreased activity in the energy sector.

For reports through the first 10 months of 2013, combined city sales and use tax collections totalled more than $40.2 million. Compared to the same span last year, collections have dropped nearly $1.3 million, or 3.1 percent.

Sales tax collections so far in 2013 lag 1.1 percent behind 2012 year and still could match last year with gains in the November and December reports, Romero said. But use tax collections have dropped 31.6 percent behind and won’t catch up.

Romero said she’s hoping holiday sales during December will bolster tax collections reported in January, kicking off a year with  growth.

Nonetheless, she expects the city budget for 2014 to reflect no increase in collections.

For Mesa County, sales tax collections through reports for the first 10 months of 2013 total nearly $22.4 million, about 1 percent less than the same span in 2012.

While sales tax revenue projections for 2013 have been lowered below what was budgeted, it appears as though revenues will meet projections, Arnhold said.

More revenue for the capital improvement fund in particular could mean that projects that had been postponed could be scheduled for completion sooner, Arnhold said. Spending on capital construction offers the added benefit of bolstering the local economy — and further sales tax collections.

Still, the overall budget for Mesa County for 2014 will reflect no growth in sales tax revenues, Arnhold said.