Trend prompts projections of rising sales tax collections

Phil Castle
Phil Castle

Phil Castle, The Business Times

The upward trend in sales tax collections in the Grand Valley has prompted increasingly upbeat projections for the remainder of this year as well as next year.

“We certainly think we’re headed in the right direction,” said Frank Whidden, deputy Mesa County administrator for resource management.

“We think it’s encouraging,” agreed Jodi Romero, financial operations director for the City of Grand Junction.

Mesa County reported a 3.6 percent increase in year-over-year sales and use tax collections in its September report. The City of Grand Junction reported a 2.2 percent gain.

With year-over-year gains in 11 out of  the past 12 months, the upward trend in sales tax collections constitutes an indicator of higher retail sales and generally improving economic conditions.

“It’s a positive indicator of where the local economy is going,” Romero said.

Mesa County reported collecting a total of nearly $2.7 million in sales and use taxes in September, an increase of almost $93,000 and 3.6 percent over the same month last year. County sales tax collections were up 4.1 percent, more than offsetting a 1.3 percent dip in use tax collections.

The city reported collecting a total of more than $4.2 million in sales and use taxes in September, a gain of $90,500 and 2.2 percent over the same month last year. While city sales tax collections edged up almost 1 percent, use tax collections jumped more than 16 percent.

Because tax reports lag a month behind, September reports reflect sales in August.

Romero said earlier-than-usual back to school shopping that bolstered sales in July likely resulted in comparatively lower sales in August. Still, combined sales tax collections for both months increased an average of 4 percent over the same two month in 2013.

The latest numbers bring year-to-date sales and use tax collections for Mesa County to $22.9 million. That’s an increase of nearly $519,000 and 2.3 percent over the same span last year.

The city has collected a total of more than $36.8 million in sales and use taxes so far in 2014. That’s an increase of $735,000 and 2 percent over the same span in 2013.

Whidden said the upward trend in tax collections is expected to continue through 2014. “We’re going to finish 2014 very strong.”

Initial budget projections for 2015 peg the increase in tax collections next year at 2 percent, he said. Local and regional indicators similarly point to economic growth, he added. “It seems to be picking up.”

Romero said the city tentatively has projected a 3 percent increase in tax collections for 2014 above 2013 levels and another 3 percent year-over-year increase for 2015.