County sales taxes rise, yet TABOR threatens
Mesa County is having a dickens of a time with its 2017 budget. It’s having the best of recent times with sales-tax revenues still on the rise and the worst of times with the looming prospect of a Taxpayer’s Bill of Rights refund.
Taxable sales pumped nearly $2.6 million into county coffers in July, well ahead of the same month a year ago, when taxes brought in less than $2.2 million.
Sales-tax revenues hit $19.6 million for the year in August, $1.1 million, or 6.5 percent more than the $18.5 million at the same time in 2016.
“Last year was awful,” which makes this year’s revenues look all the better, County Administrator Frank Whidden said.
The problem with improving from “awful” is the so-called “ratchet effect” of the Taxpayer’s Bill of Rights, which says that revenues may not grow faster in a given year than the sum of the inflation rate and the rate of population growth.
The amount of allowable revenue growth is the lower of actual revenues in the previous year, or the amount permitted by the Constitution in that year.
Mesa County’s 2017 revenues can grow a maximum of 4 percent, and the county now projects 3 percent overall growth this year.
That projection, however, doesn’t include state grants, for which a full accounting is frequently unavailable until the following year, the county’s budget officer, Eleanor Thomas, said.
Mesa County this year rejected passing $5 million from the Colorado Department of Local Affairs to Mind Springs for the construction of a 64-bed mental health facility, West Springs Hospital, in Grand Junction. The $5 million would have counted against the revenue cap, increasing the likelihood of a tax refund.
If the county has to refund money to taxpayers, it would have to do so from its general fund, which receives the smallest amount of sales tax revenues.
Mesa County voters in 1982 approved a 2 percent sales tax. Half of those revenues are distributed to the county’s municipalities. The larger share of the remaining revenues, 55 percent, go to the county’s capital fund and the remaining 45 percent goes to the general fund — which the county would tap for any refund.
That would leave intact the current budget, in which the county has a $36 million capital fund and has to eat $8 million into reserves to maintain its $57 million general fund.
The last time the county had a TABOR refund, 2008, it returned more than $2 million in reduced property taxes.
Month-to-month sales taxes dipped slightly, from $2.76 million in July to August’s $2.59 million.
The year-to-year trend shows growth, but Whidden said he was seeking no lifting of the commissioners’ decision to hold spending 5 percent below budget this year.
Sales taxes related to the oil and gas industry are the biggest contributor to revenues so far this year, coming in 72 percent ahead of last year’s totals so far, according to the county’s August revenue breakdown.
Those sales generated $130,000 in revenues to the county in August, up from $55,000 in the previous August. So far this year oil- and gas-related sales tax revenues amount to $356,000, up from $207,000.
Construction-related revenues are being hammered, though, down $25,000 for the year, or 11.6 percent, from $213,000 in 2016 to $188,000 so far this year.