No wind beneath sales

People are window shopping Sunday in downtown Grand Junction, but they may not be buying. Sales tax revenue is down for the first quarter compared with 2012 in Mesa County and Grand Valley municipalities. Officials are rethinking their budgets for 2013.

An already fragile economic recovery could be at risk of reversing course, at least when viewed through the lens of the latest sales tax collection data reported by Mesa County and Grand Valley municipalities.

Through the first part of 2013, Mesa County, the cities of Grand Junction and Fruita and the town of Palisade reported slides in the amount of revenue they are collecting via sales taxes, as compared with the same time period last year.

The drop is especially significant for both Mesa County and the city of Grand Junction. Through the first three months of the year, the county is off 4.61 percent year to date in sales tax revenue, and Grand Junction is collecting 5.1 percent less in sales and use taxes than it did through the first three months of 2012.

That has officials rethinking the budgets they had planned for 2013.

“We’re going back to look at our capital plan, and we may have to make some adjustments, because we’re not going to have the revenues that we anticipated,” said Mesa County Finance Director Marcia Arnhold.

“We’ve adjusted our projections down to say that we’re not going to meet budget,” she said.

Looking at the monthly numbers for Mesa County, the recent negative trend began last July, when collections for that month were close to 1 percent less than in July 2011. That snapped a streak of seven straight months of revenue growth as compared to the previous year.

Between July 2012 and March 2013, all but one of the months showed negative growth in terms of monthly sales tax collections, as compared to the previous year.

The slide has Grand Junction officials reassessing as well. Jodi Romero, financial operations director for the city, said in an email the city has been able to absorb the revenue loss so far with savings from other budget segments.

Romero also said city officials are monitoring the situation very closely, “and in the upcoming weeks and months our city manager will also be strategizing with City Council on the current budget.”

On either ends of the Grand Valley, both Fruita and Palisade are also tallying less in sales tax collections.

Through the first two months of the year, Fruita collected 2.24 percent less in city sales taxes than in 2012, and received 4.74 percent less from its share of the county sales tax.

The city expected 2013 revenue from these sources to be up 3.86 percent and 4.7 percent, respectively, over 2012 actual revenue.

“We are not planning any cuts, but we’re tracking (revenue collections) very closely,” Fruita City Manager Clint Kinney said. “We don’t want to call it a trend after just two months, but we’re paying very close attention to it.”

The revenue slide is a similar story in Palisade, where town Treasurer Joe Vlach said that while the town’s collections of sales tax are about even through the first two months of the year, it’s receiving almost 5 percent less year-to-date from its share of the county sales tax for the first quarter of 2013.

Looking more broadly at the data, Arnhold said the overall trend line is still positive in terms of the number of dollars brought in to the county from sales tax collections going back to the 1980s.

“We’re still growing, just at a much slower rate,” Arnhold said. “At least we’re getting a little flatter and not seeing the peaks and valleys that we did between 2006 and 2008.”

“That boom and bust is hard to manage,” she said.


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