Nelson Harvey
Citizen Telegram Contributor
Rifle, CO Colorado

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April 3, 2013
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Rifle sales tax revenue is up, but there's a catch

Sales tax revenues were up in Rifle during January compared to the same month in 2012, but the increase was mainly due to the introduction of a voter-approved 3/4 cent sales tax to fund the construction of a new water treatment plant.

Discounting the effect of that new tax, sales tax revenues in other categories actually fell about 10 percent, said Rifle Finance Director Charles Kelty.

"I was disappointed with the figures for January," said Kelty. "With the new revenues, I expected a bigger jump than we saw."

Total city sales tax revenue rose 8.9 percent to more than $540,000, from just below $500,000 in January of 2012.

The latest revenue numbers showed large bumps in food and hardware sales, with sales tax revenue from food sales up 43 percent to more than $93,000, and hardware sales tax revenue up 57 percent to nearly $28,000.

The increase in food sales tax may be partly due to the opening of the Eagle Springs Market Place and Farm Fresh Cafe in early January. The market, located at the former Columbine Market at 1733 Railroad Ave. in Rifle, includes a cafe, butcher shop and several spaces for artists and craftspeople to display their wares.

Ken Sack, the owner the Eagle Springs Organic farm in nearby Silt, owns the complex.

"Being a new business, I think we're holding our own," said Debbie Guccini, who manages the market complex. "We have some busy days and some slow days, but our breakfast and lunch is usually pretty busy."

Hardware sales have also been steady, at least according to Dan Sherer, a managing partner at Valley Lumber, Rifle's largest hardware store.

"It's definitely up a little bit," he said. "There are a few projects going, and there were no projects during pretty much all of last year. There are a lot of people fixing up their houses too, doing smaller projects."

Declines in lodging, vehicles, oil and gas

Among the sectors that saw declines in sales tax receipts in January were motor vehicle use taxes (assessed when cars are registered) and lodging taxes. These fell by six percent and 21 percent, respectively.

The lodging sector in Rifle has continued to struggle in recent years, most notably seen recently with the demolition of the Rusty Cannon Motel.

Lodging tax receipts for January came in at just over $7,000, down from about $9,000 in 2012.

"I think we're down about 20 percent compared to last year," said John Creech, the general manager at Centennial Suites in Rifle. "But we are paying our bills."

Creech noted that his hotel caters to longer term guests, such as workers with the natural gas industry. As such, he said, Centennial Suites may be doing better than many of the hotels that cater only to tourists and highway traffic.

Still, the January sales tax figures indicated a drop of more than 30 percent in oil and gas tax revenue compared to January of last year, suggesting a decline in industry activity. Kelty said that was partly due to the departure of Bell Supplies, a Texas-based oil and gas supply company that recently shuttered it's Rifle operation.

Kelty said another oil and gas vendor - which he wouldn't name because they are still in business in the area - also reported a reduction in sales of over $200,000 in January compared to last year. As a result, he plans to audit the tax reports of several oil and gas companies, "just to be sure that they're collecting everything they should," he said.

The slowdown in sales tax receipts in January drove Rifle's general fund revenues down as well. They declined by 10 percent compared to January 2012 and came in at just over $377,000.

General fund expenditures, meanwhile, were up 8 percent to just over $630,000, which Kelty said was partly due to the pre-payment of some city contracts for 2013, such as a contract for groundskeeping and maintenance at the Brendan Theatre Complex and the Rifle Civic Plaza, which includes city hall and the Rifle Branch Library.

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The Post Independent Updated Apr 3, 2013 05:43PM Published Apr 3, 2013 05:42PM Copyright 2013 The Post Independent. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.