2010 retail sales drop across area | PostIndependent.com

2010 retail sales drop across area

Kelley Cox Post Independent

Municipalities in Garfield County experienced an average 4 percent decline in sales taxes for 2010 compared to the previous year. But retail sales did show signs of picking up during the final quarter of the year, especially in Glenwood Springs and Carbondale.

In Glenwood Springs, 2010 sales taxes came in about 3.9 percent behind 2009 figures. The city’s 3.7 percent sales tax rate generated about $13 million for 2010, down from $13.58 million collected in 2009, according to city finance director Mike Harman.

“We were more hopeful that we would be able to end the year with a positive number,” Harman said of a 2.63 percent decline for December sales, which included the holiday shopping season.

“I was somewhat surprised December was down that much,” he said, especially considering tourism dollars rebounded from July through December.

Revenues from Glenwood Springs’ 2.5 percent lodging tax began to increase over the previous year starting in July 2010, about the time the two new Marriott hotels opened at Glenwood Meadows. Lodging receipts increased through six straight months to finish slightly ahead of 2009.

From his own observation, Harman said it appeared there were a lot of people visiting Glenwood Springs before and during the holidays.

But in talking to at least one downtown merchant, people were being more frugal in their spending once they got here, he said.

“It sort of tells the story,” Harman said. “Yeah, people were saving enough money to get out of town to come over here, get a motel and eat out, but not much beyond that.”

Harman said he won’t compile a sector-by-sector breakdown of 2010 sales taxes until sometime in late March or April.

Bottom line, Glenwood Springs has not seen a positive monthly number on a year-to-year comparison since May 2008. City sales taxes that year were down a little more than 1 percent compared to 2007.

“We’ve never really rebounded since then,” Harman said.

However, the percent decrease was smaller over the final four months of 2010 than it was earlier in the year.

Sales taxes were down an average of 6 percent for the first half of the year, but improved to an average 1.7 percent decline for the final six months.

Even with sales taxes stabilizing some, it would still take a 9 percent swing for revenues to match 2011 budget projections, Harman said.

This year’s city budget is based on a 5 percent increase in sales taxes over 2009 figures. Sales taxes make up about 50 percent of Glenwood Springs’ general fund budget.

The story was much the same in neighboring Carbondale for the year as a whole, although sales taxes were actually up in June and December of 2010.

Carbondale collected a little more than $3 million in 2010, compared to $3.2 million for 2009, down 5.1 percent, according to Nancy Barnett, Carbondale’s finance director and acting town manager.

“We projected we would be down 5 percent for budget purposes, so we ended right on budget,” she said.

The 2011 town budget is based on sales taxes remaining flat through this year, Barnett said.

Carbondale did see two months last year in which sales taxes improved on a year-to-year comparison. Collections were up 1.9 percent in June 2010, and again by 2.8 percent in December.

“That was a good sign,” Barnett said. “I hope we can keep that up.”

The city of Rifle was the only municipality in Garfield County that had an overall sales tax increase for 2010. But that may be an anomaly, city finance director Charles Kelty said.

Rifle sales taxes ended the year 3 percent ahead of 2009, but that was due to a nearly 260 percent increase in the oil and gas sector. That was attributed to a single pipe company supplying the natural gas industry, he said.

“We are being very cautious with that,” Kelty said. “I don’t know if we can rely on those numbers in projecting for the next few years.”

While city sales taxes came in at nearly $6.6 million for the year, compared to $6.4 million in 2009, virtually every other retail sector was down, he said.

According to Rifle’s 2010 sales, lodging and use tax report, bars and restaurants decreased 11 percent; food decreased 4 percent; general retail decreased 10 percent; liquor stores decreased 11 percent; and motels decreased 24 percent.

Some categories did see minimal increases, including car parts and sales, up 2 percent; and hardware and utilities, both up 5 percent.

“If I were asked to make a projection for the 2011 sales tax revenues, I would have to say it’s way too early to tell if the economy is rebounding and we’ve stopped the downward trend,” Kelty said. “I would feel a lot better if the categories with decreased revenues started going the other direction.”

Elsewhere around Garfield County, New Castle sales tax revenues dropped 9 percent, while Parachute revenues fell by 5 percent for 2010.

New Castle brought in just over $1 million in sales taxes last year, compared to $1.1 million in 2009, according to town finance director Lyle Layton.

With the recent addition of a new McDonald’s restaurant, which opened in late October, the numbers began to increase through the final two months of the year, he said.

Retail sales in Parachute brought in $1.22 million last year, compared to $1.29 million in 2009, town administrator Robert Knight said. The year-end figure was a substantial improvement over what had been a 15 percent sales tax decline through October 2010, he said.

Silt town administrator Pamela Woods could not be reached Monday for that town’s 2010 sales tax numbers.

Meanwhile, Garfield County’s 1 percent sales tax, which is collected in the six municipalities as well as in unincorporated areas, was down 25 percent last year compared to the previous year, according to Garfield County Treasurer Georgia Chamberlain.

The county collected $8.8 million in 2010, compared to $11.9 million in 2009, she said, adding she was unsure why the percentage decrease in the county’s numbers would be so much more than the municipalities. She did note that there may be fewer retail businesses in unincorporated areas now than there were in 2009.

A quarter of the county sales tax goes to fund the six-branch Garfield County Public Library District, while the remaining three-quarters is split between emergency communications, the county road and bridge department, the sheriff’s department and the various municipalities.


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