City sales, accommodations taxes up in 2019
Receipts for sales tax and accommodations tax for the city of Glenwood Springs finished 2019 up between 4% and 5% each.
Sales tax receipts finished the year 4.54% above 2018, with over $19.12 million collected. The increase was greater than the city had budgeted for. “We generally forecast a 2% increase. The economy was strong in 2019, and people were spending money,” said Steve Boyd, the city’s chief operating officer.
The sectors with the largest percent gains compared to 2018 are apparel/accessories at 34.71% and “all other” at 57.93%. All other is “a small category that captures businesses that don’t fit squarely somewhere else. It is not a perfect science by any means; the categories should be looked at in very general terms because lots of stores could fit into more than one category and some not very well into any category,” Boyd said. Boyd would not speculate on why these categories saw large increases.
While the percent increase in these categories was large, all other is one of the smallest in dollars collected among the 15 categories at $223,622, bringing in more than only personal services at $54,148.
No category saw a sales tax decrease over 3%, with three categories slightly in the negative (general merchandise stores, miscellaneous retail and business services).
The sectors with the largest dollar gains were apparel/accessories, riding its nearly 35% increase with $969,692 collected, $249,867 more than in 2018; building materials and supplies, collecting nearly $2.23 million — an increase of $191,746 from 2018; automotive/service stations collecting nearly $2.23 million, an increase of $140,731 from 2018; and motel/hotel, collecting nearly $2.03 million, an increase of $104,736 from 2018.
Boyd attributed these gains to a “strong macroeconomic environment.”
The largest dollar decreases were much smaller numbers, with miscellaneous retail collecting $1,587,939, or $38,639 less than 2018; and general merchandise stores collecting over $2.91 million, or $36,113 less than 2018.
Some numbers are more significant to Boyd than others. “I look closely at the hotel/motel category because it is an indication of the tourism economy; eating/drinking because many of those dollars are disposable income; and general merchandise because it is a large category and tracks how things are going overall.”
General merchandise, despite its decreases, still brought in the most money among the 15 categories with slightly more than $2.9 million collected.
Another on Boyd’s watch list, eating/drinking places, brought in the second most dollars at over $2.64 million which was $79,327 more than in 2018, a 3.09% increase.
The roughly $2.3 million collected by both automotive/service stations and building materials and supplies were the third and fourth most, respectively, followed closely by food stores at over $2.21 million.
Motel/hotel was the final category collecting more than $2 million.
Glenwood Springs’ accommodations tax increased 4.39% as compared to 2018.
“The forecast was 2% from last year’s budget, so the actual year over year was slightly better than forecast,” said Steve Boyd, the city’s chief operating officer.
Three months saw greater than 10% increases: January (18.34%), February (12.61%) and April (13.23%).
Two months saw small declines, with June down 1.19%. July was down 0.05%, or basically flat, bringing in just $82 less than in 2018.
Boyd was neutral about the large increases and modest declines. “I wouldn’t read too much into this. A month of tax receipts can be significantly impacted by an unusual event like a conference or someone filing an amended return to correct an error either in the current year or prior year,” he said.
The two months with the next largest increases were March (9.1%) and October (8.97%).
May, September and December saw increases of less than 0.06%.
August and November saw increases in the range of the yearly increase at 4.17% and 4.52%, respectively.
Not surprisingly, the four months with the largest accommodations tax collections were June through September, all above $100,000. July, despite its slight decrease, collected the most with $169,291. The fifth highest month was March, the only other month to crack the century mark, with $110,226 collected.
The similarity of the increases in sales tax and accommodations tax is not typical. “Accommodations tax growth usually outpaces general sales tax. The two were more consistent in 2019 than normal, partly because our supply of hotels is strained at busy times, and partly because we have more short term rentals in the area that are not actually within Glenwood Springs that take some market share from out hotel/motel population,” Boyd said.
A look ahead
With Gov. Polis’ statewide stay-at-home order due to COVID-19, the state’s economy has been suffering, like economies all over the world. There’s no telling how fast the recovery will be or how much it will affect Glenwood Springs.
“It’s too soon to tell. We are modeling several scenarios, the worst case being pretty severe. We are at the height of uncertainty right now, and more information is coming each day. Ask me again a month from now, and I think I’ll be able to answer this,” Boyd said.
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