Glenwood sales taxes appear to be stabilizing |

Glenwood sales taxes appear to be stabilizing

GLENWOOD SPRINGS, Colorado – Sales taxes for the city of Glenwood Springs were up, albeit slightly, in February compared to the same month last year.

And March numbers could very well follow suit once all the collections for that month are reported, according to Glenwood Springs Finance Director Michael Harman.

“It is a small increase, but still positive,” Harman said of a 0.11 percent increase in sales taxes, from $864,591 in February 2010 to $865,578 for February of this year.

For now, March numbers are down 0.18 percent compared to the same month last year. But that could easily change.

“There are still 87 licensed vendors that have not yet filed for March,” he said. “None of them will be large amounts … but it is quite feasible that March will show a positive once they file.”

The March numbers will be updated when the April sales tax report is prepared in early June, Harman said.

The February increase was the first month-over-month positive number for city sales taxes since May of 2008, just before the national recession took hold on the local economy.

Based on the still-preliminary numbers for the first quarter of 2011, though, sales taxes are still running 1.48 percent behind last year, and well behind 2008 and 2009 levels.

That continues to be a problem in that the 2011 city budget was based on sales taxes returning to 2009 levels, plus 5 percent. The city now anticipates sales taxes for this year will be about the same as in 2010.

Glenwood Springs City Council in late March directed City Manager Jeff Hecksel to begin implementing a series of budget reductions based on the lower-than-projected revenue figures. The reductions were already built into the budget plan when the 2011 budget was approved last fall.

The cuts include a 3 percent reduction in general fund spending across all departments, plus three furlough days for city employees and suspension of the city’s 1 percent retirement fund match for workers enrolled in the program.

Three vacant positions, two in the police department and one at the community center, will also remain unfilled for now, Hecksel explained.

The initial round of cuts come to $749,825. Additional staffing cuts, if implemented, would trim another $116,000 from this year’s budget, according to the reduction plan.

Back on the positive side, the city did end last year ahead of projections, Hecksel said.

“While sales taxes were down [for 2010], expenditures were also down,” he said in his March memo.

Fewer contingency funds were used than budgeted for the year, leaving a fund balance of almost $4.2 million, compared to the budget projection of $3.9 million. The city plans to use that difference to supplement 2011 spending, Hecksel said.

Another positive indicator is that the city’s accommodations (lodging) tax continues to outperform last year’s numbers. Lodging tax collections were up 18.8 percent for March, and for the year are running 11.13 percent ahead of 2010.

Those tax dollars go into the city’s tourism fund for marketing and promotion efforts, which are handled under contract with the Glenwood Springs Chamber Resort Association.

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