Glenwood’s retail economy sizzles over summer
Glenwood Springs’ July sales tax receipts, an economic thermostat, indicated the city’s general fund did not receive as much green from marijuana or retail sales within the health and recreation sector. But the city was well fed by its eating and drinking establishments, and well taken care of by its motels and hotels.
Raking in $1,686,355 during the month of July, Glenwood Springs saw a 2.78 percent increase in sales tax collections compared with July 2017. For the year to date through July, sales were up 2.75 percent.
Seven months into the year, the city has collected nearly $10.2 million in sales taxes, representing roughly $274.5 million in total retail sales, according to the latest reports from the city.
“Glenwood’s economy is strong right now. I think we will see even better growth in the August numbers when everything is in,” Glenwood Springs Chief Operating Officer Steve Boyd said. “We continue to see low unemployment, steady retail growth and good tourism activity.”
While five categories dipped, compared with their performance last July, four of those — marijuana, health and recreation, business services, and personal services — combined, earned the city $61,276 worth of sales tax revenue.
Automotive and service stations, alone, although down 7.49 percent from July 2017, contributed $177,001 to the city’s general fund.
“The only number that is down significantly from last year is auto sales, but a lot of that can be explained by having an unusually strong July in 2017,” Boyd explained. “The number in 2018 is right on the four-year average for the category, so it isn’t an indication of it weakening.”
Ten of the city’s 15 sales tax collection sectors climbed when paired with their July performance last year, including many of the city’s biggest economic players like those from eating and drinking establishments, as well as motels and hotels, which contributed $269,839 and $277,314, respectively.
“The lodging performance shows what a dynamic destination we are for tourists, primarily coming up from the Front Range, and it is exciting to be in a location with so many different activity choices for our guests,” Hotel Colorado General Manager Christian Henny said. “Summer was very strong. We had great demand and unfortunately had to turn away a lot of people due to being sold out, particularly on weekends.”
Glenwood’s separate accommodations tax also collected 7.23 percent more than it did in July 2017 by earning $169,527. Year-to-date, the lodging tax, which goes to fund the city’s tourism promotion efforts, is performing nearly 6.9 percent better than in 2017.
Additionally, because of the U.S. Supreme Court’s decision in South Dakota v. Wayfair Inc., in the near future, online retailers also must collect state sales tax, according to a Colorado Department of Revenue Taxation Division news release.
However, what that means for home-rule municipalities, like Glenwood Springs, remains in question, said Boyd, who has been closely monitoring developments regarding sales taxes for online sales.
Boyd explained that, on Sept. 20, the Joint Budget Committee of the General Assembly considered and denied a request from the Department of Revenue for additional funds to implement the new requirement for larger remote sellers to apply for a state sales tax license by Nov. 30 and start collecting sales tax by Dec. 1.
“Glenwood Springs is a home-rule city, meaning we collect our own sales tax, rather than having the state do so for us,” Boyd said. “So, even when the state starts requiring remote licenses, our situation will take some time to unfold.”