New Castle, Parachute post double digit tax revenue increase in 2001
and Donna Daniels
Despite the lagging economy and Sept. 11, two towns in Garfield County racked up double digit sales tax revenue increases in 2001.
Overall, western Garfield County communities, particularly New Castle and Parachute, outstripped their eastern neighbors in economic growth.
New Castle posted a whopping 39 percent increase in sales tax revenues in 2001 over 2000.
In 2000, New Castle took in $475,243 in sales tax revenues. In 2001, that amount jumped to $662,261.
Town finance director and treasurer Lyle Layton attributed the gain to an increase in the town’s sales tax from 3 percent to 3.5 percent in January 2001 and to a two-year population gain of nearly 500 people. That means more folks spending money in town.
Retail growth has also helped.
Mr. T’s Hardware opened a New Castle store late in 2000. Now folks don’t have to go to Silt for hardware, Layton said.
City Market is the town’s single biggest contributor to sales tax revenue, he said. New Castle Superbowl, which opened in 2000, has been a big draw for New Castle and outlying areas.
“When you get one (store) here and one there, it adds up,” Layton said. “It’s a whole lot more convenient to shop here. With the traffic problems in Glenwood, it’s such a hassle to run over there.”
New Castle’s 2001 tax revenues more than exceeded the town’s budget projections.
“With the way the economy’s gone and with 9/11, we’ve been very concerned we wouldn’t meet projections,” Layton said. “When we do the budget we’re pretty conservative on revenue (projections). We don’t want to get caught. We’ve read that some towns in the area didn’t meet their budget. We don’t want to get caught like that.”
Parachute rides the wave
Parachute rode a strong economic wave in 2001, coming in close behind New Castle with a 33 percent increase in sales tax revenues.
In 2001, Parachute posted $389,478 in revenues on its 3.75 percent sales tax rate. That’s a 33 percent increase over 2000, when the town took in $314,617 in revenue.
Although Parachute has had its share of hard times, it’s always managed to forge ahead, said Mayor John Loschke.
In the last two years, thanks to a big boost from two major industries, the town has a very strong economy.
American Soda, a soda ash mining and production company, opened for business in June and Williams Co. continues to lead the county’s boom in natural gas production.
Besides hiring local workers and bringing in new people who have settled in the area, the companies have given local young people an opportunity to find good jobs that keep them in Parachute, Loschke said.
“I see 10 to 15 kids I babysat (when they were kids) now working in gas production. They want to stay in the community and be a part of the community. It’s great to see that,” he said.
A shopping center built in 2000, which includes a True Value hardware store, Wendy’s and a gas station, “has really helped,” Loschke said.
The town is growing as well.
“It’s fast approaching 1,300,” he said.
Parachute draws shoppers from throughout the Grand Valley School District 16, which encompasses about 5,000 people who shop in neighboring Battlement Mesa and Parachute, he said.
Silt logged a healthy 18 percent sales tax increase in 2001, thanks in part to a new restaurant, the Miner’s Claim, from its first full year of operation.
“That made a big difference,” said town treasurer Lyn Messersmith. “Any new business really helps with our bottom line.”
Total 2001 sales tax revenues from the town’s 3 percent sales tax rate were $458,000. The total includes use tax on construction materials and vehicles purchased outside the town limits.
October and November are big months for Silt due to hunting season, Messersmith said, and 2001 was no exception. Sales tax collections for October were up 27 percent over the previous year, and up 16 percent in November.
In a bit of a blip that Messersmith thinks might be Sept. 11-related, December 2001 tax receipts were down 2 percent from those collected in December 2000.
“Usually, December is a big month for us,” Messersmith explained.
Silt’s use tax on vehicles increased 26 percent over last year, and use tax collected on construction materials increased 12 percent.
“There was definitely an increase in building activity,” Messersmith said.
Silt sales tax collections for 2001 were also boosted by a $5,000 remittance from one business. Its sales taxes had been going to the city of Grand Junction due to an accounting error at the state level, Messersmith said.
Rifle’s three-year run of double-digit yearly sales tax growth came to a stop in 2001, although collections increased a respectable 7 percent over the previous year, said city finance director Nancy Black.
The city’s sales tax rate is 2.5 percent.
Black said sales tax collections increased 12 percent in 1998, 13 percent in 1999 and 11 percent in 2000.
“We’ve had better years than this, “Black said of 2001. “But we could have done worse.”
The troubling news for Rifle is that retail sales tax growth has been decreasing since 1999, and sales taxes alone increased by only 5 percent last year.
“Use tax is holding us in a higher percentage,” Black said.
Motor vehicle use tax collections were up 25 percent last year, thanks in part to zero financing deals the auto industry offered following the Sept. 11 attacks.
“People went out and bought cars,” Black said.
Construction use tax was up 5 percent, for a total use tax increase of 16 percent.
Black attributed the sluggish sales tax growth to residents shopping outside the city limits.
Total 2001 sales tax collection in Rifle was $2.2 million. Although most retail tax receipts dipped below double digit increases, sales in liquor stores increased 12 percent.
Glenwood Springs happy
to hold steady
Garfield County’s largest city, Glenwood Springs, is still the sales tax giant. But it did not see the growth of its western neighbors, and just held steady from 2000 to 2001.
Although the city has not yet posted its sales tax revenues for December of 2001, overall revenues for 2001 are expected to be about 3 percent higher than 2000.
City manager Mike Copp said the modest growth is welcome.
“We’re fairly pleased. We’re glad we didn’t have a decrease,” he said. Three percent growth “is good considering all that’s happened.”
In 2000, Glenwood Springs took in $9.7 million on its 3.25 percent sales tax. As of November 2001, it had collected $9.5 million.
“I think we’ve been a very fortunate community. We’ve seen sales tax trail off in some communities similar to Glenwood,” said Glenwood Springs Mayor Don Vanderhoof. “Glenwood has increased slightly, which I think is a very positive thing.”
Businesspeople he’s spoken to around town echo that feeling.
“They seem well satisfied,” he said. “I’m tickled to death our sales tax has remained as strong as it has. I hope the worst is over, and if it is, Glenwood came through with flying colors.”
In Carbondale, complete 2001 sales tax figures aren’t yet available, but finance director Nancy Barnett predicts a 9 to 10 percent increase over 2000.
“In 2000, sales and use taxes were up 15 percent” over 1999, Barnett said.
“It’s flattened out a little,” Barnett said of 2001 sales. The town’s sales tax rate is 3.5 percent.
Reflecting a decrease in construction activity, Carbondale’s use tax collections dropped 52 percent in 2001, after hitting a high of $348,000 in 2000.
Assistant town manager Bentley Henderson said use tax revenues were boosted in 2000 by construction of a pair of three-story office and retail buildings on Main Street.
The town didn’t see any major commercial projects in 2001, and residential construction was down.
Like other towns, Carbondale saw an increase in motor vehicle use tax collections, thanks to post-Sept. 11 zero percent financing. Carbondale’s increase was 25 percent.
“That really saved us this year,” Barnett said.
Carbondale total sales tax collections, including use tax, was $2.73 million.
Garfield County also held steady over the last two years.
Revenues on its 1 percent sales tax totaled $5.4 million in 2000. In 2001, the county collected $5.7 million, an increase of .05 percent.
The tax is applied throughout the county, including within the county’s six towns.
One quarter of the county’s sales tax revenue goes to county departments with the largest amounts to the library and public works.
Three-quarters of the revenue is divided among the county’s municipalities.
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