City and county sales tax revenues drop significantly

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GRAND JUNCTION, Colo. (KKCO) - The economy may still be bouncing back, at least, that's what the latest sales tax revenue reports are showing.

Grand Junction and Mesa County were one of the last to go into the recession, so many expected us to come out later, too. Officials say that could be why our sales tax revenues are so short compared to last year, but that doesn't make it any less stressful for business owners.

It's been a slow start, but one that's not too surprising given our city's past. For Cheryl Lucas at CRYSTAL Books and Gifts, first quarter sales have not been kind, but she's not alone.

"The first quarter has been soft. I found January was probably the worst month,” Lucas said. "I think Grand Junction as a whole is maybe behind the curve a little bit with the rest of the nation."

Sales tax collections are down both at the city and county levels. Year-to- date, city sales tax revenues compared to last year are down 3.7 percent.

"Our March collections which are for February retail activity, those were down six percent," city financial operations director Jodi Romero said.

For the county, first quarter sales are down 4.6 percent compared to 2012, and March sales tax numbers are proving to be decreasing as well.

The city says internet sales could be impacting sales tax revenues during the holiday season, but the drop in revenue is across the board.

"If people who shop here have to pay for sales tax, then if they buy something online, it's also fair they pay the sales tax," Lucas said.

"We were a little surprised at that decline. It's a little bit hard to determine why that's happening," Romero said.

For the city, a continuous drop in sales tax could mean a budget shortfall, something officials are prepared to do if fewer people continue to buy.

"When we do need to make up a shortfall, we all come together across the board and make up that shortfall, so we have been successful in doing that for the first quarter," Romero said. "I think there's a lot of activity out there in terms of people out and about, and as the weather has become nicer, we'll see more activity."

The city was hopeful with the summer months, sales tax revenues would start to bump up. That's because past studies have shown about a third of the city's sales tax comes from people visiting the Valley.

The county says it's not yet looking at trimming down its budget to compensate for the lower sales tax numbers.

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