by Marissa Lorenz
Sales tax revenues continue to show positive trends, consistently meeting or surpassing last year’s numbers and far surpassing conservative predictions made at the start of this year’s COVID19-related restrictions.
Numbers for June sales were reported back from the State last week. And while overall revenues are still expected to be lower than originally budgeted for 2020, local governments continue to re-adjust their predictions, now reporting sales tax revenues that are meeting or exceeding what had been budgeted.
Kremmling reported $97,690 in sales tax revenue for May, up $5,128 or 5.5% over May, 2019, and $121,474.49 for June, a 26.5% increase over June 2019’s collected $96,029.62. Year-to-date, the Town has collected about $550,063 in sales tax revenues in 2020, compared to $463,235 this time last year, representing a nearly 19% increase for the year.
“The sales tax revenue is far better than expected,” stated Town Manager Dan Stoltman. “We were anticipating a decline due to the impacts of COVID-19, but that hasn’t yet been the case. We are, however, still being cautious with our spending as we do not know what will happen in the months to come.”
County Finance Director Curtis Lange is now reporting that County sales taxes are projected to be 100% of the budgeted level. June’s numbers were within $300 of last year’s collections, he observed.
“We are seeing sales tax receipts this year which are comparable to our budgeted sales tax revenues,”
Lange explained. “We are still very cautious about how COVID-19 may affect our budget and our community the second part of this year. It may result in a $400,000 negative effect to our budget this year.”
Lodging was closed for nearly two months, but also demonstrates a strong rebound. Lange projects lodging taxes to be 80% of the annual budget with short-term rental renewals to be at 100% the budgeted level. Building permits are projected to be 80% of the original budget amount. Highway user taxes are projected to be slightly lower than budgeted for 2020. Airport reimbursements for projects are projected to be increased from 95% to 100% of costs, due to an increase in federal funding to essential transportation infrastructure.
In all, with expected federal Coronavirus Aid, Relief, and Economic Security (CARES) Act reimbursements through the Department of Local Affairs (DOLA) for COVID19-related expenses, that reimbursement is estimated to be about $700,000, making 2020 revenues about $184,000 higher than originally forecast. COVID-related expenses, however, have already reached over $450,000
and are expected to go as high as $570,000 by the end of September and possibly $750,000 through the end of the year, according to Lange.
The County’s overall budget shortfall is now anticipated to be about $385,000 in 2020, a negative outcome but much less than the once-feared $4 million that had been discussed.
The Colorado state sales tax rate is 2.9%. The Grand County rate is 1.3%. And Kremmling’s city sales tax rate is 4%.