Local sales tax collections up

Local sales tax collections up

April 10, 2001

By Janelle Holden
Journal Staff Writer

Compared to last year, the City of Cortez is enjoying a healthy growth in 2001 sales and lodgers tax revenues.

A March analysis of the city’s sales and lodgers tax revenues from January and February reveals an 8 percent growth in the sales tax and 4.42 percent in the lodger’s tax compared to 2000.

"It looks good so far," said Kathi Moss, the city’s finance director. "But it’s really hard to tell right now how our in-town vendors are doing versus what the out-of-city businesses are bringing in."

The analysis does not reflect the March opening of Safeway, either. The boost from Safeway will be reflected in April’s figures.

Moss did say, however, that the top ten in-city businesses brought in more revenue than last year.

The top ten businesses, outside of utilities, who contribute the most to the city’s revenues are Wal-Mart, City Market, the Montezuma County Courthouse, Slavens True Value, Southwest Auto Center, Keesee Motor Company, Sears Roebuck and Company, McDonald’s, Golden Corral Family Steakhouse, and Steve Keetch Motors, Inc.

Only 14 percent of the city’s revenues comes from out-of-city vendors, like mail-order catalogues and Internet sales.

So far, the city has collected $835,876 in taxes, helped in part by an 11 percent growth in January’s collection, which Moss credits to payment of delinquent accounts.

The city’s 2000 revenues were $170,000 short of what was expected, due mostly to the Mesa Verde National Park fires in July and August of 2000. As a result, the city has budgeted for a conservative 5.5 percent in growth in 2001.

Normally, the city budget is based on a 7 percent growth in sales and lodger’s taxes from the previous year.

"It’s really hard until we get to July and August because of the tourist season. Right now it’s going OK, but with gas prices the way they are and the stock market, we’re still not 100 percent convinced that we’re going to stay at that level," explained Moss.

"As a result, council and management have asked all of the department heads to really be conservative, even though they were approved for a budget, to really be tight with their budget," Moss said.

City businesses collect 3.5 percent of retail sales for the city, and until June, will keep 3.33 percent of the sales tax revenue as a vendor’s fee.

The city council recently passed a resolution to collect 2 percent of the vendor’s fee to fund the retail enhancement program, a marketing program run by the Cortez Chamber of Commerce to draw in regional trade.

Within three years, the Chamber must prove to the city that the program is benefiting area businesses. One of the means of measuring the program’s success is through sales tax figures.

According to Ronda Cluff, the coordinator for the Cortez Main Street Association, the marketing committee chosen to handle the fund will pick a baseline figure from the city’s sales tax revenues to compare at the end of the three year program.

A new tax form that reflects the changes in the vendor’s fee will be mailed with a letter to all city businesses in May, and in June businesses will be required to collect based on the new system.

Cluff said the city’s first promotional event will be held at Christmas.