A jump in sales tax collections prompts $9.5 million budget for Gypsum
It's quite a change for the town, which operated on just a $60,000 budget back in 1980
GYPSUM — A couple of weeks ago, the Eagle Valley Enterprise Time Machine column reported that the town of Gypsum’s operations budget for 1980 was expected to hit $60,000.
To say things have changed over the past 40 years is a massive understatement. In 2020, Gypsum is looking at a $9.5 million operations budget. That’s what happens when a town’s sales tax collections take a massive jump. What’s more, a 2018 ruling by the U.S. Supreme Court has been a contributing factor for Gypsum’s 10.5% year-to-date sales tax increase.
“Our finance director predicted that a portion of our increase was from the Wayfair ruling. We are getting online sales tax revenues in, and it’s real money,” said Gypsum town manager Jeremy Reitmann. “It’s about like having a new fast food restaurant in town.”
Gypsum is among many Colorado jurisdictions feeling the effects of a pair of governmental actions in 2018. In South Dakota v. Wayfair the U.S. Supreme Court upheld the state’s right to apply sales tax to internet transactions, even if the retailer does not have property or employees in the state. In 2018, the state of Colorado enacted new online sales tax rules.
Along with netting online purchase sales tax for the first time, Gypsum also welcomed a new retailer to town this year when Ace Hardware opened.
By law, sales tax revenues are not tied to individual businesses. Collections figures are reported by category, and Gypsum’s two largest sales tax categories are:
- Retail/grocery — which has grown by $252,000 or 14.06% year-to-date in 2019. Total collections are approximately $2,044,200.
- Retail — which has grown by $102,500 or 25.22% year-to-date in 2019. Total collections are approximately $508,700.
While sales tax numbers have seen a big increase in 2019, Reitmann said collections from the town’s 1% real estate transfer tax have actually dropped. Gypsum officials are estimating $900,000 in real estate transfer tax in 2019, down slightly from the approximately $1 million collected in 2018.
Looking to 2020
For the year ahead, Gypsum is looking at a $9.5 million operating budget. That figure reflects an anticipated 3% increase in sales tax revenue and a modest capital improvements list.
“And our reserve fund will be sitting at 27% — $2.6 million,” Rietmann said.
Gypsum’s largest capital project planned in 2020 will be a $600,000 improvement along the southern portion of Valley Road.
“It’s a bit of a roller-coaster ride there at the moment,” noted Gypsum assistant town manager Jim Hancock, also the town engineer. “We are going to pattern the project after what we did on Highway 6. It has been a problem out there forever, and this is an engineered solution rather than a patch.”
Additionally, the town is planning a $123,000 street overlay/sidewalk project along Eagle Steet to the Eagle Court/Cedar Court area. The U.S. Highway 6 bridge over Gypsum Creek is slated for a $100,000 concrete repair project and the nearby pedestrian bridge will get a new $45,000 railing.
Other capital expenditures for 2020 will include the development of a new town website and new community development software. The town will replace six of its light-duty pickup trucks and the aging playground equipment at the Second Street Park.
Construction won’t start on a couple of large capital projects in Gypusm next year, but planning and right-of-way acquisition will. Hancock said the town hopes to complete the design for two roundabouts along U.S. Highway 6 — one at Valley Road and one at Schoolside Drive.
Water, wastewater projects
In 2020, Gypsum is planning construction of a $450,000 new water line down Valley Road south of Cooley Mesa Road, a joint trench project with Black Hills Energy. The project will be financed from the town’s water fund.
On the wastewater side, the town is looking at a $40,000 study in preparation for an upcoming sewer plant expansion. Also in anticipation of a plant expansion, Gypsum residents will see a 6% increase in their monthly sewer bills — roughly a $1.44 per month increase— beginning in 2020.
The public hearing for the 2020 budget is planned for the next meeting of the Gypsum Town Council, scheduled for 7 p.m. Tuesday, Nov. 12, at town hall.