Eagle County sales tax drops 24 percent
EAGLE COUNTY, Colorado ” The economic recession hit Eagle County, Colorado a little harder in January.
County sales tax revenue was down 24 percent in January compared to the previous year ” an almost 20 percent bigger drop than the county budgeted for.
Sales tax accounts for about 20 percent of the county’s budget.
The county planned for a 5 percent decrease in sales tax revenue ” which amounts to about $427,000 ” in the 2009 budget.
“We were initially planning 5 percent ” as we saw how bad it got in December, we were hoping we would only suffer 10-15 percent,” said John Lewis, the county’s finance director.
The numbers are “sobering,” said Commissioner Jon Stavney, but the board needs more information before taking any drastic action.
“We’re not doing any major overcorrection based on January, but we’re monitoring,” Stavney said.
Department heads have been told to start thinking about where they might cut their budgets if the sales tax numbers continue to fall, said Acting County Manager Keith Montag. “It’s time to dust off those lists and reevaluate the feasibility and impacts of those suggestions so we can be ready to implement them should the need arise.”
The county has $4.75 million in contingency money in the 2009 budget, which is enough for the county to handle a 20 percent to 25 percent decrease in sales tax, Lewis said. Since 1984, 2003 was the only year the county’s sales tax revenue decreased. It dropped 6 percent that year.
Capital projects and ECO Transit both are funded in part by sales tax revenue and could be affected if the numbers continue to drop, officials said.
Lewis said he thinks February’s sales tax numbers will be worse but that things could get better in March or April.
“I think February will look bad,” Lewis said. “Februaries normally are huge.”
Staff Writer Chris Outcalt can be reached at 970-748-2931 or firstname.lastname@example.org.