Glenwood sales tax drop not as bad as expected |

Glenwood sales tax drop not as bad as expected

John Gardner
Post Independent Staff
Vail, CO Colorado

GLENWOOD SPRINGS, Colorado – While city revenues have continued to decline for 23 consecutive months, Glenwood Springs City Manager Jeff Hecksel said that the declines in March and April weren’t as bad as he expected.

In fact, he considered March’s 2.5 percent decline from March 2009 to be an improvement.

“The [city’s] general fund, at the end of April, is not out of line with where we thought we would be at that time,” Hecksel said. “Basically speaking, the city is right where we expected it to be – maybe a little better off.”

According to a monthly financial report released by Glenwood Springs Finance Director Michael Harman, January and February both recorded close to 9.5 percent declines when compared to the same months for 2009. Surprisingly, March was only 2.5 percent below the same month in 2009. However, April saw declines at 7 percent below the same month in 2009. But that is still pretty good news, according to Hecksel.

“March and April still weren’t as bad as February,” he said.

The good news, if there is any, is that while declines continue, the city has yet to post a double digit single month decline this year. And the numbers seem to be leveling off.

“We are just now, as of March and April, starting to see some moderation,” Hecksel said.

June 2008 was the last time the city reported an increase in sales tax revenues.

Glenwood ended the first quarter of 2010 with just below $2.9 million in sales tax revenues, a 7 percent decline from the first quarter of 2009 totals. That is half the 15.5 percent decline the city saw for the first quarter of 2009. The city ended 2009 down nearly 17 percent overall.

While Hecksel expects declines to continue through May, he’s hoping that things will begin to shape up in June.

“I have no reason to think that May will be any better than January or February,” he said. “However, June, July, and August, I hope they will be better. History will determine if they will be or not, but I really don’t know.”

Despite the declines, the city hasn’t had to make any drastic adjustments. Hecksel said that he and city staff continue to monitor expenses to counter the continued losses.

“We are continuing to monitor expenditures and all of our revenues,” Hecksel said. “We continue to reduce costs where we can and have been successful in that.”

Accommodations taxes are also beginning to post lesser declines from last year.

Through April 2010, the city posted an 8 percent decline in accommodations tax revenues. That is a much better number than the 33.5 percent decline the city saw just one year earlier.

While the year started off similar to 2009’s numbers, with January posting a 19 percent decline, the three months that followed posted substantially better numbers. The city posted a 7 percent decline for February, while March and April had much lesser declines of 4 and 2 percent, respectively.

That could be good news for area hotels going into the summer tourist season, which has historically been its strongest months.

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