Steamboat sales tax slide continues |

Steamboat sales tax slide continues

January collections down 8 percent; West Steamboat hit hard

Mike Lawrence

— City sales tax collections continue to slide in front of a rapidly approaching shoulder season that could push some downtown businesses over the edge.

The city of Steamboat Springs collected about $150,000 less in total sales tax revenues in January 2010 than it did in January 2009, a decrease of about 8 percent, according to a preliminary report the city's finance department released Monday.

Year-to-year January decreases particularly were steep for the lodging industry, which dipped 16 percent from a year ago, and the West Steamboat area, which dipped about 25 percent. The city collected only $6,304 in building use tax in January 2010, compared to $48,767 in January 2009 — an 87 percent decrease for an indicator of local construction activity.

January's sales tax figures follow a year-to-year drop of more than 10 percent in December, which capped a bruising 2009 that saw the city collect about $16.7 million in total sales taxes compared to $19.9 million in 2008. On the upside, though, that drop-off of about 16.3 percent fell within city budget projections, meaning no reserve spending was needed. City Manager Jon Roberts said Monday that the city actually has about $750,000 in excess general fund revenue from 2009.

"Expenses came in under budget, and revenues came in over budget," Roberts said about the final assessment of 2009 city finances.

The city budgeted for an 18 percent decrease in sales tax collections for 2009, compared to 2008. An additional 10 percent drop is budgeted for 2010.

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Roberts said the Steamboat Springs City Council will discuss how to use the $750,000 at its meeting tonight. He said the amount is not enough to end the furlough program for city employees, which could cost about $1.2 million. Roberts said the money could restore safety and training materials for Steamboat's police and fire departments, or it could roll into city reserves.

Tracy Barnett, of Mainstreet Steamboat Springs, gave mixed reviews of January's 8 percent decrease in sales tax collections.

"Any down is

still down, and on top of the past downs, it's a downer," Barnett said. "But (the fact) that it's not as far down as predicted, I think is a good sign. I don't know if it's going to be enough to help some of these businesses survive. It's just a real tough go at this point, and people are getting fairly discouraged."

Barnett said she has heard that "a couple" of downtown businesses could be forced to close in coming weeks, possibly after the end of ski season or, she said, "maybe even before."

"Retail numbers are the worst in 10 years for downtown," Barnett said.

Barnett said downtown business closings could be spurred by extensive Lincoln Avenue re-paving work slated to begin in April, and "the fear of how much worse it's going to be during construction than it is anyway." Some downtown business owners said their struggles were exacerbated in the fall during Colorado Department of Transportation work conducted by Scott Contracting, part of massive improvements to U.S. Highway 40's downtown stretch.

City, business, CDOT and Scott Contracting officials have been meeting to prepare for the work and attempt to lessen the potential impacts to businesses. Construction officials say they plan for the work to be done before the height of the July and August summer tourism season.

Business owners have asked for considerations including more advance notice and detail with construction schedules, variances to city sign codes to allow open businesses to promote themselves, more pedestrian access to downtown streets and an increased effort to provide downtown parking where possible.

Barnett said reports of slow economic recovery might not bear fruit fast enough for downtown business owners.

"The predictions are optimistic, but that doesn't help them pay the electric bill," Barnett said.

Sales tax numbers

■ Total collections in January 2008: $2,166,093

■ Total collections in January 2009: $1,901,894

■ Total collections in January 2010: $1,749,279

■ Percent change, Jan. 09-10: -8

Category Jan. 2009 Jan. 2010 Percent change

Misc.retail: $681,526 $667,790 -2

Lodging: $459,147 $385,849 -16

Sporting goods: $148,187 $147,700 -0.3

Utilities: $233,842 $208,202 -11

Restaurants: $315,330 $281,758 -10.7

Liquor stores: $63,860 $57,981 -9.2

Area Jan. 2008 Jan. 2009 Percent change

Downtown: $273,028 $233,733 -14.4

Base area: $664,287 $598,860 -9.9

U.S. Highway 40 corridor: $578,724 $508,145 -12.2

Regional: $237,861 $297,598 25.1

West Steamboat: $147,994 $110,943 -25

Source: City of Steamboat Springs, in a preliminary report

that is subject to change after full collections are received.

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