Marijuana sales tax data hard to come by in Steamboat Springs
July 8, 2014
Steamboat Springs — Steamboat Springs residents who want to find out how much revenue their city is gaining from grocery and liquor store sales each month have a relatively easy mission.
Marijuana store sales? Now that’s a different story.
Elected officials and residents in Steamboat are learning that it will be hard for them to figure out exactly how much money the new recreational marijuana industry is contributing to the city’s coffers.
The general answer, according to city officials, is that marijuana sales so far have accounted for a very small portion of Steamboat’s bigger revenue picture.
But the exact dollar figures never may be known publicly.
That’s because with only two pot shops running in the city, the release of any sales tax data about the shops would go against the city’s sales tax code that prohibits the release of confidential tax data from individual businesses.
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The city is able to combine sales tax totals for other industries such as grocery and sporting good stores because there are enough of them to prevent the release of potentially proprietary information.
Towns such as Telluride and counties in Colorado have been able to release detailed data about the industry’s impact on their budgets because they have more businesses to report on.
Even when Steamboat hits three marijuana stores as expected, the city still does not plan to release the collection information for the industry if one of those three stores accounts for 80 percent or more of the collections.
That policy mirrors one used by the state’s Department of Revenue in reporting sales tax figures.
The Steamboat Springs City Council last week asked how much money marijuana sales are projected to generate in the city’s budget.
Some council members said they wanted to know because marijuana legalization was pitched to voters with the reasoning that it would generate tax revenue for the state and cities.
“Everyone is curious what the number is,” Finance Director Kim Weber told the council.
Short of releasing the specific tax figures, the city has been able to provide a limited outlook of the industry’s impact so far.
Weber said Tuesday that the combined sales tax revenue from retail and medical marijuana sales currently accounts for less than 3 percent of the city’s annual sales tax collections.
The city has collected about $8 million in sales tax through May of this year, and ended 2013 with $18.8 million.
In recent years, liquor store sales have accounted for about 4 percent of the city’s sales tax collections.
The city typically breaks out certain industries in the sales tax reports when they generate more than 3 percent of the total revenue.
However, if marijuana sales pass the 3 percent threshold, the figures still could be withheld if the release goes against the city’s code that protects the release of potentially proprietary information.
The city collects its normal sales tax on marijuana purchases and also receives back a small portion of the sales tax the state collects from recreational sales here.
Statewide, the recreational marijuana industry has during its first four months generated an estimated $11 million in tax revenue for the state.
That’s the bigger revenue picture.
What about at the store level here in Steamboat?
Rocky Mountain Remedies co-owner Kevin Fisher said business has been great and “things are only going to go up from here.”
He said his employees also contribute greatly to the local economy just like any other business.
Jobs at Rocky Mountain Remedies, which has about 50 employees, start at $15 per hour.
Fisher said Tuesday that about $30,000 worth of payroll is distributed each week to the workforce.
“I have employees who have bought houses and paid for mortgages with their jobs,” he said. “That’s not insignificant, and the community continues to support us.”