Healthy spring cushions taxable sales in Breckenridge
summit daily news
Summit County, CO Colorado
BRECKENRIDGE ” Taxable sales activity in the town of Breckenridge last December was down 12.5 percent ” or about $5.8 million ” compared with the previous year.
But a fruitful spring of 2008 left the year-end sales numbers about 3 percent below that of 2007.
“We definitely saw a downturn with the economy,” Mayor John Warner said.
The town in January through March averaged 5 percent more in taxable sales than it did in 2007. However, by November that amount had fallen to nearly 16 percent below that same month from the previous year.
Town financial-services manager Brian Waldes said that after years of relatively consistent growth, the fourth-quarter numbers have fallen below the three-year average.
“Once trends reverse to this degree, it becomes very hard to predict; 2007 was ” by a sales-tax perspective ” the best year Breckenridge ever had in history,” Waldes said.
The town’s actual sales-tax collections for 2008 ” recorded at $13.3 million ” are 1.9 percent above those of 2007. But a lag of several weeks between the activity and collection make the picture appear much rosier than reality, Waldes said.
The real-estate transfer tax collections in Breckenridge, at about 34 percent below 2007, showed one of the sharpest declines among town revenues. About $3.7 million was accrued toward a RETT budget of $5.7 million in 2008.
These numbers were at dismal levels for most of the year, looking most shabby in November, when they were about 68 percent below that same month in 2007.
The real-estate transfer tax “was pretty much a disaster last year,” Waldes said. “It’s not picking up.”
He said that, fortunately, the tough-to-predict nature of this revenue stream has caused it to be used mostly for projects rather than operations.
“That kind of softens the blow a little,” Waldes said. “But it’s definitely alarming.”
The town council saw the downturn coming last fall and in October took pre-emptive measures ” through budget cuts, elimination of vacant positions and putting projects on hold.
“We’ll see if we need additional measures during the year,” he said. “The council has already taken measures, but it’s something we’re prepared to be dynamic about.”
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