Sales tax collections for Stage still lagging
SUMMIT COUNTY – Sales tax collections intended to pay for the Summit Stage’s late-night service are still lower than expected, but Stage officials aren’t worried – yet.
Summit County Transit Director Bill Watterson told transit board members Thursday that sales tax money received by the Stage for March is about 10 percent lower than expected. In March, county officials discovered many businesses hadn’t been collecting an additional sales tax enacted Jan. 1 during the first two months of the year. County finance staff and Stage administrators estimated businesses failed to collect as much as $225,000 in January and February.
In March, county finance director Linda Gregory said the exact dollar amount that wasn’t collected won’t be known until the taxes are paid. Businesses will be responsible for paying the taxes they didn’t collect. Gregory said, after the mistake was first discovered, further investigation revealed the state’s tax division had made errors as well.
“There was more going on than we thought,” Gregory said. “It turns out the state was sending the tax increases to the towns. So now the towns’ taxes are messed up, the county’s taxes are messed up and the transit tax is messed up. We don’t expect to see a resolution until next month.”
Gregory said state accountants are having to make fixes manually because of archaic computer and paperwork systems.
Watterson said he expected the shortfall for March collections to improve, although not to the full level. He said the reduced funds won’t become a concern until June.
“We’re significantly under budget on our expenses, so we’re kind of treading water, but there’s no need for alarm,” Watterson said. “It’s a lot better than it was last month.”
County Commissioner and transit board member Bill Wallace suggested the board review the budget in July to make sure the Summit Stage wasn’t spending money it didn’t have. Ironically, the Stage pushed up the debut of late-night service to March 3 after encouragement from restaurant associations, the Summit Prevention Alliance and board members hoping to capture night-time spring break riders. The Stage requested and received permission from the Board of County Commissioners to begin spending the extra tax funds before they were collected.
In November, Summit voters approved a quarter-percent sales tax increase, from 7.5 to 7.75 percent; the Stage’s share of that tax increased from .50 percent to .75 percent. After the election, the county finance department sent letters to the 4,000 vendors and merchants, which pay sales tax to the state Department of Revenue, informing business owners they needed to adjust their cash registers. Many forgot, however.
The transit board and Stage administrators will continue to analyze the new late-night bus service. In its first month, the service gave rides to 2,200 people after 12:30 a.m., with peak ridership on the night of St. Patrick’s Day (March 17). Summit Prevention Alliance coordinator Beverly Gmerek, a major proponent of the service, said the service is saving citizens money.
“The latest figures indicate it costs the county $582 for each DUI arrest,” Gmerek said. “When you add in the expenses afterward for the district attorney and the court, it gets closer to $1,000. By reducing the arrests last month by 10 DUIs, that’s $10,000 that can be put back in the county’s economy.”
Reid Williams can be reached at (970) 668-3998 ext. 237 or email@example.com.
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