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Sales taxes dip, lodgers taxes strong

Business Improvement District expects more growth
Paradoxically, the sales tax collections in April declined while the lodgers taxes increased. However, city collections are still ahead of last year, and the Business Improvement District expects more growth.

While Durango sales tax collections dipped in April, lodgers taxes saw double digit gains.

“We obviously don’t like seeing any decline, no matter how brief,” said Tim Walsworth, executive director of the Business Improvement District.

General city sales taxes collections declined 1.1 percent dropping from about $1.081 million last April to about $1.069 million, according to city data.

At the same time, lodgers tax increased 13 percent, up to $52,790 in April from $46,630 the previous year.

The paradox is tough to explain, Walsworth said.

“You would think more people are in hotel rooms and that would equate to more sales tax,” Walsworth said.

It is the first monthly decline the city has seen since at least 2009, City Manager Ron LeBlanc told the Durango City Council on Tuesday.

The local economy is still healthy, he said, but if the collections continue to decline over three or four months, he plans to discuss it with the board.

“We are prepared to recommend actions if they are warranted,” he said.

However Walsworth doesn’t expect the slow down to be sustained because total sales tax collections since January are still 3.4 percent above last year, the tourism season outlook is positive because gas prices are low and a new weekly direct flight to Los Angeles started June 2.

The city was also busy Memorial Day weekend with 2,100 Iron Horse Bicycle Classic riders coming from out of town to compete, he said.

So far this year, north Durango, which includes the north Main Avenue corridor, has seen the fastest sales tax growth in the city, he said.

Four Corners Stoves and Spas saw some of this growth with first quarter sales just above average, said Richard Moore, the head of sales.

The city has been planning for redevelopment along north Main that would encourage sidewalks and pedestrian safety, and Moore said that could encourage growth.

“Increased foot traffic would go a long way for business,” he said.

To encourage shoppers to continue walking into stores instead of ordering items online, the Business Improvement District launched an internet directory this year to help people find products they are looking for locally.

“Just that ease and the ability to comparison shop while sitting in one place is certainly something we’re concerned about,” he said.

mshinn@durangoherald.com

Jul 12, 2016
Durango sales taxes see second month of declines
Mar 8, 2016
Holiday seasonal sales, lodgers tax collections disappointing in Durango
Jan 20, 2016
Durango’s collection of sales taxes and lodgers taxes up in 2015


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