The holiday season was not as strong as predicted, but December still was a record-setting month for Durango retailers.
December sales tax collections increased 3.8 percent to $1.62 million from about $1.56 million collected in December 2014.
“Even though we didn’t see the growth we wanted, we still set records,” said Tim Walsworth, executive director of the Business Improvement District.
He wanted to see a 6 percent to 7 percent increase in sales tax in December compared with the previous shopping season. December is usually the highest or second to highest month for sales in the city, he said.
While sales and lodgers taxes sometimes correlate, that was not the case this holiday season.
Lodgers tax collections of $56,268 were a slight decline – about 1.2 percent – from the $56,934 collected in December 2014. During the prior two holiday seasons, the lodgers tax collections increased in the double digits. December 2014 increased 23 percent over the previous year.
The decline in travelers is likely related to the slowdown in the oil and gas industry in New Mexico, Texas and Utah, said Michelle Thom, general manager for the Strater Hotel. Many people working in the industry drive to Durango for the holidays, she said.
“They were not in town renting rooms like they normally do,” she said.
Thom believes the decline could persist while the oil and gas industry remains depressed.
The lodgers tax also could have been affected by increasing vacation rentals, said Bob Kunkel, Durango executive director for the Durango Area Tourism Association. Some people renting homes for a short period don’t realize they have set up a business and should pay taxes, he said.
Lodgers tax collections varied dramatically in 2015, and late reporting by some businesses could have created the swings, he said.
To help bolster local lodging businesses, an industry group to represent hotel and motels in the area is forming, Thom said. After initial meetings last year, the group should be running in April. It will help business owners understand issues such as the lodgers tax rate, vacation rentals and panhandling, said Thom, chairwoman of the Colorado Hotel and Lodging Association.
A similar organization was active in the 1990s, but it splintered into other groups.
“I’m really trying to revive it, but revive it the right way,” she said.
mshinn@durangoherald.com
