The depletion of the joint sales-tax fund was discussed at Tuesday’s City Council meeting.
The joint sales-tax fund, created in 1990, is a combined percentage of both city and county taxes. It is a county special revenue fund, said Diane Sorensen, La Plata County finance director.
The joint sales tax provides funding for projects that are designated by both the city and the county. These projects are decided upon annually.
In the past, the joint sales tax has provided funding for the opportunity bus, the public library, senior services, the Humane Society shelter operations and ongoing monitoring costs for the Durango landfill.
The joint sales tax also funds other projects that are agreed upon between the city and the county.
The 2011-2014 joint sales-tax fund has been put toward three programs: the Durango Public Library, the landfill closure and senior services, Sorensen said.
During the four-year time period, 83.7 percent or $6,947,145 of the joint tax sales dollars were put toward the public library, 15.8 percent or $1,309,030 were used for senior services and 0.5 percent or $40,000 was put toward the landfill closure.
The ending balance for the 2014 joint sales-tax fund is $421,863. It is estimated that by 2016, the fund will decrease to $103,113, and in 2017, the fund balance is projected to be completely depleted.
Once the fund has been depleted, any monthly expenditures would be taken directly from the revenues received that month, Sorensen said.
“Every year, for the last seven years, expenditures have exceeded revenues,” Sorensen said. “Spending in excess of revenues is not going to be sustainable.”
The recommended fund balance is $175,000, which is equivalent to the estimated revenue that the joint sales tax generated monthly in 2013.
It is important that the fund continues to have a positive balance, Sorensen said.
“We would not be able to write a monthly check to these programs with the depleted fund,” she said.
To sustain the fund, Mayor Sweetie Marbury suggested the joint sales tax be used strictly to support the library.
It is also possible that the La Plata County would create a new library district, meaning the public library would become an independent agency with a dedicated property-tax revenue approved by voters, said City Finance Manager Julie Brown.
This would mean the joint sales-tax fund could be used to support other projects, such as contributing to the terminal expansion at Durango-La Plata County Airport, Marbury said.
“This is one of the reasons we always encourage people to shop locally; we can see the benefit right here.” she said. “The county, the city, Ignacio and Bayfield are all benefiting from shopping locally. It is critical to the lifeblood of La Plata County.”
By shopping locally, consumers are directly benefiting the library and the senior center, she said.
tferraro@durangoherald.com
