Basalt sales tax revenues up
December 25, 2008
BASALT ” Basalt’s economy held its own this year even as news on the national front kept getting worse in the fall.
The town’s sales tax collections are up 4.4 percent for the year through November compared to 2007, according to a report by town finance director Judi Tippetts. The town has collected $3.39 million through its 3 percent sales tax, compared to $3.25 million at the same point last year.
Summer is the season that Basalt butters its bread because anglers head to the rivers, boaters go to Ruedi Reservoir and second-home owners visit the Roaring Fork Club to golf and fish. Tax collections were down in July, strong in August and flat in September. Collections lag one month behind actual sales, Tippetts said, so July collections reflect June sales.
The town continued to show modest growth in sales into September and October.
“We haven’t seen a downturn at all,” said Mike Mercatoris, co-owner of Zheng Asian Bistro in Orchard Plaza. Business remains consistent with prior years even though there is greater competition from more restaurants in the midvalley, he said.
The seven-year-old restaurant has always marketed itself as a less expensive alternative, Mercatoris said. And that approach is particularly important these days, with consumers being more careful with discretionary income. Therefore, Mercatoris said, he is holding steady on prices.
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“Stay focused on what you do,” he said.
Zheng also started serving lunch in October, providing its customer base with a less expensive option, and it started catering, as well. The restaurant depends heavily on local residents. When the upvalley economy is going well, downvalley workers have more money and dine out more often, Mercatoris said. When the economy isn’t doing so well, diners seek the less expensive options. Either way, Mercatoris believes he is positioned well.
Basalt’s restaurants with bars showed healthy sales growth during 2008. Sales tax collections from that category were up 11 percent to $298,711 from $267,800 last year through November, the town report showed. Some of that growth reflects Crave Kitchen and Smoke getting established in their first full years at Willits Town Center and El Korita’s relocation to its larger space. They opened in 2007 at Willits, but this is their first full year of operation there.
Basalt’s economic driver is City Market. The retail food category, which includes City Market and Clark’s Market, accounts for more than one-third of sales tax dollars collected by Basalt.
So far this year, retail food businesses have collected $1.26 million in sales tax, up about $215,000 or 20 percent from the same period last year.
General retail stores faced a tougher time, as a whole, in 2008. Sales tax collections in that category are down 1.3 percent at $611,520 through November.
That reflects a mixed bag for retailers. Toklat Gallery in the Riverwalk building experienced “a great summer,” said owner Lynne Mace. She relocated her family’s gallery from Ashcroft a little more than three years ago. The business is approaching its 60th anniversary overall. Manager Mindy Langston said Mace has done a good job of building business after the relocation.
Langston said she feels that the national economic downturn has changed the buying habits of many local residents. They are more interested in supporting local stores at this tough time and they are looking for more “genuine” and heartfelt” gifts. Toklat sells the wares of local artists, from jewelry to paintings and a variety of other items.
So far, the economic downturn hasn’t hurt the gallery. “October was a really good month for us,” Langston said. “I had some killer days.”
Veteran retailer Tracy Bennett has become accustomed to “ups and downs” during 16 years as owner of Midland Shoe on Midland Avenue, the town’s main street. After a “banner year” in 2007 she is facing what she called a “miserable, horrible 2008.”
Part of that is weather related. The seasons went from winter to summer in the Roaring Fork Valley this year, wiping out spring shoe sales, she said. Now, the economic downturn affecting the entire country is inevitably hitting local shoppers, she said.
Bennett is prepared to deal with slow times until business picks up. She’s done it before. She experienced slowdowns after 9/11 and during the summer of 2002, when Colorado wild fires destroyed tourism.
This downturn feels different, though, and Bennett expressed what’s on everyone’s mind: What will 2009 bring?
“This is sort of a whole different type of animal,” she said.