Consumer spending in Aspen holds strong
Aspen, CO Colorado
It appears the national recession hasn’t hit consumer spending in Aspen yet.
City Hall’s finance director, Don Taylor, is reporting that March’s sales tax collections are up 6.7 percent from the same month in 2007 and first quarter collections are up 10.8 percent.
Lodging tax collections for March showed a 13.2 percent increase and year-to-date collections improved by 13.8 percent.
March retail sales were $67,370,441, representing a 7 percent increase in total retail sales compared to 2007. Year-to-date retail sales are $194,724,080, representing a 10.9 percent increase over 2007.
Aspen’s retail economy has been strong since January with significant increases in nearly all industry sectors.
The largest contributor to the city’s tax revenues ” tourist accommodations ” is reflecting a healthy 13.4 percent year-to-date increase, with the second largest contributor ” restaurant and bars ” reflecting 6.3 percent year-to-date increases at the end of March.
Historically, the city brings in more than one-third of its annual sales tax revenue through the first three months of the year. Similarly, Aspen sees nearly one half of its lodging tax revenue in the first quarter.
Aspen’s portion of Pitkin County’s 2 percent sales tax collections for February is up 10 percent from last year and first quarter collections are up 8.7 percent.
The Real Estate Transfer Tax (RETT) that contributes to the housing fund are $2,061,931 through April, which is running 33 percent behind in collections and 22 percent behind in the 2008 budget.
Year-to-date collections for the RETT that funds the Wheeler Opera House through April are $1,107,658, which is 33 percent behind from 2007 and 11 percent behind the 2008 target.
However, Taylor said while the RETT is volatile and down from the stellar years 2005 and 2006, it is still reflecting a substantial increase from the comparable figures for 2004 and prior years.
The Wheeler RETT is up 25 percent from 2004 and up 71 percent from 2003. The housing RETT is up 30 percent from 2004 and up 87 percent from 2003.
“These trends appear to be due to an exceptionally high rate of real estate sales in the years 2005 through 2006 in Aspen and the local as well as the national decline in real estate sales in 2007 through the current period,” Taylor wrote.
City of Aspen voters will be asked this fall to allow City Hall to borrow against future revenue generated by the 1 percent RETT and the housing portion of the 0.45 percent sales tax.
The bonds ” which could be as much as $92.5 million ” are dependent upon renewing the RETT, which expires in 2024, and the sales tax dedicated to housing, which sunsets in 2010.
The RETT and housing portion of the sales tax together generated nearly $11 million in 2007. It’s estimated that the sales tax, if extended, would grow at a rate of 4 percent. The RETT is predicted to grow at 5.5 percent. Those are conservative estimates, according to city officials.