Grocery store, online sales taxes keep Carbondale in black despite downturn

John Stroud
Glenwood Springs Post Independent

A new, larger City Market store in Carbondale and a robust effort by the town to work with the state of Colorado to collect sales taxes for local online sales equals good news headed into the 2021 budget cycle.

Unlike some Roaring Fork Valley municipalities that saw large decreases in sales taxes during the ongoing business restrictions related to the pandemic, Carbondale seems to have weathered the worst better than most.

Taxes collected on retail sales in the town through August were up 2.5%, and preliminary numbers for September (reflecting the prior month’s sales) show a 4.6% increase, Carbondale Finance Director Renae Gustine said during the Sept. 22 Carbondale Board of Trustees meeting.

Those numbers don’t even include the numbers since the opening of the new City Market store on state Highway 133 in late August, Town Manager Jay Harrington said.

Combined with increased building activity in the town throughout the year, and the online sales tax collection program, town finance officials said they are confident projecting a 5% increase in sales tax revenues as the town begins its 2021 budgeting.

To illustrate the importance of being able to collect sales taxes for online sales, Trustee Marty Silverstein, a retired postal worker, said the volume of Amazon packages coming through the Carbondale Post Office has more than tripled during the pandemic.

“It’s been equal to what we would see the week before Christmas,” Silverstein said of a daily volume of between 2,000 and 3,000 packages since spring.

“We would typically see about 500 to 800 Amazon packages a day before the pandemic,” he said. “So, getting sales tax revenue on that is just huge.”

Trustees supported the 5% figure for budget projection purposes, but worried about the potential for another economic shutdown if the COVID-19 numbers spike again to levels seen in the spring.

Mayor Dan Richardson noted that the Roaring Fork Transportation Authority member jurisdictions are all over the board in their sales tax predictions for the coming year.

Glenwood Springs is projecting a 10% decrease, for instance, and Aspen has said it anticipates the taxes going to support the bus system will go up 18%, he said.

One area where the town of Carbondale is not expecting to see revenues return to normal levels is in the Recreation Department, due to the Rec Center operating at limited capacity under the COVID restrictions.

“That’s one area where we’re just going to have to say we’ll budget for trying to get back to normal, but we know that very well may not happen,” Harrington said. “Especially with special events revenues, I don’t see us going back to 600 people in the Rec Center.”

Trustee Lani Kitching said Carbondale appears to have weathered the financial storm better than some of the towns that rely more heavily on tourism.

“We are in better shape here due to the diversity of our economy, and that makes it a little bit easier to support the tax projection,” she said.

Gustine said 2021 budget details will be presented to the town board at its Oct. 13 meeting.