Retailers nationwide reported weak back-to-school sales this year, and Colorado Springs did not buck the trend.
According to a report from the city's Finance Department issued Tuesday, consumer spending in Colorado Springs slowed in July, increasing by the smallest percentage year-over-year since January as sales at department and discount stores plunged.
August sales tax collections, based on sales in July, rose just 2.83 percent from a year earlier to $10.5 million, the smallest monthly gain since collections edged up a paltry 0.15 percent in January.
Even though the August gain continued a string of consecutive monthly increases to 20, it paralleled a similar weak month a year ago in the wake of the Waldo Canyon fire.
Fred Crowley, senior economist for the Southern Colorado Economic Forum, attributed the decline in collections from department and discount stores to disappointing back-to-school sales, and perhaps reflecting a shift of such spending to online purchases.
Without the decline in collections from department and discount stores, overall collections in August would have grown nearly twice as fast, when compared with a year ago.
This year's Black Forest fire had little apparent effect on the city's tourism industry; collections of the city's tax on hotel rooms and rental cars in August jumped 9.44 percent from a year earlier, the biggest monthly gain since January. Bed-and-car tax collections so far this year are up 4.18 percent to $2.33 million.
Sales tax collections so far this year are up 7.22 percent from a year earlier to $71.6 million. August's use tax collections - from manufacturing equipment, building materials and other items bought outside the city - surged 16.48 percent from a year ago to $674,311 and are up 16.36 percent so far this year.
Combined sales and use tax collections in August were up 3.56 percent from a year ago and so far this year are up 7.8 percent to $76 million.That total doesn't include special sales taxes for public safety, trails and open space and tourism, which add $21.5 million.
When adjusted for inflation, combined sales and use tax collections this year are the highest since 2007, according to Finance Department calculations.
Why it's important: Sales and use tax collections fund more than half of the city's annual budget for police and fire protection, roads and other services. Sales tax also is a primary measurement of consumer spending, making it a key barometer of the local economy.
The breakdown: Industry categories with the largest percentage increase from a year ago were hotels and motels, up 21.95 percent; auto repairs and leases, up 13.2 percent; and furniture, appliance and electronics, up 12.67 percent. Industries with declines were commercial machines, down 20.11 percent; department and discount stores, down 16.87 percent, and business services, down 16.19 percent.
Medical marijuana: Sales tax collections from marijuana businesses in August surged 23.81 percent to a record $120,161, and so far this year are up 28.87 percent from the same period a year ago to $756,680.
Contact Wayne Heilman: 636-0234 Twitter @wayneheilman
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