Steamboat Springs Editor's note: This story has been corrected to state that Routt County has a general fund unreserved fund balance of $6.5 million.
County tax receipts up
Routt County Finance Director Dan Strnad released unexpected good news about the county’s single cent of sales tax Wednesday when he reported that sales tax collections were up 11.28 percent for January, compared with January 2010.
Receipts went up $45,181, to $445,671. The growth in sales tax created a bit of breathing room in the county’s 2011 budget — Strnad budgeted late last year for a decrease in sales taxes that predicted sales tax collections of just $385,808 in the first month of the year. Tax receipts were up 15.52 percent from the budgeted amount.
Sales tax produces about 9 percent of the county budget, with property taxes accounting for the greatest share — about 37 percent.
Strnad prepared the 2011 budget in late 2010 expecting sales tax collections to be off $400,000 in 2011. He based that forecast on a 9 percent decrease in enplanements at Yampa Valley Regional Airport and a continuing slowdown in the construction industry that is expected to result in a hit on building-use taxes.
Declining auto sales also were expected to reduce the county’s 1 percent auto-use tax.
Steamboat Ski and Resort Corp. officials have confirmed that the numbers of arriving passengers at the airport early this winter exceeded expectations given the number of seat reductions.
Routt County’s financial health received a vote of confidence from the financial rating firm Standard & Poor’s early this year when the firm reviewed the county’s credit rating in connection with repayment of debt on the Routt County Justice Center.
Standard and Poor’s reaffirmed its A rating on the Justice Center debt and an A-plus credit rating on the county overall, along with a stable outlook for Routt’s fiscal health.
County Finance Director Dan Strnad released the report this week during the annual meeting of the Routt County Public Building Authority. The authority is a nonprofit corporation formed in 2005 when the county financed construction of the justice center on Shield Drive with a form of debt called certificates of participation.
The county recently made a lease payment of almost $1.25 million to the authority, which in turn made a similar payment to the investors in the certificates, most of them banks, County Manager Tom Sullivan said Thursday.
The remaining indebtedness on the Justice Center is $14.14 million, and the county’s positive rating helped it get modest interest rates that will allow it to pay down the principal throughout 20 years with the debt due to be retired in 2025, Sullivan said.
“Routt County is very proud of our fiscal planning that put us in great position for the A-plus rating,” Sullivan said.
He praised Strnad for his ability to explain to S&P’s the county’s strategy for working within Colorado’s Taxpayers Bill of Rights to assure that future tax collections will be sufficient to repay the debt. The county has “banked” available property tax mills by deferring them for tough economic climates. S&P’s observed that the county could have generated an additional $10.8 million in 2010 but instead set that amount aside for the future.
“The county has some taxing flexibility because it has kept its mill levy below the TABOR limitation,” the S&P’s report stated. “It is only levying 11.33 mills of their potential 18.97 mills for property tax revenue. Management expressed that they would increase the mill rate to their limit, as necessary, in order to maintain the current tax revenue.”
S&P’s said in the same report that its positive outlook on the county is based on “very strong reserve levels, with a general fund unreserved fund balance of $6.5 million or 33.5 percent of its fiscal 2009 expenditures.”
S&P’s observed that Routt County depends heavily on tourism but that the volatility of that industry is balanced by employment in health care, the Hayden Station power plant and coal mines.
“Routt County has very strong wealth levels, with a per capita estimated buying income of 137 percent of the national average,” S&P wrote. “In our view the county’s overall debt burden in fiscal 2009 is moderate, at $3,600 per capita. The county’s future capital needs are manageable and will be financed on a pay-as-you-go basis.”
— To reach Tom Ross, call 970-871-4205 or e-mail tross@SteamboatToday.com