City sales collections are down for the second month in a row, and this may temper plans for next year.
The collections were down by 1.5 percent in May, dropping to $1.17 million from $1.19 million during the same month last year. In April, collections were down 1.1 percent.
Lodgers tax also declined by 7.6 percent to $76,875 from $86,489.
These declines may have been caused by residents postponing large purchases and the loss of oil and gas jobs in Farmington, City Manager Ron LeBlanc said.
Fewer high-paying jobs in Farmington could be resulting in fewer shoppers, he said.
While it may not continue, he told the Durango City Council on Tuesday the city needs to be prepared for an economic slowdown.
“It’s not cause for alarm, but we have to have a conservative outlook in preparing the budget,” he said.
So city staff will be looking for savings this year and revising budget projections for next year because they had been anticipating 4 percent sales tax growth in 2017. Thus far, the city has collected 2.5 percent more sales taxes than last year.
“When you are sales tax dependent, you have to be nimble, and we are nimble,” he said.
The council also reviewed $1.9 million in proposals for city streets and facilities projects that may be done next year. These projects were chosen from $4 million in possible projects, but they may need to pared back further, Finance Director Julie Brown said.
The city has been spending down its fund balance – which is akin to a savings account – in recent years, so there isn’t extra cushion in the budget, aside from mandatory reserves, she said.
The streets department plans to focus primarily on maintenance, but 46 sidewalk ramps for those with disabilities may be added, Director of City Operation Levi Lloyd said.
If La Plata County’s road and bridge property tax passed, it could boost the city streets budget by $680,000, and it would help the city keep up with the rising cost of asphalt.
In the last year, the city has seen the price of paving an alley double, he said. There are no alley-paving projects planned for next year.
Public art funding may also be cut completely from the budget.