Finance Committee Agenda and Packet 2023 10 19

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City Of Louisville COLORADO • SINCE 1.878 SUBJECT: SALES TAX REPORTS DATE: OCTOBER 19, 2023 FINANCE COMMITTEE COMMUNICATION ITEM 2 PRESENTED BY: MAHYAR MANSURABADI, SALES TAX AUDITOR SUMMARY: In this financial update, Staff will provide a comprehensive analysis of the City's sales tax collections, broken out by various parameters such as type, area, and industry. While Sales, Use, and Lodging Tax demonstrate growth YTD, Building Use Tax and Auto Use Tax have declined. Total Tax Revenue is up 7.1 % YTD when compared 2022. 1. Sales Tax: Up 6.9% YTD vs 2022. Over half of sales tax revenue, 54.1 %, has been generated from in city businesses. Outside city sales tax revenue has increased by 14.3% Year -To -Date (YTD) compared to 2022. 2. Use Tax: Up 42.5% YTD vs 2022. The driving force behind this growth has been new businesses relocating to Louisville, particularly those engaging in substantial building and office acquisitions. Please note that we project this growth to end closer to 6% after BAP refunds are factored in. 3. Building Use Tax: Down -19.1 % YTD vs 2022. This was an anticipated decrease; as we had a large influx of Marshall Fire home rebuild permits come in August 2022 which spiked building use tax. As the year continues, building use tax will continue to trend downwards with a projection of -57.7% vs the 2022 calendar year, aligning with pre - Marshall Fire trends. 4. Auto Use Tax: Down -8.8% YTD vs 2022. This decrease can be attributed to a reduced volume of vehicle purchases in the post -pandemic landscape 5. Lodging Tax: Up 191/o YTD vs 2022. During the September's Finance Committee meeting, Chair Dickenson inquired about the predominant contributors to the CTC (Colorado Tech Center) sales tax revenue. In our analysis for the 2023 calendar year, we found that general retail stores play a significant role, accounting for 40% of the total sales tax revenue, with a quarter of that being food stores/restaurants. Manufacturing follow closely, representing a 35% of the revenue. Additionally, the wholesale goods industry contributes a substantial 15% to the overall revenue. The remaining 10% stems from service -based industries, with a particular emphasis on science, engineering, and research -based companies. RECOMMENDATION: Receive and file. FINANCE COMMITTEE COMMUNICATION 8/47