The city and county of Broomfield has trimmed expenses in the wake of financial challenges presented by the COVID-19 pandemic. But uncertainties on the full economic impact remain as the unprecedented health crisis continues.
Gov. Jared Polis extended the deadline for Colorado retailers to remit sales taxes from April 20 to May 20. The extension makes Broomfield revenue projections difficult to pin down, Finance Director Brenda Richey said during an April 14 electronic City Council meeting.
Broomfield reduced its operational costs by furloughing 235 full-time and part-time workers, according to city spokesperson Carrolyn Romero. Furloughs went into effect Wednesday and will last through June 30.
Employee health benefits will be paid through the furlough dates. Prior to the furlough start date, a workforce team assisted employees with applying for unemployment.
“We’re trying really hard to be good partners with our furloughed employees, but again can’t imagine the toll it’s taking on them.” Romero said.
She added that if operations are impacted greatly with the smaller workforce, employees can be called back to work before June 30 with a 48-hour notice.
Along with furloughs, a hiring freeze was applied to all vacant positions. In a financial update to the council on April 21, Richey forecast a reduction of $2,402,997 in personnel costs.
The makeup of Broomfield’s revenue stream is 27.8% from sales tax, 28.4% property tax, 5.7% use tax and the rest from other sources such as grants. Richey believes a clearer picture for revenue projections will emerge in mid-May.
“From the data of having the shelter-in-place requirements for a little over a month, retail sales are rapidly declining and unemployment is increasing, which is threatening our short- and long-term stability,” Richey said in a presentation to City Council on Tuesday. “We still don’t know how the extended due dates for the sales tax payments play into our ability to begin the recovery process.”
As of now, 45% of sales tax revenue has been collected compared to last year. However, this is subject to change as the May 20 deadline nears.
Without definitive numbers, Richey predicted revenue will be less than 2019 — $104,665,702 compared to last year’s $120,290,837, with sales tax accounting for a large portion of the loss.
Mayor Patrick Quinn said the FlatIron Crossing mall brings in an estimated quarter of sales tax Broomfield collects. The mall is temporarily closed.
Richey said grocery sales revenue saw an uptick of 7.5% and online sales sectors projected a 52% increase. Those rises are helpful, they’re not enough to mitigate the loss of other retailers, she said.
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