Colorado Springs Mayor talks taxes, budget cuts, and COVID-19

First seen in the Colorado Springs Independent

Mayor John Suthers shared his thoughts on local current affairs during a webcast Aug. 26 arranged by the Council of Neighbors and Organizations, a neighborhood engagement organization. The mayor discussed the economy, COVID-19, the upcoming tax ballot initiative and answered select questions from the audience.

Suthers highlighted the resilience of the city’s economy despite the COVID-19 shutdown this spring. The local economy has been supported by both online sales tax and ongoing construction projects, he said. Amazon’s reported sales tax is up 180 percent from last year, and residential and commercial construction remain at record levels, according to the mayor.

The city saw a decrease in revenue in both March and April, but May and June showed increases. June revenue was 3.9 percent higher than the same time last year, he said. Suthers attributed this to a local willingness to support restaurants by dining in or taking food to go.

Despite a strong summer, sales tax revenue is still down 7 percent this year compared to the same time frame last year. The city has implemented budget cuts and a hiring freeze to compensate for the loss. The mayor reported that the city cut $22 million in expenditures and has 250 fewer staff members compared to this time last year. The $37.5 million in county CARES Act funding given to the city will be used to help pay for police, firefighters and COVID-19-related costs, Suthers said.

The mayor also highlighted a November TABOR ballot issue that would allow the city to recover more rapidly by using 2019 figures to act as the base for tax rates, as opposed to using 2020 figures. If passed, the city would collect more tax revenue for 2020. The initiative would not increase city taxes, Suthers says, but it could cut the city’s economic recovery time in half.

The ballot initiative would also allow the city to keep revenue normally refunded to taxpayers under the Colorado Taxpayer’s Bill of Rights to help make up revenue shortfalls.

The mayor is in talks with state government officials to see if some restrictions in the city can be lifted due to the falling number of COVID-19 cases in El Paso County. He added, however, “it’s not a time to take our foot off the pedal with social distancing and mask wearing.”

Overall Suthers says Colorado Springs has weathered COVID-19’s impacts on the economy well.

“I think we can look back at how we dealt with this COVID-19 crisis as one of the finest hours of our city,” he said.