Taxable sales hit by slumping housing and car sales

Cash strapped Carson City found some bad news in a report on May sales tax revenues.

The report shows taxable sales dropped nearly 10 percent, led by an 11.3 percent decrease in auto sales, the capital's biggest single category with $22.9 million of the total $78 million in reported sales.

Carson City Manager Linda Ritter said the city had anticipated and budged for a decrease in sales.

The city is "actually pretty comfortable with our '07 projections," she said. "We were pretty conservative."

But she said they are planning to revise the projections down for 2008.

"It could be as much as $400,000," she said.

She said she and fiscal staff are giving the Board of Supervisors monthly updates on the city's financial condition.

At the same time, the city's second biggest category, general merchandise sales, were just about flat, reporting a 1 percent drop to just over $12 million.

With 10 of Nevada's 17 counties showing a decrease from a year ago, taxable sales statewide fell 3.6 percent in May.

Only those counties with a strong mining base escaped negative numbers. Total sales reported to the Department of Taxation were $4.1 billion for the month.

Douglas suffered a similar fate, an 11 percent decrease to $60 million in taxable sales. Like Carson City, the blame falls on an 11 percent decrease in motor vehicle sales and the weak housing market.

Building material sales fell about 9 percent in the capital city but 23 percent in Douglas County. Statewide, that decline was nearly 29 percent.

Sales of furniture were down 60 percent statewide, 72 percent in Douglas and 46 percent in Carson City compared with May 2006, also a reflection of the housing market.

Washoe County also reported a decrease in total taxable salesa 4.2 percent to $590.7 million for the month. Sales in Clark County were off 3.8 percent to just over $3 billion.

Lyon County reported a near 37 percent drop in sales as tax revenue from mining plummeted from $2.6 million a year ago to less than $467,000. Lyon was the lone exception among counties with a strong mining industry. The housing market's troubles also hurt Lyon as sales of building materials fell 45 percent to $3.5 million.

Also in the red were Churchill, Eureka, Lincoln, Mineral and Nye counties.

One bright spot was Storey County, which is enjoying strong growth in revenues from growth and expansion at the Reno-Tahoe Industrial Center. The increase was nearly 122 percent over the same month in 2006, a total of $13.3 million in taxable sales.

But biggest increase for the month was Lander County which reported huge increases in sales related to the mining industry. Total taxable sales reported were $40 million - a 260 percent increase.

In fact, the other counties that reported increases in sales - Elko, Esmeralda, Humboldt, Pershing and White Pine - can also credit the booming mining industry.

State revenues from sales and use taxes are now $14.2 million below the amount forecast by the Economic Forum and used to build the state budget for the fiscal year. With one month remaining to report in FY 2006, total sales were $44.95 billion.

• Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.

By the Numbers

County Taxable Sales Change from 2006

Statewide $4.11 billion -3.6%

Carson City $78.1 million -9.8%

Churchill $26.1 million -6.2%

Douglas $60 million -11.1%

Lyon $25.8 million -36.8%

Storey $13.3 million 121.8%

Washoe $590.7 million -4.2%

Clark $3 billion -3.8%