Little pandemic impact seen on gross receipts revenue

Despite the effects of the coronavirus pandemic, governmental entities in Quay County continue to see minimal impacts on gross receipts tax revenue.

Quay County manager Richard Primrose said during a recent county commission meeting the July report on gross receipts taxes that reflect sales in May showed a strong increase.

“It surprises me that gross tax receipts are up so well,” he said during the meeting.

During a follow-up phone interview last week, Primrose said gross receipts tax revenue to the county collected in May was about $224,000 — a 25% increase over May 2019’s $179,000.

Primrose attributed the strong number partly to several construction projects in the county, including bridges being built on U.S. 54 near Logan and another on old Route 66 west of San Jon, plus Mountain Road’s reconstruction in Tucumcari.

Construction tax receipts totaled about $63,000 in May, compared to $18,000 a year ago, he said.

Primrose also food sector of the gross tax receipts ledger had risen by about $2,000 in May from a year ago.

“I attribute that to the fact they’re buying their groceries in Tucumcari,” he said.

Primrose observed similar strong sales in groceries the previous month.

Primrose said receipts from the accommodations and retail sectors were down about $3,000 in May from the previous year.

Quay County also received $3,200 in receipts in May from an internet sales tax that went into effect in September.

Primrose noted House Bill 6, passed by the New Mexico Legislature during a special session in June and signed into law by the governor, also would spring additional internet sales tax receipts to counties and municipalities. That portion of the bill takes effect in 2021.

During a Tucumcari City Commission meeting last month, Finance Director Rachelle Arias reported the city’s gross receipts taxes increased by 3.3% during the 2020 fiscal year despite COVID-19 setbacks in lodging and restaurant businesses.

Primrose noted the ongoing Mountain Road project would have added significantly to city coffers.

“That would be huge for them,” he said. “A $20 million project would bring in a lot of receipts.”

State figures show gross receipt tax distributions in May were just 1.2% less than in May 2019, according to a recent report in the Albuquerque Journal.

The report also cited strong grocery sales in the state. Cities and counties still get payments from the state that represent a portion of the revenue they would have received if the groceries had been taxed. Those payments rose sharply, totaling $10.7 million statewide in May, compared with $4.2 million in May 2019.

When excluding those payments, May 2020 fell 2.8% from a year ago.