Sales tax collections in Colorado Springs began the year sluggishly, shrinking slightly compared with the same time last year, according to a report this week from the city’s Finance Department.

February tax collections, which reflect spending in January, were down 0.10% compared with last year.

Sales tax revenue accounts for more than half of the city’s general fund operating budget and as such, is closely monitored by city officials as they use the money to pay for parks, roadwork, police and fire services.

The year-over-year decline, while slight, somewhat mirrors national trends. Retail sales plunged 1.2% in January before rebounding moderately in February, according to the Commerce Department. Reports this month, meanwhile, showed consumer confidence falling amid worries that an escalating trade war will fuel further inflation.

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“Sales from January predate concerns that have arisen over the federal government and tariffs,” said Bill Craighead, director of the Economic Forum at the University of Colorado Colorado Springs. “Nationally, there’s a lot more anxiety over the economy and economic outlook than back in January. … And of course the federal government is very important here.”

Craighead emphasized that one month’s worth of data shouldn’t be read into too deeply, especially January. He called it a “dead month,” as consumers step back from major spending after the December holiday season.

Further, weather in January was especially harsh, which he said might have kept more people at home than usual. Cold weather impacted much of the country, likely contributing to the slump in January sales, according to The Associated Press.

One bright spot in the city’s report was hotel and motel revenues. This sector saw a 28.3% increase in sales tax collections when compared with the same time last year.

Meanwhile, the city’s Lodger’s and Auto Rental Tax — a separate levy collected on hotel rooms, motel rooms, short-term rentals and rental cars and an indicator of tourism activity — saw a 9.15% increase in collections from February’s report a year ago.

A large portion of this increase might be attributed to a new, off-season convention in Colorado Springs, said a spokesperson with Visit Colorado Springs, a marketing agency for the city and region.

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“It illustrates the power that an off-season convention can have on industry performance in Q1,” they said.

The group did not specify which convention, citing a lack of specific data from the city’s report.

While the hospitality industry dominated revenue increases, utilities also saw a significant increase in collections, up 22.4% from a year ago. Miscellaneous retail saw a 5.3% increase, rounding out the three best performing industries percentagewise.

On the flip side, business services — which includes professionals and consultants — saw a close to 26% decline. Medical marijuana businesses saw a 16.1% decrease in collected revenue, the city report shows. Building materials rounded out the top three worst performing industries, seeing a 12% drop in collection revenue.

Other industries that saw decreased included clothing stores (down 6.9%), grocery stores (4.8% decrease), furniture, appliances and electronic stores (2.6% decrease) and restaurants (2.2% decrease).

The full report can be viewed online.

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