Grand County staff presented an update to the Budget Advisory Board on year-to-date sales and use tax collections and proposed a simple linear-trend method for projecting 2026 revenue.

The county’s current actual sales and use tax collections through August were reported as $10,150,000, compared with an amended 2025 projection of $10,330,000 — a variance of about $185,465 under the amended budget, according to the presentation. Staff said monthly performance this year has mixed results: several softer months, several flat months and two relatively strong months in July and August.

Board members were shown a chart comparing the original 2025 budget, the July amendment (a downward adjustment), and actual collections by month. Staff said the variance has ranged from several hundred thousand dollars below budget in earlier months to the current roughly $185,000 shortfall, and that recent months have outperformed the amended projection.

Why this matters: staff also presented a snapshot estimate of the county general fund for 2026 based on current assumptions. The illustrative estimate held projected 2026 revenue at $20,480,000 and projected 2026 operational expenses at $21,210,000, producing a budget gap of about $732,000 that would need to be covered from fund balance if those assumptions hold. Staff emphasized that the figures are estimates and that some items — updated interest projections, health insurance costs and other pending adjustments — remain uncertain.

On projection methodology, staff proposed using the most recent three years of post‑COVID data (2023–2025) to draw a simple linear trend to estimate 2026 distributions for transient room tax (TRT) and related monthly distributions. For one part of the TRT estimate, staff applied a year‑over‑year change from January–August 2025 versus the same period in 2024 (negative 7.7%), applied that percentage to 2024 totals and said the result aligns with current budgeted figures for 2025.

Board members asked for more detail in the projection worksheets: one member asked staff to include a side‑by‑side plot of the 2026 projection lines so the board could visually compare scenarios. Another member suggested weighting more recent year‑over‑year slopes more heavily (for example by averaging the 2‑year slope with the 3‑year trend) so that the projection would reflect recent softening. Staff said they would present a methodology that averages the year‑over‑year figure with the three‑year trend at the next forecast discussion.

Board discussion also covered the implications for capital planning: several members asked whether the draft 2026 budget includes a regular transfer into capital projects to replenish capital reserves. Staff said the current 2026 estimate did not include an explicit recurring transfer to capital and that any small replenishment would be contingent on underspending in 2026, which staff described as “guesswork” and not a reliable plan. Several board members asked staff to produce capital spending history (five‑year average) for the next meeting so the board can consider adding a recurring capital transfer in tentative budget decisions.

Staff emphasized a conservative approach for the coming budget and noted that, historically, county compensation lines have been underspent by an average of about $1,020,000 per year (2019–2025), which partly informs a practice of budgeting modest shortfalls and relying on typical underspend patterns when balancing budgets.

Looking ahead: staff said they will return with revised forecasting worksheets that: (1) show alternate trend‑weighting methods (including heavier weight to recent slope), (2) plot 2026 scenario lines directly on the monthly charts, and (3) include TRT methodology detail and the effects of a uniform TRT rate change. Board members asked that staff add a clear breakout of assumptions (interest, health insurance, one‑time adjustments) and provide a capital needs history before the next budget advisory meeting.