Staff Photo by Tim Barber/Chattanooga Times Free Press
The Costco Wholesale store opened in 2010 at exit 350 on Interstate 75 in Georgia.Catoosa County leaders were disappointed and disbelieving that sales tax revenues for November — Costco’s first full month in the county — were lower than last year’s.
“I don’t believe that. I just don’t believe that,” said Commissioner Ken Marks when informed of the revenue figures Monday. “I can’t believe that.”
November 2010 sales tax figures were down $34,000 from $539,267,061 in 2009 to $504,969,072 in 2010, according to county Finance Officer Carl Henson.
Henson, Marks and other officials had anticipated an increase in sales tax with the opening of a Costco Warehouse Club on Cloud Springs Road in October.
A Costco club typically does between $115 million and $135 million annually in sales, leading to hopes that the store could boost county tax incomes by as much as $3 million annually.
“We were hoping for the recovery of the economy and, with Costco coming on, we were expecting a big number,” said Commissioner Jim Cutler.
“Looking at that month, it was very discouraging to see it was down from last year,” Henson said.
Bob Palermo, general manager at Costco, said sales have been very strong. On a big picture, he said, the store is likely to take some money away from other local stores, but many of Costco’s customers are driving down from Hamilton County or coming north from Whitfield County, Ga.
“The influx of money is definitely coming from there,” he said.
Henson said Catoosa sales tax numbers have fluctuated over the past few years, with large swings from month to month, leaving county financial managers questioning whether or not the state is using the entire month every time.
In Georgia, sales taxes are collected by the retailers and sent to the state. From there, the tax money is sent back to the counties.
“The revenue seems to bounce around a lot and you never can be sure that you have a clean cutoff [point],” Henson said.
Attempts to reach to reach officials with the Georgia Department of Revenue were unsuccessful Monday — a state holiday — and messages were not returned.
Marks also questioned the state’s reporting and remained incredulous.
“I don’t have an explanation,” he said. “Maybe we need to wait another month.”
If the numbers are accurate, Cutler and Commissioner Dewayne Hill said the revenues would have been even worse without the Costco.
“In Catoosa County it hasn’t been as bad as it has in some places, but we’re never happy to see the sales tax down,” Hill said.
Contact staff writer Andy Johns at ajohns@timesfree press.com or call 423-757-6324.