Feeling the pinch
Retail sales continue downward spiral, tax income up

Store co-owner Louis Bonaguidi, left, takes cash from customer Ron Dedman Wednesday at City Electric Shoe Shop. Bonaguidi said that revenue for the store was up for the months of January and February. — © 2009 Gallup Independent / Cable Hoover

Copyright © 2009
Gallup Independent
By Bill Donovan
Staff writer

GALLUP — Retail sales in stores and businesses in Gallup continue to slump in January, according to information provided last week to the city by the New Mexico Taxation and Revenue Service.

Sales in January declined 13.44 percent from the year before and even more than the January 2007 figures.

The state figures showed retail sales this past January to be $23.9 million, as opposed to $27.7 million in 2008 and $28.2 million in 2007.

January was the fourth month in a row that the city has seen retail figures fall in the double digits with declines between $3 million and $5.2 million each month. There is nothing in the state figures that indicate this is turning around in the next couple of months.

Exactly which retail stores are being most affected by the current downturn in the economy is hard to gauge, although several restaurant owners said they were having problems because the tourist trade is suffering or because people are not coming in from the reservation as often as before.

Fire Rock Casino, which opened in November, may be starting to have some adverse effect on the local economy since it’s taking in more than $2 million a month, but no one is especially pointing to the casino; instead, it’s more that the general problems that are affecting the economy nationwide are hitting businesses just as hard here.

Sylvia Abeita, who had traveled from Crownpoint Wednesday to sell some jewelry, said the economic downturn has definitely affected her family because “it’s harder and harder to find dealers who are buying.”

He said she was thinking of going to Albuquerque to see if the dealers there are buying but she expects that the reason the dealers here aren’t buying are probably prevalent elsewhere.

“If it doesn’t get better, I may try getting a job as a substitute teacher in the fall,” she said.

Not all businesses have been affected by the downturn.
Louis Bonaguidi, who owns and operates City Electric Shoe Store, said his sales are up, especially in the area of shoe repair. “It’s like people looking at buying a new car and decide to get their old car fixed,” he said.

Most of his customers are Navajo and many of them are employed by the Navajo Nation. “If the tribe should be affected by the downturn, we will be affected a well but hat hasn’t happened.”

Although the tribe is facing a $25 million shortfall, tribal officials have taken steps to meet the shortfall without laying off any employees.

Putting on another of his hats, Bonaguidi, who is chairman of the Inter-Tribal Ceremonial Association, said the association’s board is now talking about the recession and how it will affect this August’s event.

Board members have checked with other recent Indian shows, like the one put on by the Heard and the recent one in Denver and learned that both showed decreases in attendance.

So there’s talk, Bonaguidi said, of cutting out one day during this year’s event.

One proposal would be to have the events that are normally held on Wednesday, the first day of the Ceremonial, rescheduled for Thursday. There is also discussions of cutting back on Sunday’s events as well.

Cutbacks at the Inter-Tribal Ceremonial notwithstanding, city officials had a reason to be thankful since gross receipts for January continued to be up for the second month in a row with the city collecting $1.77 million, as compared to $1.57 million for January the year before.

In fact, this may be a record for the city for January, although City Manager Gerald Herrera pointed out that gross receipts figures are higher in part because the city added an extra quarter cent last summer.

The city has seen increases seven of the past nine months. As a result, it’s looking at a total increase over last year of $863,227 or about 6.1 percent. With that quarter cent, city officials estimate that the city would be about even with the gross receipts for last year.

The city’s share of the gasoline tax skyrocketed in January with the city’s 1 cent for every gallon sold bringing in $90,023, more than twice the $44,445 it received in January 2008.

Before that, the city’s gasoline revenue for the year had been less than FY 08 but the robust January number means it’s now up more than $30,000 over last year.

The revenue from the gasoline tax is used by the city to help pay for the maintaining of city streets.

The lodger’s tax for February, was also up significantly with the city collecting $72,990 as compared to $50,846 the year before. This year to date, the city has collected $11,807 more this year than it did during a similar period in the last fiscal year.