The Colorado Governor’s Office of Planning and Budgeting recently published a new Economic and Fiscal Outlook. The report includes projections for cannabis tax revenue in the current and coming fiscal years. The Outlook also confirms our analysis of recently published sales figures out of Colorado, which we have shown to still be growing year-over-year, but at a reduced pace compared to the months ahead of the COVID-19 pandemic.
According to the report, “sales are expected to continue growing in FY 2020-21, due to growth in sales in March and April 2020. However, this growth is anticipated to occur at a slower rate than prior to the pandemic due to suppressed tourist activity in the state and lower wages among Colorado workers.” In our coverage of April’s cannabis sales in Colorado we identified that year-to-date sales as of that point remained up compared to the first four months of the 2019 calendar year. However, the pace of growth had fallen behind 2019’s over 13% annual increase in total sales.
The Planning and Budgeting Office’s report also includes a breakout of year-over-year changes in recent monthly sales by county, which are shown in the chart below.
The chart above shows the impact of the pandemic on counties that rely on tourism for a large portion of their sales. Revenues are down sharply year-over-year in areas home to normally heavily trafficked ski resorts, such as Eagle County (where Vail is located), Pitkin County (Aspen), Summit County (Breckenridge), and Routt County (Steamboat Springs).
Notably, Denver’s April 2020 sales were also down by a significant margin year-over-year. Those visiting Colorado for skiing or other activities typically fly into Denver and frequently make purchases in the city before traveling to destinations in the mountains.
Sales in suburban areas that rely primarily on purchases made by residents have for the most part remained strong and growth has continued, according to the above analysis. Year-over-year growth in Adams County, which encompasses the suburbs northeast of Denver, has held up particularly well. To the southeast of Colorado’s capital, in Arapahoe County, a strong year-over-year expansion in sales persisted into April this year, but annual growth rates have slowed with the COVID pandemic and the state’s stay-at-home order. An exception to this generalization is Jefferson County, west of Denver, where April 2020 sales were off compared to the same month last year, after seeing strong increases in February and March 2020.
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