Taxable sales fall for Dunn County

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Dunn County’s taxable sale’s decrease in 2009 is among the biggest in the state and one tax official says it may be due to a large increase in oil activity.

The county was down about 44 percent in taxable sales and purchases from 2008’s fourth quarter (October, November and December), according to a North Dakota Tax Commission report. The numbers are a barometer that show how the economy is in each county.

“2008 was just an anomaly, that’s how I describe it,” state Tax Commissioner Cory Fong said. “When you take growth on top of that growth in 2008 it’s just completely unsustainable. If you look at the longer, broader view, you can see that we’re right on track in terms of overall growth.”

Other counties with significant decreases include Burke, down 65 percent; Towner, down about 34 percent; Williams, down about 21 percent; and McHenry, down about 10 percent.

The decrease, sometimes dramatic, may be due to an exceptionally good year in sectors such as oil, Fong said.

“Keep in mind, 2008 was off the charts with some of these counties, especially in the oil patch,” he said. “You look at a Dunn County down 44 percent and you think ‘oh my gosh, the bottom’s fallen out,’ but I don’t think it’s accurate to take that leap because of course 2008 was just off the charts for many, many of these counties.”

Reinhard Hauck, Dunn County auditor, said he is unsure why the drop occurred.

The report cautions about drawing conclusions about the information because of economic activity level. For example, businesses that deal only in exempt sales or services do not file sales tax returns, therefore, their sales are not included in this report.

Adams County saw a 5 percent increase over last year, according to the report.

Taxable sales and purchases usually don’t fluctuate much in the county, said Ed Gold, executive director of the Adams County Development Corp.

“The agricultural sales might have helped,” Gold said. “Our economy is either agriculture or health-related.”

Fong said Tuesday that during the fourth quarter, North Dakota’s overall taxable sales and purchases slowed by 7.9 percent, or by $269 million, compared to the same time period during 2008. Taxable sales and purchases are up when compared to fourth quarter 2007 statistics.

Fong said there are 15 sectors that are factored into the taxable sales and purchases, which include: Mining and oil extraction, utilities, construction, manufacturing and wholesale trade, among others.

Fong said retail trade saw growth throughout the state in the fourth quarter.

“It is a barometer for consumer confidence, it’s that sector that demonstrates or captures discretionary income, what you can use to go shopping that those kinds of things,” Fong said. “This quarter also captures the all-important Christmas shopping season.”

Some area cities saw growth compared to last year.

Of the 50 largest cities, Bowman had one of the highest percentage increases for the fourth quarter, up 26.6 percent from the previous time frame in 2008.

“I would assume that a lot of that is coming from a lot of the influx of industry that we have right now,” said Ashley Alderson, executive director of the Bowman County Development Corp.

Alderson said the influx of people contributed to taxable sales may be due to a transmission line that was recently completed and construction of 13 wind turbines near Rhame.

Taxable sales and taxable purchases are reported by businesses to the Office of State Tax Commissioner on quarterly or monthly sales tax returns, according to the report.

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