State releases economic forecast

MONTROSE  — Montrose County, along with the Western Slope, continues to be less affected by the national economic downturn, according to recently released economic reports.

Last Friday, the Colorado Office of State Planning and Budgeting released a memorandum of the office’s revenue forecast. Monday, the Colorado Legislative Council Staff released another memorandum that presented the current budget outlook based on the September economic, General Fund and cash fund revenue forecasts.

This information provides an “economic forecast” for the state, along with its regions.

The revenue forecast states that Colorado’s economy is more resilient and “perhaps better poised to rebound” from the current national financial turmoil than the national economy.

Local statistics and opinions concur.

“I agree with the forecast that the Western Slope is not as greatly affected as the rest of the country,” said Sandy Head, executive director of Montrose Economic Development Corporation.

According to the Legislative Council report, the western region of Colorado is still growing at a healthy rate.

From 2000 to 2005, Montrose County had a 13 percent rate of growth, according to MEDC data. Between July 1, 2006 and July 1, 2007, Montrose’s population is estimated to have grown about 6 percent, according to the U.S. Census Bureau.

The state’s and area’s unemployment rates are also indicators in the economic forecast.

Though the unemployment rate in Montrose County has increased from 3.3 percent in July of 2007 to 4.8 percent in both July and August 2008, it is still below the state’s rate of 5.2 percent in July and August 2008. The national unemployment rate was 4.6 percent in 2007; August 2008 was at 6.1 percent, according the Bureau of Labor Statistics.

Colorado’s move toward renewable energy exploration has also created more jobs, according to the reports.

Head said she sees Montrose moving more in this direction as well.

Recently, Vancouver-based cellulosic ethanol plant, Lignol Corporation, decided to move from Commerce City to Grand Junction. Montrose was second in the running, Head said. However, the company had some property in the Grand Junction area. The fact that MEDC didn’t have a “turn piece” of land — a large enough parcel with water, rail and utilities already in place — lost the fight for Montrose. The Legislative Council report discussed Lignol’s move to Grand Junction.

However, Head said there are other conversations with other companies.

The national economic downturn may hurt businesses because they are unable to move their employees and their families due to a struggling housing market, she said. New companies may also struggle because of the tight financial credit lending by banks.

Montrose’s retail sales are looking up, said Juli Messenger, executive director of Montrose Area Merchants Association.

From Jan. 1 to July, retail sales were up 8 percent citywide, she said. However, the other three sectors, construction, auto and use tax are down. Looking at building permits, she said, they are mostly residential; very few are commercial.

The Legislative Council report states that Montrose County permits for housing decreased 60.4 percent. The county also reports a 90.2 percent drop in the value of nonresidential construction projects.

Contact Kati O’Hare via e-mail at katio@montrosepress.com