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2 Sense: Put your money where your house is

By Val Hale And Donna Milakovic - | Mar 13, 2014

Donna: I completely understand the drive to shop online and in some of the great retail areas outside Utah County. With our busy lives it can be very convenient to sit home and order the things we want. Also going out to meet friends at City Creek for a little retail therapy is a day well spent in my book.

However, I do also strive to make certain I shop locally as much as possible. I have a Utah County hairdresser, babysitter, mechanic and my trips to Salt Lake to shop are far more rare now that Traverse Outlets have opened in North Utah County. I know just enough about the amount of tax revenue generated for our towns to feel it is very important to shop where I live.

I have been known to drive 20 miles on gas fumes to make it to my local gas station and fill up. It helps that the station is usually several cents cheaper than anywhere else in the Valley, but I also know that the sales tax and transportation tax generated by my annual gas budget is significant for our town. Recently a grocery store opened in Eagle Mountain, where I live. My family has moved almost all of our grocery shopping to the local Ridley’s. I have not been to a store in our neighboring town in months. However, even shopping at the other grocers in Utah County would benefit our county more than travelling afar and paying taxes in other counties or states.

It is not realistic, in our day to expect people to exclusively shop in their local grocer, bookstore or family owned retailer. Nonetheless, making an effort to find the local and family owned businesses that have the services you want close to home will make a huge difference in our tax revenue and will preserve the great boutiques and small businesses of Utah Valley.Try a little harder to find something close by before running off to a big box store in another town. Being conscious of where you are paying sales tax is all it takes. Our recreation programs, arts programs and transportation needs are met with dollars from sales tax. You pay them with every transaction so why not keep them close to home.

Val: I was talking recently with a retailer from Utah Valley who expressed concern about the status of retail sales here in the county. He said some retailers here are experiencing a 30-percent drop in sales this year. He identified two reasons for this drop in sales.

One big reason for the decline in sales is competition from the Internet. We have addressed that issue before in this column. Many people have found they can stay at home and shop from the comfort of their computer. They can surf the net until they find great deals. On some sites they can even avoid paying sales tax. The proposal to tax on-line sales has gained some traction legislatively, but so far it hasn’t happened, so brick and mortar retailers are competing on an uneven playing field.

A second reason for the sales decline, he said, can be attributed to many Utah Valley residents spending their money in Salt Lake County. The retailer I was talking to mentioned he had spoken with several Salt Lake County retailers who had expressed surprise at how many credit cards they were processing from Utah Valley. Apparently, many of us in Utah County are traveling north around the “Gravel Curtain” to go shopping.

Like Donna, I don’t have a problem if someone wants to do some occasional shopping in Salt Lake City. But if we make a habit of passing by our local stores to spend our money up north, we are hurting our economy twice.

The first economic hit comes when we lose Utah County jobs because of the lost revenue. If sales are down, retailers will not be hiring as many employees. That means fewer people earning and spending money locally.

The second economic hit comes from lost sales tax revenue. Your purchases in Salt Lake County are contributing revenue into the coffers of the cities up north to help them pay for their infrastructure and services. Meanwhile, the city and county where you live and, possibly, work gets nothing.

Many Chambers of Commerce have what is called a “Shop Local” campaign. The intent is to get residents to frequent local businesses instead of taking their money elsewhere. Apparently, we need to do a better job of educating our Utah Valley residents about the need to shop here at home. A man I was speaking with earlier this week made the comment that too often we Utah Valley residents will “spend $5 worth of gas to save $2 in a store 20 miles away.”

Let’s all do our part to help keep jobs and sales tax revenues here in our county by patronizing local stores. We all benefit when we do.

Val Hale is president and CEO of the Utah Valley Chamber of Commerce. Donna Milakovic is Executive Vice President of the Utah Valley Chamber of Commerce.

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