Business up, no recession in Kitsap

While the economic health of other Puget Sound counties deteriorated and the state slipped into a recession last winter, Kitsap County remained strong, according to state Department of Revenue statistics released last week.

“Other Puget Sound counties, such as King County, boomed bigger over the last decade, and now they are busting bigger,” said County Commissioner Chris Endresen. “Kitsap County is steadier in terms of employment and income.”

Retail trade in Kitsap jumped by 9.6 percent during the last quarter (September through December) of 2001 over the same time period the year before. Similarly, overall taxable retail sales in Kitsap increased by 5.5 percent in the last quarter of 2001 — also over the same time period the previous year.

State officials define all taxable sales to include construction, contracting, manufacturing, transportation, communications, utilities, wholesale, real estate and insurance.

Retail trade, on the other hand, better represents consumer purchases and includes building materials, hardware, general merchandise, food, auto dealers, apparel, furnishings, eating and drinking places and retail stores.

County Commissioner Tim Botkin says the county budget is on track overall, since it is meeting forecast revenue levels, but it is also a time of fiscal wariness.

Because of the sour state revenue picture, the state legislature implemented several cuts to balance the budget this year.

One of those cuts will hurt Kitsap County.

The county won’t receive the estimated $480,000 in Initiative 695 backfill funds, which county officials planned to receive after July and are earmarked for law and justice services.

“We are going to be looking at that in the next few months,” Endresen said.

Since county officials planned for the funds as promised, the backfill was written into the $74 million general fund budget for 2002.

The legislature provided cities and counties with backfill money after voters repealed the value-based license tab tax and the legislature implemented $30 car tab fees in 2000.

The backfill amount estimated for Kitsap represents about 50 percent of what was lost.

“I still think we need to monitor the sales taxes,” Endresen said.

So even though Kitsap isn’t busting as hard as other Puget Sound counties, county officials are keeping a close watch.

“I think the increase in Kitsap was largely driven by car sales and the attractive interest rates offered last winter,” Endresen said. “There were people who were probably waiting to buy a car, but jumped in on the better deals.”

That theory, largely held by county officials, could make some sense, since retail sales in Bremerton jumped by almost 19 percent during that time and overall sales increased by more than 14 percent.

Most of the auto dealerships in Kitsap County are located in west Bremerton.

Bremerton saw the third-largest increase in sales among the 50 cities monitored by the state revenue department.

Overall sales in travel-dependent SeaTac during that time plummeted by 18 percent, and in retail sales by 8.8 percent. In King County, overall taxable sales dropped by 6.8 percent.

Sales in Tukwila, a city primarily supported by a strong retail core and regional shopping center, dropped by 18.3 percent.

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