Lodging sales tax collections drop

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— Lodging saw a substantial dip in sales tax collections for July, a statistic that paints a puzzling picture for observers of the local economy.

The category took in about 11.4 percent less in sales tax collections than in July 2007, city of Steamboat Springs figures show. That represented a $33,289 drop, from $290,804 last year to $257,515 this past July.

"I'm not exactly sure why it's so large," Sandy Evans Hall, executive vice president of the Steamboat Chamber Resort Association, said about the decrease. "I knew June would be down, but I was not expecting July to be down quite so much."

Evans Hall said the chamber looked at its weekly lodging barometer and found that July occupancy rates were comparable to last year's.

July is a busy month for sports tournaments, Evans Hall said. However, fewer teams were in town for Triple Crown and the Steamboat Mountain Soccer Tournament. It's possible that occupancy was low for higher-end hotel rooms, Evans Hall said, which would affect sales tax collection.

"Some of the properties were saying that hotels and properties that were housing Triple Crown were doing well, but maybe some of their larger units not housing Triple Crown were down as much as 40 percent," she said. "Maybe Triple Crown masked what consumers were doing this summer."

City Revenue Supervisor Kim Weber suggested that rental properties might have cut rates because of the slow economy.

"I really didn't see a lot of rate reduction happening," Evans Hall said.

Alpiner General Manager Dea Westwater said visitor numbers and fees at the Lincoln Avenue motel increased in July and August from the previous year.

"The cost of living is going up, and you have to accommodate the increase in fuel cost and all that wonderful stuff," Westwater said.

Downtown motels work closely together and help one another out if occupancy is low, Westwater said. She said she didn't hear about other rental properties that were down for the month.

Occupancy on the mountain was down, Weber said. That could be partly because Thunderhead Lodge was a popular spot with Triple Crown visitors, Evans Hall said. The lodge has been demolished for redevelopment. Overall sales tax collections in the mountain area were down 19.3 percent, or $241,734 compared with $299,462 in July 2007.

Sales tax collections on utilities were up 15.5 percent in July, which Weber attributed to higher energy costs. That helped edge numbers up overall, she said. Steamboat's total July sales tax collections were about 1.8 percent higher than in July 2007.

Within the Colorado Association of Ski Towns, Steamboat fared better than Aspen, Glenwood Springs, Crested Butte, Silverthorne and Telluride for the month. Aspen saw an increase of 1 percent from July 2007, and the other towns saw losses. Vail saw an increase of 3.45 percent. July figures weren't available for other group members.

The city is up about 3.8 percent from 2007 year-to-date. City budget officials expect 2009 sales tax collections to be 4 percent lower than this year's, Weber said, and they are planning accordingly.

"We have to respectively cut the departments' budgets by that so we have a balanced budget," she said. "So, we're hopeful that it doesn't decrease that much, but we feel that there's a very good possibility that it will."

Comments

Matthew Stoddard 5 years, 7 months ago

There ya go! July- easily the biggest month for the summer with activities such as Balloon Rodeo and Art in the Park, along with Mountain Soccer and TC...down 11.4% (-19.3% on the mountain alone) in sales tax revenues. So...what happens, again, when we get rid of TC altogether, considering the TC properties seemed to do the best?

Can't blame it on not having T-Head Lodge open. I used that argument about Ski Time closing down and others brought up how it would just be "redistributed" to open businesses. That evidently didn't happen in this case. A little food for thought for those wanting TC to go away.

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JLM 5 years, 7 months ago

No air service in July, dependent upon automobile travel, high gas prices. Welcome to the real world.

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Matthew Stoddard 5 years, 7 months ago

There's plenty of flights in July on United, connecting from Denver. TC still drives and as some people on this forum said, they don't spend money. I guess they spend more than others (others, meaning all the "affluent" people, as I've been told they are called) since they still paid to come here and spent the money on gas to get here.

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Matthew Stoddard 5 years, 7 months ago

This is true, but why do people lower rates? To get people who weren't booking to come. When business is great, why discount? Someone will eventually take it.

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