Year off to a good start for restaurants, lodging in Summit County
May 19, 2011
Sales tax revenue numbers from across Summit County continue to indicate an increasingly strong and sure-footed local tourism economy based on first quarter data.
The restaurant and short-term lodging industries in Breckenridge and Frisco are leading the recovery, with significant increases in sales tax revenue generated in the first three months of the year from the same time frame in 2009 and 2010.
Sales taxes collected from Breckenridge restaurants and bars climbed a steady 6.5 percent from the same time frame last year and tax revenue increased more than 9 percent in March 2011 from March 2010, indicating a strong finish to the season for the industry.
Frisco sales tax revenue from restaurants grew by nearly 1 percent in first quarter 2011 from the same time period in 2010, and March saw a 7.39 percent increase this year from last.
But even in light of the positive trends, enthusiasm is tempered among members of the business community.
“From the restaurant end, it was a good winter,” said Seth Zelen, owner of Frisco’s 5th Ave Grille. “I don’t think we’re out of the woods by any means. There’s a long way to go for the economy to rebound, but it’s getting there. I feel pretty positive.”
Zelen said he didn’t see individual patrons spending more, but he was seating more customers through the winter season than in the past, an observation echoed by other local restaurant owners.
In adapting to the unstable economy, Zelen changed his menu options to feature smaller, more affordable meals, but during peak season this year, he did see patrons more willing to purchase higher-priced items if they were offered.
“My theory is that last year, and maybe even the year before, people were frightened,” said George Blincoe, who owns the Dillon Dam Brewery. “And they’re still frightened, but they’ve decided that life’s going to go on and you’re going to take vacations. Maybe you’re not going to go crazy like you used to, but going out for a burger and a beer (is OK).”
Sales tax numbers also indicate a stellar first quarter for vacation rentals in Frisco, though hotels and inns didn’t appear to do nearly as well. Vacation rental sales tax collections increased by 27 percent in March of this year from the same month last year. January and February collection numbers were well above the same time last year and more in line with the revenue levels of 2009.
In Breckenridge, short-term lodging sales tax numbers jumped 14.7 percent in March from the same month last year. Overall, Breckenridge lodging companies appear to have had a solid year, with a 4 percent increase in sales tax output from first quarter last year. But, some in the industry say, it’s a slow recovery process.
“The overall feeling is that the lodging community collectively sees improvements in overall bookings, but there is negligible growth in nightly rates and nights per stay,” president of Breckenridge Resort Managers Toby Babich said in an email. “We are excited to see any growth in a still uncertain economy and travel market and will keep providing a good value and better experience to our visitors to encourage further growth in our community.”
Babich noted that the lodging sector fell the furthest of any market when the recession hit, with a sales tax revenue drop of 22.3 percent from 2008 to 2009.
Retail also made gains in Frisco, with sales tax increasing 10.8 percent over first quarter 2010. Breckenridge retail numbers improved slightly over 2009 and 2010 in January and February, but lost ground in March.
Both Dillon and the county showed growth in sales tax revenue as well. Dillon posted a 7.4, 9.7 and 5 percent increase in sales tax in January, February and March, respectively, while the county saw a total increase of 2.65 percent for first quarter over 2010.
Town manager Gary Martinez noted that, though the county continued to see growth in sales tax revenue, the numbers are just slowly recovering from an approximately 20 percent drop in 2009.
“Even though these numbers were up, they were up from very low levels,” Martinez said.
Sales tax revenues from Silverthorne were not broken down by industry, but were fairly flat overall.