Breck revenue down in February
BRECKENRIDGE – Breckenridge elected officials met all day Friday to discuss spending priorities in light of weak sales tax revenue this year.
Priorities include maintaining services and infrastructure and expanding marketing efforts to attract tourists to town.
Friday, the council convened in a “retreat” and agreed to allocate an additional $39,000 to market the town in Boulder and Grand Junction. That’s in addition to $20,000 they’ll spend for summer entertainment at the Blue River Plaza and about $7,000 to develop a marketing plan.
According to Finance Director Judy Ferris, overall revenue – including investment income sales and accommodations and real estate transfer taxes – is down 21.7 percent.
Taxable sales revenue was down 2.4 percent in February. Retail sales tax revenue was down 11 percent in February, and merchants around town are warning town officials to expect even lower sales tax revenue for March.
“It’s unfortunate, although it’s not too surprising,” said Corry Mihm, executive director of the Breckenridge Resort Chamber.
She said visitors are still booking places to stay, but they’re putting more people in smaller units or staying in lodging that’s less convenient. They must eat, she noted, so food sales haven’t taken as big a hit as other business sectors.
“But retail is the most discretionary,” she said. “They can decide to buy all their friends and family souvenirs or get something really nice for themselves, or they’ll wish they could buy it but think they’d better wait. Unfortunately, retail’s the most vulnerable sector in hard economic times.”
“I am so concerned about our retail,” said council member David Hinton. “And you know what? Everyone’s been complaining about the empty storefronts and all the real estate offices on Main Street. Just think if there were all those additional holes (if real estate offices weren’t there). I’ve changed my tune. God bless them all. March was tough.”
Additionally, real estate transfer taxes (RETT), which helped boost sagging revenue in 2002, are down 40 percent year to date – and down 51 percent when compared to April 2002.
Some of that could be the result of numerous time-share units sold last year at Main Street Station, and condo sales at Vail Resorts’ Mountain Thunder Lodge. Ferris pointed out RETT revenue has become increasingly dependent on the sale of time-share units in the first two months of 2003.
Additionally, revenue generated from the town’s pay parking lots was down 18 percent in February.
“Bad snow conditions and uneasy economic times might have been one of the causes for this decrease,” said Jim Benkelman, town transit director. “At the end of February, when we started getting snow, the numbers indicated a steady jump. Unfortunately, the snow didn’t come early enough.”
A major storm left up to 3 feet of snow four days after most of the ski resorts closed.
The only bright spot is sales revenue from grocery and liquor sales, which is up 40 percent. Town officials aren’t sure whether to attribute that to an increased number of time-share vacationers or City Market’s new method of reporting sales tax revenue. Last year, the store began reporting taxes 13 times a year – every four weeks – rather than once a month.
Revenue isn’t the only thing that’s off.
According to town officials, reservations at the golf course are down, as are conference bookings.
“It doesn’t look like it’s going to be a fraction of what it’s been,” said Roger McCarthy, chief operations officer for the Breckenridge Ski Resort, which owns the commercial space at the Village at Breckenridge. “And the packaging the competition’s giving away is amazing.”
Summer bookings through the BRC’s central reservations are on pace with last year’s bookings.
Economic journalists with TIME magazine said this month that growth nationwide should be in the 3 percent to 4 percent range but that the nation needs growth of 5 percent to 6 percent to pull the economy out of the doldrums.
“But if you think of all the drastic things that happened over the past two years, it’s not terribly surprising that it’s slow to recover,” Mihm said.
Jane Stebbins can be reached at (970) 668-3998 ext. 228 or email@example.com.
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