Summit County tax revenue down in December |

Summit County tax revenue down in December

summit daily news
Summit County, CO Colorado

Sales-tax revenue in Summit County dipped 2.2 percent in 2008, the first drop since 2003.

The decline wasn’t unexpected, but the worst may be yet to come, said county finance director Marty Ferris.

For December 2008, tax revenues dropped 14.2 percent from the previous year, leading to renewed concerns about the county’s budget. The 2009 budget accounts for a projected 5 percent drop in sales-tax revenues for the year, so if the January numbers become a trend, it could require more cuts.

But it’s still too early to jump to conclusions, Ferris said. The county commissioners are tracking the numbers monthly and will take another close look in May, when the final tallies for the ski season come in, with sales-tax revenues from March.

For now, the county is still in a wait-and-see mode after slashing the budget across the board.

Most of the county’s sales-tax revenue comes from commercial operations at Keystone and Copper Mountain, including restaurant sales, shops and lodging.

But a 0.75 percent transit tax that funds the Summit Stage also is collected on sales within the incorporated towns, giving a countywide view of tax revenues.

For 2008, the transit tax was down just 0.4 percent, but for December, it dipped 8.1 percent from last year.

The annual drop in county sales-tax revenue was on par with reports from Summit County’s towns. Frisco, for example, saw its annual sales-tax revenue drop 1.74 percent for the year, from $6.13 million to $6.026 million. The town’s biggest monthly drop was 15.38 percent in November. The 5.17 percent drop from December 2007 to December 2008 was relatively small by comparison.

Broken down by category, Frisco’s December sales-tax revenue declined in all categories except food, where revenues jumped by 13 percent, or almost $13,000, for the month. That may suggest that people are buying food and preparing it in their condos rather than eating in restaurants.

December tax revenue from the town’s restaurants dipped 11.8 percent compared with December 2007, but was down just 0.94 percent for the year. Revenues from lodging taxes dropped 7.83 percent for December but were up 1.63 percent for the year.

Across ski country, dips in occupancy rates and slow reservations for the second half of the ski season are a huge concern.

January occupancy rates in the mountain region dropped from 60 percent last year to 50 percent, and January reservations were down almost 19 percent from last year’s pace.

Summit County’s proximity to Denver may be softening the blow of the national recession. Record traffic through the Eisenhower Tunnel in January and big holiday weekend crowds on the slopes suggest that overall skier visits may not take the huge hit feared by some at the start of the season.

Hardest hit are the destination resorts far from drive-to markets, said Michael Berry, president of the National Ski Areas Association.

“If you don’t have a close market, you’re going to feel the bite a bit more,” Berry said.

Some eastern resorts are on track to match last year’s numbers, which indicates that people may be staying closer to home. Berry said good snowfall in New England has helped soften the economic blow.

“When you go West, it gets a bit more complicated,” Berry said.

In the Rockies, location seems to be key, with Summit and Eagle County resorts still racking up decent numbers. But more remote areas like Steamboat and Telluride will likely take a bigger hit.

Berry said the industry is on track to post between 56 and 58 million visits for the year, a drop from last season’s record 60.1 million, but not that far off the pace from recent years.

Looking ahead, Berry said sales of ski passes for next winter, set to begin next month, should help the industry get a feel for how next year might go.

Beyond that, it’s all about the timing. If the national economy bottoms out in spring with signs of recovery in the summer, the ski industry might also rebound strongly.

If the recession deepens through late summer or fall, it could make for another rough winter, he said.

Bob Berwyn can be reached at (970) 331-5996, or at

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