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Winter Uncertainty Looms as Park City Finalizes 2021 Budget

Park City Municipal is hoping to finalize and accept a revised budget for fiscal year 2021 by mid-October. A steep decline is forecasted for the city’s sales tax revenue and travel visits but everything could change at a moment’s notice when it comes to COVID-19.


Worry about everything, panic about nothing was the mindset adopted by the Park City City Council during 2021 budget discussions at their meeting on Tuesday.


City Financial Planner Erik Daenitz said sales tax revenue and travel to Park City could be down as much as 50% with the winter tourist season fast approaching and the COVID-19 pandemic showing no signs of slowing down.  


“We’re expecting pain in the winter, ranging between 50% down to 45% down over the course of our biggest revenue months,” he warned. 


December through March are traditionally the biggest business months in Park City, fueled by thousands of visitors eager for a mountain town getaway or ski vacation over the holidays. With COVID-19 concerns causing air travel to plummet, however, the city will likely have to rely on visitors within driving distance for the majority of business this winter.


Park City Councilmember Steve Joyce told KPCW despite all of the predictions and financial models, the future remains uncertain.


“The fact that everybody’s got their crystal ball out and trying to guess what the winter looks like, and we don’t know what it’s going to look like,” Joyce said. “We’re seeing Utah spike right now, I don’t know whether that’s going to have an impact. People are reluctant to fly so a lot of our international travel may be down dramatically. Even the workforce changes. Without J1 [visas] this year, they’re getting some college gap years and, what is it, some H2B visas, but what’s that going to look like? No one knows.”


The news on Tuesday was not all bad. Park City actually out-performed projections in the summer months by a significant margin and those gains help offset some of the increased losses expected this winter. Joyce said the summer numbers were a welcome surprise.


“We were looking then and we thought the summer was going to be down to, just, dead,” he said. “Financially dead. And it turned out that for sales tax, as everybody has seen, it’s been busier than I think anybody expected and we actually came in the three months of April, May, June, we were $1.3 million above what we projected for sales tax.”


Even though Park City fared better during the summer months than anyone expected, a faster overall recovery was also projected. As of right now, Park City is not on track to hit those numbers.


“Unfortunately, we also projected kind of a faster recovery than we’re now looking at,” said Joyce. “That takes us through some more of the lucrative months. By the time we get balanced with everything, we ended up with about a half-million dollar drop. We went from 36% drop of sales tax for fiscal year 2021 down to 43% drop, so that was worse but the $1.3 million took us ahead so we’re kind of, we think we’re in ok shape but, boy, we’re just not going to start spending money.”


With so much of Park City’s economic future dependent on the COVID-19 situation and out of the city’s hands, the city also has to prepare for the scenario of 2021 looking much like the last six months of 2020 has.


Joyce said the city has had to dip into their financial reserves some since March. He worried that a second wave of COVID-19 restrictions could see more businesses go under, further hurting revenue and tourism, also preventing the city from providing essential services.


“If you start really seeing some big businesses go under, then it starts just this kind of cascading chain of we lost not 20 or 30% of that tax, we lose all of that so it impacts the city and the services we can deliver, which, of course, makes our overall target of people coming to Park City go down as well,” he said.


The good news is Park City businesses have been resilient so far with only a handful falling victim to the pandemic as of September.


If you are interested in seeing the full staff report on the Fiscal Year 2021 budget, a link can be found here.

Sean Higgins covers all things Park City and is the Saturday Weekend Edition host at KPCW. Sean spent the first five years of his journalism career covering World Cup skiing for Ski Racing Media here in Utah and served as Senior Editor until January 2020. As Senior Editor, he managed the day-to-day news section of skiracing.com, as well as produced and hosted Ski Racing’s weekly podcast. During his tenure with Ski Racing Media, he was also a field reporter for NBC Sports, covering events in Europe.