Stronger than expected numbers for sales tax revenue in September is encouraging news ahead of a major financial update to be given at this week’s Park City City Council meeting. The council will be briefed on all aspects of the city’s finances ahead of major decisions like funding the future Arts and Culture District.
Speculations and predictions for what Park City’s economic outlook will be for the remainder of 2020 and into 2021 are all over the map. One thing that is certain is nobody really knows how the rest of the COVID-19 pandemic will affect the peak ski season from December to March -- months that are critical to the economy of a resort town like Park City.
Some good news heading into the heart of the winter season were stronger than expected sales tax revenues for September. So strong, in fact, that they brought in $40,000 more than the pre-pandemic fiscal year 2020 budget called for, according to a report by city staff.
City Manager Matt Dias says he was just as surprised as the rest of us, but attributes the strong report to early safety measures around the pandemic and Park City’s easy driving distance from several major cities.
“You had the same sticker shock we did, quite frankly,” Dias says. “I think we are attributing it to the proactive safety measures that we have in our community, we’re attributing it to people’s confidence in those. We’ve been a mask required community very early on and I think that gives people some comfort, but then in addition, I think again our proximity to major drive markets, and that proximity has increased what people are willing to do at this day and age.”
Sales tax reports are released on a two month delay. Revenues from the Thanksgiving holiday will not be available until January or February 2021.
With some frugal financial planning early in the pandemic and much needed state and federal assistance through over $2 million in CARES act grants, Dias says the city is actually in a fairly good position going forward, considering the current situation.
“At this point, you know, we’re doing pretty well all things considered,” he says. “We understand that there’s a lot of people hurting out there and there’s a lot of small businesses and other types of nonprofits that have take a huge hit, and we have as well, but, fortunately, we were able to predict this, the way it lined up with our budget process, so we were able to stringently reduce our planned expenditures and budget accordingly.”
One major planned expenditure over the next several years is the Arts and Culture District at the corner of Kearns Boulevard and Bonanza Drive. If things stay on schedule, demolition begins in the spring and construction soon after.
With a cost of $70 million, city staff wants to cover all of their bases before moving forward with the project.
Dias says part of the purpose of this week’s financial update to city council is to get clear direction on whether or not the project should go forward given the hefty price tag.
“We’re getting to a critical juncture where before we enter the construction period and really make a major expenditure, we wanted to put, or have a moment where we sort of put pens down and ask the council ‘yes or no? Do you want to proceed or do you not want to proceed?” says Dias.
Councilmember Steve Joyce has expressed reluctance to green-light the project at past council meetings given the uncertainty of the COVID-19 situation and has said he wants to have a clear timetable in place before approving any spending.
Dias says Thursday’s financial update is scheduled for upwards of an hour and a half and will be a deep dive on the overall financial standing of the city.
“We’re going to do that, in and of itself, to make sure everyone has the exact same information, we’re incredibly transparent to the public,” he said. “From time to time, I hear interest in our finances and our budget process can get sort of granular, this will be a little different. This is going to encompass every fund, every source of revenue, our debt position, outstanding bonds, but it’s going to do so in a strategic way.”
Thursday's city council meeting will be held virtually over Zoom and is scheduled to begin at 3:30pm. Details on how to participate in the meeting can be found here.
