Park City sales-tax numbers beat projections, pointing toward nascent recovery
Sales-tax collections in Park City in July beat City Hall projections by a wide margin, providing a key data point that illustrates a nascent economic comeback of sorts from the spring business shutdowns designed to combat the spread of the novel coronavirus.
The numbers lag by several months and, in the case of July, they offer one of the first important community-wide readings on economic activity since sales taxes are charged on such a broad range of transactions.
According to City Hall, $767,523 was collected in sales taxes in July, which was the first month of the municipal government’s 2021 fiscal year. The figure dropped from the $890,546 tallied in the previous July, but it bested the five-year average in that month of $748,225.
July is an important month in the summer-tourism season, typically offering a calendar jammed with athletic and cultural events as well as the Independence Day celebration. There was a series of cancellations, though, this July based on worries about the illness. The Fourth of July parade and fireworks were the most notable of the events that did not occur. The July 4 celebration typically draws a large crowd to Main Street followed by fireworks at Park City Mountain Resort that night.
Park City was crowded on many days in July regardless of the cancellations. People flocked to Main Street, including on pedestrian-only days, trails were busy and traffic appeared as heavy as it had been since the ski season ended. There were reports of solid sales in the community during that month.
Park City leaders in the spring crafted a budget for the 2021 fiscal year amid numerous unknowns regarding the impact the coronavirus would have on the economy. The City Hall projections in the spring anticipated $287,263 in sales taxes would be collected in July. The projection was upped in September to forecast $592,130 in sales-tax collections in July. The actual number of $767,523 represents a significant beat to the upside.
City Hall says the formula it uses to prepare the projections involves numerous travel-related variables. It is difficult, though, for the model to accurately predict the number of people traveling to Park City in personal vehicles from inside Utah and from outside the state, the municipal government says.
Although the sales-tax numbers in July were strong, likely pointing to a solid August as well, the figures in the summer months are not nearly as important to the overall budget as those of the ski season. The period between December and March traditionally is the most profitable stretch of the calendar for a broad range of businesses that rely at least at some level on the ski season.
There are concerns about the ski season with the illness still spreading in the U.S. and the economic uncertainty the coronavirus has caused persisting as opening day approaches. There is also worry the Sundance Film Festival, usually an especially lucrative stretch of the winter, will not generate the usual economic numbers since organizers plan a greatly scaled back event in 2021.
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