Cortez Journal

City officials worried about spotty tourism

July 3, 2001

GROCERY-STORE officials at Cortez’s three main supermarkets, which include the new Safeway, have been reporting that tourism appears to be down this summer. A little more than 20 percent of the city’s sales-tax revenues comes from sales of groceries.

By Janelle Holden
journal staff writer

It seems there is no such thing as the perfect tourist season.

The wildfires at Mesa Verde National Park during July and August of 2000 devastated sales-tax collections for the city of Cortez, and this summer an energy crunch and economic downturn have already slowed tourism across Colorado by at least 5 percent, according to a recent study done by Longwoods International.

The city has yet to compile a June analysis of the sales- and lodgers-tax revenues, but May’s numbers are in. As of June 1, the sales-tax revenues were up by 8.91 percent compared to last year, but the lodgers tax was down by 2.11 percent, and down by 9.34 percent in comparison to May 2000.

"The problem that we have is that this is for our May retail, so we really haven’t hit the tourist season yet," said Kathi Moss, the city’s finance director. "That’s one of the problems with relying on tourism so heavily, that it’s so late in the season before you know how you stand."

City Manager Hal Shepherd agreed. "The city government operates based on what everybody else does," he said. "We plan a budget a year ahead and two years ahead, not having any idea what money is going to be spent in the community."

Visitation at Mesa Verde National Park can be a strong indicator of how the city’s sales-tax revenues will look in the coming year. Mesa Verde was off 3,984 visits compared to May 2000.

Year-to-date figures for the park through May show 109,101 visits, 211 fewer than the 109,312 visits during the same period in 2000.

A large part of the sales-tax revenue, a little over 20 percent, comes from grocery sales. The big three grocery retailers in town — City Market, Wal-Mart Superstore, and Safeway — are reporting an increase of 3.1 percent over last year. But with the use tax included — a tax on any merchandise over $1,000 purchased outside of the city for use inside the city — grocery sales-tax receipts have increased by only $29,000.

If the use tax is factored out, Moss said, the tax revenues are flat or down a bit.

"Certainly, I think everyone in town has noticed that tourism is down, at least that’s the general consensus. What we see at Mesa Verde as being down, would be one possible indicator, but other than that I really couldn’t comment," said Jim Berhost, general manager of City Market.

Safeway opened in March, and according to the figures, its arrival has not increased the total amount of sales in the city. However, Safeway managers say business is increasing.

"Things are going really good. Although we don’t know how we compare to last year, our sales every week are better," said Tom Land, general manager of Safeway.

Whether the three stores’ competition for a piece of a seemingly smaller pie will force one out of business is yet to be seen.

"It’s very, very rare that we leave the community once we’re there," said Tom Williams, a Wal-Mart spokesman.

The sales-tax revenues are not the sole factor in determining how well grocery stores are doing in town. Government entities buy goods without having to pay the tax.

Because of last year’s fires, the city’s sales taxes were down by $175,000 from the projected increase. As a result, Shepherd and Moss have urged city department heads to keep their budgets tight.

Shepherd and Moss hope the Chamber of Commerce’s new retail-sales enhancement program will draw in buyers from the Four Corners area and increase the number of people who regularly buy goods and services in Cortez, thus decreasing the city’s dependency on the whims of tourists.

Copyright © 2001 the Cortez Journal. All rights reserved.
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