GYPSUM \u2014 As they review the initial figures reflecting the
\neconomic impact of the COVID-19 pandemic, Gypsum officials aren\u2019t yet seeing a
\ncataclysmic revenue drop.<\/p>\n
But that doesn\u2019t mean trouble isn\u2019t on its way.<\/p>\n
Last week, Gypsum Finance Director Mark Silverthorn told members of the Gypsum Town Council that numbers from March indicated that increased supply\/panic purchasing offset the impact of having the Eagle County Regional Airport close a month early.<\/p>\n
\u201cBut the figures through May will give us a better idea of what will actually happen,\u201d Silverthorn said.<\/p>\n
That\u2019s why the town\u2019s early financial analysis isn\u2019t as
\noptimistic as its early 2020 sales tax revenues. Right now, Gypsum is revising
\nits budget to anticipate a 50% drop in sales tax revenues for the remainder of
\n2020.<\/p>\n
\u201cWe want to be pretty aggressive in our new outlook for
\nrevenues,\u201d said Gypsum Town Manager Jeremy Rietmann. \u201cWe just all have to be
\nhonest with ourselves because it\u2019s like throwing darts in the dark right now.
\nWe have our best estimates, but it is all speculation.\u201d<\/p>\n
\u201cOur goal is to provide reliable, quality services and also, at the same time, to adjust to the economic reality of the situation we are in,\u201d Rietmann added.<\/p>\n
In simplest terms, the town wants to cut spending to reflect a post-COVID-19 reality and keep its reserves intact to ride out the storm.<\/p>\n
The town has a healthy fund balance to bridge the current economic situation. Gypsum anticipated having $3.9 million in reserve for 2020, but as of early April, reserves are around $4.2 million. That gives the community some leeway as it looks toward long term financial planning.<\/p>\n
\u201cIt\u2019s very difficult to know the duration of this right
\nnow,\u201d Rietmann said.<\/p>\n
Originally, Gypsum approved a $9.5 million operating budget
\nfor 2020. The revised spending plan has cut $1 million from the budget.<\/p>\n
\u201cWe have gone through the entire general fund budget, line item by line item,\u201d Rietmann said. \u201cWe hack away at anything leaving what we need to have, not what we want to have.\u201d<\/p>\n
The top line item on the \u201cneed\u201d list is current staffing.
\nGypsum\u2019s revised budget does not include layoffs or wage cuts.<\/p>\n
\u201cWe believe our staff is pretty minimal for the amount of things we are covering right now,\u201d Rietmann said. \u201cWe feel confident we can find savings in enough other places to weather this through. Right now, based on our projections and modeling, we don\u2019t think staff cuts will be necessary.\u201d<\/p>\n
But the town has made significant cuts to its capital spending plans for this summer, including axing a $600,000 project to correct the dips along Gypsum Creek Road.<\/p>\n
\u201cWe admit that road is not in great condition, but it is acceptable during tough economic times,\u201d Rietmann said.<\/p>\n
The town is also saving money by canceling the popular Gypsum Daze event this year. However, the cancelation was prompted by COVID-19 social distancing concerns, not because of a financial impact. Rietmann noted that the town is not out any money because of the cancelation because the entertainers scheduled to perform at the event have agreed to postpone their appearance until 2021.<\/p>\n
Like Gypsum, officials in the town of Eagle are revising
\ntheir budget.<\/p>\n
\u201cIt\u2019s really hard to predict what is going to happen,\u201d said Eagle Town Manager Brandy Reitter. \u201cWe have never experienced this as a local government or as a state or a nation.\u201d<\/p>\n
Eagle, like municipalities across Colorado, is heavily dependent on sales tax revenue. With COVID-19, Eagle is planning for a 25% drop in sales tax receipts for 2020.<\/p>\n
\u201cBut we have different scenarios planned out if we need to
\nbe more aggressive with budget reductions for the end of the year,\u201d Reitter
\nsaid.<\/p>\n
Eagle\u2019s initial action is to freeze all one-time
\nexpenditures including capital projects. \u201cWe are not canceling our projects
\nbecause they are still a priority to the town,\u201d she noted. \u201cAs soon as we turn
\na corner, we will start scheduling.\u201d<\/p>\n
Eagle also has a healthy reserve fund for 2020. Over the past few years, the town increased its reserves from 20% to 25%. Then, at the end of 2019 and during January and February of this year, unanticipated increases in sales tax further bumped reserves to around 37%.<\/p>\n
\u201cWe had planned for a recession in the development of our 2020 budget, but we weren\u2019t planning for this type of reduction,\u201d Reitter said.<\/p>\n
Eagle doesn\u2019t anticipate layoffs or wage cuts. \u201cWe are freezing all new hires and we will not hire seasonal positions. The permanent, full-time staff will pick up those duties and we will have our hands full trying to maintain everything and keep the town looking nice,\u201d Reitter said.<\/p>\n
The COVID-19 shutdown has been a difficult time, Reitter noted, and now the gradual reopening process will present its own challenges.<\/p>\n
\u201cThe community has really done its part. People are staying home and complying with the state order and wearing masks in public,\u201d she said. \u201cIt has been nice to see everyone come together to help mitigate the impacts and it\u2019s nice to see a light at the end of a very long tunnel.\u201d<\/p>\n