{"id":2456535,"date":"2020-03-30T22:56:01","date_gmt":"2020-03-31T04:56:01","guid":{"rendered":"https:\/\/www.aspentimes.com\/news\/city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts\/"},"modified":"2020-03-31T06:55:27","modified_gmt":"2020-03-31T12:55:27","slug":"city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts","status":"publish","type":"post","link":"https:\/\/alwaysmountaintime.com\/kspn\/local-news\/city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts\/","title":{"rendered":"City of Aspen projecting massive revenue losses, expenditure cuts"},"content":{"rendered":"<div class=\"swift-gallery p402_hide\" readability=\"6.4434250764526\">\n<ul id=\"imageGallery-323556-320\" class=\"gallery list-unstyled\">\n<li data-thumb=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-150x150.jpg\" data-src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-1024x682.jpg\" data-sub-html=\"Maddie Vincent\/The Aspen Times | A view of an empty Hotel Jerome on Main Street in Aspen, March 30, 2020. (Maddie Vincent\/The Aspen Times)\" class=\"h-100\" readability=\"-0.5\">\n<div class=\"caption\" readability=\"10\">\n<p><strong>A view of an empty Hotel Jerome on Main Street in Aspen, March 30, 2020. (Maddie Vincent\/The Aspen Times)<\/strong><br \/>Maddie Vincent\/The Aspen Times<\/p>\n<\/div>\n<div class=\"row no-gutters h-100\">\n<div class=\"col my-auto\"> <img decoding=\"async\" src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-1024x682.jpg\" data-no-lazy=\"1\" alt=\"A view of an empty Hotel Jerome on Main Street in Aspen, March 30, 2020. (Maddie Vincent\/The Aspen Times)\"><\/div>\n<\/div>\n<\/li>\n<li data-thumb=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-1-150x150.jpg\" data-src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-1-1024x610.jpg\" data-sub-html=\"Maddie Vincent\/The Aspen Times | A view of the playground at Wagner Park that was closed due to the COVID-19 outbreak, March 30, 2020. (Maddie Vincent\/The Aspen Times)\" class=\"h-100\" readability=\"-0.5\">\n<div class=\"caption\" readability=\"10\">\n<p><strong>A view of the playground at Wagner Park that was closed due to the COVID-19 outbreak, March 30, 2020. (Maddie Vincent\/The Aspen Times)<\/strong><br \/>Maddie Vincent\/The Aspen Times<\/p>\n<\/div>\n<div class=\"row no-gutters h-100\">\n<div class=\"col my-auto\"> <img decoding=\"async\" src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/coronarevenue-atd-033120-11-1-1024x610.jpg\" data-no-lazy=\"1\" alt=\"A view of the playground at Wagner Park that was closed due to the COVID-19 outbreak, March 30, 2020. (Maddie Vincent\/The Aspen Times)\"><\/div>\n<\/div>\n<\/li>\n<\/ul>\n<p class=\"caption-toggle\"><a href=\"https:\/\/www.aspentimes.com\/news\/city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts\/#\" class=\"show-captions\">Show Captions<\/a><a href=\"https:\/\/www.aspentimes.com\/news\/city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts\/#\" class=\"hide-captions\">Hide Captions<\/a><\/p>\n<\/div>\n<p class=\"STND-STND BodyText DropCap\">The city of Aspen finance director is estimating a loss of almost $13 million in lodging and sales tax revenue this year due to the COVID-19 crisis, with steep declines in just about every industry in the resort community.<\/p>\n<p class=\"STND-STND BodyText\">City Finance Director Pete Strecker\u2019s 2020 tax projections will translate into massive cuts in capital projects and municipal services, including in public transit and parks and open space programming.<\/p>\n<p class=\"STND-STND BodyText\">City Manager Sara Ott told Aspen City Council on Monday that 55 part-time employees have been laid off and more operational cuts are coming.<\/p>\n<p class=\"STND-STND BodyText\">\u201cThe city needs to take action pretty quickly in its own spending to be responsible back to the community, and there\u2019s going to be tough choices coming before the council in the future about priorities,\u201d she said.<\/p>\n<p class=\"STND-STND BodyText\">Strecker projects that economic weakness is expected through the summer and a slight rebound will occur in the fall and December, with a weaker opening to the 2020-21 ski season.<\/p>\n<p class=\"STND-STND BodyText\">Strecker, who was the chief of economic forecaster for the Colorado Governor\u2019s Office during the recession that began in 2008, told council his projections are just a snapshot in time.<\/p>\n<p class=\"STND-STND BodyText\">\u201cIn August we\u2019re hoping there is a (bounce back) but that\u2019s absolutely contingent upon what the travel looks like, the travel bans, and how soon and comfortable people are moving around the country and around the world,\u201d he said. \u201cThe overall projection at this point is that we will see softenings all the way through the year, even December, ski season, we are still down 22 percent.\u201d<\/p>\n<p class=\"STND-STND BodyText\">He projects a decline over last year in monthly sales tax revenue anywhere between 65% in March to the 50% reductions through the summer months and into the 30% losses in the fall.<\/p>\n<p class=\"STND-STND BodyText\">The losses are due to the abrupt shutdown of the ski areas, restaurant and bars, lodging and all non-essential businesses through <a id=\"N0x1cd21b0N0x1c8d8d0:N0x1cd21b0N0x1ccf848\" href=\"https:\/\/www.aspentimes.com\/news\/new-pitkin-county-order-limits-business-and-asks-tourists-to-leave-area\/\">public health orders issued<\/a> earlier this month to prevent further spread of the COVID-19 virus.<\/p>\n<p class=\"STND-STND BodyText\">Several events like the <a id=\"N0x1cd21b0N0x1c8d930:N0x1cd21b0N0x1ccf968\" href=\"https:\/\/www.aspentimes.com\/news\/aspen-food-wine-cancelled\/\">Aspen Food &amp; Wine Classic<\/a> and <a id=\"N0x1cd21b0N0x1c8d990:N0x1cd21b0N0x1ccf9f8\" href=\"https:\/\/www.aspentimes.com\/news\/aspen-ideas-festival-cancels-2020-event-because-of-coronavirus\/\">Aspen Ideas Festival have been canceled<\/a>, which are major factors in Strecker\u2019s projections.<\/p>\n<p class=\"STND-STND BodyText\">\u201cBy industry, the hardest hit are the likely areas of high-cost items like luxury goods and automobiles, followed by additional optional areas like clothing and sporting goods,\u201d Strecker wrote in a memo to council. \u201cWith limited and\/or heightened fear of travel anticipated, accommodations will also be hit hard. A slightly muted impact would then occur at restaurants, but not as deep given local patron visits.<\/p>\n<p class=\"STND-STND BodyText\">\u201cThe least impacted industry will be in the areas of general retail (which includes some large online retails that have been able to remain open during this time and have even seen a boost) and basic necessity retail like food and drug.\u201d<\/p>\n<p class=\"STND-STND BodyText\">Strecker projects a nearly $6.59 million loss in city sales tax revenue and a $4.4 million reduction in the city\u2019s share of Pitkin County\u2019s sales tax.<\/p>\n<p class=\"STND-STND BodyText\">The lodging tax revenue is projected to take a hit of $1.65 million, according to Strecker.<\/p>\n<p class=\"STND-STND BodyText\">He wrote in the memo that based on those projections, collections will be significantly reduced and will affect various city funds and leave varying options on how to weather the impact:<\/p>\n<p class=\"STND-STND BodyText ListBullet\">\u2022 Transportation: This is the area of greatest concern. Transportation has revenue from three tax streams: city sales and lodging tax, as well as indirectly from the 1.0% valley-wide transit sales tax. The aggregate impact is a $2.3 million loss among these sources, and there is then the impact of a reduced transfer from the parking fund given that there is no paid parking at this time, initially estimated at $1.5 million in lost revenue. Immediate steps, including reduction in service levels and hours, have started.<\/p>\n<p class=\"STND-STND BodyText ListBullet\">\u2022 General Fund: $3 million reduction is only the initial impact as departmental revenue from fees also will decline. With this, expenditure cuts are recommended. There is fund balance that can be utilized and there is the option to push more property tax revenue to this fund, but it will require decisions on slowing or stopping projects in the asset management plan.<\/p>\n<p class=\"STND-STND BodyText ListBullet\">\u2022 Parks and open space: $4 million reduction. Sales tax is a main source of income and as such, delaying capital projects is imperative.<\/p>\n<p class=\"STND-STND BodyText ListBullet\">\u2022 Child care\/Kids First: $500,000 reduction. This fund has sufficient fund balance to delay immediate cuts but will then reduce resources to put forth on a capital expansion project in the future. There is already one position that is proposed to remain unfilled at this time (resource teacher).<\/p>\n<p class=\"STND-STND BodyText ListBullet\">\u2022 Tourism Promotion: $1.2 million reduction. This amount has been communicated to (Aspen Chamber Resort Association) to assist in prioritizing destination marketing dollars. ACRA does have close to $800,000 in reserve on its books, plus the city is holding another $300,000 in fund balance at this time.<\/p>\n<p class=\"STND-STND BodyText\">Additional work still needs to be completed to analyze other fee-based revenue streams, property tax (though little impact is anticipated), and real estate transfer taxes (typically volatile and less detrimental in the near term if collections fall).<\/p>\n<p class=\"STND-STND BodyText\">The city administration is already scaling back its operations and will bring forward a formalized cost-cutting package for the council to consider in the near future.<\/p>\n<p class=\"STND-STND BodyText\">Councilman Ward Hauenstein said it is not going to be easy to tighten the city\u2019s financial belt but it is necessary to save lives in this crisis.<\/p>\n<p class=\"STND-STND BodyText\">\u201cThe public health orders are really designed to put an end to the spread of this contagion but in doing that, it heavily impacts businesses,\u201d he said. \u201cWe have to be able to kill the virus, we have to kill the spread of it, but we have to be prepared for the economic recovery.\u201d<\/p>\n<p class=\"STND-STND BodyText Tagline\"><a href=\"mailto:csackariason@aspentimes.com\">csackariason@aspentimes.com<\/a><\/p>\n<p><a href=\"https:\/\/www.aspentimes.com\/news\/city-of-aspen-projecting-massive-revenue-losses-expenditure-cuts\/\" target=\"_blank\" rel=\"noopener noreferrer\">via:: The Aspen Times<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A view of an empty Hotel Jerome on Main Street in Aspen, March 30, 2020. (Maddie Vincent\/The Aspen Times)Maddie Vincent\/The Aspen Times A view of the playground at Wagner Park that was closed due to the COVID-19 outbreak, March 30, 2020. (Maddie Vincent\/The Aspen Times)Maddie Vincent\/The Aspen Times Show CaptionsHide Captions The city of Aspen [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[49],"tags":[],"class_list":{"0":"post-2456535","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-local-news"},"acf":[],"publishpress_future_action":{"enabled":false,"date":"2026-07-04 02:32:12","action":"change-status","newStatus":"draft","terms":[],"taxonomy":"category","extraData":[]},"publishpress_future_workflow_manual_trigger":{"enabledWorkflows":[]},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"KSPN The Valley&#039;s Quality Rock","distributor_original_site_url":"https:\/\/alwaysmountaintime.com\/kspn","push-errors":false,"_links":{"self":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts\/2456535","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/comments?post=2456535"}],"version-history":[{"count":1,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts\/2456535\/revisions"}],"predecessor-version":[{"id":2456549,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts\/2456535\/revisions\/2456549"}],"wp:attachment":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/media?parent=2456535"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/categories?post=2456535"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/tags?post=2456535"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}