Property tax revenue has stayed steady so far throughout the coronavirus pandemic, while lodging tax revenues have ridden the wave of business restrictions.
But after initial spring shutdowns, some coastal cities experienced one of the best summers and falls on record for lodging, with the tourist season extended deeper into fall by the shift toward online working and learning.
David Glasson, city administrator in Long Beach, said the city fell about $100,000 behind budget in both sales and lodging taxes when the town shut down to visitors for two months in the spring.
“But, as summer went on, the people came,” he said. “I think they came locally. I think … people who had never been to Long Beach before, but they’re in the region, they said, ‘Where’s a place we can go that’s rural and kind of out of the way?’”
By October, Glasson said, Long Beach generated $122,000 in lodging tax revenue, nearly 30% above the previous record despite having no large events to draw tourists. By the end of the fiscal year in December, Long Beach was only down $14,000 in lodging taxes and $65,400 in sales taxes from 2019.
The story was similar in Seaside, which was down 55% in lodging revenue in the spring from the previous year but up by 18% in the summer. Only 90 minutes away in Portland, said Assistant City Manager Jon Rahl, hotels were mostly empty.
“The coast did pretty well,” he said. “And I think a lot of that has to do with the space that we had. People can distance in a different way at the coast.”
A year-to-date lodging report in December by the Oregon Tourism Commission showed that the coast, while down 15% to 20% in room demand and revenue, outperformed every other region in the state, along with the U.S. as a whole. The Portland market suffered the most, with room demand cut in half from 2019, and room revenue down by more than 60%.
April Clark, finance director in Warrenton, estimates the city was down nearly $145,000 in lodging taxes between March and June of 2020 compared to the year prior, and another $107,000 between July through September. But Clark said lodging tax income from the fall could be up with schools and work online.
“Usually Labor Day, everything shuts down and you’re done out at Fort Stevens and KOA, which is where our biggest transient room taxes come from,” she said. “But people continued to camp into September and October. The weather was good.”
Astoria breathed a sigh of relief during a recent mid-year budget update, when Susan Brooks, the director of finance, reported that the city was only down by 12% between June and December from 2019. While lodging revenues track closely with restrictions on businesses, Brooks said, she is hoping for a strong start to this year.
“We do anticipate that due to COVID fatigue … that there’s probably some pent-up demand, and that people will probably be taking shorter trips rather than longer trips that involve hopping on a plane or going abroad. I’m hoping that will work to our advantage in the coming months.”