Plastic pays the way for Moab tourists
Officials explain how tax revenues are allocated

Credit cards get a lot of use in Moab.

Recently, Travel Council Executive Director Elaine Gizler shared 2017 figures from credit card giant Visa that showed domestic visitors to Moab spent more than $133 million, with an additional $10 million from international tourists. The figures came directly from Visa, Gizler noted, so they do not include cash payments or other credit card purchases.

In addition to the report from Visa, Gizler gave an update on county income. Throughout 2017, Grand County collected more than $5 million in transient room tax. TRT is an additional 4.25 percent tax imposed on any form of temporary lodging for stays of less than 30 consecutive days. TRT revenues help fund the Travel Council; two-thirds of the first three percent of the TRT are allocated to the Travel Council. The other one-third of the first three percent is combined with the remaining 1.25 percent to fund “law enforcement, search-and-rescue activities, solid waste disposal operations, and museums.” Gizler continued, “the county also collected $735,686 in car rental and restaurant tax.” That income goes towards “the airport facility, the Grand Center, Star Hall, Old Spanish Trail Arena, trail development, Thompson, and fireworks.”

Tourism has a large impact on the finances of the city as well as the county. According to Lisa Church, the city’s head of communications and engagement, “in 1991 the Moab City Council opted to set the city’s property tax rate at zero percent.” Since that time, “sales and use tax, TRT and resort community tax have provided the majority of the city’s overall annual revenue.”

The latest rate chart from the Utah State Tax Commission lists Moab’s sales tax as the highest in the entire state. At 8.6 percent, Moab marginally surpasses Alta and Park City. Moab sales tax applies to every purchase made in the city, excluding “anything grocery related.” Church claimed the high sales tax “has enabled the city to not charge a property tax.” Still, the sales tax could be viewed as a contributing factor in Moab’s high cost of living. However, “taxes overall are a little higher here, but I don’t think that’s the reason that rents are so much higher,” Church argued. “My personal perception is that it’s really more of a function of the fact that we’re a tourist community.” Church noted that people who own property in areas where short-term rentals are allowed can make far more money doing nightly rentals compared to long-term rentals for residents.

Unlike the Travel Council, the City of Moab does not fund any tourism promotion. Instead, they are working toward mitigating the high cost of living through efforts such as the affordable housing fund. Church said the fund “has about $90,000 left over from last year and we’re adding another $150,000 to it…it seems to be something that our city council is committed to continuing to add to.”

Moab city does not fund development projects directly, but tries to “encourage developers to include affordable housing in whatever they do.” Church added, “through the planning offices, both the city and the county, they’re definitely looking at what those incentives might be…how can they create new incentives for the creation of housing that is actually affordable?”

Gizler spoke to The Times-Independent about the benefits locals receive from having essential services funded by tourists. “If we did not have those taxes coming in, where would we be?” Gizler asked rhetorically. Since 2015, Grand County is fourth out of Utah’s 29 counties in the amount of TRT collected. Gizler mentioned Moab’s consistent growth and wondered what would happen if that trend reversed. A drop in tourist revenue would have dramatic effects on the community, Gizler hypothesized. Currently, “tourism is the only driver for revenue…and until we diversify our economy,” Moab will have to rely on visitor spending to fund essential services.

When discussing the Travel Council’s goals, Gizler said they are “not looking for big increases,” instead focusing efforts to “maintain the county’s revenue.”

Local spending is excluded from the Visa report because it only tracked spending in the 84532-zip code by cardholders who live outside of the Moab region. “Since tourism is the driver of our economy in Grand County, I wanted to provide the details so you are informed,” Gizler said in a report to Moab business owners. According to Visa, domestic tourist spending in Moab went up 8.1 percent from 2016 to 2017. Furthermore, the average cardholder spent $172.88 in Moab.

The report listed and ranked the areas with the top spending in Moab. The ranking is as follows: Denver-Boulder, Provo-Orem, San Francisco-Oakland, Los Angeles-Riverside-Orange County, Seattle-Tacoma-Bremerton, Phoenix, New York-Northern New Jersey, Grand Junction and Washington-Baltimore. Similarly, Visa released a ranking for international visitors. In order, the highest spending came from the following ten countries: Canada, France, Germany, China, the United Kingdom, Switzerland, Italy, Belgium, Netherlands and Spain. Also, the report ranks the market segments that received the most spending. Those segments are, in order: restaurants, oil, other retail, lodging, supermarkets and other travel and entertainment.

Since those rankings only account for Visa spending, they could be altered by the incorporation of other payment methods.

In the letter, Gizler gave a summary of the Travel Council’s advertising efforts. She noted that they do not run television commercials during the spring, summer or early fall. Instead, a majority of the advertising is done in January, February, March, November and December. The bulk of advertising is done then “to build our shoulder season business, and to have potential tourists think about coming to Moab.”

ByBy Nathaniel Smith

The Times-Independent