Sunday, May 31, 2020

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Moab, UT

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Moab
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    County could cut budget by 30%

    Tourism-related tax revenue could fall at least 60%

    Featured Stories

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    Carter Pape
    Carter Papehttp://moabtimes.awebstudio.com/author/carter-pape/
    Reporter Carter Pape covers news out of the Grand County Council Chambers, including housing, tourism, crime, and more.

    Grand County Council Administrator Chris Baird told the county council last week that he was anticipating a cut to the county’s general fund budget of up to 30% as tourism in Moab takes a drastic hit alongside nearly all other local businesses amid the COVID-19 pandemic.

    The county’s general fund backs a bulk of the public salaries and local services from which local taxpayers and tourists benefit, with the city’s general fund backing many of the others, such as public water and sewer. The county’s general fund is, in turn, backed primarily by sales, lodging and property taxes.

    Because of the drastic decrease in visitation, Baird said that he anticipated cuts across the board to sales tax revenue, restaurant tax revenues, tax revenue on car rentals and most of all transient room tax revenues, which tourists pay on stays at hotels, RV parks and overnight rentals.

    In response to the budgetary crisis the county faces, Baird said that 14 full-time and five part-time county staffers have been laid off. However, the furloughs have saved the county less money than would be ideal, since it is self-insured for unemployment, leaving it to cover the insurance payouts its furloughed staffers receive.

    The county is not, however, on the hook for the additional $600 in weekly unemployment insurance payouts that Congress approved last month. The state will cover those costs via funds allocated by the federal government, making furloughs an overall savings opportunity for the county and an overall financial boon for the furloughed employees.

    This extra money for furloughed workers, though, puts the county in an awkward position as it considers across-the-board cuts to payroll. Although a 3% county pay cut would save roughly $275,000 per year, according to Council Chair Jaylyn Hawks, such a cut would not affect furloughed or unemployed workers, effectively leaving them with pay raises while workers who stay with the county — council members most likely included — suffer pay cuts.

    The county also faces decisions about permanent staffing cuts as the decrease in service threatens to leave a lasting impact to ongoing revenues and fund balances. Although interest rates are low and expected to decrease amid the financial crisis, fulfilling ongoing costs with loans could leave the county in an increasingly vulnerable financial position. County Treasurer Chris Kauffman advised the council to use either no loans or a very small total amount in loans to meet payroll as it plots the way forward.

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