This week the front page of the Monticello, Utah newspaper, San Juan Record (SJR) read, “Travel and tourism sector sees significant growth.” The article went on to quote the San Juan County Economic Development Director, Charlie DeLorme about the Transient Room Tax (TRT) and the Restaurant Tax (TRCC).
“Travel and tourism is seeing significant growth in San Juan County, even as other sectors of the economy show little or no growth.
“There are a lot of opportunities if you have a unique and good quality product,” said Charlie DeLorme, the Economic Development Director for San Juan County.
Transient Room Tax (TRT) and restaurant taxes (TRCC) were up nine percent in 2015 and DeLorme expects another record-breaking year in 2016.
“Our combined room and restaurant collections in 2015 were $783,157,” said DeLorme. “I expect an 11 percent increase in 2016, in addition to the significant expansion of lodging properties.” read the story
The article mentioned several different businesses in San Juan County as if the growth of those businesses was a result of the efforts of DeLorme’s Economic Development Department. It is a well-known fact that Charlie DeLorme has been involved heavily with one of the businesses named in the article, the Discovery Center, better known as the Four Corner School. His involvement along with San Juan County Commissioner Bruce Adams, ex-Monticello City Mayor Doug Allan, and the San Juan Record owner Bill Boyle was outlined in a story by The Petroglyph News blog titled “Four Corners School Receives $1.59 million in Tax Money.” It was reported:
“In 2007 San Juan County commissioners authorized the Four Corner School to receive over $500,000.00 dollars in Tax money from the county to build the Four Corners Discovery Center. Once the public found out about this and raised a fuss the county eventually rescinded the money, but not before some $400,000.00 had been paid to the school. read the story
DeLorme’s office has handed a great deal of tax money to the Discovery Center / Four Corner School, so he may warrant some credit for helping the school become what it is today. It appears that in the eyes of DeLorme and other county officials, handing over taxpayer dollars to the Four Corner’s School, as well traveling around the world allegedly promoting San Juan County, are legitimate economic development activities.
The fact that Charlie DeLorme is a world traveler extraordinaire was made clear in a 2010 article published in the Deseret News titled, “San Juan County Stakes its future on tourism.” Beginning in 2006, Charlie has traveled to trade shows throughout Europe and Asia, from England to Russia to Singapore, to purportedly promote San Juan County. The article said:
“We think the benefits far outweigh the costs. It’s absolutely worth the investment,” Adams said. “Charlie has really been good at keeping his costs to a minimum when it comes to spending actual county money. He’s enormously judicious in the way he handles funds.”
DeLorme uses the excuse, “Tourism is a relationship business,” to justify his global junkets. He claims to be the best man to engage people face to face because of his knowledge of San Juan County. The article continues:
“DeLorme ran a company offering San Juan River trips, as well as “cultural and natural resource tours” to places like Siberia and Guatemala, until 2004.”No one knows the backcountry of San Juan County better than me.” DeLorme stated.
But does DeLorme and his lavish travel and handouts to the Four Corners School, really deserve credit for the uptick in tourism?
The Travel Trends Index indicates that domestic travel has been on the increase nationwide and will continue to increase through the summer months of 2016. It indicates that through September the volume of travel will grow at a rate of 2%. There is a nationwide increase in travel. So it’s fair to say that DeLorme’s travels have actually benefited foreign nations more than San Juan County, since the uptick in tourism appears to have nothing to do with his global face to face meetings.
Without real comprehensive numbers from DeLorme’s office, it would be difficult to draw a precise conclusion about the effectiveness of the San Juan Economic Development Department. Nevertheless, the SJR article failed to provide any statistics or information to support their claim that DeLorme’s activities were driving travelers and tourists to San Juan County.
The one thing the article got right is that the TRT and TRCC taxes were up 9% in 2015. The combined room and restaurant TRT and TRCC taxes from last year provided San Juan County an additional $783,157 dollars to fund Charlie DeLorme. When added to the State Sales Tax, property tax, business license fees, and all the other government taxes and fees these businesses have to pay already, the TRT and TRCC taxes comprise an enormous tax burden for travelers and locals alike.
The $783,157 are dollars taken from the operating budgets of San Juan County business that could be used to hire employees, purchase goods from other businesses in the area, and effective marketing. According to DeLorme this increase in tax revenue is a good thing and he is expecting an additional 11% increase in 2016.
Of course DeLorme thinks increasing taxes is a good idea. After all, his salary is paid by the same ordinary hard-working people who are also footing the bill for his globe-trotting “outreach.”
The people of San Juan County are tolerating what can be described as legalized government theft, under the guise that somehow it’s good for their economy.
Here are some recent numbers that show where San Juan County sits in relation to the national averages when it comes to income, taxes, etc. Remember that the promotion of tourism in San Juan County with the TRT and TRCC has been in full swing for 10 years when you review the numbers.
- The unemployment rate in San Juan County, Utah, is 7.10% – Nationwide 6.30%, with job growth of 4.62%.
- Future job growth over the next ten years is predicted to be 42.10%.
- San Juan County, Utah Taxes – San Juan County, Utah, sales tax rate is 6.35% – National 6%.
- Income tax is 5.00% – National 4.72%.
- San Juan County, Utah Income and Salaries – The income per capita is $15,303 – National $28,051, which includes all adults and children.
- The median household income is $40,186 – National $64,585. more info
So for 10 years the county has been forcing businesses to pay for DeLorme’s travels and efforts through the TRT but what has really been the return on their investment?
According to economic reports, DeLorme’s travels have not benefited the local economy at all. The fact is, most of the growth is happening in Spanish Valley to the south of Moab.
Taxable sales have gone back and forth a little, but there is no concrete indication that the exorbitant TRT/TRCC really doing anything to promote economic growth the San Juan County.
The SJR article cited some unsupported numbers provided by DeLorme:
“In general, DeLorme reports that 2016 started very strong. “In the first quarter of the year, TRT collections were up 47 percent. Our shoulder and winter seasons without a doubt have grown.”
DeLorme estimates that the tourism in San Juan County is roughly split 50-50 between individual travelers and bus tours. “In some areas, the tour buses represent almost 80 percent of the total business.”
The SJR also failed to address how the TRT and TRCC are affecting the businesses profit margin. If the TRT is 11.85% on every room sold, how will those costs be passed on? Business owners will only be able to pass on so much to the consumer before their businesses suffer. Local enterprises will be forced to choose between possibly losing business, having to cut payroll or other operations, or doing both and slowly dying.
Current tourism trends are based mostly upon the world economy, in relation to the value of the US dollar, gas prices, etc. Travelers from Utah and Colorado comprise the largest tourist bloc in San Juan County, with most of the rest coming from other parts of the United States. There is no basis in DeLorme’s assertion that his world travel is driving international tourists to Southern Utah.
DeLorme claims erroneously that “(Tourism) is the only sustainable growth industry San Juan County has.” The fact is that mineral extraction, oil & gas, agriculture and the cattle industry have powered the local economy for over a century—and have proven to produce more new wealth, and be far more reliable and sustainable than tourism without the interference of oppressive federal agencies.
As the Economic Development Director for San Juan County you would think DeLorme would be aware aware of the problems in tourism-centric communities like Jackson Hole, Wyoming, Moab, Utah, and especially, Escalante, Utah.
Tourism cannot be a stand-alone industry. Economic growth is a dynamic exchange of goods and ideas between diverse sectors and businesses. But DeLorme’s latest efforts will put San Juan County behind the glass of a museum diorama, with just about as much activity.
The new welcome sign created by the San Juan County Economic Development Department reads, “The World’s Greatest Outdoor Museum.” A museum is defined as: “noun a building in which objects of historical, scientific, artistic, or cultural interest are stored and exhibited.”
“Calling San Juan County and all those that live there an exhibit is not only offensive, but under minds everything that the majority of citizens in San Juan County are trying to preserve – their culture and way of life. Charlie Delorme’s slogan screams anti-economic growth, NO access to public lands, NO mining, NO oil and gas, NO ranching, NO farming, NO recreation, and NO gathering wood to heat your homes. This slogan promotes San Juan County being made a National Monument that can be visited. The big question is what do the some 14,000 thousand citizens of San Juan County do now that they live in a museum? Better yet what are they people or just exhibits? One citizen put it like this, “are we wax figures or what?” read the story
It is clearly time for the county to provide an actual return on investment report showing that for every dollar the county takes from a business this is what that business gets back in return. The available numbers that are available do not support the assertion that the tax money the county is taking from local businesses is helping.
Instead of continuing to fund a bad idea let’s take a step forward and try a new approach to economic development. Get the government off the backs of private businesses, and leave the money with those who earn it to be used for economic activity that will actually spur economic growth. Free markets run by free people will create a stronger economic base in San Juan County. Shrink the local government footprint by reducing wasteful activities and unnecessary interference by an economic development department or board.
This is the only way San Juan County businesses will really see a significant growth in its specific markets.
“One of the great mistakes is to judge policies and programs by their intentions rather than their results.”
― Milton Friedman