Much of Florida’s economy is driven by tourism, but the nationwide coronavirus lockdown has made tourism impossible.
While exact figures since the shutdown won’t be calculated until the end of the month, Bay and Walton County officials said that their municipalities will see an impact on their revenue streams.
Most officials said that they are unsure of how it may affect future budget plans.
Louis Svehla, Walton County public information officer, said that sales and use taxes, including the tourist development tax, which is a 5% tax on short-term rentals and hotels, count for one-third of the Walton County’s revenues.
Walton County normally sees about 60% tourism occupancy in April, said David Demarest, a TDC spokesperson. Right now the county is at 2%, he added.
“At this time, we feel certain that the losses will be in the millions of dollars,” Svehla wrote in an email, but that, right now, Walton County is seeing delays in projects due more to a shortage of available employees than a shortage of funds.
Early pandemic projections for Panama City Beach anticipated a 60% decline in tourism and up to $9.1 million in tax revenue losses, made up for with capital project budget cuts including road repairs and facility enhancements, City Manager Tony O’Rourke said.
“This year, we’re in pretty good shape as far as the reductions that we’ve planned,” O’Rourke said.
O’Rourke confirmed this 60% decline in tourism and $8.8 million in lost revenue, and expects a higher rate of decline in tourism in the following months due to the short term rental prohibitions and gathering size restrictions, leading to a sharper decline in tax revenue.
“We’ll see what we can do for next year, but it will be more impactful as far as operating expenses,” O’Rourke said, referring to impact on city employee personnel and the local government’s essential day-to-day services.
Panama City officials also said that the city is expecting shortfalls because of the pandemic.
Bay County Manager Bob Majka said that the county has about $80 million in reserve funds and is expecting between $25 and $40 million in losses depending on how long the shutdown is in place. After the reserves, they may be able to push projects like enhancements and repairs from Hurricane Michael, he added, and that jobs may be impacted.
“This is going to cause a lot of organizations, whether they’re private sector or public sector, to really go back and look at the way they conduct business,” Majka said about the innovative uses of technology being employed to conduct business during the pandemic.
“That in itself could be an improvement at the business level but may also lead to fewer employees on the backside as well,” he added.
Officials will know more about how these losses when the March and April budget tax reports are available in May and June, respectively.