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Data shows shifts in Ketchum economy this year in wake of pandemic

Since recovery from outset of the COVID-19 pandemic, the resort town of Ketchum started to feel busy again. For a time, Blaine County had more cases per capita than any other county in the country. But new data shows that busy feeling in Ketchum may not come from traditional tourists – but owners of second homes and people staying for longer stretches of time.

Ketchum’s local option tax data for the fiscal year of September 2019 through August 2020 is in. The LOT can give an idea of the economic health of the key city – and how many tourists are still coming to Ketchum and spending money despite the pandemic.

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The City of Ketchum LOT is an extra tax on top of Idaho’s regular six percent sales tax. There is a three percent room tax, a three percent liquor tax, and a two percent retail tax that includes building materials but excludes groceries and motor vehicles. 

The data only includes the City of Ketchum, and doesn’t factor in the separate City of Sun Valley or other areas of Blaine County.

This shift in tourism caused Ketchum to lose thousands of dollars in local option tax revenue.

LOT more specific to tourism 

Ketchum, Idaho
Photo: Don Day/BoiseDev

According to Grant Gager, the City of Ketchum’s director of finance and internal services, liquor-by-the drink, room and condominium receipts are largely connected to tourism.

Looking at April through August 2020, during the time of COVID-19, total liquor sales are down from the same period last year.

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During those months in 2019 Ketchum earned $119,386 in tax collections, while this year the city brought in $74,104. That’s a drop of $45,282, or 38%.

The pandemic had a clear impact on tourists and liquor sales. Prior to March, Ketchum saw increases in tax collections on liquor.

Ketchum liquor-by-the drink LOT collections

April MayJuneJulyAugustTotal
2019$14,175$15,627$26,314$31,872$31,398$119,386
2020$1,205$8,335$15,931$22,423$26,210$74,104
Via City of Ketchum

When COVID-19 hit Ketchum saw a major decrease in room tax revenue.

From April through August 2019, the city brought in $125,027. This year during the same months Ketchum only saw $61,666 in room tax revenue. That’s a drop of 51%. Though tax collections fell in every month post-pandemic, a big driver of the dropoff comes from the month of April when Ketchum collected no new room tax revenue due to lockdowns in Blaine County.

Ketchum hotel LOT collections

AprilMayJuneJulyAugustTotal
2019$9,074$7,458$23,178$45,607$39,710$125,027
2020$1,410$10,313$28,783$21,159$61,666
Via City of Ketchum

Condominium tax revenue only saw a slight 2.6% drop during April through August this year.

The city saw a decrease for three months: March, April and May. Then in June and August receipts improved. July was a minor setback, bringing in just $162 less than last year. 

Ketchum condominium LOT collections

AprilMayJuneJulyAugust Total
2019$5,440$5,837$13,757$26,475$21,406$72,915
2020$1,118$493$16,320$26,313$26,732$70,976
Via City of Ketchum

Less tourism, more locals

The other retail and building material receipts are more likely associated with residents of Ketchum.

In April through August 2019 Ketchum saw $634,868. This year during the same months it brought it $571,218. The drop in other retail tax revenue collected can be directly connected to the pandemic. The new type of tourists in Ketchum are less likely to be purchasing things like souvenirs.

Ketchum retail LOT collections

AprilMayJuneJulyAugust Total
2019$74,092$80,854$124,217$188,698$167,007$634,868
2020$38,230$69,464$145,530$165,937$152,057$571,218
Via City of Ketchum

Building materials tax revenue saw a decrease from 2019 in April and May this year, but revenue increased moving into summer.

Ketchum building materials LOT collections

AprilMayJuneJulyAugustTotal
2019$22,930$26,599$39,615$31,255$28,108$148,507
2020$15,126$25,668$36,470$35,029$35,416$147,709
Via City of Ketchum

Gager said that Ketchum was busy this summer. But the new type of tourist spend their money differently.

“A second homeowner doesn’t pay hotel rates,” Gager said in a previous interview with BoiseDev. “(A second homeowner) doesn’t go out to dinner as much, doesn’t buy the Ketchum, Sun Valley trinkets as much as somebody who is here just for a week or two staying in a hotel or an Airbnb. And so while we may have a lot of people in town and more people than we ever have it’s a different clientele who is spending significantly less than we otherwise would see.”

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Total receipts & looking ahead

Even after some major losses because of the pandemic the City of Ketchum is only down about 15% in total tax revenue from April through August. And when looking at the full fiscal year Ketchum is only down 5.45%.

Ketchum Total LOT collections

AprilMayJuneJulyAugustTotal
2019$125,711$136,374$227,082$323,906$287,626$1,100,699
2020$55,680$105,368$224,564$278,485$261,574$925,671
Via City of Ketchum

“The budget that the City of Ketchum is about to adopt forecasts a 30% decrease in sales tax revenue for the coming fiscal year,” he said. “And a lot of that is predicated on a few things you know I think, as cold and flu season picks up. This thing is only likely to get worse. And so we really are expecting much lower traffic through the fall and winter months.”

Autum Robertson - BoiseDev reporter
Autum Robertson is a BoiseDev reporter focused on Meridian and McCall. Contact her at [email protected].

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