The Sun Valley Air Service Board on Wednesday adopted a budget of $2,134,000 for fiscal year 2021, indicating a significant rollback in funding for two core marketing organizations in the valley.
Governed by the mayors of Ketchum, Sun Valley and Hailey, the Air Service Board is tasked with administering the ‘1 Percent for Air’ local option tax (LOT), a provision that tacks on an extra 1 percent to various tourist-driven sales—car rentals and lift tickets, for example—in the mayors’ respective cities.
The 1 Percent for Air tax, renewed by voters in 2017, supports increased air service and tourism in the valley. Those LOT dollars amassed by Ketchum, Sun Valley and Hailey are then divvied up between Visit Sun Valley and the Fly Sun Valley Alliance at the start of every fiscal year in October.
Last year, the Air Service Board funneled around $3.17 million to the marketing organizations, more than $1 million more than the figure projected for 2021.
According to Carol Waller, Executive Director of the Fly Sun Valley Alliance, it’s not just LOT revenues that have taken a hit since COVID-19 arrived in the Wood River Valley. In line with national trends, she said, flight bookings are currently flattening as the virus continues to surge and travel demand drops.
“From April and on, passenger loads plummeted,” Waller said. “We had far fewer flights from then until June, and planes were flying primarily empty. The bottom line is, we were having a good winter and February and then, of course, COVID hit.
Of all three jurisdictions, Ketchum contributes the bulk of the 1 Percent for Air LOT revenue. In fiscal 2021, Ketchum is expected to contribute $1.5 million, Sun Valley around $599,000 and Hailey around $34,400 for a grand total of $2.1 million.
Ketchum Mayor Neil Bradshaw pointed out what he called a “discrepancy” in the figures on Wednesday.
“There’s quite a big range there, from $1.5 million coming from Ketchum, to the $34,000 coming from Hailey,” he said. “I know every city has done their best to prepare an estimate, but I think there’s a lack of visibility as to what the future holds.”
Bradshaw said if the city of Ketchum does not meet its revenue goals, it should have the ability to reopen the Air Service Board budget and revise its local option contract with Visit Sun Valley and the Fly Sun Valley Alliance.
“Everyone wants to have some way to modify the contract in case it’s not meeting our needs,” Sun Valley Mayor Peter Hendricks responded. “Hard to believe, I know, but Mayor [Bradshaw] I do agree with you that we need to take a conservative approach here.”