Orange County tourism taxes improved in June, but collections remain ‘historically low'

June's collection down 89.2% from last year, Orange County comptroller's office says

FILE - Park guests enter the Magic Kingdom during the reopening of Walt Disney World, Saturday, July 11, 2020, in Lake Buena Vista, Fla. Walt Disney Co. reported net income that plummeted dramatically in the third quarter, when it most of its theme parks remained closed and theatrical movie releases were postponed. Net income results were better than the loss analysts expected, however, but revenue missed expectations. (AP Photo/John Raoux) (John Raoux, Copyright 2020 The Associated Press. All rights reserved)

ORANGE COUNTY, Fla. – In his monthly update on Orange County’s tourism-related taxes, Comptroller Phil Diamond released numbers Thursday showing only a slight increase in the collection of tourist tax dollars last month related to hotel stays in the county.

Orange County’s tourism development tax collection, or TDT, are collected from hotel and resort stays and go toward tourism-related projects including the Dr. Phillips Center for the Performing Arts, the Orange County Convention Center and more. When the theme parks closed in March, hotel stays across the region dropped dramatically to post Sept. 11, 2001 levels.

Here’s where things stand: In June, Orange County received a historically low $2,629,400 in resort tax dollars, according to the comptroller’s office. That’s an 89.2% decrease from June 2019 but a slight increase from compared to May’s collections.

In May, TDT was down 95% from the year prior. In April, TDT collection dropped 97% compared to the same time last year.

Diamond said the increase in revenue can be attributed to the reopening of some of Central Florida’s largest attractions.

In June, most theme parks, including Universal Orlando and SeaWorld, began to reopen in a limited capacity leading to more area hotel stays. It remains to be seen if enough people feel safe enough to plan those family vacations in Central Florida again.

However, also in June, Florida began seeing large increases in coronavirus cases. As of Thursday morning, more than 510,000 people in Florida have tested positive for COVID-19 since March and 7,871 people have died as a result of the virus.

Diamond said his office is looking forward to seeing July’s collections as there are more hopeful signs for the tourism industry, including the reopening of all four parks at Walt Disney World, Disney hosting the National Basketball Association and Major League Soccer at its ESPN Wide World of Sports Complex and the Convention Center hosting the Amateur Athletics Union (AAU) 2020 Junior National Volleyball Championship. He said the Fourth of July holiday was also a rather busy one for the Central Florida region.

“These positive developments, however, must be tempered with the reality that the number of new COVID-19 cases in June and July were spiking at high levels, along with the announcements that one major theme park was reducing its workforce and another major theme park was delaying the opening of several of its hotels and resorts,” Diamond said.

The hotel and lodging industry and tourism in general continues to be among the hardest hit due to the coronavirus. A majority of hotels and theme parks were forced to furlough and layoff employees.

A recent survey by the American Hotel and Lodging Association indicates a majority of U.S. hotels have yet to hire back furloughed staff. Nearly 87% of hotels furloughed employees due to COVID-19 travel impacts, according to the AHLA.

Over a period of four months, 37% of hotels have been able to bring back at least half of their full-time employees, according to the survey.

Hundreds of hotel owners report they are in danger of losing their property to foreclosure due to the coronavirus, according to the AHLA.

In June, the county spent $17 million of its reserves to cover its expenses. According to Diamond, most of that money went to cover costs associated with the Orange County Convention Center.

Diamond said that while the county is lucky to have reserve dollars, spending significant amounts of reserve money without bringing enough money in is simply not sustainable.

“While the County is fortunate to have healthy reserves that can be used over the short-term to meet its funding obligations, it will be important to continue to analyze ways to minimize the drawdown since the length of time for the tourism industry to recover is unknown,” Diamond said.

Orange County Mayor Jerry Demings echoed those thoughts and said that with a new fiscal year just around the corner and the end of the financial impacts of the coronavirus nowhere in sight, the county can’t keep spending “as if nothing has happened.” He said county leaders will need to work with the comptroller’s office to cut costs and spend money responsibly.

“Without question, the Board of County Commission is going to have to make some public policy decisions that are going to be tough. We will have to cut some spending, there’s no question about it,” Demings said. “So where we cut? We will wrestle with those issues with the Board of County Commission.”

The new fiscal year begins Oct. 1.

The comptroller’s office will release July’s TDT numbers in September.