Report suggests forming economic development group, other steps

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Most recommendations in pandemic-recovery plan already identified by local authorities

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Months in the making the Economic Resiliency Plan commissioned by local officials advised improving communication with residents and businesses, forming a countywide economic development organization and proposed some outdoor dining and shopping solutions that failed to take off last summer.

At a Joint Policy Group meeting Feb. 4, Andrew Knudtsen and Carson Bryant presented Economic and Planning Systems’ draft report to elected officials from the county Ouray and Ridgway, which each contributed more than $15,000 of their federal coronavirus relief funds to pay for the study.

The report includes lengthy summaries of the state’s capacity restrictions and policies, as well as explanations of the structure currently being used in the county to respond to the pandemic. It also details answers to an online survey sent to 240 businesses, which received 62 responses, which they said provide a snapshot of economic conditions.

Survey

Among their findings was confirmation of what seemed anecdotally obvious to locals: last summer brought an influx of visitors to the county, which helped cushion some of the pandemic’s economic blow for some businesses. They determined 83 percent of all traffic in 2020 was from outside the county, compared to 79 percent in 2019, with a peak in July at 95 percent.

Economic impact of the pandemic varied across businesses: 25 percent of respondents reported that revenue for 2020 was modestly or significantly higher, while another 25 percent said revenue was “down modestly” and one-thind said it was “down significantly” Three-quarters of the businesses said in the survey that it was either likely or very likely that they will continue to operate through 2021.

But restrictions on business capacity, health risks, social distancing and closures “have jeopardized the viability of many businesses,” the consultants said. Unemployment spiked at 19 percent in April, but fell to 6.7 by November, just above the statewide rate of 6.2 percent. Typically, the county’s highest unemployment rate is 4 to 5 percent in the winter months. Ouray County recorded 690 unemployment claims in 2020, peaking at 123 in the last week of March. The average of 13 claims a week was significantly higher than 2019’s average of three claims per week.

“Many businesses have struggled, while others have had normal, if not successful, years,” they wrote.

Visitation is the primary driver of the county’s economy, with just under onethird of all jobs in the Accommodations and Food Services sector. That includes half of all jobs in Ouray, and just under one-quarter of all jobs in Ridgway. Retail and public administration jobs each made up just under 10 percent of the county's workforce, the report said.

Because the county’s economy is so interconnected, with dollars spent in hotels closely tied to dollars spent in food, retail and recreational experiences, the county is “vulnerable to consumption-related shocks,” the report said.

Asked about their primary concerns for their businesses’ continuity, the top survey response was “health/COVID-19 infection,” followed by cash flow or working capital. One-third of the businesses said paying their rent or mortgage was a concern for continuity, and more than a quarter cited supply chain issues and customers not returning.

Just under half of the businesses said they need to invest in personal protective equipment, and 29 percent said online sales or ordering are needed to adapt to the pandemic. Twenty percent said they need to reconfigure indoor space and add outdoor space. When asked about the barriers to making those changes, the most common answer was uncertainty about the length of the pandemic, limited money and space, and insufficient return on investment. Only 6 percent, or about 4 businesses, said the city or town code prevented them from making those changes.

In an effort to help businesses stockpile PPE, Ouray County used more than $25,000 from federal coronavirus relief funding to purchase masks, gloves, sanitizer and other supplies for businesses, which was distributed in the first week of January.

The consultants also wrote the pandemic has exacerbated housing issues, with the median single family home price jumping to $559,000. The consultants attributed that to the “Zoom Town” trend, with remote workers moving to mountain towns, a trend they expect to continue and to limit housing availability, creating further challenges for employee retention.

Recommendations

The report includes a list of 21 recommendations, which range from improvements for local governments to suggestions for local businesses.

Eight of their recommendations focused on improving communications with residents, visitors and guests, including one-way communication of restrictions and resources, and two-way conversations about businesses’ needs. “The goal is to create clarity among residents, businesses, and guests about how decisions are made and how the information is disseminated,” the report said.

Those suggestions included creating a downloadable app, a Facebook page, using written mailers and “reverse 911” notifications. Businesses need a channel to communicate to local officials, they said, specifically suggesting “fielding surveys and questionnaires” more often to gather more up-to-date information about the economic landscape. The consultants also suggested hiring a permanent public information officer, which the county approved funding for in December but has not yet hired. They advised that “seasoned local government staff” review and provide guidance for the county’s outgoing communication.

To support local businesses, they recommended promoting available resources, such as federal aid programs, to increase awareness of those efforts, as well as helping small businesses organize financial records needed to apply for those programs. The consultants also advised that local businesses should “establish a relationship with local lenders” for pursuing Paycheck Protection Program loans.

More than 200 Ouray County businesses received more than $8 million in PPP loans last spring, according to data from the Small Business Administration. Most businesses pursued those through Colorado banks: records showed Alpine Bank processed 118 of the local loans, while Citizens State Bank handled another 57.

Several of their practical suggestions have been implemented or attempted over the last year, particularly attempts to using outdoor spaces to cope with indoor capacity limits.

Temporary shelters or tents, seen commonly in other cities, have not been a popular approach in Ouray County, but the consultants recommended using them for dining, retail display, fitting rooms or waiting areas, or to create pricier private experiences for customers.

EPS also suggested making “permanent improvements,” such as adding a roof or space heaters for patios, and working together to “put vacant space into productive use, as it would be unlikely to be leased/sold during these uncertain economic times.”

Sidewalks and street or lane closures could also help with space issues and creating a different social environment, the consultants said.

Many businesses used sidewalk space last summer, though the harsh winter put a damper on most of those attempts. Several Ridgway businesses discussed street closures or using parking spaces to expand outdoor options over the summer, and the town streamlined permit applications for encroachment and liquor license modifications, but ultimately none pursued the option.

The report’s tactical recommendations included advising businesses to have online ordering platforms and curbside pickup, which many have already implemented over the last year, and holding recurring events rather than one-off or annual events to encourage people to return. While they advise holding these outdoors and ensuring social distancing, it’s not clear what those events might look like during a pandemic.

Another suggestion, creating communal outdoor areas where alcohol can be consumed, was also implemented last summer, with rules changed to allow alcohol at and Fellin Parks.

Five of the 21 recommendations address regional economic resiliency, including addressing the goals from a 2011 development report that called for diversifying the economy, expanding and branding assets and obtaining broadband internet, which is in progress.

The consultants advised forming a countywide economic development organization to promote regional cooperation between Ouray and Ridgway, because of their interdependence and to better leverage resources. The report doesn’t provide specific suggestions for marketing, aside from focusing on “quality over quantity,” and notes that a regional organization could be an opportunity to “reconsider the marketing angles used to attract visitation.”

The county should examine balancing economic growth with sustainability, including addressing housing attainability and infrastructure to keep up with growth and visitation, they determined.

“’This captures in a single document a lot of what has happened,” said County Commission Chairman Ben Tisdel. “I think the findings and conclusion is a good summary of how that all fits together, what the role of government and of individual businesses can be.”

Ouray City Councilor Ethan Funk, who was the city’s liaison to the consultants as they developed the report, described it as a useful “peer review,” similar to the step in scientific research when findings are reviewed before publication.

Many of the problems and challenges identified in the report have already been identified by locals and elected officials, he said. “But here’s someone from the outside peer-reviewing, without knowing our conclusions and they came to the same conclusion,” he said. “Here’s people from the outside who aren’t part of the community, affirming that we weren’t out in left field before.”

Some of those issues have also become more acute during the pandemic, Tisdel said, such as the scarcity of affordable housing and the need for collaboration between the municipalities.

The report’s summary of recommendations, which takes up seven pages of the 64-page document, can now be taken by each governing body to review and prioritize, Funk said. In reviewing the initial draft before it was presented to the policy group last week, he asked them to distill those into a simple, numbered list, which he hopes will make it easier for the councilors and commissioners to review.

“There’s going to be some things that the town, city and county are all going to have to decide what they’re willing to fund,” said Ridgway Town Councilor Russ Meyer, who served as liaison for the town. “There’s expenses involved in some of the suggestions, we’re going to have to sort out the highest priorities and the ones that are going to provide the best bang for the buck. But I think there was some really good information that they provided.”

Each of the three elected boards were asked to discuss the report among themselves before the policy group meets again tonight (Feb. 18).

Liz Teitz is a journalist with Report for America, a nonprofit program focused on supporting journalism in underserved areas. Email erin@ouraynews.com to make a tax-deductible donation to support her work.