Shutdown affects local economy

It is difficult to measure exactly what the economic effect of the ongoing U.S. government shutdown is on Boulder City, but it doesn’t look good.

The shutdown, which began Oct. 1 because Congress failed to approve a federal budget, resulted in the majority of federal employees everywhere, including Boulder City, being furloughed, or sent home without pay.

The National Park Service started closing all areas of Lake Mead National Recreation Area on Oct. 1, and by Oct. 3 the park was entirely closed to visitors and 170 employees had been furloughed, Park Service spokesperson Christie Vanover said.

The closing of the recreation area, which includes Lake Mead, Lake Mohave, a portion of the Colorado River and 1.3 million acres, affects the local economy in multiple ways.

First, the businesses that operate within the park had to cease operating Oct. 2.

Forever Resorts, which offers houseboat rentals, lodging, raft tours and other services at several locations within the park, estimates that the shutdown will cost it $280,000 per week, regional Vice President Rod Taylor said.

“It’s hurting,” he said.

To manage the lack of business, Forever Resorts had to lay off about 100 employees last week, Taylor said.

Lake Mead Cruises, which operates tours aboard the Desert Princess paddleboat, had to lay off about 30 employees last week, General Manager Lisa Stephens said.

“This is one of our best months out of the year, so we know we’re going to take a huge hit,” Stephens said.

Boulder City-based Desert Adventures, most popular for its kayaking and canoeing tours, has had to “totally shut down” and lay off 30 full-time employees, according to owner Izzy Collett.

“October is our busiest month of the season, generally when we build up (our revenue) to get us through winter, to get us through slower times,” Collett said.

Desert Adventures was looking forward to having its 10th anniversary next year, and was “really excited” that it made it through the recession, Collett said.

But with the shutdown costing the business thousands of dollars each day, Collett doesn’t know if it will last to celebrate the 10-year mark.

“I don’t even know if the business will be here at this point,” she said.

The Park Service estimates that under normal circumstances, 14,500 people visit the recreation area and spend $500,000 in the region each day in October.

Additionally, many of the furloughed federal employees from the Park Service and the U.S. Bureau of Reclamation, as well as many of the employees laid off from the affected businesses, live in Boulder City. People without an income generally spend less money than those with an income.

One bureau employee who lives in Boulder City, and asked that he not be named, said last week that he will have to limit his spending, and possibly file for unemployment.

But fortunately, effects of the shutdown do not yet appear to be hitting most local businesses.

Several businesses told the Boulder City Review the shutdown has had no obvious effect on their bottom line.

Todd Cook, owner of the Boulder Dam Brewing Co., said that the shutdown’s economic effect may be less noticeable because business typically picks up in October.

“We don’t notice it right now. The weather got cooler. The kids are back in school. We had Art in the Park,” he said.

But he added, “Could it be better? Sure.”

Boulder City Chamber of Commerce CEO Jill Lagan said she also hasn’t heard of an effect on most local businesses.

“I have not had any businesses say to me, other than the ones who work inside the park, that it’s really impacted them,” she said.

Lagan suggested that the shutdown may even in some ways be beneficial for Boulder City, because it has forced some tourists, who planned on visiting the Lake Mead and the Grand Canyon, to spend more time in Boulder City.

Hoover Dam is open, she said.

But in the long run, Lagan’s optimism is trumped by the dire reality of the situation.

“You can see in the projections, that if this goes too long, where this all leads us,” she said. “It won’t take much to go back to (the recession) and go even deeper.”

A bill providing back pay to furloughed federal workers was passed by the House of Representatives on Saturday, but as of Wednesday morning, it had not been voted on by the Senate.

A federal budget also had not been approved by Congress as of Wednesday morning.