Unemployment is at a three-year low and hotel tax revenues from tourism are at a three-year high. Both are signs that the county’s economy is on the mend, though still lagging behind year 2000 levels, according to officials.
Improvements in many of the county’s leading economic indicators — including property and hotel tax revenues, as well as average income — are outlined in a report released Thursday by the controller’s office.
"We have a nice low unemployment rate at 4 percent and the average [per capita] personal income in San Mateo County remains at the upper end of the state and America," Assistant County Controller Bob Adler said.
One particularly bright spot is the steady increase in tourism dollars, mainly associated with area hotels and San Francisco International Airport, flowing into the county after a downturn prompted by terrorist attacks on the East Coast in 2001.
"The drop in air travel and tourism after the ‘9/11’ event in 2001 significantly affected the county’s economy, but this segment of local industry is gradually rebounding," according to the report.
"We’ve had 39 straight months of increases in the [hotel] tax," said Anne LeClair, president of the county Visitor and Convention Bureau. The increase in hotel tax revenue contributed about $772,000 to county coffers alone in 2006, and came as a result of average hotel room price increases of more than 19 percent over 2005 to about $117 a room, Leclair said.
"All signsare good," LeClair said. "The tourism industry is strong."
Because hotel taxes are set and collected by the jurisdiction where each hotel is located, city revenues from hotel taxes weren’t included in the report, but were also expected to show increases, according to officials.
Unemployment is down to 4 percent from 5.9 percent in 2003; property tax revenues rose more than 36 percent to $298 million over the same period. Commercial real estate vacancies are at their lowest rate, 17 percent, in five years. Personal income increased to $54,807 in 2004 (the latest numbers available) compared with $52,103 in 2003, the report shows.
"There are lots of positive indicators," Adler said, but warned in the same breath that is no indication of future performance.
Total SFO passenger numbers rose only slightly, by 1.1 percent, to about 33.6 million for the fiscal year compared with a year ago, Adler said. Officials hope the scheduled launch of Virgin America Airline, to be based at SFO with offices in Burlingame, will help boost those figures in 2007.
Perhaps more troubling is that residential real estate and property values in general are starting to cool, Adler said, pointing out property taxes provide the lion’s share of the county’s $371 million in total revenue.
"It’s the sweet and sour of all businesses," Adler said.