Lake Geneva, Wisconsin hotels got hammered in 2009, with a drop in room revenue of 45%. Statewide hotel revenue per available room was down 15%
According to the just released 2010 budget, room tax revenue for the city of Lake Geneva was $511K in 2008 and projected to be only $280K for the rest of 2009; a drop of 45%. The Village of Fontana saw a drop in room tax revenue of 33%; $345K in 2008 compared to $230K in 2009.
Statewide the latest figures from the Wisconsin Innkeepers Association show a drop of 15.1% in revenue per available room. The Wisconsin Innkeepers Association is a non-profit trade association consisting of approximately 1,000 hotels, motels, resorts, inns and bed &breakfasts around Wisconsin. The data show southern Wisconsin had a drop of only 9.9%.
The Lake Geneva area has a very high concentration of hotel condominiums. The Wall Street Journal reported that “the condo hotel may go down as the Pets.com of the real-estate bubble.”
“It’s time to recognize that things have changed and that they will continue to change for the next – yes, the next 10 years and maybe even the next 20 years. We are heading into what we call the New Normal, which is a period of time in which economies grow very slowly as opposed to growing like weeds, the way children do; in which profits are relatively static; in which the government plays a significant role in terms of deficits and reregulation and control of the economy; in which the consumer stops shopping until he drops and begins, as they do in Japan (to be a little ghoulish), starts saving to the grave.”
Despite the slide in room tax revenue to the City of Lake Geneva, local taxpayers have increased the amount of tax money going to the Lake Geneva Convention and Visitors Bureau (LGCVB). In 2007 taxpayers paid them (with no strings attached) $80K; in 2008 they were paid $90K, and in 2009 they got $95K of taxpayer money. The LGCVB is budgeted to get $95K in 2010. Contrast this with the amount of money going to support the YMCA athletic program, which will receive a slight increase; $45.4K in 2007 vs. $45.8K in 2010.
***Special Note from the editor: The photo for this article was selected to portray the slowdown in construction in Lake Geneva, Wisconsin. It was not selected to portray city staff in a bad light . Considering some of the border line psychopaths that are elected to office in LG they do a remarkable job.*****