Facing falling tax revenues, new limits on how it can spend tourism funds and several unplanned expenses, the Grand County Commission on July 15 approved a midyear budget amendment that draws about $1.86 million from the general fund to balance its 2025 budget.
The 6-1 vote followed a public hearing and multiple workshops, as commissioners worked to close a growing budget shortfall. The transfer addresses both reduced revenue and program expenses that can no longer be funded through the transient room tax (TRT) under stricter state interpretation.
“The reality of it is we’re in this situation right now because of a huge shortfall, and we can all hope that the economy turns around in the next six months, but we’re not done,” said Commission Chair Bill Winfield. “… This is the entire county [suffering], and we’re going to have to look at everybody’s budget for next year.”
Tax revenue down more than 6%, TRT rules change
As of April, the most recent available tax data, Grand County’s overall tax revenue was 6.1% below its original 2025 budget estimates.
At a July 1 budget workshop, the commission opted to assume the 6% decline would continue through December instead of relying on more optimistic projections based on a three-year average – a method often used to smooth out fluctuations.
According to county data, tax revenues have fallen by an average of 1.3% per year since 2022. Transient room tax (TRT) collections — the county’s largest source of tourism-related revenue — are down 2.9% compared to the same period last year and have dropped 3.3% annually on average. For 2025, TRT revenue is down 9.2% compared to what was originally projected as of April tax data.
Sales tax revenues are underperforming this year and, if current trends continue through December, the county projects a shortfall of about $515,000 compared to original budget estimates. OHV-related tax revenue is also expected to come in below projections.
Only the restaurant tax — which makes up a smaller share of overall tax revenue — has modestly improved, outperforming original projections by about $24,000.
“In our budget to actual variance, we’ve been under the whole [year],” Budget Officer Steven Vowles told the commission during the July 1 budget workshop. “We have not performed even up to our estimation.”
The county’s original 2025 budget projected 0.5% growth in total tax revenues.
The amendment lowers Grand County’s projected TRT mitigation revenue for 2025 from $5.08 million to $4.52 million — a reduction of nearly $560,000.
The shortfall reflects both lower TRT and sales tax collections and changes under House Bill 456, which took effect July 1. The new law requires counties to spend the first 2% of their TRT collections on “establishing and promoting” tourism. That change reduces how much money can be allocated to mitigation, tightening the county’s spending flexibility.
That change, combined with renewed scrutiny from the Utah State Auditor’s Office, prompted Grand County to reclassify some tourism-related expenses. As a result, the county determined that Grand County Active Transportation and Trails (GCATT) responsible recreation efforts — including its Trail Ambassador program, which provides visitor education, trail etiquette guidance, safety tips and cleanup at high-use trailheads — were not an eligible use of TRT.
In efforts to generate more revenue, the commission previously voted to increase the TRT county rate from 4.25% to 4.5% under HB456, but due to state notification requirements, the higher rate will not take effect until October.
General fund absorbs tax decline
To close the budget shortfall, commissioners approved transferring $1,857,464 from the general fund, the county’s primary source of flexible funding. At the time of the vote, the fund held about $10 million in reserves.
Roughly $1.43 million of the transfer went toward covering projected tax revenue shortfalls and expenses no longer eligible for TRT funding:
– The county allocated $564,418 to the TRT Mitigation Fund to comply with new caps on allowable spending under HB456, which reduced how much can be used for tourism mitigation. The allocation also accounts for lower-than-expected TRT collections.
– Commissioners directed $120,870 to the Tourism, Recreation, Cultural and Convention (TRCC) Fund to offset projected shortfalls in TRCC sales tax revenue, which typically supports parks, museums, and other public tourism-related facilities.
– A total of $340,791 was used to sustain GCATT’s responsible recreation programming, including trail ambassador staffing, at a reduced level through the end of 2025.
– Another $404,172 addressed the anticipated gap in sales tax revenue based on underperformance through May and revised year-end projections.
The remaining portion of the transfer — about $427,000 — covered other unplanned general fund obligations:
– The county had previously approved $350,000 to assist Grand County Emergency Medical Services, which continues to face financial strain from rising personnel costs and inconsistent billing revenue.
– A total of $33,986 went toward recruitment and human resources services to help fill vacant positions.
– An additional $18,365 covered a state-mandated increase in retirement contributions for law enforcement employees.
To soften the impact on reserves, county staff identified $958,871 in anticipated savings from ongoing staff vacancies and salary-related underspending. As of July 17, the county was actively hiring for 10 positions, according to its website.
Commissioners warn of future cuts
Several Grand County commissioners said the $1.86 million general fund transfer approved Tuesday offers only a temporary fix to the county’s structural deficit.
“We are spending way more than we know is going to be coming in,” said Commissioner Brian Martinez. “These cuts are going to have to be made.”
Commissioner Mike McCurdy said the county must begin preparing now for leaner operations in 2026. “Next year is going to be a kick in the teeth,” he said.
Commissioner Jacques Hadler, who made the motion to approve the amendment, said he would have preferred to fund GCATT at a higher level, but appreciated the other commissioner’s willingness to compromise.
Commissioner Mary McGann cast the lone dissenting vote, expressing hope that tax revenues could rebound throughout the remainder of the year.
Winfield said the compromise helped extend key programs through the end of the year, but warned more reductions are likely in the future.
“We have to budget based off of a reduction in staff in the future, if the economy doesn’t correct itself,” he said.
Editor’s note: This story was to correct that the most recently available tax data is April. It was also updated to include that Grand County TRT revenues are down by 9.2% in 2025 compared to what was originally projected.