Business

Friday Harbor hits 2nd-best sales tax revenue ever, but still $1M less than 2007

According to the numbers, the Friday Harbor business community would seem, overall, to be in good shape.

But you’ll have a hard time convincing some Friday Harbor businesses of that.

The town had its second-best year in lodging and sales tax revenues in 2008 — receiving $1,027,207.41 in sales tax, $137,146.84 in lodging tax, and an additional $137,146.84 in lodging tax charged for tourism promotion.

But revenues are received two months after they are generated, which means those revenues were generated from November 2007 to October 2008. Businesses say this past November and December were sloooooowww, thanks to the recession and the December storms.

The result: Lodging tax revenues were almost on par with the previous year. But sales tax revenues, while $51,542.03 more than that collected in 2006, were $902,351.30 less than that collected in 2007.

Like the commercial vacancies that have cropped up around town, economic activity is being driven by a variety of factors.

— The economy: Marine Design, the Mullis Street manufacturer of boat railings, laid off 11 of its 14 employees before Christmas and is now making railings for homes.

“It’s pretty dead. It’s as dead as you can get almost,” said Mark Sheppard, owner of Marine Design and a neighboring business, Bakery San Juan.

“Most of the work we do is for boat manufacturers. They’re gearing up in January for spring boat sales. Last year this time, the season never took off. It went down hill from day one last year.

U.S. Marine Bayliner, which closed its plant in Arlington, was Marine Design’s largest customer. Business is slow at another large customer, Nordic Tugs. Sheppard is waiting to see what happens at the Seattle Boat Show, Jan. 23 to Feb. 1 at Lake Union. But he’s not very confident that this year’s boating season will be more vibrant than last year.

He consolidated his shop space and is making the south end of his shop — about 2,100 square feet — available for lease. Call 378-6598.

— Not the economy: Friday Harbor Yachts, the long-time waterfront yacht brokerage, is scaling back.

“We just shut down our space on Spring Street and gave up our spaces at Spring Street Landing, but we’ve kept some commercial slips on the main dock,” owner Skip McPadden said. “It’s definitely not economy related. I can afford to have it even if it doesn’t make money. It was because of internal issues. It’s just not fun right now.”

However, McPadden — who owns McPadden Employee Benefits in California and whose wife owns Dominique’s Clothing in Friday Harbor — admitted the number of boat listings is up while sales is down.

— The economy: San Juan County home prices, new listings and pending sales dropped while the number of homes on the market increased last month, according to the Northwest Multiple Listing Service, which tracks real estate data in 19 Western Washington counties.

There were 21 new listings in December, only seven pending sales and nine closed sales. There were a total of 376 homes on the market, up from 298 in December 2007. That’s a 26.17 percent increase.

The median home price was $455,000, down from $835,750 in December the prior year; the latter number was undoubtedly skewed by a million-dollar home sale, but the 45.56 percent drop is still telling. In the Northwest MLS region, pending sales slid 17.6 percent compared to the same month a year ago and prices were down 9 percent.

— Not the economy: Island Museum of Art has moved from the former Spring Tree Restaurant because its offer of free rent has expired. In addition, the IMA’s parent organization, San Juan Islands Museum of Art and Sculpture Park, is raising money for a permanent location with the goal of operating an accredited art museum. The organization also operates Westcott Bay Sculpture Park.

The IMA occupied the site, about 800 square feet, for about three years. Owner Cloud Oakes, who founded the San Juan Island Food Co-Op at Surina Business Park, now has the former restaurant/gallery space available for lease. Call 378-0720.

— The economy: The unemployment rate in San Juan County jumped to 5 percent in November, according to the state Employment Security Department. December’s figures weren’t released as of Friday.

Statewide, a record number of new unemployment claims were filed in December. More than 90,000 people applied for unemployment benefits, eclipsing the previous record of almost 73,000 set in December 2001. The agency has doubled its staff at the unemployment call centers and increased phone capacity to better manage the workload — and more staff are being hired as quickly as possible.

At the end of 2008, more than 136,000 Washingtonians were receiving unemployment benefits, compared to 72,910 at the end of 2007, the state Employment Security Department reported.

— Not the economy: Sweet Spot, the candy shop adjacent to the ferry landing, has closed. Owner Marilee Weber, who had advertised the business for sale as early as January 2008, has reportedly taken a job on the mainland. She could not be reached by phone.

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