Predictions about the economy are a little like a weather forecast or experts telling us when the Big One will hit California — interesting, to be sure, but not necessarily the gospel.

Actually, weather forecasts have become a lot more reliable because of technology, weather satellites’ tireless diligence and exhaustive computer modeling.

The same could be said, at least partially, about economic forecasting, minus the weather-satellite factor. Still, predicting what the future will deliver to the economy is wildly unpredictable, but the experts do it anyway.

Thus, the sizable turnout recently at the Alisal Guest Ranch for the North Santa Barbara County Midyear Report, presented by the UCSB Economic Forecast Project. The featured guests were city managers from the four North County cities and a county government honcho.

What these experts had to say was mostly optimistic, with a sprinkling of challenges facing specific areas, plus a rather pointed prediction by Economic Forecast Project Executive Director Peter Rupert.

The bottom line is that things look pretty good at the moment, but Rupert all but promised a recession in the future. He wouldn’t be pinned down on exactly when the economic downturn will happen, only that it will happen.

What makes the prediction safe is that, historically, the nation’s economy is very gravity-specific, in that what goes up must come down. It is inevitable, and Rupert’s message at the Economic Forecast meeting was for municipal managers to prepare for the inevitable.

Segments of the report that spoke directly to our region concern the economies of Solvang and Buellton, which because of proximity and continued growth are fast becoming the mid-county’s Twin Cities.

Solvang’s interim City Manager Rick Haydon, who recently retired from the same position in Santa Maria after leading that city through some rough economic times, reported that with Solvang getting more than half its revenue from tourism, the city must find ways to make the local economy more robust during the weekdays.

The town’s shops, hotels and restaurants — and parking spaces — are mostly filled on weekends, but those in-between days are what the city’s leaders need to work on. A big part of the city’s revenue stream comes from the bed tax, so keeping hotels full is critically important.

And because the city’s fiscal health depends on tourism, which requires an abundance of lower-wage workers, another challenge is providing housing for those workers. We’ve considered a lot of options regarding affordable housing, and none are suitable for this area.

Haydon’s bottom line — “As long as tourism is up, Solvang will be up.”

Buellton City Manager Marc Bierdzinski had a generally rosy report, in part because of Buellton’s smaller size and a balanced budget.

Bierdzinski said one of the city’s biggest challenges is a factor most retail-driven local economies are facing, what he termed “retail leakage,” as in online retailers taking business away from local stores, thus depriving the city of a valuable tax revenue stream.

Another looming challenge because of Buellton’s growth in recent years is the need to raise water and sewer fees for the first time since the city was incorporated in 1992.

All things considered, things look pretty good for Solvang and Buellton, as long as local policy makers heed experts’ warnings about the possibility of the overall economic cooling-off in the months ahead.

With competent elected officials and administrators in place in both Solvang and Buellton, we believe those challenges will be met, and this region will continue to be one of the very best places in California to live.


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