Occupancy Tax Data Indicates Record Summer for County

COURT HOUSE – The size of the crowds in Cape May County over the summer months, along with the reports from local businesses, signaled the Jersey Cape enjoyed a good summer, and recovery from the pandemic was closer than predicted. 
According to a county release, in spite of Covid concerns, the beaches along the Jersey Shore were the place to be, according to the latest occupancy tax data provided by the New Jersey Treasury. Cape May County generated a 20.49% increase in occupancy tax from June to August this year, versus the same period in 2019.
Cape May County experienced an overall increase of $2.24 million in occupancy tax collected from January through August 2021, which amounts to 21.10% more revenue earned in lodging over 2019. The total occupancy tax revenue generated in the first eight months of 2021 was $12,874,917.15 compared to $10,631,414.58 over the same time in 2019, a record year for Cape May County and the best comparison to determine actual growth. 
Overall, the State of New Jersey’s Tourism occupancy tax is a 5% levy charged by the State of New Jersey on hotel, motel and bed and breakfast inn room fees and serves to measure overnight stays. This data is released monthly and used to compare lodging growth or losses. The average overnight visitor spends $374 per person, per night across all sectors, including food and beverage, retail, recreation and transportation. Typically, lodging is used as the benchmark, and the other sectors adjust similarly.
Of the four beach counties in New Jersey, Cape May County was, by far, the top visitor destination between May and August, according to the occupancy tax data. The three traditional summer months of June, July and August generated more than $10.8 million in occupancy tax, and 84% of the total collected that Atlantic, Ocean, or Monmouth counties, generated during those three months and 70% of the occupancy tax collected the first eight months of 2021. To date, 41% of occupancy tax collected in 2021 across the entire state was generated by the four beach counties.
“We started the summer season concerned about the lasting impacts of the pandemic, the second summer of the U.S./Canada border being closed, and the labor shortage. We were optimistic that the county would continue to trend as a close-to-home and safe vacation destination. Our small businesses needed a good year to get them back on track after losing more than $1.5 billion in tourism direct spending in 2020. These numbers far exceeded our expectations and points to the hard work of our business owners and their staff that kept businesses operating. Cape May Country is well poised to recover from the impact of the pandemic sooner than predicted,” stated Cape May County Commissioner Director Gerald Thornton, liaison to the Cape May County Department of Tourism.
Losses in Cape May County’s lodging revenue in 2020 were regained within the first six months of 2021. Occupancy tax collection in May, June, July and August surpassed all other counties in New Jersey and exceeded the collection rate in 2019, which was a record year for Cape May County.
“In July and August, Cape May County generated more than $4 million each month in occupancy tax and outpaced all other counties in the state. This is the first time any county has reached the $4 million mark in one month since the tax was initiated, in 2005. It should be noted that this amount represents 5% of the actual room rate. Seven out of the first eight months of 2021 saw an increase in revenue over 2019,” stated Diane Wieland, Cape May County tourism director.
The tourism economic impact report will be released by the New Jersey Division of Travel and Tourism in the early part of 2022, and will include state data, as well as county-by-county spending by sector, visitation, state and local taxes, and employment statistics. The Cape May County Department of Tourism will continue to follow the data as it is released and make it available.
“Tourism is vital to our economy, supporting 60% of our jobs and generating billions of dollars in direct spending. In 2019, Cape May County hit a record $6.9 billion in expenditures; however, in 2020, the county lost more than $1.5 billion, or one in five of those dollars, to Covid shutdowns and restrictions, generating $5.4 billion in spending in 2020. While we continue to work to diversify our economy, tourism remains our number one industry, and the Board of County Commissioners is committed to supporting the tourism industry,” stated Thornton.