August tourism drop highlights Chelan’s economic vulnerability

CHELAN — A sharp drop in Lake Chelan visitation during August is underscoring city officials’ push to build a more diversified, year-round economy less vulnerable to tourism swings.

Mayor Erin McCardle told the City Council and Planning Commission Sept. 8 that Placer data comparing August 2026 with August 2025 showed out-of-market visitation down 47%.

“Out-of-market visitors was down 47%. Our visits were down 47%,” McCardle said. “And when you have that in our second highest revenue generating level, that’s a little concerning.”

The figures came as Community Development Director John Ajax presented the economic development chapter of Chelan’s proposed comprehensive plan update, which calls for the city to continue supporting tourism while broadening the economy around other industries and year-round employment.

Tourism remains one of Chelan’s core economic drivers. The draft chapter says it generates more than half of local sales-tax revenue, with most visitor activity concentrated in a short summer season that creates significant swings in employment, revenue and infrastructure demand. About 40% of primary jobs are tied to the broader visitor and property economy, including lodging, food service, retail, real estate and arts and entertainment.

At the same time, the city says its economy has become increasingly exposed to another volatile sector: construction, which has grown to account for a larger share of taxable sales than tourism itself.

Ajax said the economic development plan is organized around four broad themes, including greater regional coordination, diversifying around local assets, addressing workforce and housing pressures and protecting Lake Chelan and the community’s long-term resilience.

He pointed to possibilities including economic activity connected to the hospital, agricultural technology and an airport trades district developed in partnership with the Port of Chelan Douglas County.

The goal, Ajax said, is “having a more diversified economy so we’re not so dependent on tourism but at the same time recognizing that tourism really is our major economy driver right now and finding that balance.”

The draft economic development chapter describes that balance similarly, saying tourism remains central but that the year-round local economy and permanent community should receive equal weight in city decisions. Its strategy includes industry diversification, workforce and housing needs, regional partnerships and protection of the lake and community character.

The August downturn also carried into some city-operated facilities, although Labor Day weekend showed a mixed picture.

Parks and Recreation Director Audrey Cooper said the Lake Chelan Municipal Golf Course recorded 629 rounds over the four-day Labor Day weekend. That was slightly fewer rounds than during the comparable period last year, but revenue was approximately the same, meaning revenue per round increased.

The Lakeshore RV Park averaged 74% occupancy during the four days, while marina occupancy averaged 34%. The putting course recorded about 600 rounds, 40% of them played by youth.

Parking provided a much starker comparison.

Revenue from the city’s 3K parking lot was just over $10,000 during the four-day holiday period, compared with $36,000 during the same period last year.

“So utilization was definitely really low, while we certainly had a lot of capacity in the parking lot,” Cooper said.

She described Labor Day as an improvement from the month before.

“After a really rough August, it was nice to see Labor Day weekend performing a little more normally than what we’ve seen from previous years,” Cooper said.

Councilmember Tim Hollingsworth also connected the difficult month to the city’s finances.

“You know, August was kind of a good reminder that the economy’s a little bit fragile, and we have to be careful on how we manage our budget, those kind of things,” Hollingsworth said.

Chelan’s draft economic plan seeks to address that vulnerability through four interconnected pillars: regional coordination and shared investment, diversification and a year-round economy, support for the local workforce and housing and long-term protection of the lake, climate resilience and community character.

Among the specific proposals are an economic dashboard and biennial report tracking jobs, housing, tourism and the durability of city revenues; development of an airport trades district; efforts to encourage living-wage jobs and a year-round tourism and events strategy.

The city has also applied for funding through the state Community Economic Revitalization Board to undertake more detailed economic development planning. Ajax said Chelan has cleared an initial hurdle in that process and appears likely to receive the grant, although he cautioned that no award is guaranteed.

He said the work would allow the city to make future economic development decisions using more detailed data and broader community outreach.

The comprehensive plan must be adopted by December under the state’s periodic update schedule. No action on the economic development chapter was requested Sept. 8.

Andrew Simpson: 509-433-7626 or andrew@ward.media