For the first time in four years, primary economic indicators show La Plata County’s economy is slowing.

The economic deterioration started early this year with home sales and permits for residential construction lagging, said Roger Zalneraitis, executive director of the La Plata County Economic Development Alliance.

In the spring, tourism numbers dropped below last year and that was followed by declines in sales tax collections in April and May.

In March, the number of people boarding planes started to fall behind last year and that was followed by a slight decline in train ridership, Alliance data shows.

But it may be a slowdown in the pace of growth, rather than the beginning of declines, Zalneraitis said.

“I do think we can turn around in the summer. I am not convinced this is the beginning of a recession,” he said.

Sales tax collections were down by 1.5 percent in May, dropping to $1.17 million from $1.19 million during the same month in 2015. In April, collections were down 1.1 percent.

The central business district saw an 8.1 percent decline in sales taxes in May, said Tim Walsworth, executive director of the Business Improvement District.

The restaurant and tavern sector was hit the hardest, with a 14 percent decline.

Large percentage declines are so uncharacteristic that Walsworth suspects some businesses may not have filed their sales taxes on time.

“It’s making this look really alarming,” he said.

The restaurant owners he has spoken with have not seen major declines, so he expects tax collections will bounce back.

Hydi Verduzco, co-owner of East by SouthWest, a sushi restaurant downtown, noticed a slower May and June, even though the streets were full. But after July 4, the trend reversed and her restaurant business picked up.

“It’s like somebody flipped a switch,” she said.

July is typically the peak of the summer tourist season, she said.

Declines in the oil and gas industry, especially near Farmington, could be part of the slowdown because residents with high incomes are likely to come to Durango to shop, Zalneraitis said.

“We have been wondering for a year if the oil and gas slowdown was going to hit Durango,” he said.

Durango is facing other long-term economic challenges, unrelated to Farmington.

Despite help wanted signs across town, the percentage of people working in the county has remained largely stagnant for 10 years, Zalneraitis said.

At the same time, the number of people driving into La Plata County for work has risen.

This is largely tied to the price and availability of housing. The highest demand for housing is the $200,000 to $400,000 range, he said. But the average home price in May was $405,235.

Since February, the number of home sales have been lower than last year.

When people choose to drive to La Plata County, this takes away from the sales tax base as a whole. Although, it is likely not responsible for recent dips.

Even though the economy has shown some signs of slowing, Zalneraitis backs increases in property taxes to support Durango School District 9-R, La Plata County roads and bridges and the Durango-La Plata County Airport.

These are all property tax increases that will be in place through both good and bad economic times. Showing commitment to infrastructure improvement can build the private sector’s confidence in the area, he said.

“We still need to protect and develop our infrastructure,” he said.

mshinn@durangoherald.com