Government shutdown hits Keystone hard

2013-10-14T05:30:00Z 2013-10-14T17:33:07Z Government shutdown hits Keystone hardDaniel Simmons-Ritchie Journal staff Rapid City Journal
October 14, 2013 5:30 am  • 

If it had been any other month, Keystone would have made a killing.

Even in cool months like October, millions of dollars are poured into this town of 300 by tourists who swing by on their way to Mount Rushmore.

But during these past two weeks the nation has faced the first partial government shutdown in 17 years, closing Mount Rushmore along with national parks across the country. And the money faucet turned off for one of the Black Hills' most well-known tourist towns.

While the monument will reopen today, thanks to a deal struck between South Dakota and the federal government, those 14 days of closure were still a substantial blow for the local economy.

Tammy Gilbertson, managing partner of the Battle Creek Lodge, said that the town is still calculating the long-term impact of the closure.

In the first week alone, she said, 10 bookings had been canceled at her other site, the Brookside Motel, which has a total of 30 rooms.

“Which is huge for a property our size,” she said. “That’s very, very significant.”

While Keystone tends to close most of its hotels, restaurants and tourist attractions at the end of October, it is still a crucial month for the community. After earning enough revenue in the summer to cover most of their fixed costs, fall is when the town's businesses make most of their profits.

“It’s kind of a season that we use to, quote-unquote, cushion us through the winter,” she said.

In order to cut costs, Gilbertson was forced to shift an on-site manager from full-time to part-time work.

Other businesses made similar evaluations. Either cutting staff hours or considering whether to close before the end of October.

Brandi Hunsaker, owner of The Ruby House, a restaurant in Keystone, said the problem is that such cutbacks affect the town’s economy: employees have less money and therefore have less to spend in bars, restaurants and other businesses.

“It’s a trickle-down effect," she said. "Not only does it affect me; it affects my wait staff; it affects the whole community when we don’t have business.”

In the first week, she said, two tour buses canceled tours — each would have brought 40 visitors that would have eaten at Hunsaker’s restaurant.

But the economic impact is likely to be far bigger for Keystone.

Sandi McLain, president of the Keystone board of trustees, said that unlike other cities in South Dakota, Keystone funds its city infrastructure solely from sales tax revenue rather than property taxes.

McLain said that makes Keystone’s finances uniquely vulnerable to sudden fluctuations in tourist traffic.

“It can affect the economy and the sales tax dollars coming in,” she said.

At this point, McLain said, it remains to be seen how badly Keystone’s finances will be hit.

Nort Johnson, president of the Black Hills, Badlands, Lakes Association, said that while Keystone might be most immediately impacted by the closure of Mount Rushmore, the impact would be felt in the entire Black Hills.

Johnson said that in a typical October, 94,000 people visit Mount Rushmore, spending about $700,000 a day.

“Now, if you extrapolate that, that’s a $21 million loss of revenue to the Black Hills if each of those people don’t come,” he said.

While Johnson said that was a worst-case scenario, even a small hit such as 20 percent fewer visitors than normal, would still have a big impact.

Johnson said that doesn’t even include visitors who have cancelled visits because they can’t come to other national parks in the area: like the Badlands, Wind Cave and Jewel Cave.

If those impacts are difficult for non-locals to imagine, they still remain difficult for those who call Keystone home.

“I think everybody underestimates the impact of this,” Gilberston said. “Even up to the time it happened, I don’t think we really believed it would happen.”

[Editor's note: This story has been updated to reflect a deal struck on Friday between South Dakota and the federal government to reopen Mount Rushmore.]

Copyright 2015 Rapid City Journal. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(8) Comments

  1. Buldog
    Report Abuse
    Buldog - October 16, 2013 6:53 am
    @ sulley--I will copy and paste a comment from another journal article that really does hit the nail on the head.

    Roger Cornelius - 13 hours ago
    Only in America is it acceptable for the government to pay for dead cows and not health insurance for the sick and dying human beings.
  2. Frankly
    Report Abuse
    Frankly - October 14, 2013 9:09 pm
    Turn off the Faux news, folks. Republicans are responsible for the government shut down. I would explain but it won't do any good; there will be no changing your mind. Just let Hannity & Limbaugh tell you what to think.
  3. Sulley
    Report Abuse
    Sulley - October 14, 2013 5:48 pm
    Our states representives are funding the Mount Rushmore Memorial instead of helping out the ranchers who lost livestock during the blizzard. I guess tourist dollars are more important than the citizens who voted for the politicians who can't even pass a farm bill.
  4. Rhudedog
    Report Abuse
    Rhudedog - October 14, 2013 12:33 pm
    Obama is the one who controls what shuts down remember. The House Republicans are the ones who sent bills in to keep all our national monument opens during this time but it is the Democrats won't pass them. The shutdown drama is largely a media event and the struggle to control public perception
  5. Jonnnnn
    Report Abuse
    Jonnnnn - October 14, 2013 8:46 am
    SE, it appears that most of the Keystone business folks are receiving the government for which they voted as Noem and Thune are part and parcel to the government shutdown.
  6. soopysayles
    Report Abuse
    soopysayles - October 14, 2013 7:58 am
    vote everyone out of office, democrats and republicans, that is the only way, you know have the government interfering with everyones way of life and income. Wait till the effects of obamcare hits every business.
  7. StopProgStop
    Report Abuse
    StopProgStop - October 14, 2013 7:37 am
    Troll
  8. ScreamingEagle
    Report Abuse
    ScreamingEagle - October 14, 2013 6:11 am
    You can thank our President, if you live on entitlements you will be fine. If you get up everyday and go to work you may be suffering. Can we survive 3 more years of this guy?
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