During a recent Sedona City Council meeting, local officials addressed growing concerns about the economic slowdown impacting businesses in the area. Council members reported feedback from over 20 businesses, revealing that many experienced a challenging May, with June showing little improvement.

Sales tax collections in May increased by 1%, but bed tax revenue saw a significant decline of 10%, leading to an overall drop of 1.6% in total revenue. While short-term rental (STR) revenue appeared to offset some losses from hotels, officials cautioned that this figure may be misleading. The revenue from STRs could be inflated due to owners blocking out nights for personal use, which does not reflect actual bookings.

The data indicated a 4.3% decrease in room bookings in June compared to the previous year, suggesting fewer visitors and reduced foot traffic for local businesses. Traffic data also showed a decline, with over 25,000 fewer cars recorded in June 2025 compared to June 2024.

Looking ahead, booking trends for August appear more promising, although officials noted that the temporary closure of the Poco Diablo hotel might be influencing these numbers. As guests from Poco Diablo seek accommodations elsewhere, there is concern that the booking pace may be artificially high due to this shift.

The council emphasized the importance of monitoring these trends closely, as they directly affect the local economy and the vitality of Sedona's business community. As the city navigates these challenges, officials remain committed to supporting local businesses and fostering a resilient economic environment.