The languorous national economy means Provo's best income sources will falter in the next fiscal year, Mayor Lewis Billings said Tuesday.

"The economy is really changing. We're seeing some substantial slowing," Billings said. "And it could get worse."

Doing some quick calculations, Council Vice Chairman George Stewart estimated the shortfall from sales tax alone could be $900,000 or more.

"And I thought Africa was looking bad," joked Stewart, who announced last week that he will leave his post in the coming months to serve a church mission with his wife -- hopefully, he has indicated, in Africa.

But there was an ironic silver lining to the mayor's forecast: Because the dollar is weakening in the international market, causing foreigners increasingly to look on the United States as a budget vacation spot, Billings said the city's lodging tax could jump by as much as 8 percent.

"We are a cheap vacation," he said.

It's tough to gauge how much that has been happening already this year, said Charlene Christensen, director of services for the Utah Valley Convention and Visitors Bureau. She said tourism numbers have more or less been holding steady since 2007.

"For us, that's actually maybe more positive than negative, because we're able to hold the tourism industry at the same levels," she said.

The proportion of foreign tourists making stops at the Visitor's Center in Provo has actually dropped since 2007, from 8.51 percent to 7.86 percent. But, Christensen added, we're only halfway through the year and not yet done with the big summer travel season. She said if the trend continues, tourism will remain flat in the immediate future.

"Tourism definitely is driven through the other business factors," she said. "It's not going to drastically increase for another year or two."

As the home of two large universities, Utah County has the added fiscal security that some travelers will make the trip to attend school or see family, regardless of the cost, she said.

"Because of that, we aren't always in sync with the national trend," Christensen said.

Billings said Provo's Parks and Recreation Department also appears for the time being immune to economic woes and may post a 3-percent increase from fees over last year.

Others had a more optimistic view overall. Steve Densley, president of the Provo-Orem Chamber of Commerce, said the roughly 1,000 businesses that are members of his group have been able to weather the storm so far.

"We've been really, really fortunate here in Utah County," he said. "We haven't seen too many of them hurt so far."

The county and state have held a reputation for the past few years of being at least partially insulated from negative economic forces outside the state, keeping job growth and home appreciation numbers well above the national average. With an anticipated 80,000 to 100,000 people moving to Utah this year, Densley said he's confident the population growth will fuel the economy and kick-start the sleepy housing market.

"Those guys have got to live someplace," he said. "I think you'll see some real positives in the housing market."

Densley also said falling gas prices, which have given up 8 cents in Provo over the past month, will inspire consumer confidence and nudge people back out in the marketplace.

"With gas prices seemingly starting to look downward, I think you're going to see people easing up a little bit," he said.

All things considered, Densley predicted that Provo will fight out of the economic slowdown and return to normalcy by mid-2009, if not sooner.

"I think by midyear next year, we're going to see a big turnaround in things," he said. "We're always a lot better than the rest of the nation here in Utah."

• Ace Stryker can be reached at 344-2556 or at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it