A full hotel in Aspen/Snowmass doesn't mean what it used to.

Free nights, lowered room rates and the sorts of discount promotions that have become the norm as the resort strives to attract guests during a recession have degraded the bottom line in a key sector of the economy — tourist accommodations.

The occupancy rate at local hotels, lodges and condos has long been a telling economic indicator, and will remain so, but a new factor must now be taken into consideration — the average daily rate.

Average occupancy for the month of January was about 68 percent — just 1.6 percent down from the same month a year ago. The average daily rate, or ADR, however, was down 6.4 percent, according to Bill Tomcich, president of local reservations agency Stay Aspen Snowmass. The ADR is a reflection of what lodging properties are charging, and a 6.4 percent drop is significant, he said.

“People were here for the most part, but they spent less to stay here,” Tomcich said.

The resort should expect more of the same in February and March, Tomcich told the Aspen Chamber Resort Association board of directors on Tuesday.

If the resort's occupancy rates hold steady, or even climb a bit, the lodging sector will still bring in noticeably less revenue than those occupancy levels would have meant a couple of years ago. If occupancy rates are down, the impact is even greater.

“That has a huge ripple effect,” Tomcich said. “It's something that everyone has had to adapt to.”

“The trickle-down effect on something like this is enormous,” agreed Charlie Case, innkeeper at the Annabelle Inn. It translates into smaller hotel staffs and fewer dollars in the pockets of bellhops and front-desk clerks, not to mention a drop in the sales tax revenues that fund everything from Aspen's free buses to its street plowing.

Tourist accommodations are the single largest segment of the retail economy, making up 26 percent of total sales in 2009.

Local governments, trying to gauge sales tax revenues, are grappling with a new reality.

“The occupancy report doesn't mean what it used to mean,” said Hilary Fletcher, Pitkin County manager, during a recent discussion of the county's financial outlook with county commissioners.

On the front lines, it doesn't mean what it used to mean for lodging operators, either.

“There has been discounting across the board. The average rate is much lower,” said Daniel Delano, co-owner of the Hotel Lenado. “That means you're hurting if you're in the hotel business.”

Lowering rates and cutting deals are what it takes to remain competitive in a down economy, say local hoteliers.

“You just have to if you want to stay in the game,” said Carla Karzen, manager at Aspen Mountain Lodge. “It has been tough, dealing with the reality of it, but we have to do what we can do.”

It's virtually impossible, though, to make up for the lower rates with higher occupancy levels, both Karzen and Delano said, particularly since Aspen offseasons mean the resort can't rely on year-round business.

“Your occupancy can only go up so high here. Sixty percent is good, year-round,” Delano said.

“It's a vicious cycle, and it's not good for the resort overall,” he said.

To tourists, the ramifications of a lower ADR are probably most noticeable in terms of guest services, said Case of the Annabelle Inn, where the rate was actually up in January and February, but was down significantly last year.

The lodging industry is employing fewer people to take care of visitors, according to Case, but the guests may not mind.

“I think the guests are happy with the tradeoff,” he said. “They'd much rather get what they're getting, which is low prices.”

janet@aspentimes.com