City Council recall effort abandoned as group shifts focus to defeating STR tax

The Steamboat Springs Community Preservation Alliance has reconsidered its effort to recall City Council members Heather Sloop, Dakotah McGinlay and Joella West and decided against gathering signatures.

“It’s nice that the community can breathe and know who their representatives are,” said Sloop.

The preservation alliance was seeking a recall because of a recently passed overlay zone, which puts restrictions on the number of short-term rentals based on the area of town, and the short-term rental tax ballot question.

The recall effort was reevaluated because of “limited financial resources,” according to a Thursday, Sept. 1, news release. Instead, the alliance is refocusing its resources to campaign against the 9% short-term rental tax that will appear on November’s ballot.

“They are now focused only on a campaign to educate the public and business community on the potential implications of adding a 9% tax on STRs to the existing taxes of 11.4%, bringing the lodging tax on STRs to 20.4%,” the release states.

The preservation alliance is contending the short-term rental tax would make Steamboat Springs one of the most expensive places to visit in the country, and lower occupancy rates would negatively impact local restaurants and shops, which could potentially be exacerbated by a recession.

“The recent 30% fall in July occupancy against 2019 numbers serves to highlight that the slowdown is happening already, and this tax will only make things worse for years to come,” the release warns. 

With a green bar showing the current tax rate, and the red bar showing the potential tax rate, the SSCPA made a chart comparing tax rates on short-term rental among mountain communities in Colorado, Sept. 1, 2022.
Steamboat Springs CommunityPreservation Alliance/Courtesy photo

The short-term rental tax would expire after 20 years, and city officials estimate the first year would yield around $14 million in tax revenue. City Council could lower the tax at any time by passing an ordinance but wouldn’t have the authority to raise it past 9%. 

Robin Craigen, vice president of the Steamboat Springs Community Preservation Alliance, said they have been having a lot of one-to-one conversations with stakeholders and residents, and plan to develop a larger campaign that could involve public forums.

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The short-term rental tax was written to fund affordable and attainable housing projects such as the Brown Ranch development by the Yampa Valley Housing Authority — a 20-year project estimated to cost $400 million that could add close to 2,300 housing units to the city’s inventory.

The alliance doesn’t believe the city received adequate community buy-in for Brown Ranch. Craigen said the alliance isn’t necessarily trying to defeat the Brown Ranch project, but believes more work needs to be done before committing to it.

“A new tax of this magnitude for 20 years is risky in light of current market conditions,” Dan Merritts, president of the alliance, said in the release. “And we don’t even know what the Brown Ranch will deliver. The emerging scale of the development is concerning, with the potential to double the population of Steamboat with housing for 6,000-8,000 new residents.”

Merritts continued by saying that the construction workers building Brown Ranch would also need somewhere to live, and the new schools and business park included in the Brown Ranch plans would create new jobs and generate more demand for housing while adding traffic and congestion.

The short-term rental tax would also be used to help fund energy, stormwater, water, wastewater and multi-modal transportation infrastructure that would accompany housing projects such as Brown Ranch.

All three City Council members at the focus of the recall effort expressed relief and said they look forward to seeing how the community votes this November. 

“My priorities are to refocus,” McGinlay said. “This recall was a bit of a distraction.” 

McGinlay said she appreciated that the alliance communicated its decision to reconsider the recall instead of letting the issue linger without updates. 

“I think it’s fair to say council expected a vigorous campaign against the STR tax,” said West. “I look forward to what I hope is a really honest discussion on both sides.”  

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