City, fire district may merge
Talks continue on possible consolidation, property tax
The city of Steamboat Springs and the Steamboat Springs Rural Fire Protection District are continuing talks on consolidation, which would most likely mean a property tax to city residents.
City Manager Paul Hughes said the Fire and EMS Oversight Committee is developing a timeline for consolidation. The two entities plan to meet Feb. 8 to further discuss the possibility of a joint governmental entity, which would have its own elections and oversee more than 400 square miles.
“The idea originally came from the district many years ago,” Hughes said. “It makes sense to everybody to talk about consolidation.”
The two entities met more than a year ago to discuss consolidation and some council members said they were not ready to ask voters in 2004 to approve a property tax for fire and ambulance services after voters turned similar proposals down in 2002 and 2003.
The city and district already operate under an intergovernmental agreement for shared services, but consolidation would most likely require a city property tax, which would mean a more stable source of funding.
City Council President Paul Strong, who used to be on the oversight committee, said the two entities have been talking about consolidation for years. He said he would support a consolidated district that would be funded through a revenue-neutral swap, in other words getting rid of a portion of sales tax for a property tax, with net revenues to the city staying the same.
“It’s revenue neutral to government, but certainly not revenue neutral to taxpayers,” Strong said.
Because of the state’s Gallagher Amendment, business owners would share a greater burden of the property tax and residents would pay less, he said.
But Hughes said the Tax Policy Advisory Board’s recent review of the city’s overall taxing structure showed swapping sales tax for property tax was not recommended.
“What you hear from the Tax Policy Advisory Board is it couldn’t find a reasonable way to add a property tax and reduce sales tax. It couldn’t find a sales tax to reduce that wouldn’t cost a lot of money,” Hughes said.
One of the major questions in consolidation is whether a mill levy would be applied evenly for those in and out of the city. If so, the rural fire protection district could see its property taxes go down, Hughes said.
Another option is for the city and the district to stick to the current formula, which uses population and the number of calls each area receives to determine assessments. The city pays roughly 70 percent of the operating costs, and the district pays 30 percent.
The city will have to look at the future growth of the area in hashing out the terms of the consolidation. Hughes said the growth is going to be substantially greater outside the city than inside the city in the coming years, which could change the existing formula.
Hughes said it could take more than a year to solidify the consolidation. It would take a vote of the people in the city and Rural Fire Protection District to establish the district and set up a property tax. More time for education is needed, Hughes said.
Besides the property tax issues, other questions remain, Strong said, such as how to account for assets between the two entities if a consolidation were to occur and how the board would be structured.
— To reach Christine Metz call 871-4229
or e-mail email@example.com
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