City wants public input for how to repurpose accommodations tax revenue

Rich Levy uses the Yampa River Core Trail on Monday afternoon to commute to work after an afternoon of skiing. The 1986 accommodations tax ballot language allows the tax's revenue to be used for improving and developing certain city amenities and can be used for projects such as expanding the Core Trail, but can't be used to maintain existing amenities.
John F. Russell/Steamboat Pilot & Today

Back in 1986, voters in Steamboat Springs approved a 1% accommodations tax on all lodging transactions for stays less than 30 days, and on Tuesday, Dec. 13, City Council discussed asking voters whether to repurpose the tax’s revenue starting in 2024.

The tax’s revenue is restricted toward “development of improvements and amenities in Steamboat Springs,” to increase tourism and enhance “the community identity, environmental desirability and economic health of Steamboat Springs,” according to the ballot language, which says the tax revenue should “enhance the vitality of Steamboat Springs as a premiere destination resort.”

“We as a city are kind of past that,” said council member Joella West. 

The city’s priorities have shifted since 1986 and defining Steamboat as a “destination” has lost favor, evident by City Council’s decision to cut funding for destination marketing through the Steamboat Chamber, while putting money toward the Routt County Economic Development Partnership, which hopes to diversify the local economy in sectors beyond hospitality and tourism. 

“I absolutely hate the 1986 language,” said West, who served on the accommodations tax reserve committee. 

“I tore my hair out as we went through all of the proposals that came in for ways that we could possibly spend the city’s money to try to figure out what fit into this language and what didn’t,” West said. 

The accommodations tax is expected to yield about $1.8 million in 2023, which will be the final year that $660,000 of the tax’s revenue is restricted to developing multi-use trails, purchasing park land on Yampa Street and improving Haymaker Golf Course. Voters passed the accommodations tax restriction in 2013 with a 10-year expiration date. 

The City’s Finance Director Kim Weber presented different options for revising the 1986 language. She presented the results of a question in the 2022 Community Survey that showed 90% of respondents support using accommodations tax revenue for maintaining existing city amenities used by tourists and residents, such as parks, trails and recreational facilities.

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According to that same survey, 77% of respondents supported using the money to acquire new open space and parks, while affordable housing, childcare, transit and keeping the tax restrictions as-is all scored in the 63% range of support.

Only 10% of respondents supported funding destination marketing with the accommodations tax revenue.

The council members suggested putting “and maintenance” into to the 1986 language, saying the simple amendment would give the city the ability to maintain existing amenities as described in the survey.

“I think had they known that we would have built so dang much, they would have put (maintenance) in there,” council member Michael Buccino said, referring to the authors of the 1986 ballot language. 

But council member Dakotah McGinlay wanted to remain open to the other topics such as childcare and funding sustainability projects that align with the city’s Climate Action Plan. 

Council member Heather Sloop replied saying they should at least take a stab at something specific and adjust based on community feedback, and said the survey results are compelling. 

“We’ve heard the community loud and clear,” Sloop said. “I mean, 90% of them say maintenance.”

McGinlay pointed out that there wasn’t a Climate Action Plan option on the survey, but council member Michael Buccino was skeptical about whether sustainability projects aligned with the spirit of the accommodations tax. 

“(The revenue) is coming from lodging and it needs to go to the tourism that connects it,” Buccino said. 

“I see a nexus with environmental tourism,” McGinlay replied. 

The city expects Tuesday’s discussion to continue for several months and wants public input. The council members directed the city’s staff to lay out the different options for public comment. They said they want to prepare the new ballot question by July to give some headroom before the September deadline for certifying the language for November’s ballot. 

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