Steamboat council considering ballot measure to reallocate excess 2A trails funds to support maintenance, marketing or air
March 13, 2019
Editor’s note: This story was updated at 3:45 Thursday to clarify the city’s funding of the Mad Rabbit project.
STEAMBOAT SPRINGS — Voters in Steamboat Springs could see another ballot measure related to the city's accommodations tax, frequently called the 2A tax after the 2013 referendum that designated revenue would be used for trails.
If an accommodations tax question is placed on the ballot again, Steamboat Springs City Council members hope to address maintenance and enforcement issues related to the amenities created from the tax revenue, including Haymaker Golf Course and several area trails.
Council was also interested in hearing a presentation from the Steamboat Springs Chamber, which would like to see 2A funds used to market the city and attract more commercial flights to Yampa Valley Regional Airport.
A new ballot measure would likely impact the 1986 ballot language, which designates that revenue from the 1 percent lodging tax “fund development of improvements and amenities in Steamboat Springs which will promote tourism and enhance the vitality” of the city. Council members asked for input from the city attorney on how or if an amendment to the 1986 language would impact what was approved by voters in 2013.
Only one council member, Lisel Petis, expressed interest in revisiting 2013 ballot language.
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These ideas were tossed around in a City Council work session Tuesday night and will be the subject of another work session, which will be held at a later date.
The work session was focused on determining where to allocate "excess" funds from the accommodations tax that are not designated for specific purposes.
Council members ultimately decided to spend this money at the council’s discretion. Some council members expressed interest in funding city projects with the money.
Possible projects include a new chairlift on Howelsen Hill or an extension to the Yampa River Core Trail. Additional projects proposed by community organizations in public comment included a second sheet of ice at Howelsen Ice Arena, further funding to support the expansion at Old Town Hot Springs, additional pickleball courts and new bunkers at Haymaker Golf Course.
The city has not funded construction of Mad Rabbit trails, an accommodations tax funded project. The city has funded the Mad Rabbit National Environmental Policy Act planning process. Staff noted that the accommodations tax funding recommendation for 2019 includes money to continue the NEPA planning.
Possible ballot measure
Previous ballot measures designated $660,000 per year to trail building, according to the Steamboat Springs Trails Alliance proposal, and $60,000 per year to marketing these trails. The tax is currently bringing in more money than is allocated, with about $1.1 million in revenues per year. This revenue lands in a designated capital fund, which is separate from the city's general fund.
The language of a 1986 ballot measure specified this fund must pay for capital projects — new, on-the-ground amenities. It did not allow for funds to be spent on any maintenance for these amenities. In the instance of trails, this has led to the creation of the Trail Maintenance Endowment Fund held at the Yampa Valley Community Foundation.
"I think everybody understands maintenance is an issue," Petis said. "I think that's a pretty easy one to pass. I haven't heard anybody that's against that."
In public comment, Chamber CEO Kara Stoller outlined why the organization is seeking to put 2A funds to use.
Chamber leaders want the 2A funds to be repurposed after trail building projects are paid off, and they’d like to see those projects paid off sooner, rather than later, by designating the excess funds to trails.
"The chamber has been seeking a sustainable funding source, no longer being in the city's general fund, for destination marketing for many years," she said.
She added that air service into Yampa Valley Regional Airport is "a top issue" among chamber members.
"Last fall, when the air service ballot initiative failed, the chamber board and funding committee determined it was vital to include that funding effort in our scope of work," Stoller said. "Bringing visitors here is vital to growing our local economy. Businesses rely on year-round guests. The air program is a major component in our ability to attract high-value guests to our destination, provide jobs and keep our economy strong."
The chamber's air program subsidizes air carriers if flights do not get agreed-upon revenue. A sales tax that funded the program was allowed to sunset in 2016. Reserves from the tax revenue have been used to continue the program, but those reserves will dry up by the end of this winter season.
"By using only taxes collected on lodging transactions, there will be alignment with the source and the expenditure," Stoller said. "Additionally, this change will ensure that we no longer spend these funds building new amenities that we do not have the resources to maintain."
Discussions are very preliminary, but council members described the potential of placing issues on the ballot as two questions: one addressing marketing and the air program, and the other addressing maintenance and enforcement.
Council member Sonja Macys said this option "might be more appropriate, streamlined and easier all the way around."
To view the city council’s discussion on this topic, visit docs.steamboatsprings.net:10100/OnBaseAgendaOnline/.