BEHIND THE HEADLINES

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(Editors Note: In answering some of the questions, Arianthtettner used capital letters to emphasize her points.)

Q. How desperately is the city in need of money for capital projects?

A. You decide. The city's latest Five Year Capital Improvement Plan (CIP) documents a $13,600,000 revenue shortfall for essential capital needs over the next five years. Why? The numbers tell the story. FROM 1990 TO 2000 THE STEAMBOAT SPRINGS POPULATION GREW FROM 6,800 TO NEARLY 10,000 RESIDENTS, A 47-PERCENT INCREASE. AT THE SAME TIME, THE RESORT PILLOW COUNT INCREASED FROM APPROXIMATELY 12,000 TO 22,000 TODAY. Growth like this places a huge burden on community facilities and services. (The CIP addresses the long-term budget projections for the basic components of government infrastructure such as fire trucks, police vehicles, buses, roads, park facilities and open space, public works equipment, building repair and construction, and the like.)

Q. Is the shortfall threatening the health, safety and welfare of the residents of Steamboat Springs?

A. HEALTH AND SAFETY? NO. These are essential government services.

BUT WILL A REVENUE SHORTFALL AFFECT WELFARE? YES! If we maintain our current reliance solely on sales tax dollars, the revenue shortfall WILL impact the welfare of our community. The quality of life and amenities we all enjoy, such as HOWELSEN HILL, THE ICE RINK, PARKS, TRAILS AND OPEN SPACE, COMMUNITY SUPPORT DOLLARS TO LOCAL NONPROFIT ORGANIZATIONS, PLAYING FIELDS, FREE BUS SERVICE, THE RODEO, THE TENNIS BUBBLE, FREE SUMMER CONCERTS, SUMMER CAMP AND AFTER-SCHOOL PROGRAMS, will ALL be negatively affected by REDUCED FUNDING. As a member of City Council and the community, I don't want to see that happen here.

Q. Did growth pay for itself before impact fees?

A. NO. EXISTING RESIDENTS AND VISITORS HAVE PAID FOR THE FACILITIES AND SERVICES REQUIRED BY NEW GROWTH WITH THEIR SALES-TAX DOLLARS.

While growth has generated new revenues, they have NOT been enough to keep the level of city services from slipping every year. Yes, sales-tax revenues have increased 6 percent to 7 percent annually for the past few years, yet the costs to operate the city have gone up 15 percent to 20 percent during the same time. The city's annual operating budget in 1990 was $10,300,000 and for 2000 was $18,300,000.

Until now, the city has made ends meet by deferring capital projects in favor of operations and maintenance. Yet capital needs cannot be deferred indefinitely, and most citizens will not eagerly accept lower levels of service. SUBSIDIZING GROWTH JUST WON'T WORK ANY MORE.

IMPACT FEES ARE THE WAY NEW DEVELOPMENT CAN CONTRIBUTE ITS PRO RATE SHARE TOWARD CONTINUING THE QUALITY OF LIFE WE ENJOY NOW. IMPACT FEES ARE NOT A TAX. BY LAW THEY ARE FEES LIMITED TO SERVICES RENDERED. Compare impact fees to the membership fees one pays to join an existing athletic facility or golf club, in addition to paying the yearly dues for operations.

Q. Will it (growth) pay its way now?

A. ONLY PARTIALLY. IMPACT FEES CAN ONLY BE USED FOR THE CAPITAL NEEDS CREATED BY NEW DEVELOPMENT. Dollars will be set aside in dedicated accounts for Public Safety, Transit, Parks, Recreation and Open Space; and city buildings and equipment as identified in the CIP. IMPACT FEES DO NOT COVER THE COSTS TO OPERATE AND MAINTAIN THE ADDITIONAL FACILITIES. Those costs will have be paid from the general fund, 73 percent of which is generated by sales taxes. When new residents and visitors buy locally, their sales-tax dollars will be added to the pool that funds these expanded operations.

Q. How significantly will impact fees affect the cost of housing?

A. You decide. WITHOUT IMPACT FEES OR PROPERTY TAX, THE COST OF HOUSING IN STEAMBOAT SPRINGS HAS DOUBLED IN THE PAST SEVEN YEARS.

If developers pass along the entire impact fee for a single-family home to the buyer, it would represent about $13 a month over a 30-year mortgage. Yet the benefit to the house and family that lives there is substantial the ability to provide the same high levels of service and amenities that attracted them to Steamboat in the first place.

Q. Is there a way the city can mitigate the effect of impact fees on housing?

A. FEDERAL LAW PROHIBITS DISCRIMINATION ON THE BASIS OF HOUSE SIZE.

This is the reason the city cannot charge a larger impact fee for a larger house. A family of four has the same impact on parks and police no matter whether they live in a 1,000- or a 5,000-square-foot house.

Council is developing a program to pay for impact fees for affordable smaller homes through the city's general fund.

The city cannot legally waive impact fees.

Q. A group of five residents is now trying to get the fees voted on at an election. Do you think the fees should be presented to the voters?

A. IN THE 1999 COMMUNITY SURVEY OUR CITIZENS STRONGLY SUPPORTED IMPACT FEES.

They were the preferred revenue choice to fund open space acquisition, air-quality improvements, new roads and other public infrastructure needs.

This was later confirmed in the June 2000 Town Meeting and subsequent public forums. IN MY OPINION, THE CITIZENS HAVE ALREADY VOTED.

Nonetheless, if a group wishes to bring impact fees to a vote it is their right to do so. This is the democratic process.

Q. If the city pursues a property tax, would it alleviate the need for impact fees?

A. A PROPERTY TAX MIGHT EASE BUT NOT ELIMINATE THE NEED FOR IMPACT FEES. Impact fees, by law, can only pay for those capital facilities required by new growth.

Impact fees are estimated to generate approximately $1,500,000 in annual revenues or $7,500,000 over the next five years if current building trends continue.

That still leaves a $6,100,000 capital-needs shortfall or more if impact fees don't meet revenue projections (refer to the first question).

As I see it, a property tax would be used for capital needs: existing infrastructure replacement, renovation, maintenance, etc.

It would bring additional taxpayers to the table. Since local residents own less than 50 percent of the properties within the city limits, out-of-town property owners could now contribute financially to the our infrastructure if a city property tax is approved in the future.

A property tax would provide a predictable revenue stream for capital investments, would diversify the our revenue sources and most likely raise the city's bond rating (and lower the costs to finance projects).

Steamboat Springs revenue stream, with its high dependence on variable sales tax revenues, could be compared to a one-legged stool, wobbly and unpredictable to sit on!

IF WE DON'T HAVE IMPACT FEES TO COVER THE CAPITAL COSTS OF NEW GROWTH, THEN YOU, THE AVERAGE TAXPAYER, CAN ANTICIPATE REDUCED CITY SERVICES AND WILL ALSO HAVE TO PAY FOR THE COSTS OF GROWTH OUT OF YOUR OWN POCKET.

In my opinion, impact fees now and a small property tax in the future can help stabilize the city's finances to the benefit of the entire community.

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