Steamboat Springs Q. On Nov. 5, voters will decide on an excise tax on new development. Why did the Impact Fee Advisory Committee decide on an excise tax to replace the impact fee?
A. At the request of a number of developers and other comments, the City Council appointed the Impact Fee Advisory Committee to explore whether another broader-based method of raising the revenue needed to pay for the infrastructure costs resulting from growth and development in the community could be utilized. The Impact Fee Committee was charged with the responsibility of finding a revenue-raising method that at least the amount of revenue as would be raised by the impact fee.The committee explored other types of revenue-raising methods and settled on the excise tax because it would broaden the tax base to include all new construction, with commercial and industrial new construction paying their fair share and reducing the disproportionate burden on new residential construction, as is the case with impact fees.
Q. How would the excise tax work? How much funding is it expected to generate?
A. Any development or improvement in the community that requires the issuance of a building permit will pay an excise tax of 1.2 percent on the building permit value of the construction.
In the first year it is estimated the tax will generate $275,000.
Q. Impact fees, as currently constructed, include exemptions for affordable housing. Would the excise tax contain similar provisions?
A. There are exemptions, the major one being for new construction of homes that are built for Steamboat Springs residents who are employed within Routt County. Provided the valuation of the home to be constructed, not including the land, does not exceed $250,000 in value as determined by the building department, there is an exemption on the tax for locals on the first $150,000.
Thus, a new home that qualifies for a Steamboat Springs resident employed in Routt County will pay an excise tax of $1,200.
Under the impact fee ordinance, the same home might pay an impact fee of $4,000.
Also of note under the impact fee, a 100,000-square-foot commercial or retail center would pay an impact fee of just $1,546.
But under the excise tax, if the same 100,000-square-foot commercial center had a building permit value of $2.5 million, the excise tax would be $29,000.
The bottom line is that the committee determined that all development not only residential growth development should pay its fair share of the costs incurred as a result of new development in the city.
Q. What happens is the excise tax fails?
A. It is hoped that the impact fee will be voted out by the residents of Steamboat Springs. But if the excise tax is defeated at the polls, the impact fee will remain in effect.