In a 4-3 vote, the City Council approved putting the question of a local marketing district on November's ballot, a day shy of the deadline.
Those who supported the ballot question admitted that the local marketing district was not the perfect solution but was needed as a stable source for funding air programs.
"It is in by no means the ideal form. In my eight years of being on council, we have been searching and searching for ways to raise funds and tax our community. There have been many missed opportunities," Councilwoman Kathy Connell said. "We now have a window of opportunity."
The Steamboat Springs Chamber Resort Association, the lodging community and the Steamboat Ski Corp. proposed the 2 percent lodging tax that would go toward guaranteeing airline flights and would raise about $1.2 million a year.
More than 50 people sat in Centennial Hall on Tuesday night to give input or hear the council's final decision. About a dozen people, most with the lodging community, spoke in support of the proposed district and about the benefits of tourism and air programs.
Council members Connell, Paul Strong, Loui Antonucci and Nancy Kramer voted to put the question on the ballot. Council members Steve Ivancie, Ken Brenner and Susan Dellinger voted against it.
If approved in November, the local marketing district will encompass and tax most of the city's nightly lodging properties. The boundaries snake through the mountain and downtown areas and include about 600 registered voters.
Under the proposal, the council approves the district's taxing plan, appoints and removes members of the board and can dissolve the district at any time.
In its final approval, the council did not set a sunset period for the tax and placed a cap on flight marketing so it would be no greater than 7 percent of the collected revenue.
The proponents of the district first came before the council Aug. 17, giving the city just the required two meetings before the deadline to place a question on the ballot.
The three council members opposing the local marketing district said they wanted to see the entire city vote on the issue, objected to the short time frame the council was given and wanted to see the overall city tax proposal from the Tax Policy Advisory Group first.
"Only a small portion of the citizens are going to vote on this," Ivancie said. "Taxes belong to all of us."
Other council members agreed the form and timing was not perfect, but had concerns about the loss of flights if stable funding was not in place by 2005.
Sandy Evans Hall, executive vice president of the Steamboat Springs Chamber Resort Association, said the need for funding the air program was up and local businesses' voluntary funding for the program was down.
She predicted a $50,000 shortfall for next year's winter program, which would mean dropped flights in the winter. The lack of funding also could take away the recently started summer Continental Airline flight from Houston and create difficulty in finding a match for the recently awarded federal grant for a daily Houston flight.
Brenner asked the chamber and lodging community whether they would be willing to accept another 1 percent increase to the lodging tax if it was recommended by the Tax Policy Advisory Group.
Strong said he would be happy to see the entire community pass a lodging tax in 2005 to replace the tax district voters would be asked to approve this fall.
Before the merits of the local marketing district were discussed, the council voted on whether Connell had a conflict of interest and should step down.
Council members proposed that she should step down because she is an owner of a property management company.
"I speak to the integrity of not only the council, but the community. Do we want to see a person with two hats, one as the lodging community and the other as duly elected city official? What allegiance does this person have?" Ivancie asked.
Antonucci argued that almost everyone on the council would have a conflict with the issue because they all benefit economically from tourism, which the airline programs would promote.
"I think we are trying to draw a fine line here. I really don't think it is appropriate," Antonucci said.
The council voted 3-3 to let Connell vote on the issue. The tied vote meant her vote would count.
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