For 20 years, Steamboat resident Rob Douglas was a Washington, D.C. private detective specializing in homicide, political corruption and terrorism. Since 1998, Douglas has been a commentator on local, state and national politics in Washington, D.C., Maryland and Colorado. To reach Rob Douglas, email rdouglas@SteamboatToday.com.

For 20 years, Steamboat resident Rob Douglas was a Washington, D.C. private detective specializing in homicide, political corruption and terrorism. Since 1998, Douglas has been a commentator on local, state and national politics in Washington, D.C., Maryland and Colorado. To reach Rob Douglas, email rdouglas@SteamboatToday.com.

Rob Douglas: Steamboat remains calm as Vail panics

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Rob Douglas

Rob Douglas' column appears Fridays in the Steamboat Today. He can be reached at rdouglas@SteamboatToday.com.

Find more columns by Douglas here.

— Just as proposed federal solutions to the tightening national economy differ based on competing economic and political philosophies, so do official local reactions to projected fiscal downturns in Steamboat Springs and Vail.

As Vail's Town Council panics, Steamboat Springs' City Council remains calm.

As Vail raids its financial reserves, Steamboat Springs is preserving its rainy day fund.

As Vail spends blindly, Steamboat Springs plans to spend with foresight.

According to the Vail Daily, the Vail Town Council decided this week to tap the city's financial reserves to the tune of more than a half-million dollars for an advertising campaign and concerts in an attempt to stimulate the town's economy.

As reporter Edward Stoner put it, "Under the plan, about 100,000 mailers would be sent to pass holders in December to encourage them to come to Vail. About $50,000 in extra money would be thrown toward events such as Snow Daze and Street Beat to increase the number of concerts and book bigger names."

That second sentence, "$50,000 in extra money would be thrown toward events," may be far more accurate than intended as - even in their haste to spend the city's emergency funds - those involved in developing the plan recognize they may just be throwing money away.

Vail Mountain Chief Operating Officer Chris Jarnot, a co-developer and proponent of the plan to use public funds to advertise for the benefit of private businesses, admitted that reality while stating the obvious.

"There is no guarantee, especially under the circumstances we're working with," Jarnot said. "We can't sit here and guarantee that if you spend this money, you'll get the same amount of overnight stays you did last year."

But, as Vail's elected officials seem inclined to grasp at straws - given the first impulse of most politicians is to spend money whether there's a likelihood of success - the best way for any government to justify unwise and wasteful spending is to declare an emergency.

So, Vail has declared an emergency.

Vail Councilwoman Margaret Rogers - referring to current economic conditions while doing her best Chicken Little impression - reportedly stated, "The reason we have (financial) reserves is for an emergency. I consider this an emergency."

Of course, it's for Vail to decide if it is faced with an emergency that warrants spending reserve funds that most prudent municipalities maintain for true emergencies that threaten life-sustaining services and infrastructure such as police, fire and emergency medical services, utilities and passable roads. Still, it's worth examining the way Vail is reacting in comparison to the way our City Council has.

To date, although pressured by some to spend reserves, our council has wisely determined the better course of action is to maintain reserves in case the economy worsens for an extended period and thereby threatens core services that only government can provide.

Of course, the real question arising from the different responses by Vail and Steamboat to similar economic challenges is whether it's the appropriate role of government to spend public dollars marketing the business community it governs in an attempt to increase revenue for that community.

I think not.

The appropriate role of government in a free market economy (one that is tragically being cast upon the ash heap of history at the national level) is to create and maintain infrastructure that only the government can provide while minimizing interference - often intentionally misnamed "support" - so private businesses will succeed or fail of their own accord.

Therefore, it is not the role of government to market business just as it is not the role of government to compete with business. It is for individual businesses or the business community at large to use their funds to the degree they deem necessary to advance their self-interest.

And, if left to their own accord - or, when necessary, forcefully weaned from the bosom of government through which public funds flow - the private sector in a free market system flourishes and core government services benefit from the increased tax dollars those successful businesses provide.

To reach Rob Douglas, e-mail Rob.Douglas@Comcast.net

Comments

JustSomeJoe 6 years, 1 month ago

Here's an alternative column headline for you editor:

"Vail goes after business while Steamboat sits on the sidelines."

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ybul 6 years, 1 month ago

Yes, the city should help to work towards a unified marketing effort as it is a resort town.

I think you fail to understand Rob's point though. That the Reserves should be saved for an unexpected decline in revenue, or an emergency. Right now it is not an emergency, it is a probable situation that revenues will decline, based upon macro economic factors beyond anyones control, in Steamboat Springs. It is a crap shoot to Increase marketing funds today.

I do not think that Rob was suggesting that marketing should be eliminated. I believe the point was that Vail, is worried the sky is falling. If the sky does fall, then those funds raided from the general reserve would have been better saved for that rainy day.

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JustSomeJoe 6 years, 1 month ago

Here's some business 101 for you Rob. As we like to say in my business, "marketing greases the skids for sales", with sales in this case being resort visitors who spend money on goods and services while here on vacation.

Businesses can correlate marketing spends with sales increases. Business can also correlate a decrease in marketing spend with a resulting decrease in sales.

Here's a simple question for you. If Steamboat decreases its marketing budget, will sales (and sales tax revenue) a) increase, b) decrease or c) stay the same? Be prepared for B folks, and we will continue to have the same problem next year as sales tax revenue continue to decrease. It's a self-fulfilling prophecy; lower marketing costs equal lower sales.

Vail is trying to change the equation in a down market by investing in their business, which is tourism. It's how they make money and fill the coffers. It happens to be Steamboat's main business as well. Who is likely to bring a consumer into their store, the owner who advertises specials, events, etc, or the one that sticks their head in the sand?

Rob - why no comment on the percentage of the reserve fund that Vail is spending, or the increase in revenue/sales tax they are trying to bring in? Anyway, kudos to you for sticking to your "conservatism" guns and theories. I'm from a big east coast city as well, and it's always nice to read your column and get a reminder of why I left. Good luck getting the sand out of your ears.

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David Stone 6 years, 1 month ago

I think that the folks at Vail are right on target in their efforts to get more visitors this winter.If Steamboat thinks that the overall business climate is ok and doesn't need an extra push, then I hope that it works out.On the other hand,I am reminded of an article in The Pilot last spring when some community college,"economist", was quoted as saying that,"Steamboat real estate would be immune to any economic down turns in the market".Now,try telling that to most of the real estate community.Not much is moving and it just mostly just sits there. Immune indeed!

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Steve Lewis 6 years, 1 month ago

Tele's post lists the cities that puts tax dollars into marketing. To be fair he should show Steamboat is already in that list with a 2% LMD lodging tax going to market and subsidize airline service here. Our city also gives significant $ to the chamber.

I disagree with this concept that marketing fits into infrastructure spending. That concept, for me, supports a growing argument that our country practices socialism for corporations.

It is also awkward to argue the city government should shrink itself in tight times, and simultaneously argue the city should spend marketing money to keep its sales tax revenues stable. That path is really saying spend tax dollars mainly for the private sector benefits.

My preference would be that the City marketing budget follow whatever trend the other city budgets are following. From that point any increase in city marketing $ be matched by promotional discounts from the lodging and ski businesses.

Municipal govt is expected to be fiscally conservative. Spending reserves on marketing during an econoomic downturn is a gamble, and very liberal fiscal policy.

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