Friday, September 24, 2010
Steamboat Springs Steamboat Springs officials are continuing talks with operators of the Iron Horse Inn, but definitive answers about what happens next for the troubled city-owned motel likely won’t be clear until Oct. 5.
City Manager Jon Roberts told the Steamboat Springs City Council on Tuesday night that Boulder-based New West Inns has submitted a new proposal for its Iron Horse lease. Roberts and city attorney Tony Lettunich declined to comment Thursday on the specifics of the proposal because the discussions are ongoing. Roberts said those talks are continuing alongside work to prepare a request for proposals for potential new operators of the inn between the Yampa River and U.S. Highway 40 just east of downtown.
New West Inns has operated the Iron Horse since November. New West also operates the Comfort Inn on Walton Creek Road.
City Council voted Sept. 7 to accept RFPs for management of the Iron Horse and to reject the revised lease agreement New West had been operating under this summer. Roberts said the RFP has not been released and likely will be presented to City Council on Oct. 5, along with an update on lease discussions and options for the inn’s continued operation.
“We’re talking with them to see what they had in mind as far as adjusting their proposed structure,” Anne Small, the city’s purchasing and risk manager, said Thursday. “We have had some discussion.”
City staff waived New West’s monthly rent of $13,500 for December, January and February, and deferred its rent for March through May as the inn struggled through challenges such as higher-than-expected start-up costs and low-performing nightly rentals.
Spurred by a previous City Council, the city bought the Iron Horse by issuing nearly $5.3 million in certificates of participation late in 2007. Those certificates, similar to bonds, are sold to investors who receive returns on the investment.
The terms of those certificates stipulate that the city would not pay off its Iron Horse debt in full for 10 years, in order to guarantee a certain level of return to investors through interest. Seven years are left on that deal.