Mainstreet Steamboat Springs contemplates district property tax

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— Mainstreet Steamboat Spr­­ings is likely to go back to property owners, business owners and residents of the downtown commercial district to ask for a new property tax to help fund its operations.

The initiative is being renewed five years after a similar effort in 2007 failed by just a half-dozen votes.

“That was heartbreaking,” Mainstreet Steamboat Board President Bill Moser said Thursday. “I was an election judge and we had several ballots that were disqualified, and each one hurt.”

Moser said that confronted with a $10,000 shortfall to bring back the highly visible flower baskets that grace downtown each summer and with the city of Steamboat Springs steadily weaning Mainstreet Steamboat off its budget, his board of directors is hopeful of starting anew and putting the question on the November 2012 ballot.

There were just 165 ballots cast in 2007, but the makeup of the district has changed in the interim and things will be different this time around, Moser predicted.

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First, he expects the district to seek a tax that would sunset after a period of years instead of a permanent tax. His board also knows that while the district’s valuation has grown with new commercial spaces in mixed-use buildings that dot the south side of Lincoln Avenue, that growth has come with a new group of residential owners who won’t be taxed but are eligible to vote.

If approved, the tax would affect the tax bills of only a relative handful of commercial property owners within the business improvement district. With that in mind, Mainstreet has embraced the new responsible hospitality initiative that advocates for downtown events to be of a nature that doesn’t unduly disturb residents.

“It’s important that downtown be livable and important that Mainstreet supports that,” Moser said.

However, Mainstreet Manager Tracy Barnett said business owners and residents of the district bounded roughly by the area defined by Third Street to 13th Street east to west and the Yampa river north to the alley beyond Oak Street all would be eligible to vote in the election.

Questions like “How much money does Mainstreet want to raise?” and “How much would taxes be increased?” don’t yet have answers, Moser said. He said a budget would be developed and compared to the district’s property valuation, and then a mill levy amount sufficient to raise funds to cover the budget would be determined. The emphasis would be on retaining Barnett in a climate where funding for Mainstreet is expected to continue to decline, and on adding an employee to grow special events like the weekly farmers markets each summer, Moser added.

Barnett said proceeds from business improvement districts are not eligible for funding capital projects but could be used to leverage a bond issue. More typically, they are used for marketing, promotion and event funding. They also can be used to increase public safety — some urban business improvement districts hire their own security patrols, but that’s not being contemplated here, Moser said.

Mainstreet always was intended to stand on its own in terms of funding, and in recent years the city has cut its support of the entity from $63,000 to $40,000.

The annual cost of purchasing and maintaining the flower baskets that hang up and down Lincoln Avenue all summer is $10,000, Moser said. The city cut that expense from its 2012 budget.

Moser said the 2011 budget for Mainstreet was $140,000 in 2011, with the amount over and above city support coming from dues from member businesses and the proceeds from Mainstreet-sponsored events.

“The farmers market is a money-making deal for us,” Moser said. “And the Chili Challenge was a greater fundraiser this year. In its third year, Sisters in Steamboat broke even for the first time.”

Passage of a small property tax would represent a more equitable way to fund Mainstreet because not all commercial property owners and businesses are dues-paying members, Moser said. A tax would spread a broader net to bring everyone into the fold, he explained.

To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com

Comments

JustAsking 2 years, 12 months ago

How is the $140,000. spent now?

Is eliminating the flowers a typical bureaucratic move-- picking something highly visible to the public to bring sympathy to the argument for more money--while dodging the question of "where does the money go?"

What responsible manager wouldn't already have an answer for the real need to raise additional money by taxing? Questions like “How much money does Mainstreet want to raise?” and “How much would taxes be increased?” quoted in the article are certainly elementary aren't they? Should we fall for the "Give us money for the flowers" plea without first seeing how the $140,000 is being spent?

Since Mainstreet "was always intended to stand on it's own" what was the plan?

Are there paid positions in this organization that could be staffed by volunteers? Who is on salary? How much? Why?

Again, how is the money being spent? Can $10,000 be shifted in the budget to restore the flower baskets without imposing yet another tax? Aren't these questions that deserve an answer?

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exduffer 2 years, 12 months ago

How about they raise just enough money to shovel the sidewalks, pick up the trash and enclosed the water rides, I mean bus stops.

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addlip2U 2 years, 12 months ago

What does Mainstreet promote besides downtown businesses? Portion of the budget clearly pays for Ms. Barnett hard work.

Besides that, what does Mainstreet need the money for?

Just Asking...wonderful points to be answered before seeking additional funds - funds for what?

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Steve Lewis 2 years, 12 months ago

Mainstreet, I do not mind helping with Tracy's salary, but cannot support disproportionate further uses of such a tax. "Marketing, promotion and event funding" are $$ efforts far more aligned with the retail tenancy on Yampa and Lincoln, than with the professional offices of Oak Street. If your BID is to fund those efforts, please leave Oak Street out of the tax district.

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Michael Bird 2 years, 12 months ago

Why won't the district owners pay their own advertising and promotional expenses ? I wish they would pay my expenses. Each business owner can afford to pay their expenses or they shouldn't buy something they can't afford. The public need not and should not subsidize any of Mainstreet's expenses. If Mainstreet wants an organization, they must pay for it as anyone else has to when they want something and they have the income to do it. Lack of 100% voluntary financial support is absolute proof that Mainstreet lacks the supposed support of its own membership. It is time to Man Up. Member put your money into your organization. Do not expect City tax to subsidize you. Do NOT expect a district tax. Pay your own bills. Accept the concept of personal responsibility.

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Scott Wedel 2 years, 12 months ago

"a new group of residential owners who won’t be taxed but are eligible to vote."

How do they plan to institute a property tax that residential owners don't have to pay? I thought schemes to do that have been found illegal by Colorado courts.

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sedgemo 2 years, 12 months ago

I'm not a "towny" but these two statements seem contradictory:

"If approved, the tax would affect the tax bills of only a relative handful of commercial property owners within the business improvement district."

"A tax would spread a broader net to bring everyone into the fold, he explained."

A "relative handful" of taxpayers will probably not be happy to provide free services for the larger population around them.

What about offering flower basket sponsorships with some sort of small identifier attached? The entire downtown (and all passers-through) benefit from the flowers. If their presence is in peril why not offer some sort of sponsoring opportunity to keep them "alive" for the good of all?

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Tracy Barnett 2 years, 12 months ago

To all of the previous posters and those who are just wondering:

As the title of the article suggests, MainStreet is CONTEMPLATING a TABOR election for the already existing Business Improvement District (approved in 2007 but the funding TABOR election was not successful by 6 votes).

All of the questions posed by "justasking" are valid questions, some of which have answers already and some that will be determined by the constituents as the process moves forward. The money will be governed by a BID board of directors made up of commercial property owners within the district. Tracy Barnett is the only paid staff member. All other functions are performed by volunteers - except a paid accountant and a paid minute taker for board meetings.

Aside from the basic overhead expenses (staff, postage, copying, phone, etc), a large portion of the budget goes to marketing downtown as a destination to guests who don't know there is a downtown. With the population changing every week, it is a challenge to draw people downtown from the mountain in the winter. Of the $140,000 budget, much of the funding comes from "pay as you go" programs for those that participate - money in, money out.

Not all of the entire budget would come from the BID. From current commercial valuation within the district, one mil would raise approximately $53,000. One project being undertaken is to determine what that would mean for the average property owner within the district.

As the process moves forward, the public and constituents will be educated on how the BID special improvement district functions according to the state regulations for such a district. The rules are not made up by the constituents, although the constituents can determine what projects they would like the BID to undertake. Each year a work plan must be filed with the state and approved by City Council.

On the question of the "relative handful" of tax payers taking on the tax burden, that statement is misleading. Because the BID funding would be a property tax on commercial (note the word commercial, not residential) properties, commercial property owners would be responsible for the tax. There are not a lot of commercial property owners within the district. As to who can vote on the measure, the voters would be the commercial property owners, the tenants of those properties (because the tax is often passed on to them through "triple net" fees from the property owners), and residents within the district (since what happens around them in the district can affect their way of life).

For more information of the general nature of Business Improvement Districts and what they can do, who they serve, and how they are governed, you can Google "Business Improvement Districts". The more people who do this, the more informed they will be as the process moves forward. You might also check out Durango and their BID which was once again approved by the constituents for a third time in 2010.

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addlip2U 2 years, 12 months ago

So when all said and done, simply summarized: that tax would be passed on to the customer.

Give me another incentive to shop downtown!

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sledneck 2 years, 12 months ago

Justasking' You hit the nail on the head; especially with your first point: "picking something highly visible to the public to bring sympathy to the argument for more money..."

Over the years I have noticed this very tactic being used systematically. The most abused venue for this shamefull tactic is public education. Money is frittered away on surperfluous nonsense and then those holding the purse-strings return to the taxpayers asking for more cash with the tried and true guilt-trip..." but it's for the children". One would think people would be ashamed to engage in this childish attempt at deception but the fact is that, more often than not, there are a sufficient number of dupes to pull it off.

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Steve Lewis 2 years, 12 months ago

Tracy, I hope you are having a great holiday. You provide Steamboat with valuable services, and your work is appreciated. Its just that I don't feel my property taxes should be funding the above list.

We consider our Solstice Building on Oak St to be a top notch professional office property, with our tenants' own services and advertising drawing its own unique group of clients to downtown Steamboat. Please describe for us what benefits Oak Street professional tenants can expect in return for their paying for this Mainstreet marketing initiative.

In my opinion the BID marketing is about creating more foot traffic. What an irony, given Oak Street's dire lack of sidewalks. This BID is prohibited from addressing our biggest problem. Is Oak Street even on your radar?

Neither my tenants nor I placed votes the last time around. The extra extra paperwork each BID vote requires caught me off guard. My bad in 2007.

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Scott Wedel 2 years, 12 months ago

Well, that becomes the complaint of more and more taxpayers as government gets bigger.

Iron Horse was an absurd boondoggle that never made any sense and yet was dumped on the taxpayer by a city council that saw a need to act quickly and sign bond contracts that cannot be undone.

I think the word irony comes to mind.

It is always so easy for government to make a plausible sounding argument on why more taxes and government growth is a public benefit.

Certainly office rent is more downtown than it is elsewhere in SB and that is because it is vibrant commercial district. Why should Oak St commercial property owners benefit from a more vibrant downtown without contributing to MainStreet?

That question, of course, assumes that MainStreet overall adds more value than it costs as compared to being a nice amenity when paid by others.

Just as it was so easy for the promoters and beneficiaries to say that the airline subsidy tax was individually inexpensive and the overall benefit was essential, they will make the same argument here which the newspaper and public leaders will steadfastly promote and will not even respond to facts to the contrary.

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ybul 2 years, 12 months ago

-- Iron Horse was an absurd boondoggle that never made any sense and yet was dumped on the taxpayer by a city council that saw a need to act quickly and sign bond contracts that cannot be undone. --

Does not any debt in the state of Colorado require voter approval. Some have used legal mumbo jumbo to place that debt on the taxpayers T-Rex using certificates of payment based upon future federal fuel tax revenues. However, that is still going into debt without public approval. I wonder if a smart attorney could get the city out of the Iron Horse Mort(death)-Gage(grip) as it was not approved by voters.

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Steve Lewis 2 years, 12 months ago

Is this about government?

I don't see how that complaint relates to the BID, or to the airline tax. The airline tax was brought to us by ski corp. And given that Jim Cook led the 2007 BID and Bill Moser is currently leading this one, it seems fair to say the BID tax was created by our real estate businesses.

Its our private sector, not our government, creating the BID tax.

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sledneck 2 years, 12 months ago

Weapons come to bear from government, not from the private sector. Don't pay your airline tax and someone with guns will eventually come a callin'... and it won't be Bill Moser.

Inasmuch as the Jim Cooks of the world fly with similarly feathered friends they are a part of that force, NOT part of a laissez faire, free-market economic system.

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Scott Wedel 2 years, 12 months ago

Local government is certainly pleased by the airline tax and the BID tax. It is one less thing they are being asked to fund. Note that both airlines and MainStreet had been receiving city funding prior to proposing a tax.

And it is a business district improvement tax - who else other than real estate people would be expected to lead that effort? A restaurant owner with neither the time or the knowledge?

Steve Lewis complaining about a tax that promises improvements - that is 3 wire deep irony.

And ybul, nope, government does not need voter approval to issue debt. Voter approval is required when they want to increase taxes to create a new revenue stream to dedicate to the debt.

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Steve Lewis 2 years, 12 months ago

Taxes providing infrastructure and basic services makes more sense than taxes for marketing. No?

Tax ballots from the "for profit" sector just don't fit with the conservative principles that I thought I understood.

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Scott Ford 2 years, 12 months ago

Mainstreet shares a problem common to many such member-based organizations. There are businesses within the geographical boarders of Mainstreet that do not belong. Why do some businesses belong and others do not? Some may perceive "belonging" results in little or no tangible value to them, others are simply "free riders" that benefit but do not pay to belong.

Creating a BID is a blunt tool to address both of these problems since it makes everyone within the BID pay. Nevertheless, we need to be careful what we wish for. As a result taxing everyone, overtime many of those currently paying voluntary will stop. Mainstreet Steamboat will essentially become a quasi government agency specializing in promoting downtown Steamboat Springs. Essentially the process of establishing a BID will formalize what Mainstreet Steamboat perhaps is already ….a "public good."

If defined as a "public good",desired outcomes will become increasingly ill defined and there will be less accountability. One thing for sure this "public good" will demand for more and more money over time. Are we OK with that?

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Jeff_Kibler 2 years, 11 months ago

lewi, I thought the same thing about the airline tax. The airline tax is not about basic services and infrastructure, it's simply corporate welfare. It's a regressive tax that yielded few complaints about how it would affect the poorest amongst us.

As far as liberal v. conservative principles, you can't paint with such a broad bush. I'm wondering if "principles" will take on a new meaning.
These days I'm not sure if the noun "principles" resembles in any what I thought it originally meant.

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mtroach 2 years, 11 months ago

If most of the funds go to marketing why isn't Main street a part of the Chambers overall marketing budget? I can't help but think that if one entity marketed every aspect of Steamboat our budget for marketing could go further. There has to be some overlap of duties that Main Street, BTUSA and the Chamber all share, and that are funded with tax dollars, and that could be consolidated so that more money went to ads and less to funding everyone's personal marketing efforts.

I would wonder why everyone marketing this town isn't working together under one organization? Isnt this what the Chamber is funded to do?

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sledneck 2 years, 11 months ago

Your question is valid and the reason for that is simple, Mtroach. Everybody wants their own little fiefdom. Consolidate power and all but one chief has to go back to being an indian.

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Steve Lewis 2 years, 11 months ago

Jeff, The airline tax found little opposition, you are right. Against the advice of the first tax policy advisory board, the airline ballot issue was allowed to move forward at the last minute, with far too little time for rationale discussion on its pros and cons.

So when the airline ballot proposal comes in last minute and its promoters are saying the fund would otherwise go dry, it was easy sell the fear that we would be economically devastated without this tax. Who outside the airline program could know the potentials?

There was no time for a community weighing of alternative strategies, to consider why did the LMD board not taper down expenditures to better preserve its dwindling fund, and how will we address the obvious sustainability challenges to an air program that is now creating an even bigger economic bubble... there was no time, and thus too much fear, to have those conversations. In my opinion, this one was cheap enough that letting it pass was a better option than the ugly uninformed fight any real opposition would have provoked.

Next time we will have that discussion. A city council that allows this airline fund to go for broke again with taxpayer backing and present another crisis... well that's not going to happen.

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pitpoodle 2 years, 11 months ago

Here is the basic problem. Starting in January, the new airline tax will increase the cost of living in Routt County pushing people to buy outside and eventually causing locals to consider living some place that is cheaper. Remember, you can buy on-line with no tax and free shipping. This sort of dynamic is what has happened in Aspen, Vail etc. - the locals have moved away and the rich stay. In our case, more tourists may bring some business success but maybe not. A new property tax will cause rents to increase costing business owners more. Passing the cost on to customers will be a disincentive to shop downtown and will hurt business profits. If I had a business in the targeted business district, I would move out. In addition, people who can't find a convenient place to park, mostly because of too many bus stops, will not stop to shop. Maybe Mainstreet needs leadership that understands economics 101.

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sedgemo 2 years, 11 months ago

The airline tax WOULD have met significant opposition had residents of the whole county been allowed to vote. As it stands, if we buy groceries (or anything else) in Steamboat we pay the tax we could not vote for or against. Nothing short of taxation without representation. Driving elsewhere costs even more fuel and time, so county residents are SOL.

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