Voters support tax for winter air service program

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Election 2011

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— The sales tax rate in Steamboat Springs will go up a bit after voters here resoundingly approved Referendum 2B on Tuesday, a 0.25 percent tax increase that will help fund the winter air service program at Yampa Valley Regional Airport.

Referendum 2B passed with 61 percent of the vote.

Donning pilot hats and inflatable airplanes, about 40 supporters of the tax initiative celebrated its passage at Old Town Pub on Tuesday evening.

“We knew from the beginning that if everyone understood how important this was to our economy, then we had a good chance to pass it,” Yes 2 Air campaign manager Bill Stuart said. “It was a nonpartisan issue. People from all spectrums of life supported it.”

Referendum 2B was conceived by a group of community leaders to reverse the eroding ability of the business community to attract commercial airline flights to YVRA during the ski season. Without those flights, advocates of the tax fear the resort community’s ability to bring in high-spending winter vacationers would be compromised, further eroding the local tourism economy.

Steamboat Ski & Resort Corp. President and Chief Operating Officer Chris Diamond praised the air tax passage Tuesday night.

“It was a very exciting night for us,” he said. “You never know how these things are going to turn out.”

Diamond said campaign leaders now would turn their attention to developing a plan that will best spend the additional tax revenue to regain airline seats lost during the recession.

Referendum 2B’s 0.25 percent tax will generate an estimated $1.3 million annually and will sunset after five years.

Supporters said the additional revenues will enable the air program to get back up to 160,000 inbound airline seats by 2016. Advocates also said they were optimistic that after five years the air program’s reserve fund would be back on solid footing. If that proves true, they say, they would not have to go back to the voters to renew the tax.

Tax proponents made the case that mergers among the airlines that historically have served the Steamboat market, Northwest with Delta and Continental with United, had reduced competition. Add to that reductions in airline fleets, which in turn placed a premium on the most lucrative business travel destinations, plus the rapid escalation of jet fuel prices, and the $2.5 million in revenue guarantees the resort community committed to securing airline service for the winter of 2005-06 no longer stretched as far.

The airline fund’s reserves, which are managed by a Local Marketing District overseen by Steamboat Springs City Council, had slipped from $1.5 million to less than $1 million. Referendum 2B supporter and former City Council President Loui Antonucci said without new revenues, the reserve was projected to go to zero by the 2012-13 ski season.

The resort community concluded that simply increasing the accommodation tax would make Steamboat less competitive with Summit County and Vail when bidding for group travel from ski clubs.

Antonucci said Tuesday that the immediate result of the tax increase will be to restore lost seats starting with the winter of 2012-13. It also will allow Steamboat to look into restoring lost airline markets in locations such as Salt Lake City. He said plans to pursue routes on the West Coast will be discussed during the next five years.

“We cannot control what goes on in the nation or the world, but we can take control of our own destiny, and that’s what we did in this election,” he said.

Opponents of the tax questioned the use of taxpayer dollars to help subsidize an airline program that they said supported private business. Some opponents also questioned the transparency of how the tax dollars will be spent.

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

— To reach Scott Franz, call 970-871-4210 or email scottfranz@SteamboatToday.com

Comments

steamboatsprings 3 years ago

It is great to see that our community understood how important the air program is to nearly everyone in Steamboat. This helps provide a strong path to recovery and maintain the things that we all love about living in Steamboat. Many thanks to all those that worked so hard on this.

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Scott Wedel 3 years ago

Now comes the challenge of meeting the campaign promises. Chamber CEO made it clear that this will bring in 44,000 additional tourists spending an additional $44M. For the supporters that believed that then this was an easy vote.

But if reality falls well short of that and instead the money is largely spent on additional empty seats then even supporters will start wondering if we are getting what we were told and if this is actually a giant waste of tax dollars.

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dave mcirvin 3 years ago

agreed Scott. if visitor #s don't rise up this season, when will it be time to vote it down?

Ka-ching, The officers of Fortress/Intrawest have just realized a bonus this coming fiscal year.

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Scott Wedel 3 years ago

Well, they'll get their sales tax dollars for 5 years.

Though, City doesn't have to give the LMD board the monetary equivalent of the vendor fees (and City would love to keep it for their budget now that LMD has got their own revenue stream). And presumably the City could decide to research conflicts of interest on the LMD board So LMD board could find itself under great pressure.

Or if maybe a local press starts asking questions like what was the LMD's internal projections of numbers of passengers when Chamber CEO wrote letter to the editor claiming 44,000 additional passengers spending $44M.

I think LMD is going to be stunned at how quickly City of SS changes budget priorities and largely keeps the vendor fees for their budget. And City will defend their keeping of their money by saying LMD is not delivering on promises made and so the money can be put to better uses in the City's budget.

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greyrider 3 years ago

So let me get this right: We get the honor of paying more taxes to help subsidize a private company to pay other private companies to bring in wealthy vacationers to ski at a resort that many of us cannot afford to ski at. This in turn will help support local businesses that also set their prices so high many locals cannot afford to patronize them, leading to the burning of more “horrible” fossil fuels as the locals drive out of SBS to shop elsewhere. The businesses who gain from this tax pay a rock-bottom wage to their employees, and the employees in turn get the privilege of working two jobs to try and keep their heads above water. What a wonderful system we have just agreed to. As for the tax sun setting in five years, we’ll have more luck getting heroin addicts to give up their needles. And to add insult to injury, no one outside of SBS proper got to vote on the tax increase. Sounds like the best thing since nationalized health care.

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Scott Wedel 3 years ago

Greyrider, Only thing you missed was how the 2B campaign used patently false projections to sell the program to the public.

Other than that, spot on.

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Jeff_Kibler 3 years ago

You can't do an exit poll with mail-in ballots. Yet I would love to discern why this passed with so large a margin. The employees outnumber the employers. Are the employees so trepidant that they bought into this corporate welfare campaign?

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1999 3 years ago

well jeff..we were told tourism would dry up and we'd all lose our jobs.

back in texas we call it fear mongering.

so here we are again subsidising a huge corporation.

it is truly astounding to me that people voted for this.

ignorance.

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addlip2U 3 years ago

More reason to not shop in Steamboat and boycott the merchants that supported this. I just did that !

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cindy constantine 3 years ago

Maybe the KoolAid that was being drunk was spiked--you know how everyone likes a free drink. I had a store manager tell me yesterday--"Wasn't I supposed to vote for that tax since I am in retail?" I just shook my head and said "Say What??? So you WANT to pay more for groceries and your heating bill this winter??. Hope you won't be needing a new car because that tax is going up as well!!

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exduffer 3 years ago

$10,000 in spending costs you $25. Get a grip people, if you don't like the tax move.

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cindy constantine 3 years ago

exduffer--

It is not the tax, it is WHO the tax benefits. Fortress did not need tax dollars to help fund the airline program. All it did was guarantee the airlines made a profit at the tax payers expense. That is not right at any price!! So frankly you get a grip. Did you really appreciate the taxpayers bailing out all the banks?? Same concept, smaller scale.

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greyrider 3 years ago

It’s not the amount, it’s the principal. A little here, a little there, it all ads up. Taxing citizens and handing the money over to any private enterprise is wrong. It doesn’t matter if it’s here or in Washington DC, it’s wrong. Private businesses, including those in SBS need to stand on their own. If times are tough you adjust your business strategy as needed to get through it. Instead we sold out. We blinked this time so if this tax doesn’t do it they’ll be back to try and scare us into another hand out. If things get better the money will go to some other “worthy cause” to be decided on by committee, and we just can't sunset a tax that supports a "worthy cause". For the last two years local business has been crying “buy local” and I believe many people did what they could to that end, until now. All those businesses that gave in and drank the KoolAid better hope it works. I doubt they get much sympathy locally anymore.

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