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Steamboat Springs Should Steamboat Springs voters approve Referendum 2B on Nov. 1, the expected $1.3 million that could be generated annually for up to five years by the 0.25 percent citywide sales tax would be administered by the existing board of the Local Marketing District. The board also oversees revenues generated by a 2 percent lodging tax.
However, there is a notable difference between how Referendum 2B revenues and Local Marketing District revenues can be used, City Finance Director Deb Hinsvark said Wednesday.
“Use of the 2B funds will be extremely narrow,” Hinsvark said.
Revenues from the Local Marketing District lodging tax may be used to market airline service and to support summer airline service as well as to pay minimum revenue guarantees to the airlines that fly to Yampa Valley Regional Airport during ski season. But 2B funds could be used only to meet contractual obligations for airline revenue guarantees.
Hinsvark pointed out that the district is a statutory authority — essentially a government — and the city’s role is to provide the accounting of the funds. The district pays the Steamboat Springs Chamber Resort Association to post public notice of its quarterly public meetings and keep the minutes. The city would collect an administrative fee of 1 percent of the total revenues collected from the 0.25 percent tax. The city also collects 2 percent of the accommodation tax as an administrative fee.
The city appoints the members of the board and approves its annual budget. The city manager also has the authority to request additional documentation before the city releases funds to pay invoices.
City Attorney Tony Lettunich said an intergovernmental agreement between the city and the district was executed Aug. 12 so that the terms governing the tax collection and disbursement of funds already would be in place if the measure passes. The agreement was signed by City Council President Cari Hermacinski, City Clerk Julie Franklin, Local Marketing District presiding officer Steve Dawes, Local Marketing District Secretary/Treasurer Chuck Porter and Steamboat Ski & Resort Corp. President Chris Diamond. The ski area manages the ski season airline program.
Porter said the board fully anticipates that if Referendum 2B passes, it naturally would be involved in a more public process as a result of the new general sales tax.
“We understand it’s going to have a higher level of stakeholders and broader interest base,” Porter said. “There’s going to be a lot more interested people, and that’s OK. We’ve been thinking we need to have an open house once or twice a year to talk to the public about the airline program.”
The new intergovernmental agreement signed in September specifies that if the 2B tax goes into place, Ski Corp. will enter into a contractual obligation to contribute no less than $1,111,732 annually to the revenue guarantees, as long as the tax is in place and is used to fund the airline revenue guarantees.
Porter said that in his role as treasurer, he would manage the sequence in which funds available for the airline program would be committed, with Ski Corp’s $1.1 million being first in line to be applied to revenue guarantees. Next in line would be 2B funds, including any carry-over from the previous ski season. Finally, the Local Marketing District funds would be applied to the revenue guarantees, potentially putting the district in position to meet its goal of rebuilding its $1 million reserve during the five-year term of the tax.
Other members of the district board include Lisa Sanchez-Warner and former Ski Corp. marketing executive Rod Hanna. Tom Sharp serves as the board’s legal counsel. Other people who regularly attend meetings include Ski Corp. Airline Program Manager Janet Fischer, Ski Corp. Senior Vice President of Sales and Marketing Rob Perlman, YVRA Manager Dave Ruppel, County Manager Tom Sullivan and Chamber Human Resources and Finance Director Marion Taylor.
— To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com