Our View: Iron Horse proposal needs more time

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Editorial Board, August through January 2012

  • Scott Stanford, general manager
  • Brent Boyer, editor
  • Tom Ross, reporter
  • Shannon Lukens, community representative
  • Scott Ford, community representative

Contact the editorial board at 970-871-4221 or editor@SteamboatToday.com. Would you like to be a member of the board? Fill out a letter of interest now.

It’s been five years since a previous Steamboat Springs City Council made the enormously costly mistake of buying the Iron Horse Inn. The current council should learn from its predecessor and not rush into another decision that could cost taxpayers millions of dollars without being thoroughly vetted.

By any definition, the Iron Horse purchase has been a failure. Conceived as an opportunity to provide affordable housing to city employees during the real estate boom of the mid-2000s, the deal has accomplished little besides suck money from city coffers.

Now, some top city officials and council members see a way out — kind of — from under the burden of the Iron Horse. A plan to sell the city’s existing downtown police station and fire station at Eighth and Yampa streets to local outdoor gear and energy food companies Big Agnes/BAP/Honey Stinger would net $2.1 million for the city, which it would in turn invest as part of a $7 million project to raze the Iron Horse and replace it with a new police station.

Proponents of the plan like that it would get the city out of the property management business while replacing the cramped quarters of the current police station with a new facility just east of downtown. They also see the move as an opportunity for the city to turn over its aging facility to a growing local company that could improve the space and help propel the redevelopment of Yampa Street into a lively, attractive and pedestrian-friendly shopping and dining district.

But the issue is more complex than that.

Regardless of what the city does with its Iron Horse parcel, the debt obligation on the original purchase isn’t going away. Worse, there’s a pre-payment penalty that means it would cost the city $7 million to pay off the debt today. So, those six-figure annual payments aren’t going anywhere.

City officials say they’ll pay for the new police station with unallocated reserves — the same reserves that plan proponent Cari Hermacinski previously has urged her fellow council members to increase, not spend. While the city likely could afford such a large reserve expenditure, we question whether a new $7 million police station is the best use of those funds, particularly when the city’s capital budget has been decimated by years of stagnant construction activity. What about the city’s other infrastructure needs?

One of those needs, if this deal comes to pass, would be a new fire station. The only logical place for a station is the west side of town. The city has estimated the cost of a standalone station at $3 million. That means the Iron Horse plan actually would necessitate $10 million in new building projects throughout the next two years, not to mention any expenses the city would incur in renting and retrofitting a temporary police station while a new facility is built. It should be noted that the city previously has floated a $19.5 million, property-tax funded proposal for a public safety complex in west Steamboat.

Let us be clear: We want Big Agnes/BAP/Honey Stinger to remain in Steamboat, and we love the idea of it creating a Yampa Street retail presence with offices for 50 of its employees upstairs. But we don’t share the sense of urgency with which this proposal appears to be moving through City Hall. It suits the council, city staff and taxpayers to perform their due diligence before any decision is made.

Comments

Steve Lewis 1 year, 7 months ago

Thank you editorial board. We need an engaged and on board public for such a big spend. That means more time, education and diligence.

I will add another obligation to this budget picture. The City staff working in these buildings are a far more important asset than the buildings themselves. In this great recession, we can make do with moderate or even subpar workplaces for our staff. Many outside City Hall are making the same compromises. But we should not be willing to settle for moderate or subpar staff. Steamboat has a history of top notch work at City Hall. But today, in my opinion, we are losing that. Moral has never been so low, and some of our best are already departing.

Priority one should be attending to the issues of City staff.

Salaries are going to be part of that solution. The Iron Horse proposal of last week flattened future budgets and effectively would preclude salary increases that may be warranted.

Exit interviews will likely confirm pay rates are not the only problem. Effective and respected leadership is also a part of creating great staff and getting the most production from them. Few on the outside can judge this leadership as accurately as the City Council that works with the senior management team.

It is my hope the Council will set these new building projects aside and instead work to deliver Steamboat the best City staff on the West Slope.

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Scott Wedel 1 year, 7 months ago

Steve, Problem may also be that city during the boom hired some weak employees at inflated salaries. That to get the open position filled that the city accepted people with weaker qualifications being hired in at high pay grades. And now there is bad morale among older and new employees that they are now stuck earning less than less qualified coworkers.

Thus, the solution probably involves a more thorough review of employees to fix errors of people at the wrong pay grade which will include upgrades and some downgrades.

If the Finance Dept's poorly researched and badly biased staff reports on pay raises and Iron Horse are the result of weak staff then people need to be fired and replaced. Regardless, how staff was allowed to produce such weak reports needs to be corrected.

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