Plan for Steamboat Springs' lodging tax may require voter approval

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— Voters could be the final judges of the Steamboat Springs City Council's plan for how to spend the city's lucrative 1 percent lodging tax revenues.

The committee charged with recommending what to do with the annual revenue stream in 2014 met last week and discussed the potential of a public vote on the proposal, or proposals, they will recommend to the council to be funded by the tax.

It already was known the city needs voter approval if its plan for the revenue requires issuing bonded indebtedness to embark on a new capital project. But the committee now is pondering whether the city also would need voter approval to commit the tax to a project for an extended period of time.

“Let's say we make a recommendation in August, and we agree to give (an applicant) $200,000 a year for the next 10 years. There's absolutely nothing that would prevent a new City Council from saying, ‘That's a bad decision, and we're not going to award those funds',” committee member and councilwoman Cari Hermacinski said Sunday.

During an hourlong meeting last month, the committee trimmed the list of applicants for the tax from 16 to eight.

The remaining proposals range from the Haymaker Golf Course's request to earmark the tax for future capital improvements to the Steamboat Springs Trail Alliance's plan to build 46 new biking and multiuse trail segments and connections around town.

Hermacinski said she thinks it's “highly likely” that a public vote will be needed to bind future city councils to the current council's eventual plan for spending the revenue.

Calling the potential for a vote on any of the remaining eight final proposals for the tax a “surprise,” Hermacinski said the committee should know more next month about how each proposal would be financed and if it would require the city to seek a public vote.

“Frankly, this is such a high-profile tax, and a lot of different groups want it in the community,” she said. “I think the idea that it ultimately has to be approved by the voters is somewhat reassuring.”

Each of the final eight applicants for the tax will have 30 minutes next month to present to the committee and answer questions, including whether their project will require bonding.

Lodging tax committee member Kenny Reisman, who also is a city councilman, said it will be important to determine how the funding from the tax that nets $600,000 to $800,000 a year will be leveraged.

“I think every proposal has the issue of leveraging funds, and we're just trying to get what the leveraging of the funds would look like,” Reisman said. “We will have it completely vetted (by the time we make a final recommendation).”

He said the committee is working with City Attorney Tony Lettunich and members of its bond council to determine how each proposal would be financed.

“In order to get certain bonding, some proposals might have to got to a public vote,” Reisman said.

It wouldn't be the first time voters weighed in on how the tax was being spent.

The city needed voter approval to allocate the lodging tax, also referred to as the accommodations tax, to Haymaker Golf Course bonds in the ‘90s. The measure failed the first time it was on the ballot, but passed in its second effort.

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

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