Steamboat Springs City Council faces another tough budget year |

Steamboat Springs City Council faces another tough budget year

— The Steamboat Springs City Council on Tuesday night agreed it should be conservative in its approach to the 2013 budget, but members didn’t all agree on how conservative.

Next year is shaping up to be another challenging fiscal year for Steamboat. The city’s health insurance costs are expected to grow by 3 percent in 2013, and the city will make its first debt payment on the Iron Horse Inn to the tune of more than $433,000.

In 2007, the city issued nearly $5.3 million in certificates of participation to buy the Iron Horse. Those certificates, similar to bonds, are sold to investors who receive returns on the investment.

Council members mentioned the economic uncertainty in Europe and the chance of another sub-par snow year as additional reasons they should stay on a conservative track to budgeting.

"For the past four years, we’ve taken a conservative approach," Finance Director Kim Weber told the council at the start of its budget discussion. "With that approach, we’ve been able to increase the reserves through these tough economic times."

Weber said that since 2004 the city has brought in more sales tax revenue than it had budgeted for. Sales tax revenues make up about 70 percent of the city’s general fund.

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But Steamboat still is in a "cutting period," not a period of growth, council member Walter Magill said.

And council member Cari Hermacinski advocated for continuing to build the city’s reserve. She said that much of the reserve could be eaten away next year by the added burden of the Iron Horse Inn debt and other factors and added that she is worried that budgeting flat to the 2012 budget may not be conservative enough.

The council ultimately agreed to at least start its 2013 budget flat compared with its 2012 projected budget. The 2012 projection is about 7 percent below the actual revenue the city has received to date.

Weber said that while consumer confidence is "slowly ticking up," the presidential election and the unpredictability of Steamboat’s winter season should continue to give the city pause.

But some council members wondered whether the city has been too conservative in its approach to budgeting.

Council member Kevin Kaminski questioned the benefit of budgeting so conservatively that the city significantly underestimates its revenue marks each year.

Last year, revenue came in 16.92 percent above the projected target. In 2010, it came in 10.51 percent above the target.

"What are we gaining by being so conservative when we’re missing the mark like that?" Kaminski asked.

Weber said that by missing that mark year after year, the city has built up a healthy amount of reserve funds. She said the downside is that the city also has put off important capital projects and other expenditures.

City Manager Jon Roberts said that to relieve next year’s added monetary pressure, the city will have to tap into reserves or cut services.

"Staying at the same level (of funding) as last year is going to be rough," he said Thursday.

To reach Scott Franz, call 970-871-4210 or email

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Sunday, Aug. 5 2012: Steamboat City Council to discuss 2013 budget

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