Our View: New taxes make sense for Hayden
October 14, 2009
As planning and growth issues continue to affect the entire county, particularly areas west of Steamboat Springs city limits, it’s important that the town of Hayden has a strong, well-funded government. As such, we think Referendums 2A and 2B are reasonable tax measures that will help Hayden boost its slim coffers by tapping into its most valuable economic resource – Yampa Valley Regional Airport. Hayden voters should approve both tax proposals on this year’s ballot.
Of the two ballot measures, Referendum 2B has the most significant immediate impacts. It asks voters to approve a car rental tax of 3.5 percent that would raise $143,500 a year based on 2008 car rental figures. But with a 30 percent decrease in car rentals in 2009, it’s likely the tax would raise closer to $100,000 for the town in its first year.
Regardless, that’s no small chunk of change for Hayden, which like other local municipalities has struggled through painful budget cuts and employee furloughs. YVRA is in Hayden town limits, and airport fees and taxes provide about half of the town’s sales tax revenue.
Adding 3.5 percent in rental car taxes still keeps the cost of renting a vehicle at YVRA in line with some other Colorado mountain resort airports, including Eagle Valley and Aspen. If 2B passes, car rental fees and taxes will amount to 37 percent of the total cost of renting a vehicle in Hayden. That compares to 38 percent at Eagle County Regional Airport, and 32 percent at Aspen Airport. We don’t think the increase will affect a potential visitor’s decision to come to Steamboat Springs on vacation.
Furthermore, we can’t blame Hayden for seeking to tap into additional tourism dollars. It certainly feels disingenuous for Steamboat business officials to criticize the tax increase and its potential impact on tourist visits in winter and summer. The city of Steamboat Springs is a sales tax-based economy that relies heavily on tourism to fund its services and capital projects, and rarely do we take issue with using visitors to subsidize our town. Steamboat’s city sales tax rate of 4.5 percent is higher than that of Aspen, Vail, Snowmass Village, Silverthorne, Estes Park, Durango, Crested Butte and Breckenridge, to name a few other resort towns.
The other ballot measure facing Hayden residents, Referendum 2A, seeks to add a 3.5 percent lodging tax on nightly accommodations in Hayden. As it stands, only a few rooms at the Redstone Motel would be affected by the tax. It’s projected to produce about $1,200 a year for Hayden, a total that will increase if additional lodging properties are developed there.
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Finally, it’s worth reminding Hayden voters that one of the primary reasons the town moved to home rule charter status this year was so that it could levy additional taxes and remove itself from the restrictions of being a statutory town bound by the state constitution.
Levying additional taxes isn’t always the right approach for governments seeking to find additional sources of revenue or compensate during lean times, but we think Referendums 2A and 2B are prudent steps for Hayden to take to help secure the long-term financial future of the town.
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