The Pagosa Springs Area Tourism Board met on July 13 to briefly discuss a pressing issue. Should some portion of the $1 million collected jointly from Town and County Lodgers Taxes be used to address the worsening housing crisis in Pagosa Springs?
Perhaps even a large portion?
A recommendation to do exactly that, was unanimously approved by the Town Planning Commission last week.
Expenditure of the Town of Pagosa Springs’ 4.9% Lodgers Tax, and the Archuleta County 1.9% Lodgers Tax — which totaled over $1 million in 2020 — is currently overseen by the Tourism Board. For the past decade, the funds have been used for tourism marketing (about 50% of the annual budget), for subsidizing local tourist-friendly events (about 6% of the budget), for capital expenditures such as signage, the large wood-and-steel ‘Overlook’ structure across the street from the Main Street commercial block, a new portable performance stage, that kind of stuff (about 10% of the budget), with about 25% going to staff salaries.
Those are rough numbers.
No money has ever been spent by the Tourism Board, as far as I know, to address the serious lack of housing for our workforce, many of whom are essential to the tourism industry.
About $750,000 currently sits in the Tourism Board’s bank account, as a ‘reserve’. To be used, someday? For something?
During the July 13 meeting, we heard a variety of perspectives about whether some portion of these public funds should, or shouldn’t, be used to address the housing shortage.
Here is Mona Cayard, who represents the Chamber of Commerce on the Tourism Board:
“I do want to say something about the Lodgers Tax report. I think you may see a bigger increase from the vacation rentals this year. Based on my conversations with some of the [hotels and motels] they are running at 50% occupancy or below, due to staffing shortages.”
The Board considered that information — that lodging establishments should be running at low occupancy rates during the height of the tourism season — and an extended silence hung over the room.
Then Board member Lauri Heraty spoke up.
“That’s kind of just nationwide, too… An article from the National Association of Realtors just came out, and the East Coast has been hit even harder than Colorado. So, I think we really get focused on this as a Pagosa issue — a positive Pagosa issue or a negative Pagosa problem… and there’s nothing that’s going to stop what’s happening. I was in a hotel last night, and there was no housekeeping, because there’s no staff.”
Mona Cayard:
“And that’s a very common thing…”
Lauri Heraty:
“And it’s every industry, too… can’t get a rental car… look at how many flights are getting canceled. This isn’t because we have no housing or we have too many tourists, it’s a nationwide shift that… well, we don’t know what it is…. We’re not going to solve it in Pagosa, and if we do, we’re cutting off our nose to spite our face. It’s not a Pagosa thing, it’s not a Colorado thing. It’s a nationwide challenge.”
Mona Cayard:
“But it’s also a challenge here. Because workforce housing is a big issue, because workers are leaving. I’ve had more employees say that they can’t stay here, because they can’t afford to live here. So, yes, it is, in fact, a problem for Pagosa, not just nationwide. As community members, we really need to focus on, ‘What can we do about workforce housing?’ Because that really is an issue. We can’t ignore it, and excuse it just because it’s nationwide. It is truly here. I interviewed ten applicants today, and seven of them said, ‘I can’t afford to live in your community. I want a job; I want to live in Colorado. But I can’t afford to live there.’ So we need to think about that…”
Tourism Director Jennie Green told the Board she would like to get all the community decision-makers around the same table to discuss how Lodgers Tax ought to be used, going forward, but she had the impression, based on an earlier conversation, that two of the three County Commissioners were not interested in such a meeting.
“So, it might be a smaller group, but if we get everyone else interested, maybe the commissioners will eventually join.” She said she assumed that County Commissioner Ronnie Maez, a member of the Tourism Board, would be happy to participate in such a group meeting, and Commissioner Maez confirmed that indeed he would.
Commissioner Maez expressed his opposition to using Lodgers Tax funding to address Archuleta County’s housing crisis, suggesting instead that an increase to the County sales tax would provide a “long-term” revenue stream that could be directed towards workforce housing.
“The tourists pay the biggest part of the sales tax, here,” Commissioner Maez suggested. Several Board members voiced their agreement.
It’s a pretty well established fact that, in most communities, the sales tax is the most regressive form of taxation — that is, that it hits the poorest members of the community the hardest. But when community leaders believe that “the tourists pay the biggest part of the sales tax,” it can seem inviting to propose a sales tax increase.
So many false assumptions, we hang onto.
Here’s then-Commissioner Michael Whiting, speaking at a BOCC work session back in April 2018.
“One of the questions we’re asking now is, what percentage of of local taxation is on the shoulders of the locals, versus the tourists. And that’s a question that’s never been asked and answered adequately here. Ever. And that’s a really big question. It’s a big question politically, and it’s a big question in terms of how we finance things around here…”
Apparently, Commissioner Whiting hadn’t been reading the Daily Post regularly… because that question had already been asked, and pretty well answered… 12 months earlier.
What’s the economic impact of tourists visiting Pagosa Springs? Really huge? Or maybe not?
Are the tourists paying for our local governments? Or is it primarily our burden to bear, as residents?
And what other price do our full-time residents pay?