As a home rule municipality, the Town also has the option of imposing an excise tax on specific goods or services as it sees fit. Excise tax revenues could be dedicated to fund affordable housing; however, this requires voter approval first. This option could be viable and create a steady revenue stream for affordable housing if the voters can be persuaded…
— from a December 2019 memo by the Town of Pagosa Springs’ former legal counsel, Collins Cockrel & Cole.
The Pagosa Springs Town Council will meet this evening, October 21, at 5pm… a meeting that will presumably start off, according to recent tradition, with the Pledge of Allegiance and a moment of silence. We will then hear progress reports on various governmental projects and concerns, including a Lodgers Tax report, which typically explains how much more the Town collected this year, compared to the same period last year.
Here’s a quote from the agenda packet:
LODGERS TAX FINANCIAL REPORT
The lodging tax report has been updated with payments received through August 2021. August 2021 reflected a 12.14% decrease over 2020, or $12,941. While still significantly higher than 2019 (pre-COVID), Director anticipates the remaining months of 2021 to be less than 2020. With kids back in school (in person), shoulder season travel is expected return to more normal levels.
These facts are true, as far as they go. The Town’s 4.9% Lodgers Tax collections did reflect a 12% decrease in August, compared to August 2020. That’s still better that 2019, but suggests a “return to normal” in the coming months. But we note that the Pagosa Springs Area Tourism Board spends revenues from two Lodgers Tax collections — the Town’s 4.9% Lodgers Tax and the County’s 1.9% Lodgers Tax. The Town reports their collections monthly, while the County reports their collections quarterly.
The meeting packet contains the following chart, showing County collections. Most of the community’s STRs (Short-Term Rentals) are located in the county. Some data sources indicate that we have more than 1,000 STRs in the community. The County government has licensed fewer than 600, I understand.
This month’s report doesn’t mention the exponential increase in County Lodgers Tax — for just the first two quarters of 2021 — but the growth was noted in the September Lodgers Tax report.
Q2 County collections reflected a massive increase of 118% over Q2 2020, with collections totaling $115,041 compared to $52,809 in 2020; an increase of $62,232. Combined Q2 collections for both Town and County were up 95% in 2021, an increase of $175,686. Total Q2 in 2021 was $360,496.
“Massive” is right. The County tax collection from the first quarter alone was more than the entire year in 2015. And it’s all being spent to subsidize the tourism industry.
It appears to me that this chart will need to be expanded well beyond $400,000 by the end of 2021, when we note that the third and fourth quarters have traditionally been the most profitable periods for the County collections. This suggests that the County might collect $500,000 in Lodgers Tax by the end of the year… compared to, say, 2014 and 2015, when the annual collection barely exceeded $100,000.
Exponential growth of tourism? In a town were local workers are stuck living in RVs?
Later in the meeting, we’ll be treated to discussions about Resolution 2021-17, Adopting Revised Rules and Regulations for Hill Top Cemetery, HB 21-1162, a statewide Ban on Single Use Plastic Bags and Polystyrene Containers, and then we will arrive at the agenda item of the most interest to me, personally.
Discussion of Possible Ballot Questions for Upcoming Elections
The possible ballot questions which might appear on the Town’s April 5, 2022 election ballot, mentioned in the agenda brief, include possible changes to the Council composition (a reduction from seven members to five members?) and possible changes to Council compensation (how much should they be compensated, for preparing for and attending two to four meetings per month?)
The discussion will also touch on how the Town’s Lodgers Tax might be allocated, going forward.
The volunteer non-profit Pagosa Housing Partners (of which I’m currently board president) has proposed a reallocation of the Town’s 4.9% Lodgers Tax. We believe it’s unhealthy to spend $1 million per year in public funds — perhaps $1.5 million next year?— subsidizing the tourism industry, when our workers are living in RVs. We’ve been subsidizing the tourism industry very generously for the past 20 years, and that’s part of the reason our community has become dysfunctional. We believe a healthy community, in the situation we’re in, will spend the next ten years subsidizing housing for the people who keep the tourism industry — and the rest of our economy — functioning.
In line with the recommendations made last July by the Town Planning Commission, we’re proposing that 50% of the Town Lodgers tax be directed toward housing for our workforce. That would leave the (exponentially-growing) County Lodgers Tax completely untouched, and presumably used for continued subsidies to the tourism industry. We’re asking that this change of allocation be placed before the town voters on April 5, 2022, for their approval.
You can download that proposed ordinance here. It appears, from tonight’s agenda, that the Council will have a chance to discuss this proposed ordinance.
The Council is also scheduled to discuss a second potential ballot measure — also proposed by Pagosa Housing Partners, in line with the recommendations from the Town Planning Commission — which would establish a new excise tax on vacation rentals, the revenues from which would be used to encourage and facilitate workforce housing projects. This excise tax would be based upon the number of bedrooms licensed in each vacation rental, so that larger properties would pay more than smaller properties. Due to TABOR (Taxpayers Bill of Rights), any new tax in Colorado must be approved by the voters, so this excise tax proposal will appear on the Town’s April 5 ballot.
You can download that proposed excise tax ordinance here.
The Council meeting tonight takes place in-person and via Zoom at 5pm. The Council allows public comment at the very beginning of the meeting — by Zoom or in-person. It’s possible the Council will also allow public comment during its consideration of the two proposed workforce housing ballot measures?
At Tuesday’s Archuleta Board of County Commissioners’ meeting, County Development Director Pamela Flowers presented some ideas for allowing people to live in RVs year-round, as was discussed yesterday in Part Six. She got a generally positive responses to her suggestions, from the commissioners.
Ms. Flowers also proposed that the BOCC impose a moratorium on new vacation rental licenses. If we’re going to take the drastic step of allowing year-round use of RVs to address our housing crisis, she suggested, how can we, in good conscience, allow even more existing residential homes — our limited supply of residential housing — to be converted into tourist motels?
In yesterday’s editorial, I shared a detail from the Tourism Board’s website.
I noted the blurb under “Events”… that we are “returning to normal”.
Some of us feel it’s time to redefine what, exactly, we mean by “normal”.
Bill Hudson began sharing his opinions in the Pagosa Daily Post in 2004 and can’t seem to break the habit. He claims that, in Pagosa Springs, opinions are like pickup trucks: everybody has one.