Aspen lodges won’t collect voluntary marketing fee
November 3, 2009
ASPEN – Aspen’s lodging sector won’t institute a voluntary, 1 percent tax to generate marketing dollars in the wake of a ballot snafu that scuttled hopes of creating a special district to raise the money.
Representatives of most of the hotels and lodging establishments in Aspen gathered last week to discuss the idea, according to local hotelier Warren Klug, a member of the Aspen Lodging Association board and chairman of the Aspen Chamber Resort Association board of directors. There was support for the intent, he said, but it was deemed unfeasible.
“In the end, we found several of the larger properties would be unable to go along with it,” said Klug. “It just isn’t going to fly, unfortunately.”
The big, corporately owned properties aren’t in a position to levy a voluntary fee, unlike the locally owned and controlled lodges, Klug said.
In addition, it was pointed out that a voluntary fee would quickly be negotiated off the price for establishments that do a lot of group business, said Debbie Braun, ACRA president.
Lodging representatives, mindful of anti-trust laws, also quickly backed away from a group discussion about rates, Klug added.
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“When everybody agrees on some sort of price, you’re on very thin ice,” he said.
The Aspen Lodging Association and ACRA were backing formation of the marketing district – the focus of Referendum 5A – in Tuesday’s election. The question has been pulled because of errors: some people who shouldn’t be able to vote on the measure found it on their mail-in ballots, while others who reside within the proposed district and were supposed to vote on it didn’t find the question on their ballots. Votes cast on Referendum 5A won’t be tallied.
Resort officials will likely turn to the city for a short-term infusion of marketing dollars. The city supplemented this year’s marketing fund with an extra $200,000. The city currently collects a 0.5 percent lodging tax and contracts with the ACRA to develop a marketing plan for summer, spring and fall with the proceeds; the Aspen Skiing Co. spearheads the resort’s winter marketing effort.
Mayor Mick Ireland had suggested a loan from the city’s reserve fund to bolster next year’s marketing budget, to be repaid through a voluntary 1 percent fee.
The ACRA will present its 2009 marketing report and proposed 2010 plan to the City Council on Nov. 16.
“We’re hoping at that meeting … we’ll all be able to come upon a magic number and where we’re going to come upon that magic money, too,” Braun said.
The city does have a $200,000 line item in its 2010 budget for events, she noted, and has asked the community for ideas on how to spend it.
The 0.5 percent existing lodging tax is expected to generate $450,000 next year. The ACRA had $815,000 to work with this year, and had expected to have $1.3 million next year, had Referendum 5A been approved.
“I’m absolutely sure that the tax would have passed,” Klug said.
Instead, there was agreement within the lodging association that the special district will go back on the ballot in November 2010 – the next available opportunity to ask a tax question of Aspen voters.
In the meantime, other Colorado resorts are looking to bolster their marketing dollars.
Vail residents will be asked to consider a 2 to 4 percent lodging tax that is expected to raise up to $4 million for marketing. Breckenridge is mulling a tax increase to bring its marketing fund up to about $2.4 million annually, and Telluride is voting this week on whether to increase sales tax by 0.6 percent to support special events and arts.
“They’re doing the right thing,” Klug said of Breckenridge. “We should be, too.”