Breckenridge weighs options for marketing tax increase
Summit County correspondent
Aspen, CO Colorado
BRECKENRIDGE, Colo. – The Breckenridge Town Council won’t likely go to the voters this April for a sales tax increase to sustain marketing, but town officials continue to examine their options.
“Everybody agrees we have a problem – that is that we’ve got an underfunded marketing program and several people don’t know what the magnitude of the problem is,” Mayor John Warner, chair of a committee formed to address the issue, said Wednesday.
The town needs a dependable source of revenue for marketing, as its business and occupational licensing tax earmarked for marketing – approved in the early 1990s – didn’t include a mechanism to adjust for inflation.
Other revenue sources contribute to marketing, but the town needs more to maintain its share in a highly competitive travel market.
“We’re definitely on the low end of major destinations,” said John McMahon, executive director of BRC and member of the marketing committee.
He said the town’s funding is about one-fourth to one-third of communities such as Vail and Aspen and Snowmass. He said Winter Park, Steamboat and Mammoth all have higher “direct marketing” budgets.
At a time of high unemployment and decreased sales, local leaders are cautious about jumping into something that could quite possibly fail.
“Across the board in Anytown, USA right now, any tax question is a difficult task to pass,” said David Cunningham, a political consultant from Frisco.
He said the town would need to be specific with voters on where the money would go.
“They need to show they’re being responsible, good stewards of the taxpayer dollars,” he said.
At Tuesday’s town council work session, the potential revenue stream was discussed to go toward events and nonprofits in addition to marketing.
The April ballot item would be for a 0.5 percent increase in sales tax – a nickel on a $10 purchase – to bring in about $1.3 million to $1.4 million per year.
The town has budgeted $1.68 million for marketing through BRC in 2010; the proposed tax increase would bring town marketing efforts to a more competitive level, according to a previous report in the Summit Daily.
But Warner said at Tuesday’s work session that it certainly needs to be clear how much money is needed for what.
“We’re throwing a solution out there, and we haven’t exactly defined the problem,” he said.
The sustainable marketing committee formed last fall includes representatives from local lodging companies, Breckenridge Resort Chamber and others.
Possible alternatives to a sales tax increase include an amusement tax on ski area lift tickets, movies, sleigh rides and more. Council has also discussed adjusting the portions of tax revenues that go to marketing.
The committee is leaning toward the sales tax increase “because it really gives you bang for the buck,” Warner said.
The council was divided Tuesday on whether to go to the voters in April or wait until later – perhaps November or even April 2012.
Councilman Dave Rossi said Wednesday that the work sessions are “kind of like in an echo chamber” in that while everyone present understands the importance of marketing for the community, local residents have their own perspectives.
“I really believe that it would fail and we would be a lot farther back than we would have been,” he said of the potential sales tax increase.
It’s not too late for council to call a special meeting and get an ordinance approving the ballot issue by Feb. 9, but it appears further discussion and public education efforts will be needed before everyone is comfortable.
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