Snowmass Village marketing chair Purvis details rebate for tourists
December 23, 2002
When the Snowmass Marketing and Special Events Board cast the first key vote of its month-old existence, board chairman Bob Purvis voted “no” on the issue.
On the table was whether to spend $160,000 in marketing money to offset sales and lodging taxes for Snowmass Village guests who had paid in full for lodging prior to Dec. 1, but were being handed unexpected tax bills.
Some of the guests who had prepaid for holiday rentals were balking at paying the new 2.5 percent sales tax that started on Dec. 1, even if they did understand that under state law, tax on rentals is due at the time of occupancy, not at the time of payment.
Other guests were questioning, albeit less strenuously, a new .9 percent increase in the civic assessment charged on lodging rentals of condos by the Snowmass Village Resort Association.
Because some customers complained, the Snowmass lodging community came to the marketing board seeking $273,000, so that guests that had paid in full, and guests that had only partially paid, would not have to see the new taxes.
That request was a bit too rich. The marketing board only opted to cover the tax for those paid in full by Dec. 1, to the tune of an estimated $160,000 worth of “customer service credits,” as one board member called them.
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However, the marketing board’s action means that an estimated $100,000 of the $160,000 could go from the town’s new marketing fund right to the SVRA, even though the SVRA tax hike was not for marketing purposes.
Under the plan, lodging and property managers will pay the taxes due on a vacation rental, so the guest will not see them. Then the property managers are to apply to the town for reimbursement.
They don’t need to prove that someone was upset about the tax, only document that they indeed did pay the tax on their guest’s behalf.
In the case of the SVRA tax, the lodge operators would then pass the town’s marketing money back to the SVRA.
Purvis is a former Town Councilman who was instrumental in the creation and passage of the 2.5 percent townwide sales tax for marketing, special events and public relations, which is expected to generate $2.5 million a year.
And of the five recently appointed citizens to the marketing board, he has by far the most marketing experience. He recently retired as a senior executive at British Petroleum and was in charge of the giant oil company’s global branding efforts.
After last Thursday’s 3-2 vote by the board in favor of spending $160,000 to offer the resort’s mostly wealthy guests what is essentially a tax rebate, Purvis spoke with The Aspen Times.
Times:-You voted against the measure. Why?
Bob Purvis: Because I didn’t feel we had established a strong enough position from which to continue to discuss with the SVRA what might be their share in terms of the cost of the program that we intended to put in place.
I felt comfortable with what we were doing, because of the favorable impact it would have on our guests immediately. But I voted against it so that perhaps we could have continued discussions about the SVRA’s .9 percent increase and where it came from and why their share should be something larger than it now is.
But at the end of it, if we had strengthened our platform from which to continue discussions with the SVRA about their share, then I would have agreed with the proposal as you now see it.
-Many lodgers said that it was not about the money, that their customers could afford the tax. But $160,000 is a lot of money to give back. It is almost half of what the Aspen Chamber Resort Association now has for marketing for a year. How is this not a tax rebate for wealthy people who don’t need the money?
I don’t know about the need that people have for money or the lack of a need because I can’t go around and demographically profile all of these folks. It isn’t based on their net worth or what they are paying per day for lodging in our community.
It is based on whether or not they are a guest who might be upset at an increase in what they thought was going to be the cost of their fully-paid-in-advance vacation.
So the requirement to be eligible, to benefit from this program, doesn’t have anything to do with their demographics or their net worth.
It has to do with whether or not they have engaged in a transaction for the rental of property in our village and have paid in advance, in full, and are now finding that there are some unexpected additional charges, which upsets them.
Now, I would like to believe that the figure we put out there is the upside, and that many in our lodging community will responsibly manage this issue in such a way that they may not feel it is necessary to plea for recovery to the funds. But we have said that is for them in their judgment to decide.
-We’ve heard from the property managers that only a minority of their customers are upset, and yet we’ve given them the opportunity to rebate the tax for everybody.
Well, we have heard from a representative selection of property managers that the upset is great enough that we ought to deal with it before it becomes a long-term customer relations issue, which would have a negative impact on the future viability of this resort.
-Normally, the customer relations equation is between the property manager and their customers. Some property management firms have said that through good customer relations, they have managed the problem. Is the board bailing out some property managers who didn’t have their act together?
I don’t know whether we are bailing out people who don’t have their act together or not, to be honest with you.
What I do know is that we have a public relations issue that is not beneficial to the village as a whole, and I do believe that the marketing and special events board is charged with seeing that we have positive, rather than negative, public relations.
-What other customer relations opportunities that didn’t cost quite so much money were considered and rejected by the marketing board today (Thursday)?
Today, we didn’t consider an additional range of options because we were addressing the specific issues that had been brought to us, and as time was of the essence, given that the Christmas holiday starts in just a couple of days, we didn’t go off and have a retreat or workshop and brainstorm this. That wasn’t the time line that we were provided.
-But isn’t there something in between spending $15,000 on gift certificates, as the town manager proposed, and spending $160,000 on what amounts to a tax rebate. There may have been other creative options available to take advantage of this “customer service opportunity.”
That may be true. But it was the wisdom of the board that to act as quickly as we thought we needed to, that this option was the one of choice.
[Brent Gardner-Smith’s e-mail address is firstname.lastname@example.org]ts Board]