Copper Mountain and Dillon officials promote tax initiatives on ballot
October 30, 2013
The countdown to Election Day continues and in addition to several ballot measures addressing taxes on retail marijuana sales and maintaining revenues for early childhood education, several Summit County voters also will have to decide on local ballot initiatives aimed to increase town revenue for projects, infrastructure and services.
In the town of Dillon, local officials have posed two user-based tax increases that could pump $185,000 of additional annual revenue into the town coffers.
Referred Issue 2E would generate those increased revenues by applying the town's 2.5 percent sales tax on all recreational rental activity, as well as impose a $1 surcharge on admissions to a variety of public events.
The sales tax portion of the initiative would be applied to everything from boat rentals at the marina to ski, snowboard and bicycle rentals at local businesses. The tax would also apply to the use of lanes and the renting of shoes at bowling alleys.
The $1 tax on public events would be applied to the cost of admission to performing arts events, such as concerts, movies and plays, both amateur and professional sporting events, and "door fees" imposed by local bars, restaurants and taverns.
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Although the revenues could be applied to any government service, according to the question's ballot language, Mayor Pro-Tem Kevin Burns said the Dillon Town Council plans to apply the increased funds to a variety of capital projects.
"We held a public meeting about this question a couple of weeks ago and after we were able to explain to residents and business owners what we need the funds for, most people seemed supportive," Burns said. "The town has a long list of capital projects, like the town park master plan, and I think a lot of people would like to see us move forward on that."
In addition to capital projects, Burns said the funds could also be applied to maintaining services and infrastructure to make the quality of life in Dillon better.
"If people think it's worthwhile, then we'll move forward," Burns said. "If not, then we'll have to look at other funding options. That's why we have this on the ballot, to give residents the opportunity to tell us what they think is important."
The Copper Mountain Consolidated Metropolitan District also is proposing a tax initiative separate from education and marijuana questions at the state and county levels.
Copper Mountain officials are asking local voters to approve a measure aimed at steadying one of the district's mill levies.
District manager Dave Erickson said Wednesday Copper Mountain generates the majority of its operating funds from three voter approved mill levies. Two of those three mill levies are secure, Erickson said, meaning district officials can plan for and estimate the funds they expect to receive each year.
However, the "historical" mill levy, which was approved by voters in 1996 shortly after the district was formed, stipulates how much revenue the district can retain from property taxes each year. As a result, whenever assessed property values change, local officials have to reset the mill levy to ensure the district does not collect more revenue than what was approved by voters under the Taxpayer Bill of Rights.
Aside from the inconvenience of regularly resetting the mill levy, Erickson said local property values have increased dramatically since the 1990s — due in part to increased construction and the rate of inflation, which has forced local officials to ratchet down the mill levy over time.
For example, in 1996 the district's assessed property value was $23 million and the mill levy was set at 5.922 mills. The district's 2014 assessed value is $65 million, forcing local officials to drop the mill levy down to 2.614 mills.
Although it would seem fluctuating the mill levy to ensure revenues remain constant over time is a relatively small inconvenience, Erickson said inflation also has driven up the cost of services. Increased costs coupled with a rising population have forced district officials to dip into reserves to maintain services, a practice the district can't sustain for much longer, Erickson said.
To address those concerns local officials drafted Referred Issue 5A to set the historical levy at 2014's rate of 2.614 mills in perpetuity. If approved, revenues generated by the mill levy would fluctuate in accordance with assessed property values, rather than the other way around.
"The TABOR question is not a tax increase, but a way to stabilize the mill so it doesn't continue to drop out from under us," Erickson said. "It would allow us to keep up with inflation and allow us to retain all of the revenue 2.6 mills would generate regardless of property values."
Voting in favor of the mill levy question would have a significant benefit on local residents, Erickson said. Revenue generated by the historical mill funds the district's fire and first responder services. Stabilizing the mill would ensure the district could better maintain those services in the future.
"Voters have supported tax increases in the past and I think they will support this question because it just waves the provision that requires the district to adjust its mills whenever property values fluctuate," Erickson said. "If we can secure that mill base it would allow us to maintain revenues for community fire services without having to seek tax increases in the future every time the mill levy gets ratcheted down."
The town of Blue River also proposed a tax initiative to local voters. That question will be featured in Friday's edition of the Summit Daily News.