Lodging tax would bolster Frisco funds
FRISCO – Come January, visitors to Frisco will pay a 2.35 percent lodging tax – should local voters approve Measure 2A at the polls Nov. 4.
The tax would generate an estimated $250,000 annually that would be allocated to economic development, special events, advertising and marketing, recreational amenities, multipurpose facilities and open space.
“At no cost to Frisco taxpayers, (the lodging tax) will not only make the town more attractive to visitors, but will also provide amenities for the people of the town to share,” said Frisco Mayor Bob Moscatelli.
“In the first year, we will have significant monies to increase marketing, and it’s supported by a majority of the lodging community. It’s a good thing for Frisco,” Moscatelli said.
Frisco’s sales tax now totals 7.65 percent, which already applies to rooms rented in hotels and motels. The tax total includes Frisco’s 4 percent plus the 2.9 percent state tax and the .75 percent Summit Stage sales tax.
Under the proposed lodging tax, visitors would pay a 10 percent tax on their rooms. Frisco is currently the only town in the county that has not imposed a lodging tax.
Visitors to Silverthorne and Dillon, where a lodging tax is already in place, pay 9.65 percent total tax for lodging. Breckenridge’s total tax for lodging is slightly higher than 10 percent.
Current Frisco residents would pay no additional tax, should the measure pass, unless they choose to stay in a local hotel.
Reeling in the tourists
If the lodging tax passes, 60 percent of its revenues would be dedicated to economic development, marketing and special events in its first year, 40 percent in the second year and 30 percent in years thereafter.
The added revenues would substantially increase existing marketing efforts. In 2003, the town spent $40,000 on direct advertising and $55,000 on special events.
An advertising blitz geared at Front Range residents for last summer’s Fourth of July celebration yielded improved Frisco sales tax revenues. Town officials would use lodging tax money to replicate such marketing for other events like Music on Main.
Amenities for tourists and locals alike
According to Town Manager Alan Briley, a plethora of quality projects are waiting in the wings, but the recent economic downturn has put the squeeze on funding.
“We just don’t have a big pool of money to do all these neat things,” Briley said.
No specific projects are outlined in the measure, but possibilities include a Nordic skiing village, a multipurpose convention center, an ice rink, pocket parks and amphitheaters.
Briley said that groups often call the town in search of meeting facilities, and the lodging tax could help fund such a facility.
Hotel owners conflicted
Some Frisco hotel and motel owners worry that a lodging tax might take away one of their most important competitive advantages.
“When you’re working reservations, people ask what the price would be with tax,” said Lester Warpecha, who owns Alpine Inn with his wife, Eva.
“The town should maybe wait for a better time or it should have done it when business was booming three years ago. The lodging industry is not doing great; business is flat now. I hope (the lodging tax) doesn’t steer people away. Every customer is important to us.”
Paul Connelly, co-owner of Mountains reservation service in Frisco, supports the ballot measure, but has some reservations about how the town will spend the money.
“I’m for it so long as all the proceeds are spent on marketing and advertising. I don’t want the money going to a slush fund,” Connelly said.
Connelly also expressed concern that the tax will not be grandfathered in. Visitors who have already made reservations for 2004 will be taxed if they don’t pay by Dec. 31.
Briley said that fact provides incentive for guests to pay before the year is up, which would benefit hotel owners.
But Connelly said the tax is a cost he can’t pass on to guests to whom he has already quoted a rate. He said he’ll end up footing the bill or risk losing the business.
“It’s just going to charge businesses for no reason,” Connelly said.
Julie Sutor can be reached at (970) 668-3998, ext. 203, or at
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