Ski areas oppose lift ticket taxes to fund infrastructure
BRECKENRIDGE – Ski area officials don’t want to touch the “T” word.
And they defended their stance against a lift ticket tax at a Breckenridge Resort Chamber breakfast Thursday, saying such a tax would increase competition in an already dog-eat-dog industry.
“People turn to it because it seems so simple,” said Breckenridge Ski Resort Chief Operations Officer Roger McCarthy. “There’s a bunch of different ways to fund things. In Europe, the towns put in the snowmaking, gondolas and facilities to keep resorts competitive. They understand it lengthens their season. We can’t pay for a lot of this with lift ticket revenue.”
Others, however, think a tax could be a viable method to fund some of Breckenridge’s proposed infrastructure improvements. While a grand lodge, on-mountain improvements, retail and restaurant space are proposed to be funded by real estate sales, resort and town officials still are trying to determine the best method to fund a gondola from Watson parking lot to Peaks 7 and 8.
Currently, officials with the town and ski resort are discussing a Tax Increment Financing plan that would place a tax on new residents of ski area development on Peak 8. They also are considering transferring a portion of Real Estate Transfer Tax revenue generated from ski-area development sales to a fund to offset the town’s interest in the gondola.
But taxing lift tickets?
“What you’re also saying is, “How about an increase in lift ticket prices?'” McCarthy said, adding that a tax increase is perceived as yet another lift ticket price hike. “You lose control of your pricing. We compete like hell on grooming, guest services. It’s brutal.”
According to Breckenridge Town Manager Tim Gagen, Vail is the only ski town in Colorado with a lift ticket tax. Steamboat Springs town leaders tried to implement one – with the blessing from the local resort chamber and the American Skiing Co., which owns the resort – but voters turned it down.
“Most communities have some type of amusement fee attached to lots of stuff: movies, seats to a concert,” Gagen said. “It is not an inconsistent way to fund some of these things.”
But ski industry officials don’t even want to talk about it.
This week, Vail Town Council members were reminded how sore a subject the tax can be when they proposed increasing the 4 percent tax paid by the resort.
“The current Vail tax was imposed voluntarily by a different Vail Resorts ownership and management heading a very different company in a very different time,” Porter Wharton III, senior vice president of public affairs for Vail Resorts wrote the town. “Do we really want to give our guests another reason to consider going elsewhere?”
Breckenridge council members haven’t ruled out the idea of a lift ticket tax to pay for whatever infrastructure might be needed in the future, however. And they have a different relationship with Vail Resorts, than does the Vail Town Council.
“We’re not afraid to ask for what we want from the ski area,” said Breckenridge Councilmember Jim Lamb. “They need us; we need them. They know it; we know it.
“I’m not sure it’s such a bad idea,” Lamb said of a lift ticket tax. “I understand it’s a competitive business and it will get a lot more competitive in the future. I’m not convinced a $1 or $2 tax would make us drop from second-most-popular ski area to 10th. I’m not opposed to exploring the idea, but at the same time, I think the arrangement we have to pay for the gondola is acceptable.”
“A tax is a drastic alternative,” said Breckenridge Councilmember Dave Hinton. “If it were to help mitigate problems caused by a specific development, I would consider it. There are other options to consider first before we ever consider adding a tax to something.”
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