Effort begins to repeal conference center tax

Scott N. Miller
April 4, 2005



VAIL - Is it time for Vail residents to weigh in again on a conference center? A former mayor thinks so.

A group led by former Mayor Rob Ford Monday filed paperwork at town hall to start a petition drive which, if successful, could force another vote on funding for a conference center in Vail.

The petition committee wants to collect enough signatures to force Vail Town Council action or a public vote on an ordinance that would repeal a lodging tax passed in 2002. That tax is dedicated to construction and operation of a conference center.

"Myself and a number of my friends are pretty concerned with the direction that seems to be coming from town hall," Ford said.

In Ford's opinion, that direction seems to be a headlong rush into a project with the potential to greatly damage the town.

"What's become apparent to me is there's a tremendous amount of knowledge out there about the convention business' deteriorating fundamentals," Ford said.

According to Ford's research, there are simply too many communities competing for too little conference and convention business right now.

"It's a lousy business," Ford said. "People are giving away space."

If Vail proceeds with a conference center, it could result in town taxpayers being put on the hook to cover operating costs, Ford said.

"If this goes south, there's no way out," Ford said. "Let's re-educated voters, and let's be real honest about the risks."



Growing concern

The petition committee isn't alone in wanting to address the center's potential risks.

In the March 22 and 23 editions of the Vail Daily, Jim Lamont, director of the Vail Village Homeowners Association, wrote a detailed argument for holding another vote on the center.

Those arguments included the highly competitive nature of the conference center business and the prospect of town taxpayers being liable for operating costs at the center.

According to a financial report last year by a firm consulting for the town, most conference and convention centers run operating deficits every year. That's why the town's conference center advisory committee has proposed capping the amount of the lodging tax that can be used for repaying the debt to build the center.

At the moment, the tax brings in about $3.4 million per year. The committee has recommended using no more than $2.7 million per year for debt payment, leaving the rest for operating costs.

There's also more than $7 million in collections now in the bank. The committee has recommended the town use that account as a "backstop" to cover operating costs above what can be paid with yearly tax collections.

One supporter said he'd like the town council to tackle the operating cost issue head-on with a firm statement.

"I'd suggest the town council say, 'If we need town funds for operations, we'll shut the doors," said Rob LeVine, general manager of the Antlers in Lionshead.

"That's a worst-case scenario, a one-in-a-million shot," LeVine added. "But if we lock the doors, we can still pay the bonds and spin a small amount of money into the town's operating funds."

But Ford wondered if the odds aren't a little worse than that.

"It's very high risk," he said. "Our exposure is great with very little reward."

While Ford and other petition backers have their research, supporters have theirs, too.

"There's so much information, only a few people have the time or the background to digest it all," advisory committee member Stan Cope said. "None of the naysayers have put any time at all into this."

Cope, who runs the Lodge Tower in Vail Village, said he started work with the committee as a skeptic, but has since become a supporter.

"This is the most thoroughly researched project I've ever seen," Cope said. "We've been at this two and a half years."

But a lot has changed since November of 2002, Ford said.

"We're not coming out saying 'kill it,' Ford said. "But we need to educate everybody about the risks involved."



Staff Writer Scott N. Miller can be reached at 949-0555, ext. 613, or
smiller@vaildaily.com.