Lodgers mostly got what they wanted . . . for now.
The citizens who voted in favor of enacting a $4.82 occupational lodging tax to fund improvements to recreation and cultural resources will get what they wanted . . . a year from now.
The final act of the drama over ballot measure 2B seemed to take most present by surprise. Earlier tonight, Salida City Council voted to enact the new, voter-approved occupational lodging tax at $2.50 in 2009, then raise it to $4.82 beginning on Jan. 1, 2010.
In amending the original motion by Hugh Young to enact the tax at $2.50, Councilman Tom Yerkey said he proposed raising the tax to $4.82 after the first year, “out of respect for the economy, respect for the mediation that’s gone on between the city and lodging industry, and also out of respect for the constituents that voted for $4.82.”
Both Yerkey and Councilman Jim McCormick told a council chamber packed mostly with lodging industry supporters that they had been fielding calls and emails all in favor of enacting the tax at $4.82.
“I think we did it right,” said McCormick after the meeting. McCormick explained he took a lot of impassioned calls from staunch supporters of the rec programs who wanted to see the tax enacted at $4.82. “The main thing is, we’re on our way.”
Yerkey, a longtime and tireless supporter of a vibrant city-owned Hot Springs Aquatic Center and SteamPlant Theater and Event Center, said he also fielded a heavy volume of calls and emails, every single one of which was in favor of of Council enacting “what residents voted on at the ballot box, which was $4.82.”
“We have to respect the voters and yet our business community is just essential,” Yerkey said in explaining his decision to support $2.50 for the first year, then raising the rate to $4.82 in 2010. After the meeting, he said he believes the projects the new lodging tax will fund will “improve the economic vitality of the city and bring more business into the hotels.”
Meanwhile, since the Nov. 4 election, Councilman Hugh Young had been working with the lodging community to come up with a rate that the lodgers felt would not be as detrimental to the local lodging industry as $4.82. The $2.50 rate was part of the compromise lodgers negotiated with the city. Lodgers also hoped the city would agree to only raise the tax based on empirical indices from the travel industry.
Young told his fellow councilmen he feared that passing Yerkey’s amendment would break all the trust the council had earned with the business community through the negotiation process with the lodgers. Young added he thought the election results from Nov. 4 signaled that voters had given council the power to balance the needs of a healthy business community against the priorities of the community. He feared that trust could be broken in “one quick vote.”
In the end, the vote for Yerkey’s amendment ended in a 2-2 tie: McCormick and Yerkey for; Young and Moore against. Mayor Chuck Rose cast the deciding, tie-breaking vote in favor of the Yerkey amendment. Councilmen Keith Baker and Scott Damman were absent. The vote to enact the new tax, which goes into effect Jan. 1, passed unanimously.
Though visibly disappointed after the meeting, Monarch Marketing Director and Chaffee County Visitor’s Bureau Chairman Greg Ralph reiterated what he had earlier told council. Ralph lauded the negotiation process and said that after the last meeting on Nov. 24, he felt everyone came out feeling good and “that’s what Salida’s about.” He said Yerkey’s amendment left a “bad taste in (Ralph’s) mouth” for dealing with the city in the future. Lodgers had hoped the city would agree to raise the occupational lodging tax gradually, based on empirical travel industry indices. Ralph had been a consistent presence at the negotiating table since talks between the city and lodgers began in September.
Recreation Advisory Committee Co-Chairs Bill Smith and Mike Harvey differed on their reaction to the outcome of the issue. Both men told city council that although the rec commission initially voted to support $4.82, after listening to the lodgers concerns during the negotiation process, they agreed to support $2.50.
After the meeting, Harvey said that while he realized the negotiations between the city and lodgers weren’t binding, he was not sure he agreed “in principle” with Yerkey’s amendment. Harvey thought it would have been better for the city to come back to the lodgers at a later date to discuss when, and by how much, the tax should be raised toward the $4.82 cap.
Smith had a different viewpoint: “I’m really proud of everyone on Council for how thoughtful they were in how they approached their response” to the need to balance the will of the voters yet address the needs of the lodging community.
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