Fire tax efforts begin to form in Steamboat
December 13, 2010
The fire district surrounding Steamboat Springs is formalizing its efforts to place a property tax before city voters next year in order to consolidate local fire and emergency services in one funding entity.
Such a consolidation would implement a property tax for city residents. A reduction of some of the city's sales tax, potentially on utilities and food purchases, would offset that property tax.
The issue could be one of several local tax measures on the table in 2011.
As politicians in Washington, D.C., wrestle with national tax-cut legislation, a fire district consolidation could be one of three upcoming proposals for tax additions in Steamboat Springs and, perhaps, Routt County.
The cash-strapped Yampa Valley Housing Authority is kicking the tires on a ballot measure for tax funding next year, and ideas also are circulating about a tax-funded regional transportation authority.
Meanwhile, the city's Tax Policy Advisory Board is undertaking renewed efforts to assess Steamboat's tax policy. The board will form recommendations for the Steamboat Springs City Council, to address changing conditions and forecasts since a previous tax board's recommendations in 2005.
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Jack Dysart is co-chairman of the tax board and served on the previous board, as well. He expressed hope that the new board's recommendations could be ready in late 2011.
Dysart said the previous tax board determined that specific tax proposals could reduce a local government's ability to adapt on a yearly basis and allocate funding according to the greatest needs.
"In general, we thought it was better to have more general taxes and less specific taxes for things," Dysart said.
The rural fire district is seeking that specificity, though, in a time of volatile sales tax revenues and widespread city budget cuts.
If successful, the fire district vote would join the rural district with Steamboat Springs Fire Rescue and remove fire and emergency services from the city's general fund — instead consolidating the two districts under one umbrella funded by the property tax.
"We're sorting through a lot of data to make sure that the structure we propose in this is easily understandable … hopefully with as little impact to our citizens as possible," said Kathy Connell, who is president of the rural fire district's board of directors and leading the consolidation effort.
Connell is a former Steam–boat Springs City Council president who owns property in the city and outside it, within rural district boundaries. She said the rural fire district plans to hold public meetings and conduct a community outreach campaign as its ballot proposal takes shape.
The rural district already has taken initial steps in what Connell called Phase 1 of the process.
Connell said the fire district's new name is the Steamboat Springs Area Fire Protection District. That change, made Nov. 28, replaced the word "rural" with "area," an attempt to change the perception of the district that pays for fire services to areas surrounding city limits.
"It's not a matter of it's rural and city, it's a matter of us," Connell said.
The area district also has hired Denver lawyer Dino Ross, whose focuses include fire protection districts and employment law. Connell said the rural district is meeting with the Routt County Board of Commissioners on Dec. 21 to discuss potential regional impacts of a consolidation, such as whether to include Routt County Search and Rescue funding in the proposal.
A citywide fire district vote could occur next spring or early summer.
City voters have rejected property tax proposals for fire and emergency services twice in the past decade. City Clerk Julie Franklin said those votes occurred in November 2002 and 2003.
Connell told the City Council in October that the proposal's intent would be to provide a stable, long-term funding source for the rural fire district, which assesses a property tax on its residents and contracts with the city for fire and emergency services.
The Steamboat Springs Area Fire Protection District forms a 420-square-mile doughnut surrounding city limits — extending two miles west of Milner, to the Mad Creek area in North Routt County, to the base of Rabbit Ears Pass and to Yellow Jacket Pass off Colorado Highway 131.
The district had expenditures of more than $1.2 million in 2010, Connell said.
In addition to those contributions, city fire and emergency services are funded by sales tax revenues, which have dramatically decreased during the economic recession.
Fire services have been a priority during the city's budget conversations, though, and have not suffered the same cuts as other city services or staffing levels. Steamboat Springs Fire Chief Ron Lindroth said in October that, "all of our service-level needs were well met by the 2011 budget."
Lindroth said the rural district funds about a third of the city's annual fire rescue budget.
Paul Hughes, who served as city manager from 1998 to 2005, was involved in the formation of the current system. He said Bob Litzau of the city's finance department was instrumental in creating the formula that allowed for annual funding changes depending on factors such as the rural district's population.
Before the current system, Hughes said, "there was considerable unhappiness between the city and the fire district over who was paying for what."
Hughes said given that history of debates, he understands and sympathizes with the rural district's desire for stable funding.
But Hughes also is a member of the Tax Policy Advisory Board.
"I would hope that nobody would ask to go to the voters until that group's work is done," Hughes said last week. "We're looking at all options and would hate to have any precluded before we finished and presented recommendations to City Council."
In October, commenting about the recession's impacts on the local economy and job markets, City Council President Cari Hermacinski indicated the potential challenges of any tax proposal.
"I don't know if we could pass a tax for drowning kittens right now," she said.
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