Hayden voters to decide whether to boost rental car, lodging taxes | CraigDailyPress.com

Hayden voters to decide whether to boost rental car, lodging taxes

Jack Weinstein

— When mail-in ballots are sent to Hayden voters beginning today, they’ll have to decide whether to adopt two tax measures that would boost town coffers as soon as 2010.

If approved by voters, Referendum 2B, a 3.5 percent rental car tax increase at Yampa Valley Regional Airport would generate $143,500 next year, based on rental car figures from 2008.

The second measure proposed on the ballot, Referendum 2A, a 3.5 percent lodging tax increase, would affect only a few rooms at the Redstone Motel and generate about $1,200 next year.

Neither proposed tax has a sunset. There’s nothing in the ballot language for either tax that specifies how the revenues would be spent.

Supporters of the taxes say they would increase revenues without burdening Hayden residents. That’s because both taxes would be imposed primarily on visitors, Hayden Town Manager Russ Martin said.

Martin said it’s important for the town of Hayden to take advantage of a resource like YVRA. He said revenue generated from the car rental tax likely would be dedicated toward capital projects and reserves. Capital projects could include street work. The revenue wouldn’t be dedicated to town operations, Martin said.

The car rental tax would take affect Jan. 1, 2010.

YVRA Manager Dave Ruppel said it’s difficult to say whether increased rental car taxes would affect tourist visits next year.

“There’s some point out there where a guest is going to say, ‘That’s too much, I’m not going there,'” he said. “What is that point? I don’t know until people stop showing up.”

Ruppel said the airport’s car rental fees and taxes – currently at 33 percent of the cost to rent a car, according to figures previously presented by Steamboat Ski and Resort Corp. – would increase to 37 percent if the tax is approved, representing one of highest in the state. He said it’s important to look at the bigger picture – comparing what it costs to rent a car at YVRA versus other similar-sized airports.

Of the current taxes and fees, the town of Hayden receives about 12 percent of that revenue. If the tax was approved, that number would increase to more than 20 percent. The state would get 25 percent, the county would get 2.7 percent and YVRA would get the remaining nearly 52 percent.

Only Eagle County Regional Airport, with car rental fees and taxes equaling 38 percent of the cost to rent a car, would be higher than YVRA’s, according to Ski Corp. figures.

And because rental car companies are charged a percentage of their gross revenue to locate at the airport, Ruppel said if they lose business, the airport loses business.

Kay Wiltfong, who operates Avis Rent A Car at YVRA, said the company’s business in 2009 was down 30 percent from the same period in 2008. She said business at Budget Rent A Car, which is operated by her husband, Aaron, was down 28 percent during the same period. She said advanced booking numbers for the upcoming ski season are looking “very bleak,” and implementing a tax increase wouldn’t help.

“We have to do a certain amount of volume to justify us being (at the airport) and these companies surviving,” Wiltfong said. “So yeah, it’s pretty scary.”

Wiltfong said a 4 percent increase in the cost of taxes and fees doesn’t sound like a lot, but when you spread it over the entire fleets at Avis and Budget, the number becomes “pretty significant.”

Ski Corp. President Chris Diamond said he has expressed concerns about the rental car tax with the Hayden Town Council. Diamond said that although the amount of money generated by the increase wouldn’t be substantial, he understands its importance to Hayden. He added that Ski Corp. has not taken a position on the tax and was waiting to see what the voters decided.

The Redstone Motel is Hayden’s only nightly lodging accommodation, thus it would be the only one affected by the proposed lodging tax increase.

This year’s election is being conducted only by mail-in ballot. The Routt County Clerk and Recorder’s Office began distributing ballots to registered voters today. All ballots must be received by 7 p.m. Nov. 3. The Clerk and Recorder’s Office recommends returning ballots by mail no later than Oct. 29.

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