Public gives second look at Mt. Crested Butte tax issue

“That $1 million may or may not get spent…That bothers me”

On Tuesday, October 7 the town of Mt. Crested Butte hosted its second presentation to discuss the town’s financial plan and upcoming ballot questions, but public response this time wasn’t favorable.

This November the town will ask voters to approve three tax-related issues and allow the town to withdraw $8.6 million in bonds for a handful of capital improvement projects.
Councilman Gary Keiser began the presentation by giving the history of the Five-Year Financial Plan.
He said the objective of the financial plan was to implement some of the items highly ranked in the town’s 2007 Community Plan. Some of those items, such as an extension of the recreation path, a new pedestrian bridge and a new maintenance facility, could be provided by the issuance of municipal bonds.
Keiser said the town was hoping to issue most of the bonds in 2009 at the current 6.75 percent rate. But Keiser said that rate could fluctuate over time. “Getting approval (of the ballot question) doesn’t mean we have to issue the bonds. If the interest rates are 10 percent… we wouldn’t be able to afford it,” he said.
Keiser said an aquatic recreation center was also highly ranked in the Community Plan and the town was setting aside $1 million over a five-year period to support the operational costs of the aquatic center, which the DDA is currently scheduled to begin building in 2012.
The Five-Year Plan is also meant to reduce the town’s dependency on sales and use tax, which make up 52 percent of the town’s revenue. “Sales tax varies largely depending on tourist activity,” Keiser said. Keiser said the Five-Year Plan was meant to reduce the town’s dependence on sales and use taxes to 38 percent of the budget revenue.
The taxation ballot question calls for increasing the general fund mil levy by three mils, and “deBrucing” the town’s capital expenditures mil levy to retain funding that would otherwise be restricted by the TABOR (Taxpayers Bill of Rights) amendment. It also calls for extending an additional 0.5 percent sales tax that is set to expire this December.
The floor was then opened to public comments.
Mt. Crested Butte resident Jim Dean said he was against the town issuing municipal bonds for capital improvements in an uncertain national financial climate, and in face of other tax issues such as the school district’s bond.
For road repairs the bond money is intended to cover, Dean suggested an alternative financing scheme. Dean said, “You could form a special improvement district which would encompass those roads that need to be repaired—so each property owner would be responsible for paying his fair share.”
Dean agreed with the sales tax extension and the prospect of deBrucing the mil levy, but did not agree with the financial burden a property tax (mil levy) increase would place on homeowners.
Mt. Crested Butte resident Bob Goettge questioned the town’s financial assumptions over the next five years, such as costs and revenue increasing by 3 percent each year. Goettge pointed out that the town was assuming “use tax” would make a large comeback in 2009 after a considerable decline in 2008.
Keiser said now that the plan was finished, the town would be re-examining it each year during the budget cycle. The town is currently beginning its 2009 budge process, “so those assumptions will be looked at and challenged.”
Goettge also asked for clarification that properties within the DDA boundaries would not pay tax increases into the general fund, due to their tax increment financing scheme.
Town attorney Rod Landwehr said that was true.
Mt. Crested Butte resident Jim Sharpe said he thought there wasn’t much community input into the financial plan’s creation. “We’ve had no public hearings. This is a (question) and (answer) after the fact,” he said.
Keiser said there were nine public work sessions during the plan’s creation.
Sharpe said there was a big difference between public hearings and work sessions.
Keiser said Sharpe was splitting hairs, and the difference was mostly in the legal documentation and paper trail evident in a public hearing, but not in a work session.
Sharpe also questioned the $1 million set aside for recreation center operational costs. “That one million may or may not get spent… you guys can do whatever you want. That bothers me,” he said.
Keiser said there would be public input before deciding how to use the $1 million.
Sharpe also strongly encouraged the consideration of a postal facility in the plan. “You guys have been asked for postal facilities for years and years. It ranks higher than everything up there and it’s still not in the plan,” Sharpe said. “Every other community in this valley has a post office. You’re raising a whole bunch of money and still telling us no.”
Mayor William Buck said, “Our feeling is, it’s not that it’s not in the plan… (A postal facility) is pretty much one of the top items on our list in terms of making that happen. But it’s one of those undetermined things. We’re not excluding that at all from the plan.”
Sharpe said he didn’t believe it. He said, “Given the financial reality of how tight your budgets will be for the next five years do you think it’s actually realistic to squeeze in a post office? If it’s not in the plan what realistic chance do you give it?”
Buck said, “I think it’s a broad subject that can’t be discussed here.”
Keiser said the town did not know how much a postal facility would cost or where it should be located. “In order to go into a bond issue we need more specifics. That doesn’t mean it can’t be done during the time period,” Keiser said.
The financial plan assumes that CBMR’s development projects will be realized and Mt. Crested Butte resident Ed Haskell asked, “What is going on with Cimarron?”
Buck said, “It’s really not the proper place to discuss that issue.”
Haskell then said if a post office was in the plan, he’d vote against it. “Ninety percent of what I get goes in the garbage,” he said.
Mt. Crested Butte’s taxation and bond issues will be questions 2A and 2B on the ballot on November 4.