Local officials applaud state measure to rework marketing $

County vote next step in the process

[  By Mark Reaman and Katherine Nettles  ]

A longtime aspiration for many to use some local marketing funds to manage and mitigate the impacts of drawing tourists to the valley has cleared a major hurdle at the state level. Now, with the approval of county voters this November, lodging tax money could be redirected for things like trailhead bathrooms and even affordable housing and childcare support. Local officials are excited about the opportunity and county commissioners unanimously agreed on April 5 to move forward with a ballot question to seek local voter approval over the issue.

Colorado governor Jared Polis signed House Bill 1117 last week which clears the way for expanded use of lodging tax monies traditionally dedicated to marketing. The legislation permits local marketing districts (LMDs) like the one in Gunnison County that funds the Tourism and Prosperity Partnership (TAPP) to spend lodging taxes on things like workforce housing, childcare for local workers and investment in recreational infrastructure such as trails and trailhead amenities. 

“It’s pretty exciting. Former (Gunnison County) commissioner John Messner and I first brought up the idea in 2018 through CCI (Colorado Counties, Inc., an advocacy organization for counties in Denver),” explained Gunnison County commissioner Jonathan Houck. “The recent urgency being experienced throughout the state with things like housing changed the conversation and moved it along.”

“Timing is everything,” agreed TAPP executive director John Norton. “There was quite a bit of hand-wringing from DMOs (Destination Management Organizations) around the state about the bill. We stood down. It’s hard to argue that helping with housing or building a trailhead toilet aren’t good uses for some of our funds.”

The local mayors agree with that sentiment.

“I am supportive of using some of the lodging tax for housing,” said Crested Butte mayor Ian Billick. “We cannot support tourists unless our workforce has housing.”

“I agree on the need for housing and support this move. This is an important and needed bill for many communities throughout the state,” said Mt. Crested Butte mayor Janet Farmer. “I don’t see it changing much for us as I think our council is content with where we are now by using our marketing dollars for Mt. Crested Butte marketing grants and transportation needs.”  

Houck explained that at least 10% of the lodging tax would still be required to be used for marketing purposes, “but the shift really opens up opportunities. It enhances our chance to be creative with all these things. There are lots of opportunities as a result. For us in Gunnison County, an all or nothing attitude is not the answer and this allows us to continue marketing while addressing some of the impacts that come from tourism. It provides opportunity for balance. There is still a need for marketing and funding business support and economic development measures like the ICELab but if we can get approval from the voters to expand the use of the money we can use it for recreation infrastructure and opportunities that can include workforce support in thing like housing and childcare since service workers are the foundation of tourism.”

County attorney Matthew Hoyt emphasized that the bill’s language still requires that LMD funds be used to enhance visitor experience, but expands what that can mean. “A thriving community” that supports families and seasonal workers is better suited to giving visitors a positive experience, he said.   

“It’s important for our voters to understand that these types of expenditures do indeed support our visitor experiences,” said Hoyt.

Norton said TAPP already does many of the things the new funding allows. TAPP works with Western Colorado University for example and runs the ICELab that promotes business support. “Sustainable tourism is already part of our mission and we pay attention to that,” he explained. “We work with the STOR (Sustainable Tourism and Outdoor Recreation) committee, the CB Conservation Corps and Gunnison Trails, for example. We are already a diverse organization that does more than strictly promote tourism.”

“Balance is important,” emphasized Houck. “There was a time when Colorado stopped all marketing and it really hurt the state. For us, there would probably be years when the marketing budget was increased and others when it was decreased. Perhaps we utilize STOR for example to help us set priorities and envision a plan for long-term tourism infrastructure projects.”

Houck said the new shift is not a magic wand that solves every problem. With last year’s LMD revenues at about $3.4 million, and a fund balance for 2022 projected to be more than $2.1 million, there is some cash to use. But last year’s TAPP’s spending plan was $3.2 million and that included marketing, support for Western and the ICELab. 

Houck said he anticipates several hundred thousand dollars could be used every year to supplement and leverage funds for workforce housing projects but not building major projects in full. “The amount of money will allow the county to help leverage some housing projects and make them more affordable  and hopefully attract some private side investment,” he said. “That’s what we did with Paintbrush where we contributed the land as well as about $250,000 for some work that was required. We looked at it as seed money.

“The one downside of this might be that everyone will want some of the money and think there is more than we have,” Houck continued. “That’s where we have to set priorities. And people need to understand that next fall they aren’t voting on whether to have an LMD that funds marketing, but rather whether we can expand the use of the money. We’ve been good about not just marketing to try and get every warm body we can here. We focus on drawing people that appreciate what we have in the valley and also on managing the type of experience they have. I don’t see the way TAPP is moving forward changing much. But our nimbleness factor goes way up if voters approve this.”

“For the last five years our target market has been millennial trail users,” added Norton. “We focus on relatively young bikers, hikers and skiers. We’ll keep that as our focus until we see that it isn’t working but that discussion is not being had at the moment. It is working.”

Houck again emphasized that the commissioners, who control the LMD, do not want to eliminate marketing altogether. “We need to keep up with targeted marketing and if we don’t do it ourselves, we’ll be defined by others,” he explained. “We need to control our message.”

Norton agreed. “We will probably spend less on marketing than we would have, and the effect of that isn’t easy to predict,” he said. “Quitting marketing? I doubt it. The best case study of that comes from our own state, when the Colorado Tourism Office was disbanded in the early/mid 1990s. Winter held its own because of efforts by Colorado Ski Country and all the individual ski areas. Summers experienced a sharp decline, and then-Governor Roemer put the CTO back together again after several really rough years. In summers I imagine we’ll continue celebrating our fantastic trails system and targeting millennials.”

Norton concluded that the move is a good one and he anticipates voters will approve the request. What it means in the long-run however, remains up in the air. “The future is so hard to predict. Is remote work the future of work in America? Will Vail Resorts invest in the mountain and in the base area? Will building affordable housing solve the employee shortage? When will the next recession hit? I imagine we’ll try and funnel our energies and monies into those areas that seem most important and almost on an annual basis,” he said. “TAPP has been pretty nimble and handled the new balls tossed our way. We will need to remain pretty nimble.”

The state bill requires that county commissioners pass a resolution to begin coordinating with the county clerk and recorder by July 29 in order to include a ballot question in November. Then the commissioners, acting as the LMD board, must enter into an intergovernmental agreement (IGA) with the clerk and recorder in August. Commissioners directed county staff to begin working on the details of the potential ballot language for November and will consider a resolution once that language is confirmed.