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Colorado Springs goes after big bucks from state for tourist-boosting projects

June 12, 2013 Updated: June 12, 2013 at 7:30 pm
photo - The former shuffleboard  building at Acacia Park will be renovated into visitors bureau where staff can help tourists and downtown visitors.  (The Gazette, Christian Murdock)
The former shuffleboard building at Acacia Park will be renovated into visitors bureau where staff can help tourists and downtown visitors. (The Gazette, Christian Murdock)  

A group of Colorado Springs civic leaders and city officials are quietly working on a plan to go after millions in state tourism dollars for projects they say could transform the city.

Their big ideas include a U.S. Olympic Hall of Fame, a downtown multi-use stadium, a University of Colorado at Colorado Springs medical complex on North Nevada Avenue, and moving the Air Force Academy visitor center outside of the base gates for easier access.

The project, headed by the city, has picked up support from the El Pomar Foundation, the Downtown Development Authority, the Convention and Visitors Bureau, UCCS and the Anschutz Family Foundation.

However, the details are closely guarded by those involved, including Mayor Steve Bach. But whatever the group proposes, it must be "extraordinary, unique and attract out-of-state visitors to even be considered," said Kathy Green, director of communication and marketing for the Colorado Office of Economic Development and International Trade, the office that oversees the grant program.

The state is looking for ideas that could be a turning point for tourism in the region and positively impact the entire state's tourism industry, she said.

Bach believes the city's proposal fits the bill, said City Attorney Chris Melcher, who is on the team preparing the grant application, which is due Tuesday.Bach plans to announce the details of the grant that day at his monthly press conference.

"The mayor's vision and the city believe this could be a transformational moment for our community," Melcher said. "These projects, if the state does approve this application and these projects move forward, could lead to tremendous economic development not only in our downtown, but across our city - new jobs, new housing, new retail. It would also increase the profile of our city across the country."

Three years ago, the state adopted the Regional Tourism Act as a way for local governments to receive state sales tax rebates on projects that bring in tourists. The state had no interest in just cutting checks to fund tourism projects, Green said. Instead, cities must prove their projects will bring in out-of-state visitors and money.

Last year, the first year of funding, six cities or counties applied, including Douglas County, where officials wanted to build an archaeological museum. The state awarded $81.4 million in state sales tax rebates over 30 years to Aurora, where developers have plans for a 1,500-room hotel, previously known as the Gaylord Rockies project and now operated by Marriott International. The Aurora hotel and convention center project has drawn critics inside the tourism industry who believe the hotel will pull meetings and conventions away from Denver and Colorado Springs. Under the state sales tax incentive program, Aurora would receive 65.8 percent of the new sales taxes generated, which is estimated to be $2.7 million annually.

Pueblo also was approved to receive $14 million in sales tax rebates over 30 years for its Professional Bull Riding University and river walk and convention center project. The city would receive 24.7 percent of the new sales taxes generated, which is estimated to be $493,000 annually.

The percentage of sales tax rebates to the cities is based on how successful the state thinks the projects will be.

So far this year, only a few cities have expressed interest in applying for the incentives, Green said. But great ideas alone won't win the money. The projects must go through a rigorous financial analysis by an outside consultant and then pass muster with state finance officials who want to see that the projects will bring in tourists.

"The river walk alone would not have met the criteria," Green said. "But a worldwide bull riding university is completely designed for out-of-state tourists."

Chris Jenkins, president of Nor'wood Development Group, is heading up the local planning group, but declined to comment on the grant application until it is filed.

One thing the state will want to see is public and private support for the project, Melcher said. Under the state program, the projects would be built and the sales tax would be rebated based on the project's success. The state sales tax money could be used to repay bonds that would be used to pay for the projects upfront, for example.

El Pomar Foundation is among the groups writing a letter of support for the proposal.

"This project is based on some of the most important and iconic institutions in our community and we look forward to the economic benefit that will be dervived once they are complete," said Bill Hybl, chairman and CEO of El Pomar Foundation.

Representatives from the Colorado Springs Convention and Visitors Bureau and the Downtown Development Authority declined to comment on the proposal saying they didn't want to tip their hand in a program that is highly competitive; only two projects are approved each year.

"It's not final and we do not want to reveal prematurely what the city application will look like," Melcher said.

But the application will include the projected costs and economic impact of each project, including projections on how much the city stands to gain in local sales tax and jobs created, he said.

Project leaders were set to ask the El Paso County Commissioners June 6 to kick in $37,500 to help pay for a consultant and development plan on the proposal, which could be up to $100 million in projects, said Jeff Greene, El Paso County administrator. The item was postponed until the group could hammer out details.

Melcher declined to comment on how much the city has set aside for planning and development of the proposal.

John Van Winkle, Air Force Academy spokesman, said it was too early to comment on the city's proposal. But the idea of moving the visitor center to outside the academy gates has been discussed for years, he said. About 500,000 people go through the visitor center every year, after first checking in at the base North Gate.

"We would have to look at the proposal, the funding source and what the advantages to the academy and to the community are," he said.

It might seem odd to include a medical complex in the plan, said Martin Wood, UCCS vice chancellor for university advancement. But medical tourism - defined as those who come from out of state for medical treatment and stay in hotels, rent autos and eat in restaurants - benefits the region and state economy.

UCCS is building an $18.5 million Lane Center for Academic Health Sciences, expected to open in January 2014 on North Nevada Avenue. In the next five years, UCCS plans to build a branch medical campus in connection with the Anschutz Medical Campus. And there are plans for an high-altitude track where research for top-performing athletes and disabled athletes can be conducted.

However, Wood said the university still is deciding if it should be included in the proposal.

"The whole thing is in process," Wood said. "We are still going through the possible combinations.

"Part of the reason why we don't know if we will be included in the project is because we have not totally defined our project or whether it meets the tourism criteria."

The state is expected to make a decision on projects by July and then an outside budget analyst will review the economic projections. A final decision will be made by December.

One of the criteria the state will consider is that the projects would not be completed without the state help.

Melcher declined to say what, if any, private money is waiting in the wings should the project be approved. But the stakeholders are in, he said.

"The city would expect to move forward promptly on one or more of the projects," he said.

Clarity Media Group, a subsidiary of The Anschutz Corp., owns The Gazette.

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