A proposal to increase Colorado Springs' tax on car rentals and hotel stays - an idea already floated in the last year by local tourism officials - is picking up steam.
An informal group of civic, business and city leaders held its first meeting in recent weeks to discuss the idea, while the city's top tourism executive said Thursday the time is right to ask city voters to increase the tax - likely at the April municipal election.
The Lodgers and Auto Rental Tax, or LART, hasn't been increased in the 36 years since it was created in 1980; it's a 1 percent tax on auto rentals and 2 percent on hotel rooms paid mostly by area visitors. Two-thirds of the revenue goes to the Colorado Springs Convention and Visitors Bureau for tourism promotion.
Doug Price, the bureau's president and CEO, said doubling the tax rate to 2 percent on auto rentals and 4 percent on hotel rooms would generate more funding to attract visitors, whose spending at restaurants, attractions and the like pumps $1.35 billion a year into the local economy.
Not only has the tax never been increased, Price said, but it's several percentage points lower than Denver and other comparable cities. That fact was a key finding of a consultant's study in March 2015; that report, funded by area businesses and municipalities, said spending to promote tourism in the Pikes Peak region lags that of many communities.
The study said a LART increase, an attractions tax and creation of a multi-county marketing district were options to boost spending on tourism promotion.
"It's not that we're trying to take advantage of the visitors, but we are so low, we are a discount," Price said of the current LART. "The fact that it hasn't been touched in 36 years says that, hey if we really want to be like other cities and have projects that will bring in new visitors, we need to do what other cities do, and that is, those people who come in to visit, they come, they stay, they pay their fair share."
Price spoke Thursday at the Convention and Visitors Bureau's annual business meeting, held at the Olympic Training Center and attended by about 200 tourism industry representatives, elected officials, business people and community members. The meeting coincided with National Tourism and Travel Week, an industry event.
Price recapped tourism accomplishments in 2015 - including new service at the Colorado Springs Airport, the branding of the Springs as Olympic City USA and additional LART revenues funneled to the bureau for tourism promotion.
But the LART's future also was in the spotlight.
Springs City Councilwoman Jill Gaebler, who sits on the CVB's board, said after the meeting that a group of tourism industry stakeholders met in the last four to five weeks to discuss the tax and what should happen with it - if anything. That group included Price, developer and LART committee chairman Fred Veitch, Broadmoor hotel president Jack Damioli and Jeff Greene, Mayor John Suthers' chief of staff. The group doesn't have another meeting scheduled, she said.
Gaebler, who supports a tax hike, said it could benefit more than the CVB's tourism promotion efforts. Additional funds could be used to enhance economic development efforts and arts and cultural organizations - which could attract even more visitors, she said.
In any case, a tax hike proposal shouldn't proceed without educating local residents that visitors pay the lion's share of the tax and how money from an increase would be spent, Gaebler said.
If a tax hike proposal moves forward, the City Council probably would be asked to place it on the spring ballot because November's is too crowded, Price said. Colorado's Constitution requires voter approval of all tax hikes.
Suthers said Thursday he backs an increase in the tax in concept - although more community discussions are needed, the public pulse should be taken through polling and an educational campaign launched. Tourism is highly competitive, he said, and the area should do more to woo visitors.
"I personally do support an increase," Suthers said. "The question is whether we could inform the public enough. I'm a very practical person. I think if the public understands what the LART is, who pays it and what it is used for, I think it probably wins an election.
"But if you don't properly inform the voters, then they just think it's something they pay, the locals pay, then you've got a problem on your hands," he said.