On Sept. 17, the Pagosa Springs Town Council and Archuleta County Board of County Commissioners (BoCC) gathered for a joint meeting.
The conversation sprawled between many topics of mutual interest for both the town and county, but one topic revolved around a conversation spearheaded by the town about capping the amount of its share of lodging taxes that go to the Pagosa Springs Area Tourism Board.
Town council member Gary Williams initiated the idea at a previous council meeting and had asked for the topic to be included on the agenda for the joint meeting with the county.
Currently, lodging tax revenues go toward the tourism board, which is a citizen’s advisory committee reporting to the town council and BoCC. The town’s 4.9 percent lodging tax and the county’s 1.9 percent lodging tax fund the board’s overall budget.
The funding allows the tourism department to operate the Visitor Center, fund its staff, and goes toward marketing and promoting Pagosa Springs and tourism-related infrastructure.
Pagosa Springs Mayor Shari Pierce explained that the conversation about how these revenues are spent was motivated by a likelihood that lodging revenues are likely to go up with the expansion of The Springs Resort.
She said, “We feel like there’s likely to be an increase in lodging taxes, and the council feels like it’s our duty to look at this to make sure we are making the best use of those funds.”
She added that the council greatly appreciates the work that the tourism board does and wants to make sure that the board continues to receive the funding that it needs.
She told the BoCC that the council has “not made any decisions yet regarding this. We just want you to know that we are looking at it.”
A tourism board agenda document titled “Lodgers Tax Fund Comprehensive Summary” states, “Looking ahead to 2025, the town is expecting a significant increase in revenues, with a projected increase of 32%. This increase is in part to downtown construction being delayed and projections based on 2024 revenues, plus the addition of a new 79 unit hotel downtown.”
The total tourism board budget for the fiscal year 2024 stood at $1,124,147, and with the expected increase in revenues, the projected budget for fiscal year 2025 stands at $1,402,584.
Williams, who spoke next, explained that the town is looking at “capping” the amount of funding the tourism board receives from the town, with the likelihood that lodging tax revenues would be on the rise with The Springs Resort expansion.
“I had the idea that, when this new money comes online from The Springs, it’s gonna be hundreds of thousands of dollars,” Williams said.
He cited that the total budget of the tourism board stands at $1.2 million, stating, “And, so, I just introduced the idea that maybe we should cap spending for the tourism [board] at that level.”
He added that any extra funds collected on top of this would be better utilized by the town to help soften the economic impact of the Colorado Department of Transportation’s (CDOT’s) U.S. 160 reconstruction project through downtown Pagosa Springs.
He said the town would be able “to allocate those extra funds more quickly and more effectively for things like renting parking lots, if we have to, or things that would be tourism related, like acquiring the land at spots for access to the river, expanding parks.”
He explained that the current budget of the tourism board includes “money for infrastructure,” asking if the town would be better at “allocating this money.”
He added that he is not looking to “cut” funding for the tourism board, but “just looking at leveling” it off.
He stated that the tourism board only advertises in the “shoulder months” of the spring and fall, anyways, and that “we may be reaching a point of diminishing returns,” if the two entities fund the tourism board above current levels.
Commissioner Ronnie Maez pushed back on this, saying, “When you’re in business, there’s never a point where you don’t advertise. You gotta always advertise.”
He added that “the businesses and lodgers, they send that lodgers tax for it, and on the county side of it, we are obligated” to have the county’s share of the revenues spent on the board conducting advertising and marketing.
Williams explained that he didn’t “want to do anything” that would affect “staff or the quality of the work environment” at the tourism department.
Commissioner Warren Brown asked Williams if the cap would be “permanent,” or if it would be something that would be sort of a trial program and then the town could “re-evaluate.”
Williams replied that the council could try it out and “see what happens,” adding that he is really thinking about “two things: The Springs coming online with 78 new units and that CDOT is gonna disrupt our downtown, so I was really kinda thinking about the next few years.”
Town council member Brooks Lindner chimed in, “Our council might actually be more nimble in making some of these decisions with this money than the tourism board … especially when we are addressing some of the needs that might come about during the construction … it might be more efficient for us to be in control of those funds.”
Pierce stated that she feels that the town council has “a broader look at the community needs. We are not so focused on tourism, but we are looking at the other impacts of tourism on the community — the roads, the housing, those things.”
She added, “If we can look at it and see if it can be better spent in other ways, we’ll enhance our community, but also the visitor experience.”
She continued, “Again, we haven’t made any decisions, we just want to make sure you guys are aware of what we are doing.”
Council member Leonard Martinez suggested that he would like to see the funds go toward a “community development investment goal, something that would help us to diversify our income” to invest in future “infrastructure” in the community.
Council member Madeline Bergon added that the tourism board could still keep a line item in its budget for infrastructure, but “we don’t want tourism to basically throw money at anything, at anybody, just because they have this money,” should “their budget increase by several hundred thousand dollars.”
Maez noted that it was an interesting conversation, and he wants “to see what comes out of it.”
Pierce noted that she asked the tourism board, at an earlier meeting, to list its top priorities in case its budget is ultimately capped at the current level.
derek@pagosasun.com
