Why Vote Yes
12 Reasons to Vote Yes on Lodgers’ Tax Increase
Keep Durango’s economy strong! Vote Yes for Lodgers’ Tax to benefit Transit Services, Creative Arts, Non-Profits, and a Sustainable Year-round Tourism Economy.
You have probably heard about the proposed lodgers’ tax increase. This April, it will be the only question on the ballot besides the vote for new City Councilors. If passed, question 1-A gives “authorization to increase the city lodgers’ tax from 2% to 5.25%.” Before you make up your mind, consider these 12 reasons to vote “yes” for the lodgers’ tax increase:
1. It’s the Tax You Don’t Pay!
The t-word can be a scary one. A lot of people are opposed to any kind of tax increase. Normally, that makes sense, as residents would be fiscally impacted. That is the beauty of the lodgers’ tax. It’s the tax locals don’t pay! The tax only applies to visitors who stay in hotels, motels, B&Bs, and vacation rentals for less than 30 days. If visitors are enjoying our wonderful town and impacting us, why wouldn’t we want them to chip in for funding our town?
2. It will Help our Economy Recover
With the economic downturn and horrifying impacts of COVID on our local economy, we need a boost. Durango, like the rest of the world, is struggling. Many are unemployed, small local businesses are having trouble staying afloat, and restaurants are having a hard time keeping the lights on. If we want Durango to bounce back, increased lodging revenues, from tourism, could be just the thing to reinvigorate our economy.
3. The Increase to Hotel Prices is Minimal
In Colorado the average lodgers’ tax is 3.6% and the average check out rate which includes lodgers’ tax and sales tax, is 14.2%. Durango’s current total guest tax is 10.4% and if 1-A passes it would increase to 13.65%, still putting us below the state average. For a $130 hotel room rate, increasing the lodgers’ tax from 2% to 5.25% would equate to a price increase of $4.22.
4. It will Boost Transit for The Community
A major concern for the City of Durango is the looming funding shortfall for transit and public transportation. As the Durango Herald reported, the City has two years to find a funding source to fill the gap, which will start in 2023. As the article reported, “the cost to reinstate the eliminated routes would be about $434,000, in addition to the $2 million the city is already spending”. The lodgers’ tax, paid by people staying at hotels, motels or other vacation rentals, would add about $500,000 annually to the transit budget. Funding Transit helps alleviate the parking downtown and is vital to many of our community members to get to their jobs and other essential travel needs.
5. Tourism Helps Air Service For The Community
Passenger traffic recovery at Durango/La Plata Airport (DRO) has outpaced the US average throughout the duration of the 2020 pandemic. While there was weak business and local Durango and 4 Corners resident traffic, proportionately there was strong leisure and visitor traffic in and out of DRO regional airport. The average trip duration of visitors coming through DRO regional airport increased from 0.5 nights to 5.3 nights and the median household income of passengers increased from $130,000 to $147,000. For visitors flying into Durango, 59% of the passenger lodging nights were in Durango. New seasonal air service has been announced starting in summer 2021 between Durango and Los Angeles (American) as well as the initiation of year-round daily service (starting in May 2021) between Durango and Salt Lake City (Delta). Continued leisure and visitor traffic, increased visitor stay, and increased air service all point to the strength of Durango as a destination. And more importantly for local Durango area residents, the competitive air service options and daily DRO flights continue to remain convenient for both local residents and businesses.
Source: Public info from DRO - Durango/La Plata Airport, March 2021
6. It Supports our Creative Nonprofits
One exciting part of the lodgers’ tax is that 14% of the tax will go towards Arts & Culture. With this funding, our local Cultural nonprofit organizations, facilities, and events can do even more to increase our resident's quality of life. Grants from the Arts & Culture fund, which will be established if the lodgers tax passes and will be administered by the City of Durango, are estimated to be less than 5% of each organization's budget. This keeps those organizations responsible for the other 95% of their budget through earned revenue and fundraising activities. With input from the Durango Creative District and the Creative Economy Commission, the nonprofits which they plan on giving grants to include: Powerhouse Science Center & Maker Lab, Community Concert Hall, Durango Art Center, Music in the Mountains, Durango Film Fest, Animas History Museum, the City’s Public Art Program, and many more.
As you may recall, the City drastically cut Cultural nonprofit funding in 2008. The reinstatement of public funding, with help from the lodgers’ tax, is both modest and necessary to the health of this important sector of our economy.
7. It Supports Annual Events
Some of the annual events in our town were already struggling for funding pre-pandemic. After a year, or more, hiatus due to the pandemic, some of our beloved events may not be able to return. Certain events that could be supported by lodgers’ tax are the Bluegrass Meltdown, Film Fest, Taste of Durango, Cowboy Poetry Gathering, Play Fest, and many others. Every community has roads and sidewalks, but the ones you would want to live in have a vibrant Arts & Culture scene.
8. Sustainable Tourism Must be Managed
If you carefully read the ballot language of 1-A, you will notice that it designates 55% of the total lodgers’ tax to go towards “sustainable tourism marketing.” These funds have typically been distributed to Visit Durango through a City contract. A common misconception is that organizations like Visit Durango are “ad factories,” meant to churn out clever taglines, social media ads, billboards, and other advertising. While this is an important part of what Visit Durango does, it is far from the full picture. Visit Durango promotes tourism in a responsible way, while also working with the City and stakeholders on programs like economic recovery, promoting small businesses, and prioritizing stewardship of the environment and destination.
9. Establishing More Year-Round Lodging Occupancy
The Durango area has seen a substantial increase in lodging inventory this year which has decreased overall occupancies. An increase in lodging occupancy would support more year-round employment and would help decrease seasonal layoffs. Sustainable tourism marketing will help both our existing and new hotels operate successfully in a competitive market.
10. Durango Will Be Able To More Effectively Compete For Off-Peak Season Travelers
The top goal for the increased tax funding is to promote off-peak, or shoulder season, travel such as group and broad-based sporting events. The goal is not to flood the streets with visitors year-round, but we would like the tourism economy to have a healthier flow throughout the year. It is challenging for retail businesses, restaurants, and other tourism-impacted businesses to rely on the revenues they make in summer to carry them throughout the entire year.
11. Collaborative Support
Proposing an increase in lodging tax is the culmination of years of hard work from stakeholder groups behind the scenes including the Durango Area Hospitality and Lodgers Association, the Durango Creative District, the Durango Restaurant Association, Chamber of Commerce, Business Improvement District, and the Creative Economy Commission. These groups came together to form a task force to design a mutually beneficial ballot initiative. Four of the five City Councilors voted in favor of this ballot initiative. The majority of City Council candidates have stated they are in favor of increasing the lodger’s tax in April.
12. The Time Is Right
The current 2% lodgers’ tax was put into effect in 1980. Different stakeholders have made attempts to increase the tax since the 1990s. This is the first time, since 1980, that the increase has made it to the ballot.
Please help us support this Durango ballot initiative to benefit transit services, creative arts, non-profits, and a sustainable year-round tourism economy – It’s good for our residents, keeping our economy strong and good for Durango.
