Avon `use tax’ gets demolished | VailDaily.com

Avon `use tax’ gets demolished

Matt Zalaznick
Vail Daily File GraphicThe Home Depot and Wal-Mart expect to open new stories in Avon next year. Revenues from a proposed `use tax,' which failed at the polls on Tuesday, would have helped the developer, Traer Creek, pay off bonds at a faster rate, as well as help pay for the town's free bus system.

Nails, pipes and wallboard won’t be used as bus fares in Avon.

A tax on all building supplies used in the town that would have funded the town’s ailing free bus system was creamed by voters Tuesday, with 60 percent voting “no” and only 40 percent in favor.

“It definitely made my day,” says builder George Plavec, who led fellow contractors in a campaign against the tax. “I’m hoping they’re going to find some more equitable way of spreading the burden of the buses.

“They’re something we need to have,” he added. “But either the people that use them should pay for them, like the hotels, or we all should.”

The Town Council this summer was about to start charging $1 fares for in-town and Beaver Creek bus routes that cost about $900,0000 a year to run. But hotel and lodge owners revolted, saying the bus fares would drive tourists away from the town because winter visitors expect free rides in ski resorts.

Builders, like Plavec, said the proposed 4 percent tax unfairly singled out developers. Ironically, voters Tuesday re-elected the three incumbent Town Council members who backed the tax that was expected to raise about $500,000 a year.

“I thought it was an opportunity that would have been beneficial to the town,” Councilman Mac McDevitt said. “We do have a revenue problem. but we have a balanced budget. It’s a matter of looking ahead and seeing how can we increase revenue, keep expenses where they are and trim where we can.”

The Town Council last month slashed some expenses to balance spending next year. The most controversial cut will leave town employees without raises next year.

In balancing the spending package, however, the town did not count on either bus fares or the use tax passing, said McDevitt,

Councilwoman Debbie Buckley and Councilman Brian Sipes, along with outgoing Mayor Judy Yoder, voted to put the tax on the ballot. Councilmen Mike Brown, Pete Buckley and Buz Reynolds voted against it.

Aside from the buses, supporters backed the use tax because it would have been imposed on development at the large Village at Avon complex, where The Home Depot and Wal-Mart Supercenter are set to open next year and 2,400 residences can be built over the next two decades.

Village at Avon developer Traer Creek would have kept the revenues from the use tax, but the money would have helped it pay its bonds off sooner. Avon won’t receive any sales tax revenue from the two big box stores until Traer Creek has paid off its bonds on the project that’s not expected to happen for about 15 years.

McDevitt blamed the measure’s defeat on a poor campaign.

“The town is not allowed to campaign as a town for a tax issue like that and it was only in past the few days that anybody stepped up with an ad,” he said. “Unfortunately, it really required a coordinated effort from the business community to pass it, but no one stepped up to plate.”

The Town Council is now forced to find a way to pay for the buses which are punching sinkholes in Avon’s finances. The council is likely to revisit the issue soon.

One proposal has been to increase the town’s lodging tax to pay for the buses, since it appears guests at Avon’s hotels are one of the largest groups of riders, much like Vail’s free buses, which are paid for with a lift ticket tax on Vail Mountain skiers.

Avon voters, such as Ryan Bowers, said the tax would have hurt small businesses who will have to compete with the The Home Depot and Wal-Mart.

“I don’t think the other stores need to hurt when they’re going up against the big box stores,” Bowers said. “I like to see competition.”

Matt Zalaznick can be reached at 949-0555, ext. 606, or via e-mail at mzalaznick@vaildaily.com.

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