Rent relief, sales tax payment deferments coming to Avon
Town is also saving $635,000 through the recent drop in interest rates
Tenants at Eaglebend, Kayak Crossing and Buffalo Ridge apartments learned this week they need not pay rent on April 1.
The properties are owned by nonprofit corporations sponsored by the Town of Avon, but run by independent boards. Avon Councilmember Tamra Underwood and Mayor Sarah Smith Hymes serve on those boards.
“It’s a rent deferral program at this point in time,” Underwood said. “The board needs to communicate with its mortgagees, which is HUD and FirstBank, before we can enter into any rent forgiveness or abatement programs.”
Tenants will have to pay utilities, which will cost between $170 and $245.
Underwood said the board has been meeting weekly since the COVID-19 crisis began in Eagle County. The county is a coronavirus hot spot where infected people from Australia to Mexico have traced probable contraction.
Businesses can delay tax payments
Comparing the idea to an interest-free loan, the town of Avon also passed a resolution to defer sales tax payment deadlines for retailers to June 20.
That means payments that would be due on April 20 and May 20 won’t be due until June 20 for small businesses in town.
Lodging operations and businesses with more than 11,000 square feet are excluded from the deferred deadlines.
Town finance director Scott Wright said he was apprehensive about the idea.
“There are very few municipalities that I’ve heard of in Colorado as of yet that are deferring taxes,” he said.
Municipalities may only vote to approve deferring taxes if they are home-rule governments. Eagle County and the town of Eagle, for example, are statutory governments and can not take such action.
The town of Vail approved deferring taxes on March 17, with council member Jenn Bruno, herself a small business owner, saying the relief will give businesses “a chance to survive.”
On Tuesday, Wright said if those businesses don’t survive, the town could have trouble retrieving the sales tax that those businesses collected on behalf of the town.
“Some of these businesses aren’t going to come back,” Wright said. “We would have to file liens, and in extreme cases we have to do the straight warrants and go in and sell their inventory and collect the taxes that way.”
Councilmember Scott Prince voted against the deferred payments.
“I’m voting no because I’d like to get some more information,” Prince said. “It doesn’t mean I’m not supportive of it.”
Savings through refinancing
If Avon is taking a risk on the sales tax deferment, however, it may now be in a slightly better position to take that risk as the town will save hundreds of thousands through the recent drop in interest rates.
Avon on Thursday also finalized approvals on the refinancing of municipal bonds from 2010 at an interest rate of 1.23%, which is estimated to save Avon taxpayers $635,000 over the next 10 years.
The 2010 bonds were originally issued to refinance the Fleet Maintenance Facility bonds from 1998, and to obtain the required 20% match for the federal grant used to construct the Avon Regional Transit Facility.
The original amount of the Series 2010 bonds was $6,680,000 with interest rates ranging from 2% to 5% and a maturity date of December 1, 2030. The refinancing will refund the outstanding debt balance of $4,050,000 with an interest rate of 1.23% and will maintain the current maturity date of December 1, 2030.