Vail budget cutbacks deepen in wake of economic decline | VailDaily.com
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Vail budget cutbacks deepen in wake of economic decline

The good news is that town revenues in March didn't drop as much as expected

The Vail Town Council Tuesday adopted a stepped-up recession budget plan, but also approved spending about $4 million to build a new retaining wall at the town's public works facility.
By the numbers 46%: Decrease from 2019 in March town revenues. 22%: Anticipated 2020 revenue decline from 2019. $18.5 million: Deferred spending for 2020. 10.8: Months of operating expenses held in reserve.

Here’s the good news: Vail’s sales tax collections in March declined 46% from 2019. Town officials had expected a 75% drop.

Vail’s revenues continue to drop due to the near-shutdown of the town’s economy caused by the COVID-19 virus pandemic. In response, town officials are moving from the “significant” recession plan adopted in April to the plan for a “major” downturn.

That plan includes a hiring freeze and a freeze on wage increases. Cutbacks in hours could be coming, along with possible staff furloughs for seasonal employees. The town has already cut roughly $18.5 million from planned capital expenditures for this year.

Better than most

The good news in the face of the cutbacks is that the town continues to have a solid reserve fund.

In a Tuesday presentation to the Vail Town Council, Vail Finance Director Kathleen Halloran said despite the sudden downturn, the town is actually doing pretty well compared to other Colorado towns.

Data from the Colorado Municipal League indicates that Vail has more months of operating funds in reserves than the state average. The town also expects to use less of its reserve funds.

In addition, while about 40% of Colorado towns have created community relief funds, Vail has already put $500,000 into such a fund, with additional funding possible.

The way the town is cutting back on staffing is primarily through a one month delay in summer parking operations and running an offseason bus schedule until June 29.

Further cuts will come from money not spent on special events.

“I’m really impressed by this effort, and the efforts of previous councils (to build reserves),” Councilmember Brian Stockmar said.

Halloran said she’ll return to the council in 30 days to determine whether the town should implement its “crisis” recession plan. That plan calls for still deeper cuts.

Plan for wall still in place

While the town has been cutting, the council Tuesday also approved spending more than $4 million to build a retaining wall on the north side of the town’s public works facility. That work is essential for the town to rebuild and expand the facilities there.

Councilmember Kim Langmaid questioned the need for that kind of spending this year.

But town public works director Greg Hall noted that the work needed to be authorized so it could take place in the June-to-November window when bighorn sheep rams aren’t in the area.

Hall also noted that work on the wall this year doesn’t mean the town has to spend on rebuilding the public works facility in 2021 as scheduled. That work can be delayed if needed.

Councilmember Kevin Foley noted that the price of doing the work this year is favorable. And, Hall added, the wall will create nearly an acre of new, usable industrial land in Vail. That’s about the only way to create extra space, he noted.

“We would not … move this forward if we as a staff didn’t feel like it was (necessary),” Vail Town Manager Scott Robson said.

“It’s a big dollar amount, but we have cut back in other areas,” Robson added.

The council ultimately approved the project on a 6-0 vote. Councilmember Travis Coggin had to leave the meeting by the time the vote was taken.

Vail Daily Business Editor Scott Miller can be reached at smiller@vaildaily.com.


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