Vail revenues to hover around 2009 levels
July 20, 2010
VAIL, Colorado – The town of Vail’s revenue projections through 2015 aren’t looking any rosier in terms of the state of the economy – estimates put the 2015 town revenue right about where it was in 2009, at about $43.5 million.
Vail Manager of Budgets and Financial Reporting Kathleen Halloran presented a five-year estimate to the Vail Town Council Tuesday as part of the beginning of the 2011 budgeting process.
The town has consistently taken the conservative route when budgeting since the 2009 economic downturn hurt town revenues with a 25 percent decline from 2008. The Town Council and town staff have recognized, however, that 2008 was the peak of all peaks for town revenues, and those kinds of numbers aren’t likely to return anytime in the near future.
The town’s 2010 proposed revenues look like the town will recover more than half of what it lost in revenues from 2008 to 2009, but if 2011 estimates hold true, the town’s revenues will decrease yet again, by nearly 10 percent.
Sales at the town’s major redevelopment projects – the Ritz-Carlton Residences, Solaris and the Four Seasons – are expected to boost the town’s real estate transfer tax collections in 2011 by about $4.7 million from 2010, a 9 percent increase. The three big projects are expected to produce about 62 percent of the town’s real estate transfer tax revenue for 2011.
Halloran said her department is taking the conservative approach when looking at those projects, too. A July 15 memo to the Vail Town Council from Halloran, Town Manager Stan Zemler and Finance Director Judy Camp outlines assumptions that Solaris would sell 40 of its 79 wholly owned units by the end of 2011 at 80 percent of list price, the Ritz-Carlton Residences would sell a third of 71 wholly-owned units at 80 percent of list price and the Four Seasons condominiums would sell four out of 16 wholly-owned units at 80 percent of list price.
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“Over the entire five-year span, our revenue projections assume that two-thirds of units sell in total for these three major projects, with re-sales thereafter of only two per year,” the memo stated. “The resulting revenue dollars projected from 2012 through 2015 range from $2.6 million to $3.2 million per year, and are below the five-year average annual collections of $3.5 million prior to redevelopment (2000-2004).”
After effects from the three projects are felt, there are no increases projected in other real estate transactions through 2015, the memo says.
The town’s overall budget estimates show annual decreases through 2013, and then begin to creep up again slowly by just more than 1 percent both in 2014 and 2015.