Vail to survey residents about possible tax hike for housing funds
Town officials seeking a stable source of funding to address workforce housing crunch
Current funding sources
The town of Vail today counts on three funding sources to pay for housing and housing-related projects:
- The town’s general fund.
- The town’s capital fund.
- Development impact fees.
Only the impact fees are dedicated to housing.
VAIL — Funding housing can be tricky, even in a town with millions in the bank. That’s why town officials are looking into asking voters for a stable funding source.
The Vail Town Council on May 7 met with members of the Vail Local Housing Authority Board of Directors to talk about just how, or if, to ask voters to tax themselves.
That stable funding source is a key element of the Vail 2027 Housing Plan, which envisions adding 1,000 deed-restricted units to the town — either by purchase or construction — by that date.
At the moment, the town funds workforce housing in several ways, including tapping the general fund. The town loaned the Chamonix neighborhood townhome project about $17 million to pay for construction of that townhome project. The funds were repaid through sales of the 32 units.
Town officials say that isn’t a sustainable system. That’s especially true when it comes to buying deed restrictions on existing homes. That money isn’t repaid. For 2019, the town’s general fund put $2.5 million into the program.
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Housing advocates, including Vail Local Housing Authority Chairman Steve Lindstrom, have said the town needs a predictable funding source to continue the deed restriction program.
That stable funding source is likely to come from some kind of new tax.
Getting it right on the ballot
The housing authority has hired David Flaherty of Magellan Strategies to work on a possible ballot question. That process starts with asking voters what they think of the idea, and what they might be likely to approve.
That survey will start this month and will use a combination of telephone and online survey responses. The goal is to reach as many of the town’s nearly 3,400 registered voters as possible.
What that survey looks like got a bit of added definition from town officials Tuesday.
Council member Jen Mason said the survey could use a bit of explanation as to what deed restrictions are, and how the town uses them.
The survey will ask voters whether they prefer a sales or property tax. Both have potential drawbacks.
The town’s current total sales tax rate was 8.4% in 2018. Business owners in the past have expressed concerns about pushing that rate much higher.
The town’s property tax rate is one of the lowest in the county, thanks to the town’s strong sales tax collections.
Council member Greg Moffet noted that Vail Resorts is the town’s single biggest property owner. That could shift voter sentiment, Moffet said. But, he added, a property tax increase would leave the company “paying way more than their fair share.”
Vail Housing Director George Ruther said the council will get an update in June about the survey results.
“The survey will tell us what additional work we need to do,” Ruther said.
The town has until August to determine what a ballot measure might look like, and get it on the town’s November election ballot.
Council member Jenn Bruno said whatever the results, and whatever decision is made regarding the ballot, one thing is essential: We (the council and housing authority) need to be together on this.”
Vail Daily Business Editor Scott Miller can be reached at email@example.com or 970-748-2930.