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Vail Valley Voices: Good signs for economy

Vail Homeowners Association
Vail, CO Colorado
valleyvoices@vaildaily.com

Editor’s note: The following is an excerpt from the Vail Homeowners Association monthly report in April. We plan to publish weekly excerpts from the association, which keeps a close eye on economic and political trends in and outside of the town.

Town sales and lift tax revenues up:- Sales tax revenues are up 4.4 percent and estimated to finish 8.3 percent over the prior year for January. Lift ticket tax revenues this season (November-January) are up 15.3 percent. Town of Vail figures indicate the lift tax revenues are strong with some predicting the potential for a record-setting year in skier visits, which hasn’t happened in several years. The season’s better than average snowfall is a major contributing factor.

The town reports that its parking revenues through Feb. 22 were down 30 percent from 2010.- The daily “free” Frontage Road parking in West Vail for over a 100 vehicles could account for some of the loss.

Beaver Creek became a favorite for day visitors during Vail’s construction boom parking shortages because of its free parking.-Now, according to anecdotal reports, it is experiencing a “softening” in its winter business activity.-Some observers are saying that because of Vail’s renaissance makeover, the decades-long visitor migration westward to Beaver Creek and downvalley communities may be headed back up valley to Vail. Skeptics doubt that Vail’s turn towards offering more “free parking” can fully explain the change in patterns.

Mid-season analysis from Vail’s marketing establishment attributes a boost in business coming from Latin American countries. Mexico and South America are focal points of Vail Resorts’ winter marketing strategy, which, to many, can be credited with expanding Vail’s winter tourism business. Progress is being made to link the town of Vail’s summer marketing effort into Vail Resorts’ Latin American initiatives.-Discussions have begun among marketing technicians about the need to become more responsive to the advanced “cultural sensibilities” of the community’s international guests.

The Association sees these actions as progress resulting from its ongoing advocacy to transition economic development towards high-end international tourism.- With the downturn in the development economy, high-end international tourism is the most direct means to protect and improve the quality-of-life investments made by residential property owners in the community.-

Vail Resorts second quarter report: The company says it had positive growth in the second quarter ending Jan. 31 across all segments of its resort properties. The stock price is strong remaining near its 52-week high of $54. The resort segment (mountain and lodging) reported for the same period in the prior year an 18.5 percent increase in earnings before interest, taxes, depreciation, and amortization. Real estate showed a slowing in its decline over the prior year same period, down $200,000 as contrasted against a negative $6.5 million. The company reckons it will end the fiscal year up 13 to 19 percent for mountain and lodging segments with real estate projected down $10 million over the prior year. On-mountain investments for the coming season include the construction of a fine-dining restaurant at Mid-Vail.—

Year-end real estate report – Eagle and Pitkin counties : The home counties for Vail and Aspen, the two dominant winter ski resorts in Colorado, showed strengthening real estate growth. In a head-to-head comparison of total dollar volume of real estate sold, Eagle County sold $1.5 billion over 2009’s level, an increase of 67 percent compared to Pitkin County with a $1.3 billion increase amounting to a 17.75 percent rise. However, average sale price of single family homes dropped 4 percent in Eagle County and in Pitkin 11percent.-January sales numbers for Eagle County were on par with the prior year, with inventories remaining high. Foreclosures continue on the rise, as is seasonal unemployment, with over 400 fewer jobs available than a year ago.

Cost of doing business in Vail a problem: There are those in the Vail construction industry who are analyzing the cost imposed upon development by the town’s regulations and fees. The town is in the process of computerizing its development-related customer service functions to speed up the paper-handling processes.- Critics say it’s not paper handling that’s the problem, it’s the cost of doing business in the town. There are those in the industry who are say they are being priced out of the market.-Others say these developers don’t have the right product. Meanwhile, the local employment picture remains bleak.-

Town local hiring preference and discretionary spending: In a related issue, the town has reduced its $53 million in reserves by $6 million to fund improvement projects.-Some say this was done in order to keep the town’s staff construction professionals employed. The town’s bidding process, which does not have a “local preference” stipulation, stirred up a controversy when the staff recommended awarding a $1 million plus frontage road widening project to an out-of-county contractor.-The project adds or repairs bike lanes from Ford Park east to Bald Mountain Road.-The Homeowners Association questioned whether the town has appropriate criteria to objectively evaluate the “wants vs. needs” for discretionary capital projects such as the road widening project.

The Association reminded the Town Council that they had requested a “local preference” employment provision when they approved construction of the West Vail Fire Station a year and a half ago. The Town Council rejected their staff’s recommendation.-They instead awarded the project to a local contractor who, once the council removed discretionary add-ons, closely rivaled the price quoted by the non-local low bidder.-

Many in the local contracting business are critical of the town staff for appearing to look out for their own jobs at the expense of the local labor force. There are those saying that the town does not does fully factor in the cost of doing business in the Vail Valley.-Some believe there is a need for the town to adjust its development policies so that the local development industry remains competitive.–


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