Vail’s sales tax bite among the lowest for Colorado mountain resort areas
Town looking into ways to fund housing and civic area improvements
- Crested Butte: 18.4%
- Telluride: 15.15%
- Snowmass Village: 12.8%
- Avon: 12.4%
VAIL — From housing to updating the town’s civic area, Vail has a lot of wants. Some of those wants will require more tax revenue to complete.
Colorado’s constitution requires voter approval of all tax increases. That means any government has to make a convincing case it needs more revenue. In Vail, a 2019 survey showed firm opposition to a dedicated funding source for housing.
But if the town decides to ask voters for more money, one thing can’t be argued: Vail’s total tax bite is among the lowest for mountain resort areas in Colorado.
Factoring in local, county and state sales taxes, along with lodging and other taxes, Vail’s total tax rate is 9.8%. Among resort areas in the Colorado mountains, only Copper Mountain’s tax rate is lower at 6.375%.
Crested Butte is at the top of the list compiled by Vail Finance Director Kathleen Halloran. The total tax rate there is 18.4%. That town doesn’t have a lodging tax, but the taxes include local, county and state sales taxes, along with a 1% regional transit tax, a 4% tax for the local marketing district and 5% in a category Halloran dubbed “other.”
Telluride is next-highest on the list at 15.15%. Telluride charges a 2% town lodging tax, a 2.5% tax for short-term rentals and a 2% county lodging tax.
Vail’s lodging tax was established at 1.4% when voters agreed in 1999 to create the Vail Local Marketing District. The lodging tax — along with the town’s sales tax — was raised from 2002 through 2005 to fund a conference center. Those taxes were repealed when the conference center plan was derailed due to escalating costs. The roughly $9.3 million from those taxes went into various projects, including upgrades to Ford Park.
If the lodging tax was doubled to 2.8%, Halloran estimated the town could collect another $3.5 million per year.
The lodging tax could also be more likely to pass, given that the tax would be imposed on visitors to town.
That revenue could also fund a bond issue — which would also have to be approved by voters — to fund improvements in the town’s “civic area,” roughly 10 acres of town-owned land including the Vail Public Library, Dobson Ice Arena, the Lionshead Parking Structure and Town Hall.
The town also has roughly $30 million available in “tax increment financing” from a special improvement district created for Lionshead. That district was created to help fund improvements in that area. It uses added money from increased property values that would otherwise go to other property tax-collecting agencies in the county. That district expires in 2030.
Putting it to a vote
During a Jan. 21 council retreat, council members talked about what, if any, increases to put before voters.
Mayor Dave Chapin said his preference would be to ask first for a lodging tax. Councilwoman Jenn Bruno also suggested the town could investigate a tax on short-term lodging units.
“But voters need to know exactly where (new tax revenue) is going,” council member Jen Mason said.
Town Manager Scott Robson told council members he’s working to put together a conversation with Eagle County officials to discuss what, if any, revenue requests they might put to voters this year.
Vail Daily Business Editor Scott Miller can be reached at firstname.lastname@example.org or 970-748-2930.