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Council recommends delay in use tax vote

A proposed ballot initiative for a “Use Tax” — a tax on building materials purchased outside of Archuleta County — will most likely wait until next year before coming before the voters.

Currently, La Plata and Hinsdale counties have a use tax, and proponents have said that Archuleta County needs the levy “to level the playing field” for local merchants competing with retailers both out of county and out of state.

Discussing the possibility of the initiative at the monthly joint meeting between the Pagosa Springs Town Council and the Archuleta County Board of County Commissioners last Thursday, council members and commissioners alike agreed that the initiative would be a hard sell to local voters in the current economic climate.

“I’m just concerned that anything with that ‘T-A-X’ on it is doomed to failure,” said Commissioner John Ranson in the midst of the discussions.

The previous evening, Ranson and Commissioner Clifford Lucero had attended a meeting of the Home Builders Association during which the use tax had been discussed at length.

According to Lucero, the majority of the builders were not in favor of the initiative. “It was probably sixty-forty against it,” Lucero said. “I don’t think we have the full support of the builders. Paperwork was a big thing,” he added.

Both Lucero and Ranson remarked that area retailers, while appearing to support the initiative, had shown little inclination to provide substantial support for the measure. In fact, with no organization or group willing to step up and advocate for the initiative, chances of a use tax initiative passing a November vote appeared negligible.

By law, neither the council nor the BoCC can campaign for any ballot initiative. Furthermore, with a Sept. 3 deadline for placing the initiative on a November ballot, both boards recognized that any group willing to push for the initiative had little time to organize a viable campaign to convince area voters to pass the use tax.

It is currently unknown if a special election will be warranted this November. Although the Archuleta County School District 50 Joint has open seats for the Board of Education, if those seats remain unopposed, the district will cancel election plans Sept. 1. In the highly unlikely scenario that the state would mandate a special election for Archuleta County (no special ballot initiatives have been indicated, to date), the county would have no reason to schedule — or pay for — a special election unless the decision is made to pursue the use tax.

“It appears it costs the county between $30,000 and $40,000 to do an election,” commissioner Bob Moomaw said.

However, with Archuleta County voters having once rejected a use tax ballot initiative, commissioners and council members alike expressed reluctance to push through a ballot initiative this late in the game. In 2003, the Board of County Commissioners approved ballot language that would have imposed a 4-percent use tax on construction and building materials, including those used in oil and gas production and facilities; on motor vehicles purchased outside the county; and on building materials unrelated to oil and gas development. According to the ballot question, the revenues were to be shared equally between the town and county.

As proposed in recent discussions, the use tax would involve only building materials, including materials for kit homes, kit log homes or modular homes.

“If it fails again,” said County Administrator Greg Schulte, “it will be awhile before we can bring it back again.”

Still, some members of the town council wondered if the measure couldn’t make it on the November ballot. “We’ve made a lot of concessions to the builders, to the Realtors, “ said council member Darrel Cotton. “I think this is the right time to kick-start this.”

Council member Stan Holt wondered if the Chamber of Commerce couldn’t promote the measure for a November election. “Who better to take this on but the Chamber? I mean, what is the Chamber for? Nobody I know has even talked to them,” Holt said.

“This is the time we need it the most,” Cotton continued, “I think we can do it if we can get the Chamber on board.”

Bob Hart, representing the HBA, was less sanguine regarding the chance of a use tax passing in a November election and said, “I think it was brought to the builders a little late,” adding, “ ... it’s probably not going to pass.”

Presented with little time to position a new tax to the voters (albeit, one that would not affect most residents), both council and the BoCC looked to next year for introducing the measure on the ballot. With two opportunities to hold a special election in 2010 — in May and November — the meeting ended with both boards agreeing to reconvene with a decision on how to proceed with pursuing the use tax.

Later in the day, during its mid-month meeting, council provided Town Manager David Mitchem direction on how it preferred to proceed with a vote on the use tax.

“I’d like a consensus from the council to give the county some clear direction where the council is coming from,” said council member Jerry Jackson. “I personally prefer a May election.”

“If we put this off until May, we can’t stop working on this,” added council member Shari Pierce.

Holt agreed, saying, “I concur with a May date but I’d like to look into the possibility of sharing costs.” Holt indicated that the council should consider building a line item into its 2010 budget for helping the county fund the election in May.

With a motion by Jackson to direct Mitchem to make a statement to the county indicating the town’s wish for a May election on the use tax issue (with a promise to help fund that election), council unanimously supported the initiative for a 2010 election.

Although it is uncertain how the county will proceed (the BoCC will likely decide the issue of scheduling an election at its Sept. 1 meeting at 1:30 p.m. in the county courthouse), it will have the town’s recommendation in hand when deciding the issue. More than that, it remains to be seen if the voters will accept the merits of a use tax, whether the vote takes place this year in November or in 2010. Finally, the question remains if any organized effort will arise to advocate for the tax before it goes before the voters.

Council and the BoCC will meet again for their monthly joint meeting on Thursday, Sept. 17, at 10 a.m. in council chambers at Town Hall.

jim@pagosasun.com