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County: ‘Share the tax’

Staff Writer

Archuleta County is making known that it is not in favor of a possible increase in the town’s sales tax, instead suggesting both entities should, and would have to, share any increase approved by voters this spring.

Currently, a 2 percent sales tax levied in Archuleta County (on top of state levels) produces revenue that is divided between the county and town, with 1 percent going to the county and 1 percent going to the town.

Now, the Town of Pagosa Springs is considering a ballot issue that, should town council approve its placement on the ballot, would increase sales tax within Pagosa Springs by one cent per dollar to fund a community recreation center.

That increase, then, if approved by voters,would go only to the town — something county officials disagree with.

The county believes it is entitled to 50 percent of any sales tax collected by the town based on an agreement currently in place between the two entities.

That agreement was approved in 2008 and split the sales tax revenues evenly between the entities for the town to use on capital improvement projects and for the county to use for road capital improvement. It was approved following a ballot initiative that extended the 2 percent sales tax for the town and the county in perpetuity.

But with a vote to increase the tax on the horizon, the county is making its position known.

“There are existing recreation projects such as the Town-to-Lakes Trail and it seems that we should garner the public trust by finishing one project before we undertake another,” said Todd Starr, suggesting the increase is not needed. Starr is the county attorney and co-interim county administrator.

Starr also authored a letter to town manager David Mitchem putting forward the county’s position.

In the letter, dated Jan. 7, Starr wrote: “I am writing to express Archuleta County’s desire that the Town of Pagosa Springs not usurp the remaining available sales tax. We believe that both the Town and the County benefit from the history of sharing the sales tax. We believe that the sharing arrangement that currently exists helps foster a relationship of cooperation.

“Affirmatively, we would like the Town to consider placing a joint issue on the ballot that would raise the sales tax and dedicate the additional revenue to Roads within the County and curb and gutters and sidewalks within the town.

“Finally, be advised that should the Town of Pagosa Springs recognize an increase in sales tax Archuleta County is hereby asserting its right to fifty (50%) of any such revenue generated.”

This week, town council scheduled an executive session with town attorney Bob Cole to discuss the county’s right to half of any approved sales tax increase.

That session, which is not open to the public, is scheduled for noon tomorrow, Jan. 17.

randi@pagosasun.com

This story was posted on January 16, 2014.
  • Brian Griffin

    It is ironic Todd Starr mentions “garnering public trust” when speaking of the county’s intentions. Did the county garner public trust when voters approved Ballot Measure 1A and the county “forgot” to collect the tax revenue for a full year, then under-delivered on its promise to spend the money it did collect appropriately? How about when the county spent over $25,000 to develop a regional park plan on Cloman Boulevard while conveniently forgetting there were easement/access issues that eventually required the county to scrap the plan after a much-publicized promotional effort. Oh, and don’t forget about the 95 acres the county purchased on Highway 84 a few years back with the apparent intent to develop a regional park. That plan is going so well the county is now looking to dump the property because it didn’t do its homework with regard to threatened species and hasn’t a clue regarding how to write a competitive grant application. The county should be looking for ways to garner public trust, but dabbling in parks and recreation initiatives isn’t going to bolster that trust any time soon. Vote yes on the rec center; this county could use some good news and could also prove it can step forward without stumbling.

  • ajpagosa

    I’m glad the county is standing up for the vast majority of local residents who will not be allowed to vote on this, but will have to pay for it if it passes.

    Rec Center = Epic Fail

    Vote no if you’re actually allowed to vote!

  • dave

    If the town & county governments are at war why not just come out & declare it. Is it that the county is not in favor of increasing sales tax or is it the county is in favor of a increase if they get their half? Forget the Rec Center, The county & town are going to need to increase sale taxes just to pay the attorneys. Is building a 20 million dollar Rec Center in a flood plain on the edge of town the best “realistic” idea anyone can come up with? Didn’t the town & county deal with all this nonsense years ago? Sadly, to the contrary of the first sentence in this article. This article implicates that the county is making it known it is in favor of a sale tax increase, so long as the county gets half of it.. I’m not against a Rec Center. I just don’t want to pay higher taxes for it.

    • ajpagosa

      I think it is a little more subtle, or I am interpreting it that way. The city cannot afford a rec center if the county takes 1/2 of a 1% tax raise. So this is an effective way of blocking it. The county opposed a rec center couple of years ago, city is trying to go it alone.

      BTW the total cost of the rec center over 20 years is closer to 45M, if you include initial construction cost, bond interest, and over 1M/yr operating costs for 20 years (which are light in the projections I’ve seen). For example they’ve only budgeted as little as 30k/yr for manager salary. If you think you can find someone to capably manage a facility like that for little more than minimum wage, good luck. Closer to 80k would be more like it. Many other underestimates like that.

      And just in case it is not clear, unless you are a resident of Pagosa Springs (city of), you cannot vote on this. That means well under 10% of the residents of AC have no vote. But nearly all AC retail is “city of” so we’ll all pay the taxes. Pagosa Lakes is does not get to vote for example, nor Aspen Springs.

      This is a very poorly thought out plan, far too costly at the expense of many other needed infrastructures fixes, disenfranchises the majority of AC residents, and in the case of Pagosa Lakes, makes residents pay for a facility they will not use as they already have a nice rec that is paid for.

      Vote NO if you can. I am also not against a reasonable sanely priced rec center, just against paying for this monstrosity when not being allowed to vote on it.

      • Dave

        Can’t Vote. 45 million can buy a lot of concrete & steel. Town needs concrete & steel, a lot of it. Just not in the form of a Rec Center. No taxation without representation please. Thanks for your insight.

        • ajpagosa

          Lot more good info over on the Pagosa Daily Post website. No affiliation.

          Probably the shadiest thing being done here is not making it known that only a small number of people can vote on this. For example I did not initially know that, despite it being said many times by proponents that if people oppose it we’ll just let the people vote on it. As if TABOR somehow applied.

          Well it doesn’t here and they’ve largely hidden that fact, through some clever annexation of most commercial areas. So many of the people in my area, Pagosa Lakes, are not even aware they cannot vote on a sales tax that affects them, even though most of the commercial areas subject to the tax are in Pagosa Lakes. Only residents of the City of Pagosa Springs can vote on it (a few hundred), but all of Archuleta county (>10,000) has to pay the tax, since COPS annexed all the retail.

          Obvious intent is to circumvent the spirit if not the letter of TABOR, and for a program that is probably 10 times the size it should be for the local population.

          I wonder who will actually get most of this money, maybe the construction companies and so forth. But at the expanse of fixing stuff that needs fixing and putting the city deeply in debt for decades. Doesn’t make sense but then I don’t understand small town politics.

          • Dave

            All you need to understand about small town politics is understand herd mentality. Vote against people you don’t like. Issues are secondary or perhaps not even relevant. Basically, As I find out who is for this tax the more skewed I become against it. Small town politics is not about voting “for” something. Its about voting “against” something. I just think small town politics is more about “who” than “what”. Keeps things simple, just voting against what people you don’t like want. Don’t need to understand the issue, just who is for or against it. Please correct me if I am mistaken.

          • ajpagosa

            Well in this case maybe even simpler than that. If only a few hundred people vote for this tax, it happens. Crooked mendacious people behind it stand to make a great deal of money. I guess from construction or something, not clear who is the Invisible Hand here.

            All they have to do is convince a few otherwise well-meaning but gullible COPS soccer moms it’s “for the children” who “deserve it” because apparently there is no other source of recreation in our magnificent outdoor paradise.

            And it is done. All residents of AC will have to scrounge around to find an extra $45M+ over the next 20 years. And you can’t skip bond payments.

          • Brian Griffin

            Both of you are way off base. First, the county has no legal right to 1/2 of the penny, should the measure pass – and they know it. Second, there is no sleazy attempt to bypass TABOR – this is all very legal (how do you think other communities build facilities of this kind?). Third, you both need hobbies if you think anybody stands to make “great deals of money” on what you believe to be a dastardly plot to “ruin” what is already a mediocre (at best) place to live because of 100+ years of poor leadership, but with nice views. It’s a rec center for Pete’s sake, not a medical waste dump. And it’s not being packaged as just “for the kids,” although I’m sure you conspiracy theorists will not be told otherwise.

          • ajpagosa

            I think you’re entitled to your opinion (or whoever you are working for), as misguided, deceptive, and distorted as it is. What you aren’t entitled to is our tax money, without us getting to vote on it. That is what TABOR is about, that is what this issue is trying to circumvent. $45M is a lot of money, somebody’s getting it.

            You can pretend otherwise but anyone who knows the facts can see this for what it is, a money grab by a tiny little group of voters and some vested interests (equestrian?) that happened to annex for tax purposes all the retail servicing over ten thousand people in AC.

            Hope the county succeeds in shutting it down.

          • Brian Griffin

            Equestrian interests? Hahahahaha. I was in Durango over the weekend – didn’t see any horses in the pool or on the climbing wall. County has already FAILED to shut it down; they have no legal standing to shut it down. It probably won’t pass anyway – still too many backwards-thinking know-it-alls like yourself in this little burg, but hey, it’s still worth a shot. As for who “gets the money,” if you don’t know how a revenue bond works, perhaps it’s time to educate yourself a little bit.

          • ajpagosa

            Perhaps my comments are too subtle for you to understand, and I’m better educated than you can possibly imagine. We’ve already done this before Brian, you lost the arguments then, you’re losing them now, and your only response is still ad hominem attacks and personal insults. I guess nothing new here.

            To the rest of the readers, please vote No on the tax increase, those of you who are allowed to vote. The rest of us will look into other means of blocking this silly project.

          • Brian Griffin

            Yes, look into other means to block this “silly” project. I can see it now – children and their parents, grandparents even, recreating safely under the roof YOU paid for. The nerve. Swimming lessons, basketball practice, aerobics – God, where does it end? I get it; you don’t want to pay any more taxes. But quit labeling this endeavor as “silly” and “sleazy.” You sound bitter and uptight. And quit pretending to understand the financing associated with this project; it’s obvious you don’t, and it makes you sound foolish when you make assertions which are so obviously false.

          • ajpagosa

            Once again, and over and over, Brian and his cohorts who support this refuse to even acknowledge the basic issue here. Taxation without representation. That is all this is about. That is because what they are doing is outright theft, really, and they use all sorts of smarmy and insulting tactics to try to get away with it.

            Now I guess it’s for grandpa so he can exercise with roof over his head? Poor grandpa!

            If all the residents of this county have to pay for something this expensive and pointless (and yes silly and sleazy) they should at least get to vote on it. And yes EVERYONE in this county is getting taxed for this, that is the whole point of the article here we are commenting on. That is why the county is stepping in. But, and how many times do I have to point this out, only a small % (well under 10) of AC residents are allowed to vote on the measure as it presently exists. But they’re putting all of us in debt and incurring huge ongoing forward obligations.

            Other readers please take note of the tactics being employed here by rec center supporters.

            Vote No on the Rec Center, if they’ll let you vote that is.

          • Brian Griffin

            O.K., one more time, then I’m done. Neither of you have the knowledge and history (or understanding) of this project that I have; I guarantee that. If you think the numbers are fudged, show me how, since you obviously are experts in this type of thing. Dave, you said I should move to Durango if I like it so much. I guess I can turn the table and say – hey, if you want to vote on this, move to downtown. Not going to? Oh, I see. It’s like anywhere else boys, if you don’t live there, you don’t get to vote, period. That’s just the way it is. As for motorcycle man – if you don’t think the rec center will come close to paying for itself, you obviously don’t understand a revenue bond and how it relates to this project or the local economy and I don’t have time to explain it. And Dave, I love the outdoors, have made a career out of the outdoors here, really, so your comment, as usual, is way off base. Stay bitter, you two!

          • Dave

            And you keep up the good work! Mr. “Outdoorsman”.

          • ajpagosa

            What a sad, corrupt farce you neo liberals have become.

            Please vote NO on taxing people without their consent!

            Free Arculeta County!

          • Steve Sullivan

            Dear Mr. Griffin,
            We’ve asked you before and we must reiterate…please do not feed the Trolls.
            Thank you,
            The Management

          • ajpagosa

            Thank you!

          • Dave

            Rec Center kooks like you need to take number as well as learn how crunch them. Look to the Towns approved Comprehensive Plan for guidance. Finish the river restoration, river walk, Town to Lakes Trail, McCabe Creek Park, Pave unpaved alleys and streets, How bout some more sidewalks for kids to safely walk to school. I want hear ideas from someone who lives in wheelchair and what projects they think will make their life better. If you like the Rec Center in Durango so much. Then move to Durango. I moved to Pagosa to be closer to Wolf Creek Ski Area and the Hot Springs. Sorry you think Pagosa is so “mediocre” as you put it. You probably just lack the skills, knowledge, confidence, and will to engage in the abundance of outdoor activities that might result in you falling down and getting hurt. You call it a Rec Center. It smells more like Day Care Center. When I was kid, we had a name for kids like you. Have fun playing your indoor games, Inside Boy. My work is done here. I look forward to reading more of your lame rants. I said it before and I will say it again. the more I find out who is for this tax the more validated I become against it. All the members of Town Council have yet to officially way in on this scam. I believe the ones that know the difference $25,000 and $25,000,000 will prevail. You could do your side a favor and just stop posting. Better yet, just keep posting. You seem to enjoy the abuse.

        • ajpagosa

          Just want to clarify what may be going on here. I doubt the county wants a tax increase. By asserting that City must share a 1% increase, they force it to be voted on county wide. That accomplishes 2 things. One it cuts in half any revenue city would receive, ergo no rec center. Two it lets the whole county vote on it in which case it is unlikely to pass.

          I have wondered how the City ever thought it could pull such a sleazy bypass of TABOR, this is one way to block it. I am sure the County could enforce the revenue split legally if it came to that, and again the rec center is defeated.

          They can’t afford the rec center as proposed even with the full tax, at 1/2 they couldn’t even afford the interest payment on the bond issue. It really is a bad idea, conceived by people without basic arithmetic skills (or they’re just dishonest, or I guess both).

  • Dave

    Something fishy going on here. What bugs me most is the chosen location of the proposed Rec Center, on top of the Town sewer lagoons that should be responsibly fixed instead of irresponsibly discarded. Why this location? For conspiracy theorist I offer this possible rationale. A serious crime was or is currently being committed at that location. The proponants or “proponant” for this Rec Center location are aware of the crime that has been committed and this is their plan to cover up that crime by pouring concrete over it. Its just a wild “bitter” guess, but it is suspicious that the focus is on that particular location next to the river. Common sense says not to put such a “grand” project in a flood plain. The EPA needs to do some “digging” so to speak. Why is this location so important? Is the Rec Center going to be big enough to cover that crime up?

    • Brian Griffin

      Now I’ve heard everything. “Touched” a little, are we? For more information on the rec center and (other small-town conspiracies), visit http://www.pagosareccenter.com

      • Dave

        You enjoy poking a bears I see. Riverfront locations that are owned, or in stewardship of The Town of Pagosa Springs are special assets to be protected from development. The right thing for the Town to do for the proposed Recreation Center/sewer lagoon site down river of Yamaguchi Park is to restore it back to the wetlands its was a long, long time ago. Maybe even a fishing, ice skating pond park scenario like whats behind the river center. A place for geese to splash down and deer to nap-away from hustle & bustle of the big city life. A park or sanctuary that represents how responsible small town leaders deal with their failure in foresight. A big structure like a Rec Center does nothing to enhance the river. It dismisses it, even worse, it challenges the Mighty San Juan River. Good luck with that fight. Get FEMA flood map and get a clue to how bad this location is for a Rec Center.

        • Brian Griffin

          It is the only site available that is large enough to accommodate such a structure. Wish there were others, but the town has no other parcel that is adequate. I’m pretty sure the state will have some questions if the measure passes, but if it (the state) was going to permit a new sewer plant on the same parcel, I don’t think a rec. center will come out smelling worse (no pun intended). By the way, your ice skating/duck pond idea has been mulled, and may even be considered if this moves forward. Anything is better than sewer lagoons. See, we’re not so different, after all.

          • Dave

            Coom by yah ma lord, Coom by yah. Just kidding. Great! Make that pivot. Its not about a Rec Center. Its about the sewer lagoons and doing what is right for that part of the river. I bet the county has some decent land nearby they could offer up for a Rec Center, if so inclined. Best idea I heard so far is to re-develope the middle school into a Rec Center. Build a new Middle School next to the High school on a secure campus. The sewer lagoons are not the only site that Town owns that is large enough to accommodate such a structure. As Yoda would say:” No. There is another.” Town went though all this “site” confusion stuff with the skate park. Like 10 years of confusion and indecisiveness as to where to put it. Me and you. Yeah. We’re like chocolate & peanut butter. I need a Snickers Bar.

          • Brian Griffin

            How would you put a pool of any kind in the middle school? Just asking. Are you in favor of paying a little more in taxes for a new school campus? That’s the only way that will happen, you know. Just curious – what other parcels does the town own that would accommodate roughly 3.5 acres of building and associated parking (other than Town Park)?

          • Dave

            Really? Ok I’ll bite. The Large Gym. Have two huge above Ground Pools- surrounded by a elevated deck. I would be much more in favor of having that scenario shoved down my throat. Your trying to trick me into saying Reservoir Hill. Kind of funny how Archuleta County or the Archuleta County School Board owns all the good sites in town, other than the Town Park/middle school football field, of course. But since you bring it up. I am tired of worrying about the middle school kids having to cross HWY 160 to enjoy the great outdoors.

      • ajpagosa

        Anybody wants a good laugh, read the financial projections on the website above, if you can they are tiny print.

        BTW Brian, I think you ought to disclose who you are on the committee, or who you are working for. It is very clear you play a direct role, have inside info and are trolling here for tactical purposes used to build that website.

        Looks like total cost over 20 years is over 50M, would be nice to see those projections in higher res or better yet XL download format, they are barely readable as presented (perhaps intentionally). BTW I have been using back of the envelope 45M for this number, looks like I was wrong, but I never thought I’d be light.

        Yes Brain I understand revenue bonds, have a background in finance. So I would ask, since the reserve fund seems way light, the overall revenue projections quasi-delusional, and the operating cost seriously under estimated, what is the position of the creditors if the city fails to make payments? Is the entire city sales tax pool and rec center fees collateral or only the new 1%? And then what is the interest rate and has this actually been quoted by a real financial entity based on an audited proposal or is this just make believe? Has anyone in an independent position audited these numbers? Will be curious to see who if anyone signs up for an offering of this nature based on this, and what rate city has to give in return.

        Briefly, I also question the 2.41% projected rate of revenue increase over 20 years. For two reasons. One we have not yet returned to peak revenue seen in 07-08 which was fed primarily by a crazy local housing boom, so it is not clear we are even in an uptrend yet or ever will be again. Second the historical increase in revenue has been based on a boomer vaca-home buying frenzy & demographic surge as well as that good old national/local housing bubble, neither of which is likely to reoccur. Ever.

        Plus 10 year treasury rates (and thus mortgages) are going back to normal levels soon, curious if anyone here understands what that really means.

        Finally we know the user fee projections are flawed, the company that did them did not consider the fact that Pagosa Lakes residents already have a rec center and will be unlikely to use this one.

        Assuming endless linear growth rates like this proposal does is what got many people into serious trouble, it actually caused the recession: banks, municipalities, and individuals, apparently here at least no one learned anything. Plus we have yet to dig out of it locally or nationally.

        But once again, for the nth time, none of this concerns me as much as not being allowed to vote on it.

        • ajpagosa

          To clarify a point, the proposal claims even if there is no sales tax revenue increase over 20 years, bond will be paid off in 20 years. If that is true, fine. That represents ~30M over 20 years.

          The question is where does the operating budget come from under an assumption of no revenue increase? Considering operating costs & user fee revenue estimates seem (very) light. Here is where you get into tapping other parts of the city budget to pay for it. Yes I know they say the tax and user fees will cover everything, but that is only under the assumption of a steady annual increase in revenues.

          Then the final question is, what if sales tax revenues actually decline? To the point that the debt maintenance cannot be met? The website says they just take longer to pay back the debt. But under that scenario not only would bond payments be missed, but the rest of the city budget would also be smaller, yet the operating costs would still be there. This is not a stupid question, we have not yet reached 07-08 levels of revenue yet and there is zero factual evidence we will exceed them again.

          Lack of foresight for or disregard of what we math types call large tail risks is what led to a lot of banks and municipalities (and ordinary people) getting blown up in the recession. Would be nice if the proponents of this would at least pretend to remember the financial crisis and maybe even be transparent about their assumptions.

          • Brian Griffin

            Yes, an independent bond counsel has reviewed the info. Yes, the consultants the town hired were very aware of the rec center uptown (don’t believe everything you read in the Daily Ghost). The projections, all of them, are actually worst-case scenario, unless you believe the end of the world is coming. And, contrary to what you believe, the trend in sales tax for the town and county is upward (2.4% over the last 10 years, even with the recession, and closer to 5% over the last 20 years – you can check for yourself at the clerk’s office). No, a Walmart is not necessary for this to work but yes, it would help add to the bond reserve. No, I am not on the committee and I don’t work for any interested party; I just pay close attention and have reviewed all of the information for the past 7 years very closely. Bond rates now are between 4 and 5%, the lowest in years. If, for some reason, sales tax declined for consecutive years, there is $1.5 million built into the bond as a reserve payment for an entire year. Yes, there are always risks with finance, but there are risks in stepping off of your front porch. The best thing you can do if you want to learn more is visit the rec office downtown and ask to see the files. There is no funny business going on here, except for the fact that yes, only town residents can vote, but there is nothing the town can do about that since the county has no interest in this project.

          • ajpagosa

            I’m not sure I believe any of what you just wrote but even if a little bit is relatively true, why don’t you want to let the rest of the county vote on it? Why does the county oppose it if it is such a good idea?

            What is the exact interest rate used in the spread sheet? 1% one way or another is a lot of money over 20 years on $18M loan.

            $50M burden on the entire county approved by a tiny minority? Hardly seems fair.

            BTW I read the consultants original report on the rec center, not just what the Pagosa Sun had to say about it. User fee estimates are light and operating costs super light.

            Finally no one knows what the growth rate in the future will be, locally for 20 years it has been wildly distorted by boomer demographics and a vaca housing/building boom. We are now saturated on housing and the boomers are dying off. Population has been flat for quite some time.

            And please answer what happens if we miss a bond payment, where the money comes from for operations. The reserve shown on the spreadsheet is not anywhere close to adequate to cover a serious downturn. At the very least you should include a downturn like the one we just experienced, and several smaller ones. Just on average we will have 3-4 recessions over 20 years, esp given how distorted markets will become due to unwinding recent massive central bank intervention.