Aspen City Council is questioning how surplus lodging tax dollars should be dispersed and spent.
The city currently collects a 2 percent lodging tax, which funds the Aspen Chamber Resort Association (ACRA) marketing budget. ACRA officials successfully lobbied the Aspen electorate to pass an increase to the tax in 2010.
ACRA representatives presented a $1.77 million budget for 2013 to council at a work session on Tuesday. The budget accounts for all of the projected revenue from the lodging tax, based on 2012 revenues. The estimate is conservative due to the volatility and unpredictability of the fund, said city finance director Don Taylor. That means if the economy continues to improve there could be a surplus next year, he said. In the past, surplus tax dollars were given to ACRA without a formal review by council of how the organization was spending the money.
Mayor Mick Ireland argued that any funds brought in by the lodging tax that aren’t budgeted should go into a city-controlled fund from which ACRA can request money. That way there is a clear and transparent process for appropriating the surplus and council can use the extra money to pay for other unanticipated marketing ideas if they arise, he said.
ACRA President and CEO Debbie Braun said the organization was not in support of the change in process, because it could create competition for those dollars between ACRA and other organizations promoting special events.
“The concern is that you are going to take the money and turn it into Mining for Ideas,” she said, referring to a former city program that funded new Aspen events.
Whether the surplus funds are given to another agency or ACRA should not dictate the process, Ireland said. The idea is to have a review process in place where elected officials decide how tax money is spent, instead of giving ACRA funds without knowing where they’re going, he said.
“We are accountable,” Ireland said. “We should be appropriating that money from the reserve. ... We’re contracting with you as a [marketing] agency. You’re not a reserve agency.”
Councilmen Derek Johnson agreed with Ireland’s suggestion, while councilman Adam Frisch said he thinks that ACRA should have control of any extra tax dollars. Councilman Torre said he needed more time to consider the situation and Councilman Steve Skadron did not attend the meeting.
Drafts of the 2013 ACRA contract with different surplus revenue dispersal options will be presented at the Dec. 10 City Council meeting.