On Thursday in the heart of the Central Colorado tourism area of Edwards, Colorado Gov. Jared Polis signed HB22-1117. The bill will now allow some level of county lodging taxes to be used to help create affordable housing funds in Colorado to support an increasingly-stressed workforce.
As covered in February by Ark Valley Voice, the percentage of lodging tax that could be diverted to create affordable housing funding will be determined by each county. Up until now, Colorado’s lodging tax has been a designated marketing fund; meaning that the 1.9 percent tax has been directed to supporting Colorado’s massive tourism industry.
The bipartisan bill was sponsored by Senator Kerry Donovan (D), Senator Don Coram (R), Rep. Dylan Roberts (D) and Rep. Marc Catlin (R). It clarifies once and for all that some percentage of the lodging taxes (the amount to be determined locally) can be used to improve the visitor experience.
As of 2019, according to Colorado’s Office of Tourism, “the tourism industry supported more than 180,000 jobs in Colorado. Tourism saves every Colorado household $707 annually in taxes. This is the amount of tax dollars residents would have to pay if not for the nearly $1.5 billion in state and local taxes paid annually by visitors.”
Many counties, including Chaffee County, have been reluctant to adjust those lodging dollars away from the promotion of tourism. The revenue from the lodging tax within Chaffee County has grown to around $800,000 per year. Most of it is spent outside the county, bringing tourists in. Current levels of tourism have had some major impacts on our natural resources, as well as the goodwill and patience of an element of the local population.
Over the past few years, as this extensive marketing effort has rolled merrily along, the tourism industry has been facing problems, including the overuse and abuse of public lands, overcrowding of Colorado’s natural, scenic and historic sites, and an increasing workforce housing crisis.
“If the tourism community, and the industry, needs housing, because they need workers to be able to power the tourism industry, that should be an allowable use of funds too,” said Polis.
Among the highlights of the bill: 90 percent of the lodging tax funds can be used outside of tourism marketing.
This could allow counties to make capital expenditures out of their lodging tax coffers for housing and child care. Importantly for counties like Chaffee (where residents have begun to note that we feel “loved to death”) for the first time this could include funding trail maintenance, and facilitating and enhancing the visitor experience.
Featured image: Fat biking, courtesy of Lake County Tourism Panel.