Business Alliance angles for a bigger chunk of LART

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The city’s Lodging and Automobile Rental Tax fund has been on the books since 1980, supported by a 2-percent tax on hotel rooms and a 1-percent levy on automobile rentals in Colorado Springs.

The purpose of the LART tax, according to the city’s 2013 budget, is “to attract visitors and enhance the economy of the City and the Pikes Peak Region.”

That may seem like budgetary gobbledygook, and it is. There are only two things you need to know about LART:

1. It’s a local slush fund.

2. City Council appropriates the fund, not Mayor Steve Bach.

Will the same people running the same organizations get the same allocations, or can we expect radical change?

As the city budget process slowly moves forward, expect some fireworks. The alpha dogs who have had their snouts in the LART trough for a generation may have to give up some ground, but they won’t do it without a fight.

LART was established as a way to support the Convention and Visitors Bureau, as well as other worthy events and organizations. It was strenuously opposed by The Broadmoor hotel, which had been annexed into the city in 1978. Broadmoor execs figured, correctly enough, that the resort would be by far the biggest contributor to the tax fund while receiving few benefits from its involuntary investment.

Their objections cut no ice with Council, whose members wanted a well-funded private entity to promote Colorado Springs and the Pikes Peak region.

Since then, the CVB has maintained an iron grip upon two-thirds of the LART budget. In 2013, that amounted to $2.7 million, up $600,000 from a decade earlier.

For more than three decades, event promoters, local nonprofits, city departments and economic developers have quarreled over the CVB’s leavings, like so many hyenas tearing into a half-eaten carcass abandoned by a satiated lion.

Past Councils have doled out cash to the Fine Arts Center, the Symphony, the Global Advisory Council of the Office of International Affairs (a former Chamber of Commerce initiative) and to the now-abandoned downtown convention center project, among many others.

The 2013 budget allocated $39,000 to the Cultural Office of the Pikes Peak Region, $8,000 to the Pikes Peak Marathon, $25,000 to the Pikes Peak International Hill Climb, $20,000 to the Olympic downtown celebration and $100,000 to the USA Pro Cycling Challenge (which then snubbed Colorado Springs after successful events here in 2011-12). Economic development grants included $70,000 to the Colorado Springs Regional Business Alliance, $50,000 to the Small Business Development Center and $25,000 to the Colorado Springs Technology Incubator.

In the past, funds were allocated according to a simple formula.

1. Political muscle;

2. Community position;

3. A good story;

4. See 1-3.

It was enough simply to claim that your event/project/nonprofit somehow would increase tourism or contribute to economic development. You didn’t have to prove it. To have required such proof would have been … well, ungentlemanly. We’re all friends here, after all, so why shouldn’t the CVB get a few million bucks?

Those days are over. Organizations and events seeking funds for the 2014 budget had to include reality-based, return-on-investment analyses.

Will such analyses be real game-changers or just convenient window-dressing? Will the same people running the same organizations get the same allocations, or can we expect radical change?

That depends on the nine members of City Council, but it looks as if they’re serious — and that might be bad news for the Biggest Dog of All.

Past Councils have been dominated by business-friendly individuals with little experience in high-level budgeting. That’s no longer the case — newcomers Helen Collins, Joel Miller, Don Knight, Andy Pico, Jill Gaebler and Keith King bring varied experience to the dais.

“We respect each other, listen to each other, and, I think, genuinely like one another,” said Gaebler. “I think we’re different from the last Council in that respect.”

Translated, the autopilot has been turned off. The CVB will have to justify every nickel of its allotment — and the hyenas are already circling.

“When you call The Broadmoor, the Marriott, any hotel in town, and ask them about the percentages of their business, they’ll tell you between 30 and 50 percent is from business travelers, not family vacationers,” said Business Alliance CEO Joe Raso. “If business is a higher source of revenue, then shouldn’t the organization responsible for attracting that business here receive more of the LART?”

Raso and the Business Alliance want $200,000, up from last’s year’s $70,000.

Mano a mano, Joe Raso vs. the CVB’s Doug Price. And no matter what happens, Mayor Bach is lurking in the shadows, veto pen in hand.

Are you ready for some hardball?

3 Responses to Business Alliance angles for a bigger chunk of LART

  1. What a ridiculous argument made by Raso – perhaps he’ll next lobby Congress for a piece of DOD’s annual budget since we have so many defense related businesses here in Colorado Springs! Truth is, the new EDC/Chamber is such a loathsome entity that it can’t support its bloated personnel budget by traditional means. So, the high priests at RBC are always looking, like pesky squirrels, to filch any spare change they can to justify their questionable organization’s expenses.

    Mike Hunt
    August 27, 2013 at 11:32 am

  2. Joe Raso, do you think the CVB is only responsible for individual visitors coming to our City? The CVB also includes a dedicated sales team that is tasked in bringing in group business to Colorado Springs and distributes group business leads to the hotels in our City. You should already know this but group business equates to conventions, meetings, reunions, tour groups, sports events, etc. The Regional Business Alliance encourages representatives of companies to come to our City and experience all we have to offer in hopes of convincing that company to move here. That’s still onesies and twosies in the hotels. Not consisidered business group business.

    August 27, 2013 at 11:39 am

  3. If the Regional Business Alliance were on a ‘pay for performance’ basis with so much awarded for each new company brought to the area and for each new primary job created – –

    they could not meet payroll.

    In addition, they have brought forth to council claims that could not be substantiated encouraging council members to ignore a public vote for an issue that would create revenue for the city.

    If you are paying big bucks for heart surgery, you want a cardiologist not a candy-stripper.

    Allow them a $1.00 year subsidy until they have a track record.

    Rick Wehner
    August 27, 2013 at 12:16 pm