In terms of reduced expenditures, the town’s General Fund has decreased from $9,424,884 for general operations in 2008 to a projected $8,665,133 for 2011. Also, the town has not increased sales taxes nor has it increased property taxes for current year operations. However, with that being said, this year homeowners will see an increase in property taxes as a result of an increased mill levy to cover debt service as it relates to public infrastructure built as part of a massive hotel project, now known as Hotel Madeline Telluride.
In January 2007, voters approved General Obligation Bonds for the construction of Heritage Parking Garage’s ramp, tunnel, and 116 public parking spaces. This garage sits adjacent to Hotel Madeline, off of Mountain Village Boulevard. When the vote carried, it was anticipated that the bond payments would come from additional sales taxes generated as part of the overall hotel project. To date, the reality has not been increased sales taxes, at least not in the short term. The case can certainly be made that without this hotel development the 15 percent dip in sales tax revenues that the town experienced from November 2008 through 2009 would have been worse without it.
But in any case, without the increase in sales tax revenues, the General Obligation Bonds becomes dependent upon property taxes. Of the total mill levy increase of 1.472 mills for 2011, 1.316 is attributed to the debt service levy with the remainder for refunds and abatements granted in the current fiscal year. The increase of 1.472 mills translates into an additional $117.17 per $1 million of residential valuation. For purposes of comparison, on a $500,000 condo one would see a tax bill increase of $58.59, and on a $3 million home, the additional tax is $351.51.
Although an increase in property taxes is not the desire of the town, it is today’s reality. So with that, Town Council members and staff are committed to providing the highest quality of municipal services to the community and will continue to seek out grant funding and other revenue sources to create less dependence upon property taxes.