Voters to decide on tax increase to fund program

MONTROSE — A ballot initiative to create dedicated tax funding for a program that encourages airlines to fly in and out of Montrose will appear in November’s election.

The initiative, proposed by the Montrose Air Service Committee (MASC), would increase the lodging and restaurant taxes by a 1/2 percent and add a tax of a 1/2 percent to ground transportation (rental cars and shuttle) companies. This tax generated funding would go toward the airline guarantee program.

The Montrose City Council unanimously decided at its Thursday meeting to bring the issue to voters on Nov. 4.

Some businesses support the initiative, others oppose it. However, voters will ultimately decide.

The air service program uses funding as incentive to airlines, to guarantee a minimum revenue is produced by the service to Montrose Regional Airport, up to a certain negotiated level, said Scott Stewart, Telluride Montrose Regional Air Organization (TMRAO), which coordinates the program.

With the cost of air service expected to rise, creating a dedicated funding source is becoming increasingly vital, Stewart said.

Traditionally, the city has been supporting the program through a $300,000 annual investment from the general fund, according to a statement from the city. However, the council asked the MASC to look into an alternative funding source dedicated to the program.

The committee originally responded with a proposal for a 3.1 percent increase on lodging and ground transportation.

A business owner objected to the idea and the committee returned to the council with the ballot initiative proposal approved Thursday.

If passed, the measure is expected to generate $291,000 for continuation of the airline program, according to a Friday statement from the city.

“I think that the airline (program) does provide a huge service to the community,” said Mayor Erica Lewis Kennedy, who strongly backs the initiative. Even those who don’t fly out of the airport reap its benefits, Kennedy said, citing the past decade’s economic growth.

While one car rental business representative expressed confusion about the proposal at Thursday’s meeting, no other businesses spoke on the measure.

The committee’s original proposal was met with objection by lodging property owner, Gene Arzonetti, chief operating officer of Million Inns LLC.

Arzonetti, who is now a MASC member, said he supports the new proposal because it spreads responsibility for the program’s funding among businesses. “We’re trying to be fair about the whole thing,” he said.

DeAngelo’s Pizza owner, James Wilkinson, opposes the initiative.

“I just personally think it’s inappropriate to ask the citizens of Montrose to pay money to for-profit companies because they’re not making enough money,” said Wilkinson. He added that if the program is shown to benefit Montrose economically and that it’s important to have one, every citizen should pay for it.

A good local airport helps make travel prices more competitive and brings in big retail businesses that wouldn’t otherwise be here, said Kennedy.

She challenged individuals to look back at Montrose 10 to 15 years ago. Without additional airlines, traveling to the town was much more difficult.

“Montrose is in a very rare situation. A lot of communities are losing their air service,” she said.

“(Since the program), the growth and quality of jobs have increased exponentially.”

According to TMRAO, its efforts have grown air service by over 33 percent from 2003 to 2007, while the city has realized a 40.24 percent increase in sales tax collection over this same period.

“The Montrose economy has grown a great deal in the last 20 years and particularly since 2003, as a result of the efforts of TMRAO in attracting new air service,” said Sandy Head, MASC co-chair and executive director of the Montrose Economic Development Corporation.

Head added that, if passed, the initiative would free up the funding from the city’s general fund.

Contact Lisa Huynh via email at lisah@montrosepress.com