Mountain News: 

Telluride debates whether it needs to boost tourism

TELLURIDE, Colo. — Most of the so-called tourist towns of the West about a decade ago began to understand that they were as dependent upon real estate flipping as bull wheels turning. This realization hasn’t always gone over easy.

For town governments, while being called upon to provide for proliferating services and amenities, the tax base has become smaller. Taxes on retail sales have struggled to keep pace with inflation in most cases, even if these declines have in some cases been offset by increased sales of real estate.

In turn, there have been calls to minimize the real estate presence. Aspen, Park City, and Crested Butte all talked about following Vail’s lead and banning real estate offices from the ground-floor locations in retail areas. Only Aspen did.

On the other hand, some towns have even questioned whether tourists are necessary. Or they have wondered if there’s another strategy for economic development that steers clear of both the seasonality and fickleness of tourism and the elitism of second homes.

In fact, as Jonathan Schechter points out often in the Jackson Hole News, the largest source of income there – and probably most ski valleys – is neither tourism nor second homes per se, but instead dividends and investments. In other words, lots of rich people have moved into the ski towns, and whether they’re part-time or full-time residents is really irrelevant.

Meanwhile, in Telluride, there’s discussion anew about whether the community needs to work harder at tourism. Seth Cagin, who publishes The Telluride Watch, argues that it should. In effect, he thinks the economy is too small, despite everything from ski area expansions to subsidized direct lights in recent years.

Neither the ski area nor the main street merchants can subsist on either the full-time or part-time residents, he argues. Both need tourists, and a lot more of them.

"We don’t have nearly enough locals in nearly enough second homes, or nearly a big enough drive market to support Telski (the ski area operator) without the contribution from significant numbers of destination tourists," he writes. "Not only does the ski area enhance the quality of life for locals, it provides the foundation for the second-home market. And it provides jobs. We all benefit from a prosperous ski company, and we all suffer from a failing ski company."

Among other things, Cagin advocates extending subsidies to the retail sector, similar to the way affordable housing and open space are subsidized. "Without protection and support, the retail sector too will all go away or will develop in ways that do not sustain the community," he says. He suggests applying deed-restrictions to ensure retail in certain spaces, and also a building trust to manage key properties in the best interests of the community, just as land trusts manage open space.


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