City denies STR tax referendum due to illegitimacy and approves recall petitions

The Steamboat Springs City Clerk ruled on Thursday, July 28 to reject the petition asking for a vote on whether to put a 9% short-term rental tax on a ballot.

Clerk Julie Franklin approved petitions to launch a recall effort against Steamboat Springs City Council members Heather Sloop, Dakotah McGinlay and Joella West.

The referendum would not have repealed the short-term rental tax, as it has not yet been passed. The referendum also would not have repealed the Steamboat Spring City Council’s decision to put the tax on the ballot. If the referendum were approved and the petition got enough signatures, the city would be forced to hold a special election on whether or not to put the short-term rental tax on a future ballot.

The confusion was one of the city’s justifications for denying the referendum petition, which was described in a decision released Thursday afternoonin which the Registrar identified three grounds of insufficiency.

Section 39 of the City Clerk’s decision reads: “Authorizing a petition to advance an unauthorized referendum is against the law and would confuse voters by allowing voters to vote solely on whether to have a future election on the proposed tax.”

Robin Craigen, the primary contact for the petitioners’ committee and vice president of the Steamboat Springs Community Preservation Alliance, the group that supports the petitions, was disappointed with the city’s decision.

“We are not surprised because the city has delayed its response for the longest period of time possible,” Craigen said.

Craigen said the alliance is consulting with a lawyer to review the city’s rejection of the referendum. Craigen said he and his allies felt it was necessary to put the ballot issue to another vote and wanted the city council to reconsider its position and possibly repeal it immediately. He also said he would prefer not to go through a campaign process.

Get top headlines from the region delivered to your inbox every morning. Sign up here:

“It’s much more expensive to campaign against an election measure,” Craigen said. “While we appreciate that being an option, Steamboat is a community where you can still talk face to face with people.”

If the petition received enough signatures to put the ordinance up for a referendum vote, it was almost certain that even if the community voted in favor of putting the tax question on the ballot, the ballot question would not would only appear in November 2023 because new taxes can only be passed by a vote in the general election.

Regular elections in Steamboat Springs are held in odd-numbered years, when municipal candidates are typically on the ballot. Because it is an even year and no municipal candidate is on the ballot, “such an election cannot be a regular election.”

Since the city charter prohibits referendums on actions to call a special election, and the November 8 election is a special election, the city argues that the referendum challenges the city charter.

The city claims that Section 8.1 of the city charter states that “a referendum may not be called to request the repeal by the voters of the actions of the city to call a special election,” according to the first ground of inadequacy of the clerk’s decision.

In the second ground of insufficiency, the city clerk argues that the referendum request does not relate to “municipal legislation”.

The city’s decision includes a list of regular city council actions that do not constitute “municipal legislation” subject to the right of referendum, including “the collection of taxes” and “the calling of special elections.”

Since the adoption of the Taxpayers Bill of Rights (TABOR) in 1992, which requires all new taxes to be passed through public elections, putting a tax question on the ballot is as close as the city council can get to levy taxes – a city charter says municipal legislation is exempt from the right of referendum.

In the third ground of insufficiency, the city challenged the printed summary of the referendum, stating that it is the duty of the clerk to prepare the summary and not of the petitioners, but even if the clerk accepted the summary, it would be must be corrected because it refers to a “9% STR tax,” which the city says could mislead voters into using the acronym “STR” instead of spelling short-term rental.

The recall petitions were submitted by the same committee of petitioners as the referendum, which cited council members’ support for the issue of the vote on the short-term rental tax and the map of rental overlay areas in short term which was adopted earlier this year.

Sloop, McGinlay and West were part of the 6-1 majority vote that put the short-term rental tax on the ballot.

The petitioners have 60 days to garner approximately 1,000 signatures, 10% of registered voters in the most recent election, and if successful, the city council would set a date for a special election where the candidates would have to win a majority vote to retain their seat.