Denver City Council Should Nix Colorado Convention Center Payment Scheme

“I See What You Mean,” by Denver artist Lawrence Argent stands outside the Colorado Convention Center.

Denver city planners and promoters have developed a first-rate design to expand the Colorado Convention Center, but it comes with some big problems. Chief among them is that its plan to pay for the upgrades is too clever by half.

City Council members and residents should be concerned. While expanding the facility makes sense to fulfill a reasonable need — and the designs are really cool — the novel scheme the city developed to pay for the upgrades strikes us as a bad precedent. We hope council members send this plan back to the drawing board.

The scheme intends to deal with the eye-popping new cost estimate for the expansion. When the city went to voters in 2015 to ask for the right to raise tourism taxes to fund the National Western redevelopment and the convention center expansion, voters were under the impression that the $104 million to be raised for the Big Blue Bear’s den would cover it. Now the city estimates it will take $233 million — an increase of 124 percent.

Denver wants to fill the gap in large part with the creation of a new-to-Colorado special taxing district, the establishment of which avoids going to residents to approve. We appreciate that in any other city — not located in Colorado, home of the stifling Taxpayer’s Bill of Rights — elected officials would be able to adjust the lodging tax to compensate for the increased costs. However, this work-around gives precious taxing authority to a tiny group of elites to raise a good chunk of the money by upping the lodging tax another 1 percent to 15.75 percent.

Should the City Council green-light the scheme, come Election Day, while Denver voters weigh in on whether to approve a massive bond issue, the new special district — called a tourism improvement district — would be voted on by the 116 hotels in Denver with more than 50 rooms. Each hotel gets one vote. Approval requires a simple majority. Forty-three of those hotels are located downtown, and, given that large companies tend to own multiple hotels, the actual number of independent voters in the district is much smaller than the whole.

In the likelihood that the hotels approve the plan, then, lodging taxes for the larger hotels would increase across the city, and contribute to the arms race of expanded tourism taxes across the country.

Yes, the convention center is a huge economic force. And the city wants to win the prestige of attracting the lucrative Outdoor Retailer trade show. But Colorado’s largest city doesn’t need to pave the way for another special taxing district. We already have plenty, and it’s debatable whether all of them are in the broader best interest. There are business improvement districts, metropolitan districts, general improvement districts or urban renewal districts — all of which have been granted taxing authority once created. When does it stop?

Meanwhile, people already are flocking to Denver as one of the nation’s go-to places. Everywhere costs are through the roof and challenges with them. Many of the city’s urban jewels, like the 16th Street Mall, are being degraded by the opioid epidemic and related vagrancy issues the city still doesn’t have under control. And what about the areas of the city that aren’t downtown? Affordable housing? Every new tax increase detracts from possible future city investments.

No doubt, the new convention center plans are a good investment of public dollars, so why not let the voters decide?

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