State will spend $19 million to lure tourists here as part of a $26.5 million drive to create new jobs. Referendum C’s passage has made that possible.
The $26.5 million economic development package signed by Gov. Bill Owens last week is a wise investment in Colorado’s future prosperity. It’s also a clear fruit of last year’s successful bipartisan effort to pass Referendum C.
As promised to voters, this year’s legislature poured most of the money raised by what was billed as the Colorado Economic Recovery Act into long-term investments in education, health care and transportation. But the lawmakers also earmarked $19 million to promote tourism statewide, up from $5.5 million last year. While that sum is relatively modest, it produces an almost immediate return for Colorado taxpayers – making tourism promotion the poster child illustrating the wisdom of Referendum C.
Colorado was raising about $11.2 million a a year to lure tourists here through a special 0.2 percent tax on hotels and restaurant meals until a 1993 referendum, triggered by the TABOR amendment, repealed that tax.
The abrupt cutback in advertising soon began to weaken Colorado’s position in the highly competitive tourism market. By the 2001-02 recession, tourism revenues were off $2.4 billion from their peak, costing state and local governments at least $134 million in annual sales-tax revenue and worsening the cutbacks in highway spending, higher education and other services that accompanied that downturn.
Worried legislators responded by voting $5.5 million to promote tourism in 2003. A study by Longwoods International concluded that for every $1 the state spent promoting tourism in 2003, state and local governments received $15.58 in taxes. But while that study argued for restoring a strong tourism program, the rigid TABOR revenue ceilings hindered such efforts. Under TABOR’s rules, no matter how much extra money tourism poured into Colorado’s general fund, the extra cash could not be used to pay for the promotions themselves because it was automatically earmarked for tax cuts.
Referendum C’s passage, of course, lifted those revenue ceilings for five years, and a bipartisan legislative coalition this year responded by boosting the tourism promotion back to a healthy level.
Besides the tourism funding, five other economic development bills were signed by Owens last week. They include a $2 million boost to the state’s bioscience industry, $3 million to finance job-creation incentives, $1.5 million to promote the arts; $550,000 annually for the State Fair; and $500,000 in film-production rebates.
These are sound investments in Colorado’s future prosperity. Once again the 72 legislators – all 53 Democrats and 19 Republicans – who joined Owens to win passage of Referendum C last fall can be proud of their vision.