By William J. Dagendesh
The Manitou & Pikes Peak Cog Railway tax incentive program agreement reimbursement was the main focus of the Nov. 1 City Council meeting.
Gary Pierson, president and CEO of Oklahoma Publishing Co., parent company of The Broadmoor hotel in Colorado Springs and the Cog Railway, was unable to attend the meeting. Finance Director Becca Davis researched city records and provided applicable documents for council’s review.
The Cog closed in winter of 2017 for equipment repairs and upgrades, then remained closed during the worst of the coronavirus pandemic. Council approved the first 50-year agreement on June 26, 2018, and repealed it on Nov. 20 that year due to negotiated modifications. The second 50-year agreement was approved 5-2 that same day.
“The main provisions of the agreement included payments to the city totaling $1,250,000 in the first three years of 2018 through 2020. The total use tax paid from 2018 through 2021 was refunded, and after that only the rolling stock
use tax will be refunded from 2022 to 2041,”
Davis said.
“The excise tax for 2021 through 2070, the amount that will be refunded, will be the amount over Exhibit A, the base tax, for the various years. Also, the tax generated by the ridership over 375,000 riders in any calendar year is not subject to reimbursement.”
Davis said that, for the agreement’s first 25 years, the base increased by 1.5 percent to 2.5 percent every four years, and that it would increase by 14.86 percent in 2026.
“That’s $650,000 for the years 2047-2052.
For the remaining years, the increases range from 3.34 percent to 7.41 percent. Yes, I did the math,” Davis said.
“The refunds that have been paid to the Cog Railway so far: in 2021, the excise tax remitted to the city was $862,171. Per Exhibit A, the city was keeping a base amount of $507,500, which meant that $354,671 was refunded to the Cog. It looks like in 2022 we will be refunding approximately $600,000. … I have not tried to estimate any further than that.”
Davis explained that the use tax saw a $2,520 reimbursement in 2019, and a $165,827 reimbursement in 2021. The 2022-2041 rebate would refund the rolling stock use tax, she said.
“This presentation is just the facts I was able to locate in city and state documents, and is in no way meant to imply any kind of legal opinion,” Davis said.
Council made no decision about the agreement, but has the option to “nonappropriate” reimbursements.
Mayor John Graham and Councilor Julie Wolfe recommended discussing including Pierson in future conversations to determine the future of reimbursements to the Cog. Council agreed to hold an executive session to glean advice before moving forward.
Also during the meeting, council touched on the annual performance review process and timeline of City Administrator Denise Howell. The city administrator is responsible for the administration of employment-related decisions, which includes approving the hiring, termination, promotion, demotion or transfer of employees.
Mayor Pro Tem John Shada and Councilor Natalie Johnson last year devised an online system that collected information chiefly in the form of a narrative. However, Councilor Judith Chandler proposed reviewing and removing redundant questions, or possibly re-writing the questions so they focus on the competencies council is looking for.
“I believe an evaluation should do two primary things: it should be meaningful and measurable in some way, and should provide our city administrator with solid information … to give her some guidance so she continues to grow and prosper in her role,” Chandler said.
Shada said he is willing to update the system he helped create.
Howell welcomed council’s remarks, noting that the review changes every year and that it is difficult to know if council believes she has grown professionally.
“When I look at last year’s review, there wasn’t a lot of items saying, ‘Here is something you have done well,’ or ‘Here is what you need to continue to work on.’ So, I ask that you look at both sides because I believe I have improved in areas, and that there are areas to work on,” Howell said.
She said she will have her narrative to council by Monday, Nov. 21. She proposed that council complete initial reviews of her performance by Friday, Dec. 2, and for council to discuss it during a Dec. 6 executive session. Council agreed.
Additionally, council voted 7-0 to approve Resolution No. 1822 to Support Ballot Issue 7A to continue the Pikes Peak Rural Transportation Authority’s 1 percent sales tax. Lastly, Johnson read a proclamation recognizing Thursday, Nov. 10, as International Accountants Day and recognizing the city of Manitou Springs Finance Department staff.
Council’s next meeting is scheduled for 6 p.m. Tuesday, Nov. 8.