OURAY – The City of Ouray was bombarded with even more requests than usual this budget season for funding allocations from local and regional nonprofit organizations. Most of these groups got less than they asked for, or in many cases, nothing at all.
However, the Ouray City Council loosened its purse strings for the Friends of the Wright Opera House, granting that group’s request for a very small slice of the city’s Lodging and Occupancy Tax revenues, valued at about $2,000 per year, starting in 2013.
Council had previously turned down FWOH’s request for a $1,000 budget allocation in 2012. This fall, however, when FWOH came back with the LOT proposal, council went for the idea.
The City of Ouray’s draft 2013 budget, set to be adopted in December, grants an allocation of 1 percent of LOT funds that are in excess of previously committed LOT funds to FWOH’s expenditure request. Council has indicated it intends to continue funding FWOH in the same manner into future years, pending available funds.
According to City Clerk/Treasurer Kathy Elmont, the LOT generates approximately $200,000 annually. Large slices of the LOT pie (which comes from a $3/room night rented tax on hotels and short term rental units as well as a small fee on RV spaces rented), are already committed to the Tourism Fund and the Beautification Fund ((86.875 percent and 11.875 percent respectively), and to the Mountain Air Music Series. The General Fund retains 1.25 percent for administrative processing of this tax.
The concept of supporting a nonprofit organization with LOT money is unprecedented in Ouray. Mayor Bob Risch said council felt comfortable going forward with the plan, because “so much of the work they (FWOH) do will ultimately benefit the city and bring in more tourists.”
“We’re ecstatic that the city decided to do this,” FWOH Treasurer Jim Opdahl said, pointing to some communities, like neighboring Ridgway, which are discussing bond issues or taxation to support the restoration and operation of historic venues. “We really don’t want to go down that route,” he stressed.
However, Opdahl said, the realities of the nonprofit world have put pressure on FWOH to show that the City of Ouray financially supports the Opera House restoration effort.
After an intense and successful fundraising effort in 2010, FWOH purchased the historic Wright Opera House for $500,000 and is now working to renovate and preserve the building as a venue for the performing arts. Much of its funding currently comes from grants.
“So many of the granting foundations usually have a question related directly to what is the city’s extent of cooperation or support for your project,” explained Opdahl. “Doing a bit of research, we found that a lot of cities have a portion of their budget designated for a little help for restoration of a historic building to be used by the community.”
The city’s pending budget allocation is worth a lot more than it’s dollar value, Opdahl pointed out, “because we can now say a small portion of the LOT fund is designated for ongoing and restoration expenses for the Wright Opera House, which will strengthen our grant applications.”
FWOH is in the process of hiring an executive director, and will need to find new funding sources to pay for that. However, Opdahl said, “We haven’t as a board discussed how or whether (the LOT funds) will be earmarked for a particular purpose.”
The City of Ouray will hold one more work-session before formally adopting its 2013 budget at a special meeting sometime in early to mid December.
Last week, Councilor Richard Kersen scolded fellow councilors for approving a draft budget that proposes dipping into reserves by about $100,000 and called for public input on the matter.
Mayor Risch told The Watch this week that he has since gone back over the city’s budgets from prior years and found that “in every case, we have come in over $100,000 better than the budget predicted” in regard to carryover and projected revenues, even in years when the budget called for dipping into reserves.
“As long as I have been here as mayor, that has been the case,” Risch said. “It’s a $5 million budget with a lot of components and moving targets. It’s a challenge, but on balance I am confident the budget we have prepared is a very acceptable budget.”