HomeMy WebLinkAboutagenda.council.worksession.20110524 MEMORANDUM
TO: Mayor Ireland and Aspen City Council
FROM: Chris Bendon, Community Development Directo>(' " ` • ' /
RE: Work Session — Update to Economic Report for AACP
DATE: May 24, 2011 — 4:30 pm
SUMMARY:
Community discussion on the AACP has included reference to "The Economic White
Paper." This analysis was part of the State of the Aspen Area report done in preparation
for the AACP re- write. It is an in -depth analysis of Aspen's economy from 1958 through
2008 — a fifty-year period. The report cost about $60,000.
There has been criticism of the report as it was completed just prior to the economic
downturn, not reflecting the economic changes of the past three years. Community
discussion and public feedback has indicated a desire to update the report.
Staff received two proposals, both from very competent firms with economic expertise
and knowledge of Aspen. Both are in the $10- 12,000 range and the work can be
completed in 4 -6 weeks. (Minor negotiation on schedule and total costs is still possible.)
The argument to do this work — While not all planning decisions are based on the current
economy, having a thorough understanding of the economic forces at play is beneficial to
decision making. Our understandings of the economic changes over the past three years
are anecdotal and not from the holistic perspective of an economist.
The argument to not do this work — The AACP reflects community sentiment and
philosophical ideals, not the economics of the day. Collectively we have an acute
awareness of the economic changes we are experiencing and doing a study would just tell
us what we already know.
Staff is seeking direction on this matter. The Aspen Chamber Resort Association
supports this analysis and has committed to share expenses. If Council chooses to do this
additional work, staff will add it to the pending supplemental budget. Action by motion
is sufficient.
CITY MANAGER COMMENTS:
ATTACHMENTS:
Exhibit A — ACRA resolution
Exhibit B — Email from Tim Semrau
1
Exhibit A
ASPEN(N CHAMBER
RESORT ASSOCIATION
RESOLUTION OF SUPPORT FOR A FORMAL LODGING STUDY INCLUDED WITH
THE 2011 ASPEN AREA COMMUNITY PLAN AND UPDATE TO THE 2007 -2008
ECONOMIC STUDY.
WHEREAS, the Aspen Chamber Resort Association is the only business advocacy group in the
Aspen area with over 730 member businesses representing the local business and resort
perspective and interest;
WHEREAS the Aspen Chamber Resort Association Board of Directors and member
businesses, have actively sought to participate in the 2010 Aspen Area Community Plan
(AACP) over the course of the last three years and identified it as the number one local issue in
the spring 2011 membership survey;
WHEREAS, the Aspen Chamber Resort Association recognizes that the AACP is a vision for
the future of the Aspen Area that will help guide community decision - making for the next ten
years; and
WHEREAS, the Aspen Chamber Resort Association recognizes that many of the limitations
included in the AACP are based on the economic study done in 2007 -2008, when the economy
and economic activity were much more robust and before the severe downturn in the nation's
economy and its impact locally in Aspen and Pitkin County; and
WHEREAS, the Aspen Chamber Resort Association has consistently engaged in public
comment on the AACP and has expressed dissatisfaction that no economic report is included
and have publicly stated the plan should be aspirational not regulatory in nature.
WHEREAS, the Aspen Chamber Resort Association recognizes that individual member views
may differ on the specifics of the AACP, but believes that our membership is in agreement that
this is an issue that needs to be constructively addressed; and
NOW THEREFORE BE IT RESOLVED, that the Board of Directors of the Aspen Chamber
Resort Association requests the City of Aspen in cooperation with the Aspen Chamber Resort
Association and other interested parties to pursue an update to the 2007 -08 economic study on
which much of the currently proposed AACP was based; and that the City of Aspen, the Aspen
Chamber Resort Association and other interested parties jointly hire an independent consultant
to determine if the goal of encouraging "economy to moderate" lodging is realistic or even
possible when considering the significant cost impact of mitigation fees, housing requirements,
low impact mass and scale limitations, and overall construction and operation costs as
proposed in the Aspen Area Community Plan.
Adopted this 26 day of April, 2011
Warren Klug, ACRA Board Chair Debbie Braun, President & CEO
{
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To: Aspen City Council for the May 9 meeting
RE: Community Development request to consider updating the economic data used to
formulate the Aspen Area Community Plan.
Dear Mr. Mayor and Council members,
In the past three years the unimaginable has happened in Aspen; a national recession
has affected the local economy unlike any in the past fifty years. The "new normal"
Aspen economy is vastly different than the 2007 economy quantified in "The Aspen
Economy" by Economics Research Associates upon which the AACP is based.
- The report states more and more Aspen employees will be needed, never
imagining that 2,400 (two THOUSAND four hundred) Pitkin county jobs were
lost in 2009 and 2010. For the first time Aspen NEEDS jobs.
- The report accurately contended the real estate economy had become double
the retail economy. True in 2007, but due to the recession real estate's portion
of the economy has already dropped to historical levels of 2000.
-The report projects Mid valley housing prices will continue to rise, further
increasing the need for production of affordable housing as an alternative. In
fact, home prices in the mid - valley have dropped 40% in the last few years.
- The report also projects less and less workers will live and work in Aspen.
Due to the severe drop in employment, today 65% (SIXTY FIVE %) of Aspen
employees now live in the Aspen area. Isn't sixty five per cent a CRITICAL
MASSE of employees targeted by the AACP as our community goal? Do we
need 100% Affordable Housing mitigation?
- The report identifies as problematic the magnitude of second home ownership
as a percentage of the local economy. Recently an oft cited Colorado
demographer told the county commissioners "The era of second homes as the
economic driver for Pitkin county is likely a thing of the past" and the "new"
economy is likely to look like thirty years ago fueled by destination tourists,
Second homes are no longer a threat to bring too many jobs to Aspen.
(All of the above statements from public government data and methodology/)
MUCH OF WHAT THE AACP SEEKS TO DO HAS ALREADY HAPPENED
I've been told by government officials that it is good to have a plan based on a boom
economy because it MIGHT happen again. Really? All predictions are the "new
normal" Aspen economy is here for ten years. I've also been told by government
officials that the 2,400 jobs that have been lost might be "jobs we don't want here."
Once again, really? Just what kind of jobs are acceptable? The city's 2011 AACP
survey showed "economic development" as important to citizens as "managing
growth." It costs very Little in time and money to simply establish the current (and
probably future) economic reality in Aspen.
Please approve funds for an update to the economic basis of the AACP.
Thank you,
Tim Semrau
SPECIAL MEETING CALLED FOR EXECUTIVE SESSION
Date May 24, 2011 Call to order at: QL m.
I. Councilmembers present: Councilmembers not present:
Mick Ireland n Mick Ireland
Steve Skadron ❑ Steve Skadron
❑ Ruth Kruger k Ruth Kruger
�]C Torre ❑ Torre
® Derek Johnson ❑ Derek Johnson
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II. Motion to go into executive session by � __/�et L� ,St ; seconded by
Other persons present:
AGAINST:
FO
ick Ireland ❑ Mick Ireland
[+Steve Skadron ❑ Steve Skadron
❑ Ruth Kruger n Ruth Kruger
Rtorre ❑ Torre
R$erek Johnson ❑ Derek Johnson
III. MOTION TO CONVENE EXEC TIVE SESSION FOR THE PURPOSE OF DISCUSSION OF:
C.R.S. 24-6-402(4) 760e. e _ de
(a) The purchase, acquisition, lease, transfer, or sale of any real, personal, or other property interest
Conferences with an attorney for the local public body for the purposes of receiving legal advice on specific legal
ques ions.
(c) Matters required to be kept confidential by federal or state law or rules and regulations.
(d) Specialized details of security arrangements or investigations, including defenses against terrorism, both domestic
and foreign, and including where disclosure of the matters discussed might reveal information that could be used for the
purpose of committing, or avoiding prosecution for, a violation of the law;
dP d etermining positions relative to matters that may be subject to negotiations; developing strategy for negotiations;
a . tructing negotiators;
(f) (I) Personnel matters except if the employee who is the subject of the session has requested an open meeting, or if
the personnel matter involves more than one employee, all of the employees have requested an open meeting.
IV. ATTESTATION:
The undersigned attorney, representing the Council and being present at the executive session, attests that the
subject of the unrecorded portions of the session constituted confidential attorney -cli • 01 munication:
The undersigned chair of the executive session attests that the discussions in this executive session were limited
to the topic(s) described in Section III, above.
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Adjourned at: At" 4 re 7y,A i
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