FEDERAL HEIGHTS' GOOD BUSINESS DECISION
BY BILL CHRISTOPHER

The Federal Heights City Council has unanimously voted to seek voter approval on a 4% entertainment admissions tax. This is a long overdue good business decision by the Council. Given the financial plight within their confined 1.7 square mile city limits, their options for raising revenues are limited as stated by City Manager David Blanchard. Proposing an entertainment admission tax is a logical, well thought out policy decision and it reflects revenue diversification which is a good approach. Other area cities have previously imposed similar taxes such as Westminster.

ENTERTAINMENT TAX OR CUT SERVICES
Of course, the 800-pound gorilla in this decision is Hyland Hills Park and Recreation District's Water World. While the admissions tax would be imposed in other entertainment venues in Federal Heights where there is a cover charge as well as events held by businesses or organizations at churches or schools, the major tax payers would be the people who enjoy the many water rides and features at Water World. According to Federal Heights staff, the 4% tax would generate approximately $500,000 annually. Given Federal Heights' options, I cannot think of a fairer tax that would generate this level of revenue. By "fairer tax", I am comparing the admissions tax to a sales and use tax or a property tax. Without the revenue from this tax, City services will have to be cut according to City Staff. That means a lot is riding on this vote.

OPTIONAL ASPECT
As has been pointed out, neither Hyland Hills nor non-profit groups pay the tax. They collect and remit the tax to the City just like sales taxes are paid by the customer, collected by the retailer and remitted to the taxing entity. The nature of what is being taxed i.e. entertainment such as movie theatres, bowling alleys, Butterfly Pavilion; comedy clubs etc. is optional in our lives. It is not the same as taxing your heating and lighting bill or your groceries or your telephone bill or clothing (to some degree), which are essential elements of daily life. People have a choice in whether they are going to pay for some type of entertainment.

ATTRACTION GENERATES CITY COSTS
It is well known that Water World is a "classy" attraction, which brings people from all over the Metro Denver area and to some degree even from out of state. In turn, these people drive the streets of Federal Heights, which require maintenance, striping, street sweeping etc. And the nature of a major public attraction like Water World generates emergency medical calls and law enforcement calls from time to time. To my knowledge, Hyland Hills has never offered to pay a "cash in lieu" payment to the City for such services rendered. This is another reason that the entertainment admission tax is fair and warranted.

THEY WILL COME
I can well appreciate the angst of Greg Mastriona and his Board of Directors. People will continue to come to Water World even if the tax is approved. The facility is unique to our area and has such an enjoyable variety of rides and water based activities for all ages. For the small cost, which the tax would add to the admission ticket, I don't think people would shy away. Any extra pricing due to the aging infrastructure, which Hyland Hills would decide to impose, is going to be there regardless. But the price of the admission ticket in today's market is reasonable. In Westminster, the City Council imposed a 3% entertainment admission tax, which included the AMC Theatres. They were not happy about having to add the tax onto the price of the movie ticket. So, for some time, they absorbed the tax in the price of the ticket. When they did adjust ticket prices to reflect the tax, people did not stop coming to the AMC Theatres. People view it as a cost of doing business.