Some fear city cuts could stunt growth in Colorado Springs

This week, in the wake of city voters’ overwhelming rejection of a property tax rate increase, the Colorado Springs City Council will begin the task of deciding how to close an estimated $28.9 million shortfall in its 2010 budget.

Layoffs, wage cuts and community center closures are among the possibilities when the council meets Monday.
Next week, after months of discussions, local business and community leaders will gather to explain how they’ll implement an economic development consultant’s recommendations on attracting, retaining and creating jobs.

At a time when the Springs is poised to implement some of the deepest spending cuts in recent memory, will service reductions and potentially detrimental effects on the area’s quality of life derail new economic development strategies?

Some business leaders don’t like the prospect of cuts, but say the Springs’ financial woes are similar to other cities. They reject the notion that employers will be turned off by the Springs’ budget cutting.

“I don’t think I’ve ever had them ask about community centers,” Scott Bryan, chairman of the Colorado Springs Regional Economic Development Corp. board, said of discussions he’s had with employers considering the Springs.

Employers also don’t ask about police response times, although they are concerned about crime rates, he said.

“We certainly think the city has to provide essential services,” Bryan said, “but these are the cards we’re dealt right now and we have to work within those parameters.”

Others, however, fear that  drastic service reductions will have a tangible effect on at least one aspect of economic development.

Some businesses worry about retaining or recruiting top-notch, young professionals if they think Colorado Springs isn’t committed to being a great place to live, said Meredith Vaughan, president of Vladimir Jones, the advertising agency formerly known as PRACO.

Vladimir Jones is based in the Springs, but its reach is regional and it competes with firms in Los Angeles, Chicago and elsewhere to attract talent, she said.

Colorado’s lifestyle is one of the allures that helps Vladimir Jones woo employees, and she fears they’ll go elsewhere if the Springs sends a message it won’t invest in itself. The Springs’ reputation as a socially, politically and fiscally conservative city already is a disadvantage for some firms trying to attract workers, she added.

“It’s very threatening to our business,” Vaughan said about possible cuts in city services. Her husband is a Springs firefighter.

The trend of young professionals abandoning the Springs already was cited as a major problem in Operation 6035, the community-wide, economic development study prepared by Texas-based consultant Angelos Angelou. A final version of his report — outlining problems and economic development strategies — was released in September.

Backers of the study plan to roll out an implementation strategy during a Nov. 17 luncheon.

Angelou, who’s worked with many cities on similar economic development plans, said he doubts budget cuts will hurt the Springs’ ability to attract and retain jobs.

“Everyone is hunkering down, cutting costs, looking at every possible way to find savings,” Angelou said. “The city of Austin has. The city of Dallas has. Phoenix has. All your major competitors are cutting services.”

Budget cuts could affect quality-of-life amenities in the short term, but many cities will restore spending as economies improve, Angelou said. For now, cities should invest in job growth, which will improve their economies, he said.

Dennis Donovan, a New Jersey-based site selection consultant who helps businesses decide where to expand or relocate and who’s visited the Springs, said the city remains an attractive place to do business and  spending cuts shouldn’t gut the local quality of life.

What might have hurt the economic development effort, however, would have been passage of the property tax rate increase voters rejected Tuesday, he said.

“Hitting them (businesses) with another significant increase as was proposed would have definitely cost Colorado Springs jobs,” Donovan said.

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