Bloody Wednesday Looming!

City of Cripple  Creek Bracing for Final Budget Showdown

Leaders to Decide Future of Special Event Funds and Betting Device Fee Hikes

Rick Langenbrerg

The city of Cripple Creek is preparing to put the final stamp of approval on its 2022 budget, which will hit the nearly $12 million mark in expenses for next year.

This marks a 24-plus percent hike from the 2021 fiscal blueprint mainly due to a major infrastructure project, obtained by a state grant. Council members aren’t blinking whatsoever at this proposed increase, with the budget representing more of a return to pre-COVID spending.

But sparks are expected to fly this Wednesday (Oct. 20), as the council gears up for decisions on two key subjects that often raise the temper  levels in Cripple Creek.   special event funding and casino device fee increases.

In fact, the rather tame atmosphere for most meetings in Cripple Creek could change drastically this week and get quite testy.  Some insiders are predicting a new nickname for this Wednesday’s afternoon budget sessions: “Bloody Wednesday.”  According to Interim City Administrator Ray White, special events and device fees are the main issues that need to get resolved prior to the council’s adoption of a 2022 budget. The city boss is anticipating a rather lively discussion for the Oct. 20 meetings.

Special Event Furor

Due to the COVID scare, the city in 2021 backed off from funding any special events, except for their July 4th celebration.  This prompted much outcry from certain event organizers and supporters and fueled concerns about a detraction from the town’s image as a family-welcoming and tourist-friendly community, and one that supported military veterans.  In the past, Cripple Creek has established quite a reputation for its slew of weekend festivals, dubbed by one former marketing director as “The Summer of Fun.”

For next year, the city has set up a proposed funding line item for special events, slated at about $124,000, out of which approximately $25,000 will be used for the July 4th show.

But how much the  purse strings for special event monies should be opened, if at all; or how much should be allocated for individual events, hasn’t been determined.

And already, the city has received a nearly $40,000 request from ProPromotions, which does the Salute to American Veterans Rally and motorcycle ride. Due to the COVID epidemic and city funding reductions, this rally hasn’t occurred in the last two years in southern Teller.

A heated social media war was aired in Cripple Creek throughout much of 2021 over the future of this event.  The rally was eventually held in August in Woodland Park at Memorial Park. But in  a recent council meeting, Jim Wear, president of ProPromotions, expressed some reservations about having this event re-occur in Woodland Park for 2022 and didn’t make any commitments.

Relations between Wear/rally supporters and a few Cripple Creek council members soured during this fight last year, as the elected leaders made it clear that the city was not in a fiscal position to sponsor any special events.  City officials, though, in a later official letter, reaffirmed their support for the veteran rally.

In addition, the Two Mile High Club has submitted a request for funding assistance for the Donkey Derby Days.  Club members say the 2021 event was a great success, despite the lack of any funding support from the city.  But club members recently made a pitch to the city, and cited the importance of this event and preserving the legacy of the donkeys in Cripple Creek.

The council has expressed mixed opinions about the special event funding.  A few leaders have opted for keeping this money as a contingency fund, citing the financial unknowns with the COVID-19 epidemic.

Others, and many community leaders, worry about the image of Cripple Creek, if  all special event monies are eliminated.  Some say the events have helped put Cripple Creek on the map as a leading tourist destination, and have attracted more visitors.

The city, though, is trying to get more nonprofit groups and event organizers to take more of a management and ownership role in the running of their specific festivals. Cripple Creek wants to get out of the business of running special events, but wants to play a definite supportive role, according to city officials.  The budget session is scheduled for  Oct. 20 at 3 p.m.

Device Fee Hikes

The special event fight, though, may be just round one of an all-out fiscal boxing duel this week.

The city is seeking an infusion of $300,000-plus in annual revenue, and is eying the gaming industry as the main source for this pot. This represents the city’s first significant proposed change in the device fee structure in nearly 20 years.

More specifically, the city wants to either eliminate the current break it offers gaming operators on fees for their initial 50 betting devices, per casino, or just impose a slight fee increase, assessed against operators throughout the town.

In any case, these proposals have sparked concerns from gaming operators, who will be armed on Wednesday with counter-arguments and plenty of verbal ammunition.

City Finance Director Paul Harris stated that the current fee breaks were implemented in 2004, and he estimates Cripple Creek has provided the industry with $6.5 million in cost reductions.

“The main intent of the gaming device fee breaks was to help the small, “Mom and Pop” casino operators. That intent is not a factor anymore,” stated White, who noted that all small casinos have shut down or became  consolidated with a bigger operation.

The city administrator stressed that the city is eying all possible revenue sources, as it is still dealing with the economic fallout from COVID-19.

The main dilemma for the city hinges on dollars and cents. Device fees are the main funding source for the city government, and a  tool that worked well with in the past for city hall.

But with a more corporate atmosphere in the current gaming lineup, coupled with the COVID menace, the local gaming community has reduced its betting device itinerary by close to 50 percent, compared to the peak of the industry in 2008/2009.  In fact, casinos have reduced their device totals considerably since the COVID epidemic and their forced closures for the three months.

And while the industry  has rebounded well in the last year, since casinos were permitted to reopen in mid-June 2020, gaming devices have not expanded.

This has put strains on the city government, according to Harris.

The city is throwing out two proposals, both with the same end goal:  increase gaming-related fee revenue for the city by approximately $350,000.

If history repeats itself, the gloves could come off, as the subject of device fee increases, or the reduction of certain breaks, has often ignited the wrath of casino operators.

The device fee discussion is scheduled for Oct. 20 at 4:30 p.m.

The council doesn’t have to adopt a final budget until early December.  But the outcome of these two subjects could decide the fiscal and promotional fate of Cripple Creek for next year.