Cañon City Pool Tax Retention and Operating Use

Cañon City has collected a temporary 0.3% sales and use tax since January 1, 2025, under a November 2024 vote that limited it to building a community recreation pool and related capital improvements. At the same election, voters in the Cañon City Area Metropolitan Recreation and Park District approved debt to build the pool but turned down a mill levy to operate it. The city and the district weighed a modified pool, a different project or a refund of the collected but unspent tax under TABOR, and decided to propose a smaller pool, planned for the Icabone site.

The City Council's Resolution 12, Series 2026, dated August 24, refers Issue 2A to city voters so the city can keep that money and continue the tax.

Issue 2A keeps the 0.3% rate and the December 31, 2050, collection end date that voters approved in 2024. It adds a use: operations and maintenance of the community recreation pool facility and related pool capital improvements that the district operates. The city may keep all revenue collected so far and pledge it, with future collections, to the district under a multi-year agreement. The city may collect, keep and spend that revenue regardless of any revenue limit in law.

The state's January 2026 rate table lists sales tax rates of 2.9% for the state, 2.50% for Fremont County and 3.30% for Cañon City, a total of 8.7%. A yes vote changes none of them.

The council's August 24 agenda carried a proposed agreement with the district that takes effect only if voters approve 2A. Under it, the district issues no more than $18 million of the debt voters authorized in 2024, with the goal of an outdoor pool similar in scope to a 2024 study option with a recreation pool, a lap pool and a slide.

Each year the tax pays bond payments first, then an operating subsidy, then a capital replacement reserve. The agreement also requires a design and construction advisory committee, quarterly progress and spending reports until construction is complete, draft and adopted annual budgets with separate pool accounts, and annual audits checking that pool money is spent on allowed pool-related purposes. The district must give those audits to the City. The district estimates operating expenses of approximately $470,000 a year at opening, an annual subsidy of approximately $240,000 and a reserve contribution of approximately $100,000 a year. Any shortfall reduces the reserve contribution first. The city keeps a 1% administrative fee. Money already collected stays in reserve for the bonds and may not offset construction costs.

The district's 2024 debt authorization allows up to $24.8 million in principal and up to $44 million in total repayment, with a maximum net effective interest rate of 5.5% a year. The proposed agreement limits the bonds actually issued under that authority to $18 million in principal. The 2024 question also permits up to $1.68 million in annual taxes if needed after applying the City's sales-tax revenue, with no mill-rate limit.

In the proposed agreement, the city and the district state their understanding that if 2A fails, the city will ask the Secretary of State to end collection of the 0.3% tax on January 1, 2027, and will refund the remaining money collected in 2025 and 2026 as the City Council determines under Colorado law.