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Council keeps hotels subject to conditional review downtown after contentious debate; developers say change will discourage investment
Summary
Steamboat Springs City Council voted 4'' to keep hotels as conditional/limited uses in downtown commercial districts (citing community input and neighborhood concerns), overruling staff recommendation to allow hotels by right. Developers urged by-right status, saying the conditional-process barrier reduces early-stage feasibility for downtown hotels.
The City Council on Jan. 20 considered a citywide zoning and sign-code package that included a high-profile change: whether 'hotel' should be a use-by-right in downtown commercial districts (CO, CY, CK) or remain a conditional or limited use requiring public hearing and findings.
Staff had recommended that hotels be allowed by right in downtown commercial districts to align with the downtown plan's stated goal of increasing lodging opportunities and to remove an early procedural barrier that can make small, downtown hotel projects economically infeasible. Planning commission recommended tighter use standards in some blocks (for example requiring ground-floor retail/restaurant on key downtown frontages) and other commissioners proposed limited uses rather than full by-right status.
In council debate, developers and a hotel operator said the conditional-use requirement creates a substantial early-stage risk: developers typically invest hundreds of thousands of dollars in predevelopment work and may not pursue downtown projects when the conditional-use process and zoning constraints make financing and design outcomes uncertain. "You could approve this ordinance 12 as originally read and it will not allow me to develop in downtown," a developer told council, saying he would still need significant variances for any feasible downtown hotel.
Opponents urged caution and said keeping hotels subject to conditional review preserves a public forum for neighbors, allows the city to require ground-floor activation and limits the risk of encroachment into lower-scale residential blocks. Council members cited downtown character and residents'concerns about compatibility and neighborhood impacts.
Outcome: The council voted 4'' in favor of the ordinance as revised at first reading (keeping hotels subject to conditional/limited review in specified downtown zones). The motion passed with Councilors Swintech, Barnes and Pacino voting nay.
Why it matters: Supporters of by-right policy argued that loosening the procedural barrier is necessary to attract hotel investment and to increase downtown visitation and economic activity. Critics cautioned that by-right status would reduce early public notice and community input and could cause incompatible development near residential side streets.
Vote record: The ordinance was approved after second reading by a 4'' vote on Jan. 20 (ayes: Montine, Gary, Aosta, Dixon; nays: Swintech, Barnes, Pacino).
Quote: Developer Roger Gregory, whose team has pursued downtown hotel opportunities, told council, "You cannot develop a hotel on any site in downtown without significant variances... I strongly recommend that you approve the ordinance to at least remove the lowest barrier to a developer."
