Mike McKibbin

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November 7, 2012
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Longtime Rifle motel to close

One of Rifle's well-known and long-lived lodging establishments will soon turn out the lights, and the move will mean less revenue to market the city to visitors.

The 31-year-old Rusty Cannon Motel will close for good on Nov. 26, according to general manager Lady Ruiz.

"The Kum and Go next door wanted to buy it, and the owner decided to sell," Ruiz said. "Business has been down."

The Rusty Cannon, 701 Taughenbaugh Blvd., was built in 1981 and opened at the end of the last oil shale boom. Two weeks after it welcomed its first guests, the infamous Black Sunday occurred when Exxon Corporation shut down its Colony oil shale operation, leaving 2,000 workers jobless.

The 88-unit hotel survived the following economic downturn, but business dropped again after the natural gas slowdown a few years ago and increased competition from national hotel chains who built in Rifle during the drilling boom.

Ruiz said the sale will likely mean five office workers and four housekeepers will be out of work. Rusty Cannon owner Bob Cross was said to be in Texas this week and unavailable for comment.

The closure will leave Rifle with five lodging establishments, compared to eight several years ago. City Finance Director Charles Kelty said fewer lodging establishments will mean less revenue from the city's 2.5 percent lodging tax.

That "bed tax" was passed by voters in 2007 and went into effect in January 2008. Revenue raised by the tax goes into a visitor improvement fund, which is supervised by a board. Funds help market Rifle to visitors and pay for improvement projects.

Kelty said the city conservatively estimated $114,715 for the visitor improvement fund in the 2013 budget. That was before the city learned of Rusty Cannon's pending closure. Now, the city will see even less lodging tax revenue, Kelty said.

"I guess you might say there were too many hotels and motels," he added. "We, not the city but the people who wanted to build them, may have overbuilt."

The city council also planned to divert $13,000 from the visitor improvement fund to the renovation of the New Ute Events Center, Kelty said.

The fund has a balance that should cover the $13,000 transfer, he added, so did not believe that move alone would affect tourism promotion to any great degree.

"We use about half of that budget to promote the city to visitors," Kelty said.

The events center was also set to receive $200,000 from the city's information center budget, plus smaller amounts from the Downtown Development Authority, grants and an anticipated $200,000 grant from the Colorado Department of Local Affairs, Kelty said.

The city council considered these and other funding issues for the coming year when they held a public hearing on the proposed 2013 budget on Wednesday, Nov. 7. The budget will be discussed at a second public hearing on Nov. 19 and final adoption is set for Dec. 5.

However, the transfer of close to $650,000 of capital reserve funds to help the Ute project requires at least five of the seven city council members to vote in favor of the move, Kelty noted.

Councilman Rich Carter, who's architectural firm has done some work for events center backers and could bid on further jobs, will likely have to recuse himself from voting to avoid a conflict of interest, Kelty said. That means five of six council votes must be in favor of the move, he added.

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The Post Independent Updated Nov 7, 2012 05:58PM Published Nov 7, 2012 05:57PM Copyright 2012 The Post Independent. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.