The Park Record editorial
July 7, 2009
A handful of local business people have begun pushing for tougher regulation of Utah’s property-management industry — but they are likely facing a long uphill battle. The same special interests that convinced the state legislature to deregulate property managers a decade ago have already begun to resist any discussion of new rules regarding advance-reservation deposits, escrow accounts or more transparent accounting procedures.
This time, though, thanks to the stunning demise of Deer Valley Lodging and the pervasive damage it has caused throughout Park City’s economy, we hope the winds of change will prevail.
In the past, lodging firms have defended their freewheeling finances by pointing to the seasonal nature of their business and the flexibility of people’s vacation plans. And they have strong-armed other business sectors into supporting them, citing their pivotal role in bringing visitors to their restaurants, shops and attractions.
But we would argue it is precisely because they are so central to the town’s core industry tourism that they should be closely regulated.
Deer Valley Lodging’s failure to meet its financial obligations to property owners and to a wide variety of local contractors has done irreparable damage to the town’s reputation, especially in the eyes of property investors. Nothing short of a state-mandated housecleaning will restore their confidence.
Certainly some property management firms in Park City are beyond reproach. They voluntarily separate reservation deposits from operating expenses and avoid commingling funds from different properties. Some of them say they fear new regulations could punish them for someone else’s bad behavior. Unfortunately, they still cling to the notion that the industry can regulate itself.
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However, the repeated debacles of the last decade, beginning with the implosion of High Mountain Properties, which slammed its doors in the midst of a busy Presidents Week several years ago, indicates the industry is in dire need of state-imposed discipline. In a legislature heavily populated with laissez-faire business and real-estate moguls, that may be hard to achieve. But with a little nudging from all of the local businesses, property owners and employees burned by Deer Valley Lodging, perhaps they will realize it is time for Utah to adopt that same measures regulating property managers that are imposed by most of the state’s biggest tourism competitors, including Colorado.
Utah Senator Kevin VanTassell, who represents Park City at the state capitol, has told The Park Record he is reluctant to impose new regulation unless it is necessary. We suggest that those who rely on the viability of the local tourism industry add their voices to the discussion now, while the sting from Deer Valley’s bankruptcy is still fresh in their minds and while there is plenty of time to draft a well-thought-out code of property management conduct before the next legislative session. The senator can be reached by fax at (435) 789-8411, by phone at (435) 789-7082 or by email at: firstname.lastname@example.org