Colorado Town of Ridgeway Sues Hotel Owner
Alleges Code Violation and Tax Dodging
By Jordan Bradley
The mountain town of Ridgway, Colorado, is suing the owner of a hotel who agreed to house construction crews working on the site of a forthcoming $1 billion Four Seasons resort slated for a nearby town.
Town officials allege the contract signed by the owner of the 52-room MTN Lodge to house construction workers through 2031 violates zoning permissions for the hotel, and the establishment is attempting to get out of paying hotel occupancy and sales taxes. The town filed the lawsuit in late March.
The city’s town council held a special meeting on March 25 to convene with the town attorney “for the purpose of receiving legal advice on a specific legal question” in an ongoing conversation between Ridgway officials and MTN Lodge representatives, according to the Ridgway town council’s meeting agenda.
Two days later, the town filed the lawsuit against Ridgway Suites LLC, which owns the lodge, for allegedly violating the town’s municipal code by housing individuals in a long-term capacity in a general commercial zone.
MTN Lodge officials argue the long-term nature of the lodging contract excludes them from hotel occupancy taxes and the contract will boost spending in the city.
Ridgway officials, however, believe the lodge’s reading of municipal code is an attempt to dodge lodging and sales taxes associated with the long-term occupancy.
“Despite the vast sums of profit MTN Lodge seeks to gain from its multi-year agreement with Merrimac Ventures, MTN Lodge has expressed in writing that it refuses to pay any sales or lodging tax, or in the alternative, that the lodging and sales taxes do not apply to them,” the lawsuit reads, according to reporting by the Colorado Sun.
For the owners of the MTN Lodge, an extended stay contract with the Four Seasons’ developers, Merrimac Ventures, LLC, is an opportunity to financially support the lodge during a challenging time in the region’s housing and tourism markets.
According to a letter dated November 8, 2025, from the lodge to town officials: “Ridgway Suites LLC has chosen to undertake the extended-stay lodging for the Four Seasons project primarily for financial reasons. Our hotel maintains solid occupancy in the summer (approximately 73%); however, during the winter months, occupancy typically drops to single digits until Memorial Day. Thus, our average annual occupancy is approximately 53%. Industry data shows that hotels operating at this occupancy level are generally not profitable and often struggle to remain open.”
Ben Jackson, COO of Ridgway Suites, did not return a request for comment from USAE by press deadline. However, in an email to the Colorado Sun, Jackson said without renting the rooms to Four Seasons subcontractors, the lodge will close due to low occupancy.
The Four Seasons Resort and Residences in Ridgway’s neighboring Telluride broke ground last fall. When completed, the property will have 52 hotel rooms, 43 hotel residences, and 26 private apartments.
“We have been trying for months to come up with collaborative ideas that would allow extended stays and avoid a lawsuit,” Jackson wrote to The Sun. “We’ve been rejected at every turn.”
Kristin Kenney Williams, a spokesperson for the lodge, said embracing extended stay lodging in mountain towns such as Ridgway after “a horrible winter season in Colorado” is “a way to fill beds and have people still spending sales tax dollars and keeping these lodging properties open. It’s a creative and innovative solution when we’re seeing these really cyclical cycles.”
Williams declined to say more on the matter due to ongoing litigation, and she referred USAE to a March 31 press release from the MTN Lodge regarding the lawsuit.
“The Town of Ridgway is asserting that long-term occupancy would require MTN Lodge to apply for a zoning change, which the Lodge ownership group disputes, saying renting a hotel room longer than 30 days is allowed under current Town code,” the press release states. “The Town is also arguing that MTN Lodge is required to pay a combined 9.6% lodging and sales tax, also disputed by the ownership group.”
The release continues: “Ridgway’s municipal code does not prohibit hotels from offering longer stays, and it expressly distinguishes hotels from residential housing. The Town’s own tax provisions also recognize that hotel guests may stay 30 days or more. Additionally, the Town code, which follows Colorado state code, specifically provides an exemption from lodging and sales tax for stays of 30 days or more.”
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