ASPEN - The city council took a stand last week against the oft-called "Aspenization" of its town and turned down a new luxury hotel at the base of the ski area.

The Lodge at Aspen Mountain would have been the first new development in 20 years to build hotel rooms in Aspen, where many of the smaller lodges are being turned into time-sharelike fractional ownership projects.

When the U.S. Comedy Arts Festival announced this year that it was pulling out of Aspen after 15 years, it cited the lack of available hotel rooms during its March festival as one of the main reasons for leaving.

But by a 3-2 vote, the council ruled that it would not approve new hotel rooms at any cost. At 175,000 square feet, the lodge would have been the second-biggest building in town.

Besides 80 hotel rooms, the project also would have included four residential condos at 4,000 square feet each and 21 fractional ownership suites.

The hotel also promised to rise to the standard and price point of the town's three flagship lodges: The Hotel Jerome, St. Regis and the five-star Little Nell.

"We cannot only court the high end, and that's what this project did," Aspen City Councilman Jack Johnson said. "This sort of project and this sort of economy we have is not sustainable."

In the past 30 years, Aspen has gone from a town that nearly elected Hunter S. Thompson as sheriff in 1970 to a place where private planes line the runway at the airport and the average single-family home costs nearly $6 million.

Although the local affordable-housing program is the envy of other mountain resorts, reasonable rental accommodations are still a rare find. Local employers, from existing hotels to the school district, still have a tough time finding and keeping employees.

With much of the work force living in communities down the valley, a traffic jam chokes the entrance to town every workday.

Mick Ireland, who has been Aspen's mayor since June, said he could not approve a project that would further stress the housing and traffic problems. While there is a need for more moderately priced lodging in Aspen, Ireland said the need for more $1,000-per-night rooms was nil.

"I think we have to think about scaling back our mission," Ireland said. "In the resort-community balance, I think we've lost our balance."

Aspen's tourist economy took a beating in the post-Sept. 11 slump, with city sales tax collections dipping as much as 20 percent. At that time, city officials began loosening height and density restrictions to spur redevelopment downtown.

Now that the economy has picked back up, developers have been happy to take advantage of the less-restrictive rules and nearly a dozen major redevelopment projects are under way downtown. Community angst toward the pace of construction and the character of the new buildings led the council to call a moratorium on new development applications in April 2006.

The lodge project also likely suffered from having its final meeting fall during one of the busiest summers people can remember, said Bill Kane, who drafted Aspen's first growth management plan in the 1970s and now consults with ski areas. He said the hotel proposal might have been a matter of timing.

The Lodge at Aspen Mountain

• Location: 711 S. Aspen St., at the base of the west side of Aspen Mountain

• Size: 175,000 square feet; 80 rooms, four residential condos at 4,000 square feet each and 21 fractional ownership suites

• Developer: Centurion Partners, on behalf of the Aspen Land Fund

• Why the Aspen City Council denied it: Too large and at $1,000 a night, too high-end

Curtis Wackerle writes for The Aspen Daily News.