Archive | November, 2014

Northern Colorado Regional Urban Renewal TIF Study Underway

6 Nov

In light of recent urban renewal projects in northern Colorado, several northern Colorado governmental agencies have agreed to cooperate in a study that aims to develop an improved process for evaluating future Tax Increment Financing (TIF) proposals. The Cities of Fort Collins and Loveland, Towns of Berthoud, Estes Park, Johnstown, Timnath, Wellington, Windsor, as well as Larimer County, Foothills Gateway District, Poudre River Public Library District, Health District of Northern Larimer County, Thompson School District, Northern Colorado Water Conservancy District have all agreed to participate in the study.

The desire of the municipal and special district executives participating in the regional TIF study is to develop and agree to a process for future TIF proposals that will provide for the economic well-being of the people of Larimer County. The goals of the study are threefold: to develop a method to qualify and quantify the economic benefits and financial risks of TIF proposals; to identify and address the differences of TIF proposals and corresponding financial effects on taxing entities; and to adopt formal agreements that balance the benefits and risks among the participating Larimer County entities.

All of the participating municipalities and special districts agree that economic vitality is an important component of community well-being and tax increment financing is an important redevelopment tool for urban areas, because blighted conditions that are not remedied or prevented can impact economic vitality. Services needed to support other important components of community well-being are dependent on property tax for funding, and tax increment financing can impact funding for these services. The regional TIF Study will develop tools to better quantify the impacts (positive and negative) of TIF proposals on the region.

Tax increment financing proposals are necessarily variable because of the many factors that influence an optimal balance between urban redevelopment objectives and other broad public interests, so it is understood that the regional TIF study will need to recognize and address critical differences between major types of TIF proposals. Furthermore, the cooperating entities appreciate that consistency and predictability aid understanding and long-range planning for all parties involved in TIF proposals (municipalities, property tax dependent entities, developers, and citizens). As a result, it is the intent that the regional TIF study will result in intergovernmental agreements regarding the process and parameters of future TIF proposals.

A Requests for Proposals was released in the early fall and the study group is currently in the process of hiring a consultant to assist in the evaluation and analysis. It is anticipated the study will be completed by mid-summer 2015.

Author Tom Leeson is the City of Fort Collins’ Redevelopment Program Manager overseeing the Fort Collins Urban Renewal Authority and assisting with redevelopment projects across City departments. Tom Leeson, AICP, is a land use planning and real estate development professional with 15 years’ experience. Tom has extensive knowledge in both public and private sector planning, and practical real estate development experience. He has worked in multiple other jurisdictions, as well as for Clarion Associates in Fort Collins.


Your Questions Answered about Urban Renewal

6 Nov

Downtown Colorado, Inc. is proud to support Urban Renewal Authorities across Colorado. Whether an URA is long-established or still in formation, DCI has resources to ensure that this important economic development tool is as useful to its community as possible. We frequently host presentations on topics related to URAs, the latest being our October Development & Improvement Districts (DIDs) Forum. If your community is considering adding this tool to your economic development belt, you might want to consider these answers to commonly asked questions about implementing urban renewal.

Urban renewal is a controversial topic. How do I garner community support? Urban renewal does not need to be controversial. Go through planning and visioning processes with your community first. With a strong foundation of community engagement and clearly articulated goals for the community, you will be able to present urban renewal as a useful tool for achieving those goals. You must also be very vocal. Do not wait for the media and angry mobs to come to you. Establish a good relationship with your local media and be proactive about getting out clear facts and information about the urban renewal process and its benefits.

There are a lot of terms associated with urban renewal: authority, area, plan, project – what’s the difference? An Urban Renewal Authority is the financially independent, quasi-governmental entity granted the power to use tax increment financing and sometimes eminent domain for the purpose of eliminating blight. The Authority creates urban renewal plans that designate urban renewal areas within the municipality as blighted and details projects for remediating those areas. An urban renewal project is the action being taken under an urban renewal plan; it may take up an entire urban renewal area or may be as small as a single building façade.

No one wants to hear about “blight” in our community. Do I have to use that word? Yes, you do. The objective of an URA must be to eliminate slum and blight. Although economic development or job creation may be the ultimate goal for your community, the language in your URA statute objectives must focus on remediating slum and blight.

How much blight is enough blight? In order to adopt an urban renewal plan, the URA must conduct a conditions survey in the area(s) that will be designated by the plan. There are 11 factors considered to be “blight”, and there only need be one occurrence of a factor to include it in the conditions survey. If the urban renewal plan has the documented consent of all property owners in an area, then only 1 blight factor must be identified. Otherwise, 4 blight factors must be identified. In order to be authorized to use eminent domain, 5 blight factors must be identified.

How is the TIF (tax increment financing) calculated? When will it start and stop? Tax increment financing (TIF) for URAs is based on the idea that urban renewal can be attributed for the large increase in tax revenues within an urban renewal area. Therefore, the tax revenue (either property or sales) within a designated urban renewal area that goes above and beyond the base year tax revenue is given to the Urban Renewal Authority to fund urban renewal projects in that same designated area. The base year tax revenue is recalculated every two years.

The “TIF clock” does not start when the Authority is formed, and it may or may not start when the Authority adopts an urban renewal plan. It all depends on when the magic words are added to the plan. Whether it is at adoption of a plan, or added later as an amendment, as soon as the legal language is formally added to an urban renewal plan, the “TIF clock” starts counting down. Since the TIF clock is linked with a specific urban renewal area, there can be multiple “TIF clocks” in one plan. Time is up at the end of 25 years. Even though the TIF ends, the URA may continue remediating blight in the urban renewal area as long as funds are available.

DCI would like to thank our URA experts Mark Heller of the City of Thornton and Carolynne White of Brownstein Hyatt Farber Schreck for presenting on this topic. If you would like more information on how to properly form or run an URA, be sure to attend our annual full-day URA Training and watch for related topics in our monthly DIDs Forums.

Nancy Sprehn is the OSM/VISTA Community Assessment Coordinator for Downtown Colorado, Inc. During her year of service as an AmeriCorps VISTA, Nancy hopes to put her planning and placemaking knowledge to use while learning everything she can about the communities of Colorado.