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TIFs growing
In 2003, Larimer County had three TIF areas: the Fort Collins Downtown Development Authority; the Estes Park Urban Renewal Authority; and the Loveland Urban Renewal Authority, which focused its work on downtown Loveland.
Combined, the entities received $897,872 that would have gone to county coffers. In 2006, the county had seven TIF authorities - including the U.S. 34/Crossroads Renewal Plan that's part of the massive Centerra project in Loveland.
Combined, the areas took more than $2.1 million in tax revenue that would have gone to the county. This year's total is likely to exceed $3 million, said Bob Keister, county budget manager.
"That's money that could have gone to something else," Keister said. "As a county, we rely on property taxes to pay for public services. We don't have a lot of other options."
Filling in the gaps
"That's money that could have gone to something else," Keister said. "As a county, we rely on property taxes to pay for public services. We don't have a lot of other options."
Filling in the gaps
School districts with high property-tax mill levies lose out on the largest sums of money. For 2006 taxes, Poudre School District did not receive more than $2.6 million, according to public records.
School districts are "backfilled" by the state for lost revenue through the complex mechanisms of the School Finance Act, said Dave Montoya, budget manager for PSD.
Districts with small mill levies also take a hit. The Northern Colorado Water Conservancy
District, which collects a 1-mill property tax, will not receive $95,576 in 2006 taxes from
Larimer County because of its TIF entities.The district, which covers eight counties, brings in $12 million a year in property taxes, said spokesman Brian Werner. Doing without $95,000 doesn’t cripple the district’s budget, he said, but “it’s not something we can ignore.”The district’s board of directors is examining the issue more closely, Werner said.Addressing concernsConcerns about the impact of URAs on other governments sometimes are addressed in agreements creating renewal areas. When Timnath created a URA in 2004, it agreed to reimburse the Poudre Fire Protection District funding it would not receive in exchange for a new fire station.The town also agreed to return a portion of the county’s revenue in increasing increments over time. Under the agreement, which came after the county sued the town over its URA plan, by years 21 through 25 of the URA the county will receive 60 percent of its lost take.Proponents of URAs say they bring improvements to areas quicker than if left to their own devices and eventually pay off for all entities.So far, more than $45 million in public improvements have been made through the Centerra project, including changes to U.S. Highway 34, extending Larimer County Road 5 and building storm drainage facilities, said Rich Shannon, vice president of community infrastructure for McWhinney, developer of the project.Funding has come from a combination of URA taxes, metropolitan district taxes and public improvement fees charged on retail sales, he said.Even cities that use urban renewal authorities for redevelopment take a hit from TIF arrangements. Fort Collins will not receive $412,000 in 2006 property taxes because of the Downtown Development Authority and the North College Urban Renewal Area.The revenue money will be made up over time as the areas are improved and property values rise, said Chuck Seest, city finance director.“We very much look at this as the city being a stakeholder and investor in these areas,” he said.The Fort Collins City Council recently approved an urban renewal plan aimed at redeveloping Foothills Mall.While a financial plan for the project has yet to be negotiated with the mall’s owner, General Growth Properties, renewal efforts are projected to generate $60 million to $100 million in additional property taxes over 25 years, Seest said.County officials supported the Foothills Mall proposal because it seemed a legitimate use of urban renewal authority, Lancaster said. The area is not likely to redevelop without help and property values could decline.The county worries that creating urban renewal areas “will become the norm rather than the exception.”Cities are trying to keep a competitive edge by using URAs, but the result can be hard on entities that rely on property taxes.“I don’t see how you can cut up a pie into ever smaller slices and say you’re going to end up with a larger pie,” Lancaster said.
