House Bill 1375 May Slow Triangle and Olde Town Development


by John Kiljan

Dear CLRC members and friends,

Not to complain, but I find most bills passed by the Colorado General Assembly to be mundane and a little boring. On the face of it, HB 1375 is no exception. But the bill may have a negative impact on our local neighborhoods, and that I do find interesting.

Here’s what I’ve been able to find out:

HB 1375  click to enlarge or see the link below for the full text

HB 1375 click to enlarge or see the link below for the full text

The late bill passed by the Colorado legislature may set back urban renewal projects in Olde Town and in the Triangle shopping center. The bill, House Bill 14-1375, was introduced as a late bill in the closing weeks of the legislative session. The bill was finally passed in the Senate only hours before adjournment on May 7th and now awaits the Governor’s signature.

What will the bill do? No one is quite certain, but its main provisions seem to redirect a portion of new property and sales tax revenues generated by urban renewal authorities away from local development to counties and special districts. Counties and school districts will be the primary beneficiaries of this bill. The Arvada Urban Renewal Authority (AURA) is one of many renewal authorities across the State that are likely to see their available urban-renewal financing reduced by the bill.

How much redevelopment monies will AURA lose? For existing agreements, AURA shouldn’t lose anything. For new development agreements, that’s largely unknown.

Because AURA is not offering increment financing revenues for developments in the Triangle shopping centers in central Arvada, that should help with responses to the recently issued “Request for Qualifications” issued to develop Ralston Creek North in the Triangle (aka Arvada Square strip mall and the old Safeway), but new monies that would have been available for redevelopment projects in the Triangle may be reduced under this bill.

An effected project might also be in what is being called the Nine-Acre Site in Olde Town. This is the site of the current RTD Park & Ride. A hotel, retail shopping and new housing are all planned for the area just east of the movie theater. Another area where there may fewer development incentives available is in the proposed 15 acres of new apartments to be built just east of Wadsworth Bypass between Grandview and 56th Avenue.

But the biggest problem with the bill may not be the amounts of lost urban-development revenues, but the uncertainty it creates for new urban renewal proposals. The last minute legislation seems to have many ambiguities that will have to be worked out as it is implemented.

Colorado cities and their urban renewal authorities have budgets that must be balanced to prevent insolvency. And developers are particularly risk-adverse. They need to know beforehand what their incentive financing will be for projects in blighted urban-renewal areas such as the Arvada Plaza, Arvada Square or any new projects in or near Olde Town.

Most of these areas simply cannot be redeveloped without some kind of financing incentives.

My worry is that the bill may put negotiations for these new projects on hold until attorneys and the courts can determine exactly what the financial obligations of urban renewal authorities are under the bill. And much of the funding for urban redevelopment comes from bonds that are issued by the private sector. No one wants to buy a bond that they think may not be paid back.

And those delays may be extended if new “clean up” legislation is introduced early next year. That possibility is already being discussed.

Is this bill all bad? Not at all. There is inequity in the current ability urban renewal areas across the state have to keep the new tax revenues they generate from their urban-renewal projects for up to 25 years. Urban renewal authorities often generate new demand for services that they do not compensate counties, school districts or other special districts for. But in other development projects they generate little or no new demand for services and those government agencies get a substantial uptick in their property-tax revenues when the urban renewal authority’s authority expires.

Let’s pick a few examples from the CLRC neighborhoods to show how this writer views that:

The redevelopments in Olde Town (which will include the 153 Park Place Old Town apartments, plus the 400 or so new apartments east of the mini-storage, and whatever residential gets included in the Nine-Acre Site next to the movie theater) will definitely increase the need for library services provided by the county. Only a few families with school-age children go with these projects, but there will still be some increased demand on the schools. Even with up-to-date safety codes, fire department calls will also increase, as will a number of services provided by the City of Arvada and a few provided by the Apex Park and Recreation District.

The City of Arvada is already subsidizing Olde Town developments and will happily eat those costs hoping for increased sales-tax revenue in Olde Town outside of the existing designated urban renewal area.

Absent this bill though, Jefferson County will get no increase in its property-tax revenues for its libraries and schools, nor will the Arvada Fire Protection District see any increased in its property tax revenue for the services it has to provide. They will be held to their “base line” tax levels while still having to provide these needed services until the urban renewal authority’s tax collection ability expires. That should happen in another 17 years in Olde Town (if I’ve calculated it correctly), after which these other agencies will enjoy a big jump in their property tax revenues.

But these other taxing authorities are keenly aware that money later is not the same as money now.

On the other hand, the redevelopments in the Arvada Triangle (now known as Ralston Creek) are unlikely to increase the need for library services or schooling in these shopping centers. Nor is the Arvada Fire Department likely to see more service calls. Yet, under this bill, they will all, up front, get some of the revenue that AURA would have otherwise gotten to redevelop the remainder of the Triangle.

The exception is the Arvada Police Department. Enforcement costs for Ralston Creek are likely to increase simply because there will be more people shopping there. But, as with the Target shopping center on Kipling, AURA wisely exempted the APD. They will see a substantial increase in annual revenues to be used for law enforcement from the developments in the Triangle.

It appears that nothing in the bill provides for a system of payments-in-lieu-of-taxes to deal with these inequities, instead it is set up to provide a one-size-fits-all cookie-cutter approach to solving the problem — an approach that is fair for some urban renewal projects but not for others.

For most of central Arvada it doesn’t seem fair. Most of the arguments about the legislation have been centered on the financial risk cities take on in cleaning up urban blight that the counties don’t, and the need for school districts to provide for new students years before their property-tax revenues go up later on.

Why should we care? After all it is just some government agency’s revenues going to some other government agency. However, the net effect of this bill will probably be to slow down urban development in the blighted areas of Arvada that need it the most.

And that directly affects us, and it affects the quality of our neighborhoods. And it is of enough concern that front-range cities, including Arvada, are still lobbying against the bill despite its having passed in the legislature. They are now asking the Governor to veto the bill.

The Governor gets lots of veto requests.

If I’m reading the Constitution correctly, the Governor has until early June to make a veto decision. But, historically, bipartisan bills are seldom vetoed by Colorado Governors no matter how fast they are run through the legislature. And we may well end up seeing an Arvada that is not quite as ready as it could be for the Gold Line’s arrival in 2016 and a slower redevelopment schedule for the Triangle shopping centers along Ralston Road in the years to come.

HB 1375 passed by comfortable margins in both the House and Senate. But our local representatives in the General Assembly, House members Libby Szabo and Tracy Kraft-Tharp, and Senators Rachel Zenzinger and Cheri Jahn, all voted against the bill’s final passage. All of them have substantial urban renewal programs going on in blighted areas in their districts.

These are my own views about this legislation. Other readers may have different views — or not care at all. But if you do have some thoughts about this, please feel free to post them on our http://www.RalstonCommunity.org website to add to the discussion.

WHERE TO FIND OUT MORE
To find out more about the bill, I recommend googling up the words “Colorado HB 1375” for links for several current online articles.

Here is a copy of the final amended version of the bill.

HB14-1375

A couple of good summary articles can be found at

http://www.aurorasentinel.com/news/pending-law-targeting-urban-renewal-taxes-stall-future-projects-aurora-says/

and at

http://www.coloradocapitolwatch.com/bill/1/HB14-1375/2014/1/

which summarizes the bill’s major provisions.

To read more about the effort to get the Governor to veto the bill, try this link to a Denver Business Journal article:

http://www.bizjournals.com/denver/blog/capitol_business/2014/05/colorado-groups-lobby-hickenlooper-for-urban.html

And you can always follow us on our neighborhood association website at

http://www.RalstonCommunity.org

and on our Facebook site at “CLRC – Citizens for a Liveable Ralston Community”.

[Writer’s note: I’ve just gotten back from a trip overseas and am finding a lot I need to catch up on for the neighborhood association. Look for more articles on delays to development projects along the central Ralston Road corridor, the outlook for sidewalks on Ralston Road, and in new housing east of Wadsworth Bypass. If you have any suggestions for other items I may have missed, please let me know. — John ]

May 23, 2014
[edited on May 24, 2014 to reinsert missing 3rd paragraph]

John Kiljan
6185 Field Street
Arvada, CO 80004

jpkiljan@yahoo.com
303-423-9875

The Citizens for a Livable Ralston Community is an independent neighborhood association representing the neighborhoods adjacent to Ralston Road from the Wadsworth Bypass to the Kipling Parkway.

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2 Responses to House Bill 1375 May Slow Triangle and Olde Town Development

  1. Steve says:

    Opposition to this bill is all about cities wanting to spend others’ money and not their own sales tax. The bond concern is a red herring. Putting city’s money in with the other entities actually creates a larger pool of revenue to pay bonds.

    [repsjohnso@comcast.net]

  2. Pingback: Urban Renew Update — HB 1375 vetoed | Citizens for a Livable Ralston Community

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