As I mentioned in Part One of this editorial series, I had hopes that the Pagosa Springs Town Council, at their December 3 regular meeting, would hear at least a brief presentation about the proposal — apparently supported by at least some of the special district board members in the community — for a reconsideration of the Council’s November 5 resolution, Resolution 2019-18. That November 5 vote created a new ‘Urban Renewal Authority’ with the same boundaries as the Town boundaries, and also specified an Authority board of directors that included all seven Council members, plus four additional members. Resolution 2019 was approved by a 4-to-3 vote.
You can download the November 5 meeting packet here for more information.
An Urban Renewal Authority (URA), according to Colorado law, has the authority to extract Tax Increment Financing (TIF) revenues from all of the government entities in the community, to fund development projects within a defined Urban Renewal Plan area. A URA can, without too much trouble, define almost any vacant property within the Town limits as “blighted” and in need of TIF tax incentives — as was demonstrated by the Council on November 5.
All across Colorado, municipal governments have been using the Urban Renewal Law to promote economic development of vacant land — land that has never been “blighted” in the normal sense of the word, but “blighted” in the eyes of municipal councils and their attorneys for the simple reason that it’s… well, vacant.
Anyone who has read Colorado’s Urban Renewal Law with an open mind understands that the law was created to address “slum and blighted areas which constitute a serious and growing menace, injurious to the public health, safety, morals, and welfare…” That’s the actual language of the law. But clever attorneys have convinced city leaders to use the law (improperly?) to extract tax revenues from the surrounding county, school district, and special districts, for use by the city government in promoting pet development projects within the city limits.
The Archuleta County community is served by several government entities, including the Town, the County, and the Archuleta School District.
The County boundary includes, as one might expect, all of Archuleta County. The School District, meanwhile, includes almost all of Archuleta County, plus a large portion of neighboring Hinsdale County.
The special district boundaries are more… well, special.
The Upper San Juan Library District, which operates our only public library — the Ruby Sisson Memorial Library — is contiguous with Archuleta County. The Upper San Juan Health Service District — operating the Pagosa Springs Medical Center and the community ambulance service — includes most of Archuleta County, plus portions of Hinsdale and Mineral counties south of the Continental Divide, approximately 1,800 square miles.
The Pagosa Fire Protection District stretches from Aspen Springs in the west, all the way down to Chromo in the south; it does not, however, serve every single corner of the county. Pagosa Area Water and Sanitation District (PAWSD) serves mainly the urban-suburban core, and not the outlying areas like Aspen Springs and Chromo. The San Juan Water Conservancy District encompasses practically all of the PAWSD district, but extends a bit farther out from the core areas.
The Southwestern Water Conservation District, as its name implies, serves the entire southwestern corner of Colorado, including all of Archuleta County.
Yesterday, I shared a pie chart based on the information provided to the Town Council by their attorney, Bob Cole, based on an “impact study” created for the Springs Resort by Colorado Springs-based consultant Mike Anderson. The Colorado Urban Renewal Law allows an Urban Renewal Authority to enter into agreements with the surrounding government entities and extract the “incremental” property taxes created by an “urban renewal” project from those entities, with or without their permission. The URA can also dedicate “incremental” municipal sales taxes to a TIF tax incentive package, but we don’t have a municipal sales tax in Pagosa Springs; we have only a County sales tax that’s shared with the Town government.
So the Town government might contribute less than 3 percent of all TIF revenue to a future Urban Renewal project. The County and other community entities might contribute more than 97 percent of the money, if the Town is able to extract such agreements from the districts.
Normally, a town government is limited, by state law, in how it dedicates future, expected revenues for any public or private purpose. Normally, a town government approves an annual budget, and assigns specific dollar amounts for projects, staffing, and purchases for the coming year — and is allowed to assign funds only the coming year. Normally, the only way a town government can encumber future revenues, beyond one single year, is by getting a bond approved by the voters.
The Colorado URA Law makes a huge exception to that rule. If a municipal Urban Renewal Authority approves an Urban Renewal project, the URA board can encumber incremental taxes for up to 25 years — with absolutely no need for voter approval. Not only can a town encumber their own incremental taxes, they can compel the County government, the School District, and all the special districts in the community to give up their own incremental taxes for the same 25 year period.
When the Pagosa Springs Town Council approved Resolution 2019-18 on November 5 — by a 4-to-3 vote — they appointed themselves as seven members of an 11-member Urban Renewal Authority board, essentially giving the Town Council political control of all future URA decisions. Colorado law specifies that the County and the School District can appoint a representative to the URA board. Additionally, one seat on the Authority board is dedicated to the special districts. Here in Archuleta County, that would mean that the six non-municipal special districts would need to agree on one single representative. (The Town’s own special district, the Sanitation District, is already represented by the Town Council, which sits as the Sanitation Board.)
If indeed a Springs Resort expansion could generate $25.9 million in incremental property taxes — and if an Urban Renewal Authority board can decide to hand that $25.9 million back to the Springs Resort, as an “incentive” — who ought to be making that decision? The Town Council? Or the governmental districts that are contributing the money?
According to Resolution 2019-18, it would appear that the Town Council, potentially contributing 3 percent of the incremental TIF taxes, would get seven seats on the Authority board… while the County — contributing almost one-third of the taxes, and the School District — contributing more than one-third of the total taxes — should have one board member each? And the six special districts in the community — who might contribute almost one-third of the total — would have only one board member representing all six of them?
Does the Town Council want to rethink this arrangement? Because there’s another approach… that might be a lot more fair to the citizens…
Bill Hudson began sharing his opinions in the Pagosa Daily Post in 2004 and can’t seem to break the habit. He claims that, in Pagosa Springs, opinions are like pickup trucks: everybody has one.