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Governor Ritter Signs
Urban Renewal Reform Legislation
HB 1107 Protects Farmlands – Keeps Urban
Renewal Dollars Downtown
April 14, 2010—Today Governor Ritter signed
into law a bill that will help stop the
conversion of productive farmlands into
shopping centers and subdivisions at
taxpayer expense. HB10-1107,
backed by an unusual coalition—including
local governments, farmers,
environmentalists, local planners and fiscal
policy experts—found common ground on an
issue that has been contentious under the
dome for years: urban renewal funding.
Sponsored by Rep. Randy Fischer (D-Larimer)
and Sen. Morgan Carroll (D-Arapahoe), the
bill passed by an overwhelming bipartisan
vote in both the House and Senate. It adds
needed reforms into Colorado’s urban renewal
law by preventing farmlands from qualifying
as “blighted” lands in need of taxpayer
funding.
“We fought hard to prevent urban
development monies from being misused to
develop rural lands," said lead sponsor Rep.
Randy Fischer." Now we can ensure that tax
breaks intended to rehabilitate blighted
urban areas—like slums or former industrial
sites—are used in the right way, and keep
developers from getting huge tax breaks to
develop farm lands."
Colorado farmer and president of Rocky
Mountain Farmers Union Kent Peppler
applauded the bill saying “This is a great
day for agricultural producers in Colorado.
Closing this loophole means that more farms
can stay in production without fear of
condemnation for urban expansion.”
“I am extremely proud to be part of this
effort to help end the abuse of "blighting"
pristine farm land for development, which
results in millions in taxpayer subsidies to
private developers and has the absurd result
of promoting sprawl and actually increasing
true urban blight," said Senator Morgan
Carroll. Further, this practice has
contributed significantly to Colorado’s
budget woes, as the state has to “backfill”
money taken from local school districts.
“This is costing the state in excess of $50
million per year, and Colorado simply can’t
afford it,” noted Mark Neuman-Lee of the
Colorado Fiscal Policy Institute.
Historically cities, which build urban
renewal projects, and counties, from which
tax monies are diverted for the projects,
find themselves on opposite sides of this
issue; this year however, they worked
together to pass this landmark legislation.
“We all want to see smart redevelopment on
blighted urban areas such as abandoned
factory lands that sit empty due to the need
for additional clean ups” said Longmont
Mayor Bryan Baum. “HB 1107 preserves this
good use of the urban renewal tool, while
preventing the abusive use of the tool on
productive agricultural lands.” Larimer
County Commissioner Steve Johnson agreed,
saying “Counties are more than happy to
contribute taxes for true urban
redevelopment projects that add benefit to
the entire community, but too often these
funds have been used improperly to develop
productive farmland at taxpayer expense.”
“Urban renewal was intended to encourage
infill and redevelopment of blighted city
centers into revitalized, sustainable
communities,” said Stephanie Thomas, with
the Colorado Environmental Coalition. HB
1107 is remarkable because it will preserve
urban renewal funds for development that is
truly urban, and truly renewal while
eliminating the growing abuses on
farmlands.”
The Colorado State Fire Chiefs Association
was part of the coalition that supported
HB10-1107, since the legislation will
address some of the impact on fire
protection districts created by the use of
Tax Increment Financing (TIF) for Urban
Renewal.
In cases where an Urban Renewal Authority (URA)
is created for the traditional purpose of
redeveloping a slum or blighted area, the
use of TIF to fund the URA often has little
adverse impact on the fire protection
district. However, in situations where URAs
and TIF are utilized for the development of
agricultural lands, especially when these
are located in areas of the district where
no fire protection infrastructure exists,
the impact can be significant. In these
cases, the proposed development would be
built upon property that presently generates
little tax revenue and any increase in tax
revenue would be diverted into a tax
increment financing fund. This "increment"
thus would leave fire protection districts
without funding from the developed area that
is necessary to provide fire and related
emergency services.
While HB10-1107 is not an end-all solution
to the impact of TIF on fire protection
districts, the conditions established for
the inclusion of agricultural land in a URA
will help to reduce the number of situations
where there is no fire protection
infrastructure in place. Further, the
requirement that agricultural land be valued
at its market value for determining the base
amount of taxes to be paid to taxing
entities will help to reduce the financial
impact on fire protection districts.
For more information concerning the impacts
of Urban Renewal Authorities and Tax
Increment Financing on Fire Protection
Districts, see the CSFCA Issue Brief
here.
For
more information concerning HB10-1107, go
here.
Posted 04-14-10 |
