Moratorium Placed on Future Incentive Deals
~ by Bob Volpe ~
Last Tuesday morning, the DDA (Downtown Development Authority) held a workshop and regular meeting at the city council chambers to plot its future, following a recent decision that has generated mixed reviews.
When the DDA turned down the tax increment financing (TIF, a tax rebate, incentive-type deal) package proposal by Natural Grocers, they became aware of a few things that marked changes from how they did business in the past.
For one thing, they learned that Natural Grocers was under the impression that applying for a TIF in Woodland Park was just a formality and that the DDA would rubber stamp anything that a business wanted in the downtown area. Natural Grocers’ TIF application was the first major incentives package that was denied by the current DDA board.
They also learned that the documents they presented to prospective businesses, applying for a TIF, were lacking consistency.
Now it seems the DDA is struggling to discover exactly what their identity should be. They group also faces some key upcoming challenges.
These include a pending lawsuit, scheduled to go to court in March; the discovery that a flaw in a TIF contract with Trail Ridge Apartments, by a previous board, has burdened them with an unexpected $30,000 debt; and the task of developing new documents for granting future incentive deals has taken a toll on the board’s ability to focus. As a result of these issues, the DDA has unofficially placed a moratorium on any future TIF incentive deals.
At their last meeting cochairman Noel Sawyer suggested each member bring a list of three priorities that could be discussed and possibly implemented in the new TIF application document. DDA Treasurer Tanner
Coy was the only one on the board that brought in some concrete suggestions. Also, board member Ellen Carrick, who could not attend last week’s meeting, did send an email stating she liked the format that the DDA in Oshkosh, Wisconsin used as a TIF agreement contract.
Last week the board reviewed TIF contracts from other cities around the country. Carrick suggested the board review those contracts and cut out what the board liked and paste them together to form their
At last week’s meeting, the board discussed what to do about reorganizing their TIF agreement documents. But similar to past DDA forums, it didn’t take long for the discussion to get off track. Discussion immediately went to talking about how the DDA gets its income.
Sawyer then tried to bring the discussion back into focus. He apologized for not being very prepared, because he is also a city councilman and there is a lot going on right now with the city budget.
He also mentioned the Oshkosh contract. He liked the idea that that contract only allowed for a 10 year TIF agreement.
Once again, the train jumped the rails and discussion went to whether or not other DDAs around the country have the kind of debt the Woodland Park DDA has incurred.
Board member Elijah Murphy suggested one criterion that is included in the new document should
give weight to whether a business wants to develop a vacant property or an undeveloped property. This idea would also take into account the infrastructure improvements a business would make to the city, should the business want to develop an unimproved property.
Coy, though, argued that applicants should provide more documentation in the form of plans, sources and uses of funds, their development budget. He also maintained that the request for tax rebate money should outline how the applicants’ plan to fund the upfront costs the TIF is designed to reimburse, and show income and an expense schedule, professional studies, including market ad environmental studies, etc.
In the end, it was decided that board members Al Born and Ellen Carrick would draft a skeleton document of recommendations gleaned from DDA contracts from other groups around the country for the next meeting.