County miffed over proposed TIF funding
The Garfield County commissioners on Monday blasted a plan to fund the Glenwood Springs Downtown Development Authority, saying it would deprive them of property tax revenues.
Under a program called tax increment financing (TIF), the DDA could collect the increase in sales tax revenues within its boundaries above a base year amount. That will amount to $33,000 in the first year, said DDA director Bill Evans.
The DDA also plans to ask the Glenwood Springs City Council to allow the agency to collect property taxes on new construction, said City Councilwoman Jean Martensen.
It would mean the “loss of some very small tax growth to the county,” she added.
But the commissioners disagreed.
The loss of property tax revenue over the years would make a big dent in the county’s coffers, they argued. More importantly, they would have no control over the matter.
“This borders on taxation without representation,” said Commissioner Walt Stowe.
“It would mean increased property values,” Evans countered.
DDA projects to enhance downtown Glenwood Springs will range from flower boxes to a parking structure, he said.
In order to build a parking structure, revenues from sales and property taxes would have to accumulate for seven to eight years until there is $500,000 in the pot, which is the minimum needed for bonding, Evans said.
“We think there’ll be a positive payoff for you,” he told the commissioners.
But they heartily disagreed.
By the end of 20 years, that would mean a loss of $2.5 million for the county, Stowe said.
“Somehow that money has to be backfilled. We will have to ask the voters for a tax increase,” he said.
Further, if all six municipalities in the county formed development authorities, that could amount to a loss of $10 million, he added.
County administrator Ed Green said the increment of tax revenues increases every year, depending on growth.
“It’s a geometric progression. It grows very rapidly,” he said.
The commissioners were also concerned about the potential loss of part of their share of property tax revenue from the proposed Glenwood Meadows development. The project’s 475 homes and 490,000 square feet of commercial space will bring a significant increase in property and sales tax revenues for the county.
“That’s another reason we can’t support it,” Stowe said.
City Council must vote to expand the boundaries of the DDA in order to include Glenwood Meadows, but that appears to be a likely scenario, he added.
“This clearly looks like a win-win situation for Glenwood Springs, but the other (governments) would be the ones to lose,” said Commissioner Larry McCown.
“This tax robs other entities … for the improvement of Glenwood. Is that fair? When citizens pay their taxes to Garfield County, they expect those taxes to go to the county,” Stowe said.
Evans countered that Glenwood Springs is the county seat and needs the county to help fund its services.
County seats can also change, McCown said. Voters can move it to another location.
“We may have to subsidize New Castle or Parachute in the next 30 years,” he said.
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