Court rules in city’s favor in tiff over TIF | PostIndependent.com
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Court rules in city’s favor in tiff over TIF

Dennis Webb

A court ruling last week gave a major boost to plans for building a parking garage in downtown Glenwood Springs.The Colorado Court of Appeals upheld a lower court ruling in favor of the city of Glenwood Springs in a tax dispute with Garfield County and Colorado Mountain College.The appeals court agreed with a 2003 summary judgment by District Court Judge Thomas Ossola. He found that CMC and the county had no standing to challenge the city’s tax increment financing plan for paying for downtown improvements that could include a parking garage and a theater.CMC and the county had sued in 2002, arguing that the financing plan would deprive them of nearly $4 million in tax revenues. Under the plan, the city decided to set aside new tax revenues created by growth in the tax base in the downtown district to pay for ventures such as a parking structure and theater. CMC and the county argue some of that new revenue belongs to them. State law allows use of the financing plan, but the county and CMC said the city violated the law.The appeals court ruled that to have standing, CMC and the county would have to show the tax plan is directly and substantially injuring them. The court said such an injury was shown in a Grand County case in which a school district demonstrated it would have to raise taxes to make up for property tax lost to Winter Park, because the district previously had issued bonds based on projections of an increasing tax base. “No such record exists in the case before us,” the court wrote.The court also said that unless political subdivisions of the state have a clear right under the law to sue, they lack standing to challenge the constitutionality of a state law “directing the performance of their duties.” It found that CMC and the county had no explicit right under the law to sue, and didn’t meet any other conditions allowing a suit. Attorneys for both the college and the county said they have to speak with their elected boards about whether to take the matter to the Colorado Supreme Court. However, county attorney Don DeFord said that because of the state Supreme Court’s caseload, it hears only about 10 percent of the cases that parties ask it to review.The appeals court upheld Ossola’s ruling even while acknowledging that a summary judgment is “a drastic remedy.” Glenn Chadwick, CMC’s attorney, expressed frustration that the college and CMC never have been allowed to argue the merits of their case.”We think it’s unfair that we don’t have a chance to at least have our day in court, basically,” he said.He said of the appeals court ruling, “I thought the rationale wasn’t very thoroughly reasoned in light of the circumstances that we think exist in this situation.”He said the court appeared to view the case as a challenge to the validity of the tax increment financing law. Instead, he said, it’s a challenge to whether Glenwood Springs meets the conditions allowing for the law’s use.Meanwhile, the city will begin moving forward with establishing a list of projects that might be funded with the tax plan, said city manager Jeff Hecksel. He expects the city will have to go for a bond measure to begin construction on the projects.”There’s a series of steps we have to go through,” he said.The ruling comes as the city’s Downtown Development Authority is working on splitting up its marketing/promotion and capital improvement functions.”We’ve got some organizational things we need to deal with,” Hecksel said.He said City Council has discussed possibly building two parking garage instead of one, to make them more accessible to more of downtown.As for the theater, the city needs to decide who would operate it if the city builds it, and where the operating money would come from, Hecksel said. “There’s issues there that have to be resolved,” he said.The city already has more than a half-million dollars set aside through the tax plan.Contact Dennis Webb: 945-8515, ext. 516dwebb@postindependent.com


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