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Glenwood’s tax finance plan goes to State Court of Appeals

Greg Mass

The battle over Glenwood Springs’ planned use of tax increment financing to finance Downtown Development Authority projects moved to Denver on Tuesday. It pitted representatives of the city of Glenwood Springs, who are in favor of tax increment financing – also called TIF – against attorneys representing Colorado Mountain College and Garfield County, both of which feel the financing method will take money from their pockets and illegally give it to the city’s Downtown Development Authority. Oral arguments were recited to a three-judge panel Tuesday morning at the Colorado Court of Appeals, but no decision is expected for two to three months. Boulder-based attorney Paul Benedetti, an expert on Colorado DDAs, spoke to the panel on behalf of Glenwood Springs. Glenn Chadwick spoke for CMC and Garfield County attorney Don DeFord represented the county. Tax increment financing is a system of generating money to pay for projects by using a portion of sales tax revenues and the rise property tax, or ad velorum, revenues. The year leading up to Feb. 28, 2002 was designated as the “base year” for the TIF, so 50 percent of the growth in city sales tax revenues in the downtown district and 100 percent of the rise in property taxes within the district from that year will be allocated to the DDA to pay for ventures such as the construction of new parking structure or other downtown improvement projects.CMC and Garfield County are against it because they fear the system will rob them of millions of dollars during the DDA’s life span. The suit, filed in July, 2002, asks the court to find the TIF system illegal.Among other claims, the suit alleges that the state statute allowing a DDA is supposed to be used for a blighted area, but it states that downtown Glenwood Springs is not blighted; that the Glenwood Springs DDA “includes vacant lands with known development plans and potential;” that the TIF financing system proposes to use a portion of the property tax revenues produced by the mill levies of the county and of the college, which could force those entities to raise taxes for Garfield County residents who did not get a chance to vote on the creation of a DDA or on the implementation of the TIF financing system; and that approval of the TIF financing plan by the Glenwood Springs City Council was “invalid, void and an abuse of discretion.”In addition to asking for the nullification of the TIF financing plan, the suit also requests attorney fees to be paid by the defendants. If the city wins, it plans to use the money to make downtown improvements that could include a parking garage or a theater.If the city wins, it plans to use the money to make downtown improvements that could include a parking garage or a theater.


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