We should use the city’s resources to do the most good for the most people for the longest time. — John Graham
By William J. Dagendesh
The future of the Urban Renewal Authority is at a crossroads until Manitou Springs City Council can review additional information and discuss its financial impact on the city.
At the June 20 meeting, three options were proposed regarding the URA’s future: leaving the URA alone until it expires in 2031; retaining the URA and creating a memorandum of understanding for its remaining period of existence; or dissolving the URA altogether.
Finance Director Rebecca Davis said Resolution 2506 granted approving the URA. The resolution, adopted Dec. 5, 2006, ensures that all legislative findings and approving the Manitou Springs east corridor URA Plan is in place. The resolution lasts until Nov. 30, 2031, with municipal sales and property tax increments providing the funding.
Davis described the area as, “A tract of line bordered by the Manitou Springs City limits on the east; the north right-of-way line of El Paso Boulevard on the north, and the northerly and easterly right-of-way line of Highway 24 on the south and west … encompassing approximately 50 acres.”
Two funding sources, through tax increment funding, support the URA: property tax and sales tax. El Paso County distributes property tax TIF based on the increase in property tax revenue over the 2006 base amount, and the URA not receiving the city’s mill levy and other taxing entities in that area.
As for the sales tax TIF, City Council may allocate municipal sales tax increments when the URA summits a financing plan outlining the proposed amounts and purpose for which the municipal sales tax increments are to be used. This is the sales tax collected in the area over the 2006 base amount of $96,014.
In 2018 and 2020, when the city faced crisis (Cog Railway closed temporarily and the COVID-19 pandemic), council and the URA Board agreed the city would keep the sales tax as a buffer for economic concerns. This revenue was used for the city’s capital needs. Council retained the sales tax TIF starting in 2022.
As of this year, $108,818 is being spent on this area from the 77.181 mill levy. If the URA didn’t exist, the city would receive only 12.988 mill levy or, $22,017. Over the eight-year period, the extra funding the city will receive through the URA property tax TIF is forecast at more than $1.75 million.
Council has the power to determine how much of the sales tax should be allocated to the URA. However, Council has no control over how the property tax TIF is spent in the URA development area.
If the URA is dissolved, the city would gain an extra $22,017 in property tax that wouldn’t have to be spent in the URA area. Over the next eight years, the city is expected to receive about $355,737. The big disadvantage is that the city would lose the extra property tax from the 64.193 mills, more than $1.75 million that would be spent on Manitou’s east end.
“The way I look at this, is if you abolish the URA, you basically lose the remaining incremental revenue you would get from the other taxing entities mill levy,” city attorney Jeff Parker said.
Should the URA be replaced, a blight study costing about $112,100 would be conducted. The URA would then be under new state laws requiring adding board members from the county, and school and special districts. As a result, council would have less control over new developments in the URA area than they would have if an MOU is signed with the existing board.
The estimated amount of the sales tax for the new URA area, for 2023, that the city is retaining is more than $1.68 million. Council decisions will have fiscal impacts for 2024 through 2031.
“When you add the property taxing entities, it comes to $130,835.12, with $22,016.90 belonging to Manitou Springs,” Davis said.
John Maynard, vice chair of the URA Board, defended the organization.
“We’re here to serve the community just as you are. Maybe we have slightly different views on how that should happen, but by and large council gives direction and the direction we’re getting now is a mixed message,” Maynard said.
Mayor John Graham said his number crunching demonstrated that dissolving the URA wouldn’t injure the city.
“It seems to me that we should use the city’s resources to do the most good for the most people for the longest time,” the mayor said.
Mayor Pro Tem Nancy Fortuin said her math showed that the city stands to lose a lot of money if the URA is dissolved.
“But, it’s not all about money. We need to look at additional criteria — economic development, retaining the tools of the URA and respecting the URA board who has worked very hard and has done a lot for this city. We need to honor our obligations to the URA,” Fortuin said.
Councilor Julie Wolfe is opposed to dissolving the URA, believing its demise could damage area schools. Councilor John Shada, who worked on an analysis, proposed postponing further discussion until he and Davis have an opportunity to compare notes. Council agreed, and Shada, Davis, Maynard and Ann Nichols, who is also on the URA board, will meet to discuss it.
Also, State Rep. Marc Snyder summarized the 2023 State Legislative session. Snyder described this past year as the most challenging of his five legislative sessions.
“The election in 2022, people predicted a more balanced Legislature as far as party affiliation, but it was anything but. In fact, it went the opposite direction. We had 41 Democrats in the House and came out of the election with 46, which is a super majority in the House. … That made for a different session this year,” Snyder said.
“We passed a lot of good legislation I think will help people (concerning) increasing earned income tax credit and child tax credit — ways you can get money back into the pockets of people who can use that. … We had a workforce bill that will recruit younger people into the forest service and wildfire mitigation. I’m doing my best to represent us at the capitol and so far, I think it has gone pretty well.”
Councilor Judith Chandler said she was impressed with what has been accomplished.
“I think the bills that got passed really, in my personal opinion, reflects what we want Colorado to be as a state and stand for.”
Also, local musician Eli Blackshear was approved as a regular member of the Manitou Arts, Culture, and Heritage board.
Council’s next regular meeting is scheduled for 6 p.m. Tuesday, July 11.