Date: 01/21/2009

Final
BILL SUMMARY for HB09-1013

HOUSE COMMITTEE ON FINANCE

Votes: View--> Action Taken:
Refer House Bill 09-1013 to the Committee on LocalPASS



10:35 AM -- House Bill 09-1013

Representative Sonnenberg, prime sponsor, briefly explained the provisions of the bill and distributed a handout on House Bill 09-1013 (Attachment B). He explained that the bill allows fire districts or other emergency service districts to utilize taxes that would otherwise go to Urban Renewal Authorities (URAs) under Tax Increment Financing (TIF) obligations to pay for increased service demands in their jurisdictions.

09HouseFin0121AttachB.pdf

The following persons testified:

10:39 AM -- Ms. Erin Goff, Colorado Municipal League, testified in opposition toward the bill and discussed the "increment" revenue that would be lost to URAs. She continued the presentation by discussing how TIF works as a funding mechanism for urban redevelopment. Ms. Goff closed by saying that there is an incentive for URAs to negotiate with fire districts within a district to allow districts to continue collecting the increment revenue under TIF obligations.

The committee engaged in a brief discussion regarding whether House Bill 09-1013 would impair an existing contractual obligation between a URA and a fire district given a TIF contract. Representative Sonnenberg responded by saying that the bill only affects increment taxes that are realized in property tax year 2009 and years thereafter.

10:59 AM --
Mr. Brian Martens, Windsor - Severance Fire Station 1, testified in support of the bill and began by saying that URAs have a negative impact on the funding of essential services provided by fire and ambulance districts. He said that fire and emergency services nonpayment of TIF revenue to URAs in the bill would have a minimal impact on the total dollars that URAs receive from TIF. Mr. Martens closed by saying that the Windsor Fire Department's share of the $4.5 million in property tax revenue that was paid to the URA in Windsor has cost the fire department an estimated $250,000 annually and is needed by the department to help fund the growing costs of providing emergency services.

11:12 AM --
Mr. Evan Goulding, Special Districts Association, testified in support of the bill and gave the committee a brief overview of TIF. State law authorizes URAs to use TIF for projects that improve blighted areas. TIF allows an authority to issue and repay redevelopment bonds by using the "increment" of increased taxes collected within the TIF district after improvements are made. For TIF purposes, to determine the increment amount of property tax revenue, the base valuation is certified by the county and is equal to the total assessed valuation within the TIF district prior to the approval of the redevelopment plan. As phases of redevelopment are completed, the county reassesses the properties in the TIF district. Over time, improvements add to the property tax base. The revenue that is attributed to the growing tax base becomes the incremental revenue that is used by the authority for debt service on the bonds that are used to finance the redevelopment project.

Mr. Goulding continued by saying that the concern with TIF, is that is freezes the level of property tax revenue that a special district providing emergency services can take in until the URA project is completed. These projects are long-term and do not allow a fire district's revenue to grow as the corresponding costs of providing emergency services grow. He closed by strongly urging the committee to support the bill.

11:25 AM --
Mr. Chris Mendez, Colorado Counties Inc., testified in support of the legislation and the expansion of the receipt of notice arbitration above the current statutes. He closed by saying that there may be a need to amend current law to give special districts more flexibility in terms of financing the services they provide.

11:28 AM -- Mr. Bob Lackner, Office of Legislative Legal Services, responded to committee questions about the effective date of the bill and the application of the bill to property taxes that accrue to URAs during property tax year 2009. Mr. Lackner closed by saying that the bill does not have retroactive impacts.


11:30 AM

The bill was placed on the table for action and no amendments were offered.
BILL:HB09-1013
TIME: 11:31:31 AM
MOVED:Lambert
MOTION:Refer House Bill 09-1013 to the Committee on Local Government. The motion passed on a 9-2 vote.
SECONDED:Summers
VOTE
Apuan
Yes
Benefield
Yes
Gerou
Yes
Kefalas
Yes
Kerr A.
No
Lambert
Yes
Roberts
Yes
Summers
Yes
Swalm
Yes
Frangas
Yes
Judd
No
Not Final YES: 9 NO: 2 EXC: 0 ABS: 0 FINAL ACTION: PASS