Bill Summary for Bill Number HB09-1327

Date: 03/31/2009

Final
BILL SUMMARY for HB09-1327

HOUSE COMMITTEE ON LOCAL GOVERNMENT

Votes: View-->	Action Taken:
Moved 1st part of severed amendment L.001, page 1, Moved 2nd part of severed amendment L.001, page 1, Moved amendment L.002 (Attachment H). The motion Moved amendment L.003 (Attachment E). The motion Moved to refer House Bill 09-1327, as amended, to Moved to sever L.001 after line 4. The motion pas	Pass Without Objection FAIL FAIL Pass Without Objection PASS PASS

01:56 PM -- House Bill 09-1327

Representative Hullinghorst, prime sponsor of House Bill 09-1327, concerning modifications to the urban renewal law to address impacts to specified taxing entities arising from the use of tax increment financing (TIF) mechanisms to support urban renewal projects, discussed her bill and distributed a handout concerning TIF (Attachment C). Representative Hullinghorst talked about the history of urban renewal law in the state and TIF projects undertaken by urban renewal authorities (URAs). She talked about the process for the determination of "blight" and the requirements for TIF impact reports to affected taxing entities within the TIF project area. She also talked about the specific changes that would be made to urban renewal law according to the bill.

02:15 PM

Representative Hullinghorst addressed questions from the committee concerning provisions in the bill to split TIF revenue after five years if an agreement is not in place between the taxing entities affected by the TIF project. Committee discussion ensued concerning the role of other taxing entities that are affected by TIF projects, the problems with subsidizing TIF projects, and the impacts of TIF on state funding for school finance.

02:25 PM

Nancy McNally, Mayor, City of Westminster, testified against the bill and discussed specific TIF projects undertaken by URAs in the City of Westminster. Mayor McNally talked about the benefits of urban renewal and TIF allowing Colorado municipalities to redevelop areas of slum and blight. She addressed questions from committee members concerning how municipalities repay bonds taken out for TIF projects and the potential difficulty to project bond repayments under changes in the bill. Committee discussion ensued concerning challenges with the bond market and TIF agreements under to the bill.

02:42 PM

David Casiano, Mayor, Town of Parker, testified against the bill and discussed the importance of urban renewal laws that allow municipalities to use TIF projects to redevelop areas of slum and blight. Mayor Casiano talked about the importance of intergovernmental agreements (IGAs) between taxing entities for TIF projects that are possible without the requirements in House Bill 09-1327. Mayor Casiano addressed questions from the committee members concerning the impacts of the bill on municipalities and future TIF projects.

02:47 PM

Carolyn White, legal counsel, representing the Sterling Urban Renewal Authority, the Golden Urban Renewal Authority, and the National Association of Industrial and Office Properties, testified against the bill and explained that the bill would weaken the ability to implement TIF projects. She explained that the bill would eliminate an arbitration requirement currently in law and force URAs to surrender 50 percent to other taxing entities. Ms. White talked about specific TIF projects that have created economic benefits for municipalities and responded to questions from committee members.

03:02 PM

Erin Goff, Colorado Municipal League, testified against certain sections in the bill and talked about the benefits of urban renewal for municipalities in the state. Ms. Goff explained that the bill would require municipalities to meet budget shortfalls of other taxing entities impacted by TIF projects. She also discussed the current process of IGAs and the ability for other taxing entities to veto TIF projects under the bill.

03:07 PM

Andrea Amonick, City of Aurora, testified against the bill, explained that the bill removes incentives for local tax entities to negotiate with URAs, and talked about the importance of specific TIF projects to the City of Aurora.

03:10 PM

Chris Mendez, Colorado Counties Inc., testified in support of the bill and talked about the importance for all local entities that are affected by TIF projects to have the authority to collect a portion of TIF revenue. Mr. Mendez addressed questions from the committee members concerning the importance of IGAs between URAs and entities impacted by TIF projects. Mr. Mendez talked about the exemption of city and counties from the bill and constitutional growth restrictions on these entities.

03:16 PM

John Lefebvre, the Colorado County Treasurers' Association, testified in support of the bill, discussed the history of urban renewal law, and talked about specific abuses of urban renewal law in the state. Mr. Lefebvre addressed questions from committee members concerning the role of counties impacted by TIF projects and problems with commercial developments created with TIF that significantly impact property value before the bonds are repaid. Mr. Lefebvre explained that counties only benefit from TIF projects if they have implemented an individual county sales tax.

03:28 PM

Kathy Hartman, County Commissioner, Jefferson County, testified in support of the bill, talked about the large number of TIF projects in Jefferson County, and explained the process for URAs to notify counties of the impacts of TIF projects. Commissioner Hartman talked about the need for counties and other taxing entities to receive property tax revenue for large TIF projects that create new development. She addressed questions from committee members concerning IGAs and she discussed specific projects undertaken between Jefferson County and URAs.

03:37 PM

Evan Goulding, Executive Director, Colorado Special District Association, testified in support of the bill and discussed the importance for special districts to receive notices and impact statements concerning new TIF projects, which would be required by the bill. Mr. Goulding talked about the importance of fair agreements between URAs and local taxing entities. He addressed questions from the committee members concerning TIF projects and URAs in the state and the need to share a portion of TIF revenues with other taxing entities that are impacted.

03:48 PM

Paul Cooke, Director, Colorado Fire Chiefs Association, testified in support of the bill and talked about the abuse of TIF for new development on the urban fringe where emergency services are needed, but fire districts do not receive TIF revenue to provide services. Mr. Cook addressed questions from committee members.

03:53 PM

Frank Lancaster, representing Larimer Board of County Commissioners, testified in support of the bill and talked about the need to allow other taxing entities to receive tax revenue raised by TIF. Mr. Lancaster talked about specific projects in Larimer County that have abused TIF.

04:05 PM

Committee members received the written testimony of Carmen Rhodes, from Front Range Economic Strategy Center, who was unable to testify (Attachment D).

04:05 PM

Larry Hoyt, Boulder County, testified in support of the bill and discussed how current URA law does not require municipalities to share TIF revenues with counties that are negatively impacted. Mr. Hoyt talked about ways that TIF is abused and addressed questions from the committee.

04:09 PM

Ben Pearlman, County Commissioner, Boulder County, testified in support of the bill and talked about the problems of declining tax revenue for counties with a significant number of TIF projects. Commissioner Pearlman talked about the need to sustain healthy municipalities along with healthy counties and discussed the importance of dividing TIF revenues according to the provisions in the bill.

04:14 PM

Stephanie Thomas, Colorado Environmental Coalition, testified in support of the bill and talked about misuse of the state's urban renewal law and the need to include other taxing entities in TIF projects.

04:18 PM

Representative Hullinghorst distributed prepared amendment L.003 (Attachment E) and explained the amendment to the committee.

04:18 PM

Scott Olene, Department of Local Affairs, addressed the committee to respond to questions about amendment L.003.


BILL:	HB09-1327
TIME:	04:20:00 PM
MOVED:	Vigil
MOTION:	Moved amendment L.003 (Attachment E). The motion passed without objection.
SECONDED:	Middleton
		VOTE
	Acree
	Bradford
	Liston
	McKinley
	Middleton
	Schafer S.
	Tipton
	Vigil
	Waller
	Soper
	Peniston

Not Final YES: 0 NO: 0 EXC: 3 ABS: 0 FINAL ACTION: Pass Without Objection

04:21 PM

Representative Schafer distributed prepared amendment L.004 (Attachment F) and explained that the amendment was a strike-below amendment to create an interim committee to address TIF. Committee discussion ensued concerning the need to investigate the issue of TIF over the 2009 interim. Representative Schafer withdrew amendment L.004.

04:35 PM

Representative Liston moved amendment L.001 (Attachment G) and explained that the amendment would change the effective date of the bill and limit the bill to URA plans submitted after the effective date.

04:37 PM

Representative Hullinghorst commented on prepared amendment L.001.


BILL:	HB09-1327
TIME:	04:38:38 PM
MOVED:	Soper
MOTION:	Moved to sever L.001 after line 4. The motion passed on a 6-5 on a roll call vote.
SECONDED:	Middleton
		VOTE
	Acree	No
	Bradford	No
	Liston	No
	McKinley	Yes
	Middleton	Yes
	Schafer S.	Yes
	Tipton	No
	Vigil	Yes
	Waller	No
	Soper	Yes
	Peniston	Yes

Not Final YES: 6 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS


BILL:	HB09-1327
TIME:	04:39:43 PM
MOVED:	Soper
MOTION:	Moved 1st part of severed amendment L.001, page 1, lines 1 through 4. The motion passed without objection.
SECONDED:	Middleton
		VOTE
	Acree
	Bradford
	Liston
	McKinley
	Middleton
	Schafer S.
	Tipton
	Vigil
	Waller
	Soper
	Peniston

Not Final YES: 0 NO: 0 EXC: 3 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	HB09-1327
TIME:	04:39:56 PM
MOVED:	Liston
MOTION:	Moved 2nd part of severed amendment L.001, page 1, lines 5 through 15. The motion failed on a 5-6 roll call vote.
SECONDED:	Tipton
		VOTE
	Acree	Yes
	Bradford	Yes
	Liston	Yes
	McKinley	No
	Middleton	No
	Schafer S.	No
	Tipton	Yes
	Vigil	No
	Waller	Yes
	Soper	No
	Peniston	No

Not Final YES: 5 NO: 6 EXC: 0 ABS: 0 FINAL ACTION: FAIL

04:41 PM

Representative Liston introduced prepared amendment L.002 (Attachment H) and the explained the amendment. Representative Hullinghorst commented on amendment L.002.

04:45 PM

Bob Lackner, Office of Legislative Legal Services, addressed the committee to explain whether amendment L.002 was already addressed within the provisions of the bill. He explained that the provisions of L.002 were not addressed in the bill. Committee discussion ensued concerning amendment L.002 and URA projects that are new or substantially modified after the effective date.


BILL:	HB09-1327
TIME:	04:53:37 PM
MOVED:	Liston
MOTION:	Moved amendment L.002 (Attachment H). The motion failed on a 5-6 roll call vote.
SECONDED:	Waller
		VOTE
	Acree	Yes
	Bradford	Yes
	Liston	Yes
	McKinley	No
	Middleton	No
	Schafer S.	No
	Tipton	Yes
	Vigil	No
	Waller	Yes
	Soper	No
	Peniston	No

Not Final YES: 5 NO: 6 EXC: 0 ABS: 0 FINAL ACTION: FAIL

04:54 PM

Representative Hullinghorst made closing comments on the bill.


BILL:	HB09-1327
TIME:	04:56:26 PM
MOVED:	Middleton
MOTION:	Moved to refer House Bill 09-1327, as amended, to the Committee of the Whole. The motion passed 6-5.
SECONDED:	McKinley
		VOTE
	Acree	No
	Bradford	No
	Liston	No
	McKinley	Yes
	Middleton	Yes
	Schafer S.	Yes
	Tipton	No
	Vigil	Yes
	Waller	No
	Soper	Yes
	Peniston	Yes

Final YES: 6 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

04:58 PM

The committee adjourned.