Urban Renewal 101 PresentationURBAN RENEWAL 101 (IN IDAHO):
AUTHORITY, OVERSIGHT, AND
IMPLEMENTATION
Presented by Ryan P. Armbruster and Meghan S. Conrad
Elam & Burke, PA
April 23, 2020
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URBAN RENEWAL AGENCY AUTHORITY
STATUTES ▪LIMITATIONS ▪POWERS ▪FINANCING
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Chobani Yogurt Plant
Twin Falls
Urban Renewal Agency Authority
•Local Economic Development Act, Title 50, Chapter 29, Idaho Code
•Idaho Urban Renewal Law of 1965, Title 50, Chapter 20, Idaho Code
•Idaho Constitution—Article VIII, §4, Art. XII, §4
•Separate and distinct legal entity with independent authority—Yick Kong v. BRA, (entirely
lay person board) Hart v. Rexburg URA (mix of lay persons and council members). These
two Idaho Supreme Court decisions also authorize urban renewal agencies to incur long
term debt without the necessity of a public vote (2/3 majority) as required of other public
entities; Article VIII, §3 of the Idaho Constitution.
•Models throughout the state vary widely; though after HB606 (2016), models should
become more uniform, mix of lay appointees and elected officials; but latter cannot
constitute a majority.
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Limitations On
Urban Renewal Agencies
•An urban renewal agency is constitutionally prohibited from funding real
property improvements to privately owned property (which includes non-
profit entities) and granting funds to private entities (again, including non-
profit entities).
•An urban renewal agency can fund real property improvements to real property
owned by another public entity (either local, state, or federal) and may grant funds
to another public entity.
•Urban renewal agencies may only expend public funds for the benefit of the
public. The agency should be very cautious in considering funding
improvements to private property or formally participating with private
entities as a partner, joint venture, etc. Funding could be ultimately deemed a
loan or grant or gift of public funds to the private property owner and thus a
violation of the Idaho Constitution. [Art. VIII, §4, Art. XII, §4, Idaho
Constitution]
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Limitations, Continued
Idaho does not permit its urban renewal
agencies to grant tax money to private
interests for development or to lend its
credit to back loans to private interests.
NOTE –The application of Art. VIII, §4 to
urban renewal agencies has never been
specifically interpreted by the Idaho
Supreme Court.
No county, city, town, township, board of
education, or school district, or other
subdivision, shall lend, or pledge the credit
or faith thereof directly or indirectly, in any
manner, to, or in aid of any individual,
association or corporation, for any amount
or for any purpose whatever, or become
responsible for any debt, contract or
liability of any individual, association or
corporation in or out of this state.
Idaho Constitution, Art. 8, §4 (emphasis
added).
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Limitations, Continued
•The Idaho Supreme Court has held the purpose
behind Art. VIII, §4 of the Idaho Constitution is to
prevent private enterprises from gaining any
competitive advantage at the expense of the
taxpayers.
•An urban renewal agency must demonstrate that TIF
funded improvements were primarily beneficial to the
public.
•If actions challenged as unconstitutional, the agency
could face a substantial risk of costly litigation and
potentially an award of costs and attorney fees.
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Limitations, continued
A second constitutional provision also
addresses limitations on a public
entity to provide a donation, raise
money, loan its credit, or aid any
company or associated:
Attorney General Opinion No. 95-07
regarding loaning state employees to
the United Way to assist in its annual
fundraising campaign
No county, town, city, or other municipal
corporation, by vote of its citizens or
otherwise, shall ever become a
stockholder in any joint stock company,
corporation or association whatever, or
raise money for, or make donation or
loan its credit to, or in aid of, any such
company or association: provided, . . . .
Idaho Constitution, Art. 12, §4.
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What Powers Do URA’s Have?
Consistent with the urban renewal plan, to:
•Construct/reconstruct streets, utilities, parks, recreation facilities, off-street parking and
public facilities, public buildings and other improvements.
•Acquire and dispose of property or buildings.
•Improve, renovate, clear and prepare for redevelopment properties or buildings.
•Acquire property to eliminate unsanitary or unsafe conditions, lessen density, eliminate
obsolete or other uses detrimental to public welfare.
•Invest and borrow money, issue bonds, and accept loans and grants.
•Work cooperatively with other public entities.
•Facilitate Local Improvement Districts (LIDs) and Business Improvement Districts (BIDs).
•Potential lease conduit financing in appropriate circumstances. Greater Boise Auditorium
District v. Frazier
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Authorized Activities
under the Law and
the Act
Urban Renewal Project as defined by the
Idaho Urban Renewal Law of 1965 (the
“Law”) and
Project or Urban Renewal Project as
defined by the Local Economic
Development Act (the “Act”)
The definition of “urban renewal project”
contained in the Law is nearly identical
to the definition contained in the Act
The definition of “project costs”
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The Act: Title 50, Chapter 29, Idaho Code
(13) "Project" or "urban renewal project" or
"competitively disadvantaged border areas"
may include undertakings and activities of a
municipality in an urban renewal area for the
elimination of deteriorated or deteriorating
areas and for the prevention of the
development or spread of slums and blight
and may involve slum clearance and
redevelopment in an urban renewal area, or
rehabilitation or conservation in an urban
renewal area, or any combination or part
thereof in accordance with an urban renewal
plan. Such undertakings and activities may
include:
See also –I.C. 50-2018(10)
(a)Acquisition of deteriorated area…
(b)Demolition and removal of buildings…
(c)Installation, construction, or
reconstruction of streets…
(d)Disposition of any property…
(e)Carrying out plans for…repair…
(f)Acquisition of real property … to be
rehabilitated
(g)Acquisition of other property …to
eliminate unsafe conditions, etc. …
(h)Lending or investing federal funds…
(i)Construction of foundations…
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The Law: Title 50, Chapter 29, Idaho Code
14) “Project costs” includes, but is not limited to:
•(a)Capital costs, including the actual costs of
the construction of public works or
improvements, facilities, buildings, structures,
and permanent fixtures; the demolition,
alteration, remodeling, repair or reconstruction
of existing buildings, structures, and permanent
fixtures; the acquisition of equipment; and the
clearing and grading of land;
•(b)Financing costs, including interest during
construction and capitalized debt service or
repair and replacement or other appropriate
reserves;
•(c)Real property assembly costs, meaning any
deficit incurred from the sale or lease by a
municipality of real or personal property within a
revenue allocation district;
•(d)Professional service costs, including those
costs incurred for architectural, planning,
engineering, and legal advice and services;
•(e)Direct administrative costs, including
reasonable charges for the time spent by city or
county employees in connection with the
implementation of a project plan;
•(f)Relocation costs;
•(g)Other costs incidental to any of the
foregoing costs.
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Project Financing Options
•Pay-as-you-go
•Developer reimbursement agreements
•Owner participation agreements
•Conventional bank loans
•Bonds
•Note: Often no tax increment available to fund projects on a pay-as-you-go
method until at least two years after plan creation. Many projects require
infrastructure immediately in order for a project to go –requiring financing of
improvements.
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Project Financing Options, Continued
•Agency decisions regarding project financing are: properly noticed on agendas,
decisions are made in open, public meetings, and by agency resolution.
•Before financing occurs, there must be a showing the project is economically
feasible and a determination that an agency is credit worthy.
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How Does Revenue Allocation Financing
Work?
(Local Economic Development Act)
•When a revenue allocation area is formed, property valuation is calculated on a
parcel-by-parcel basis. This is the base assessment roll of the revenue allocation
area.
•Base assessment roll for the geographic area under consideration (or collectively
if more than one district) cannot exceed 10% of the current assessed taxable
value for the entire city.
•Due to redevelopment, it is anticipated the property values will rise. If property
values increase above the base value, the added value is called the increment.
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Revenue Allocation Financing, Continued
•Budget for City, County, and other non-school taxing districts limited to previous year ’s
budget plus 3%, new construction and forgone. By virtue of amendments in 2007, value
of new construction within a revenue allocation area is not available to the overlapping
taxing districts to increase budget capacity for the duration of the project area.
•County Assessor sets property values.
•County determines tax rate needed to produce budget submitted by City, County, and
other taxing districts.
•Tax rates applied to full value of property outside revenue allocation areas; to the base
value of property inside revenue allocation areas.
•Taxes from the base value go to the taxing districts.
•Property tax revenue from the incremental value, if any, goes to the urban renewal
agency for a limited period of time (20 year max, except for “grandfathered” projects
primarily 24 years).
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Revenue Allocation Financing, Continued
•The increment or revenue allocation that goes to the urban renewal agency is used to pay
for improvements within the urban renewal area.
•An urban renewal agency does not determine property valuation or tax rates.
•Funds received by an urban renewal agency for a given revenue allocation area must be
spent in that revenue allocation area with limited exception.
•Funds are invested in activities that are intended to increase prosperity of the revenue
allocation area.
•Result is often an increase in property values which would not have otherwise occurred
but for redevelopment.
•For project areas established after 2008 and voter approvals after 2008, the urban
renewal agency will not receive taxes generated by voter approved levies, such as
general obligation bonds, school district plant facilities levies, and supplemental levies.
•Also, no school district emergency levy available to urban renewal agency.
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MDC Administers two Project Areas
•Downtown District
•Ten Mile District
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PUBLIC OVERSIGHT
OPEN MEETINGS ▪PUBLIC RECORDS ▪REPORTING REQUIREMENTS
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Chobani Yogurt Plant
Pioneer Pathway -Boise30thStreet District
Operating In The Public Eye
•Public Record Law –Idaho Code §§74 -101 to 74-126
•Open Meeting Law –Idaho Code §§74 -201 to 74-208
o Notice of Meetings –Agendas, Idaho Code §74 -204
o Executive Sessions –When Authorized, Idaho Code §74 -206
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Procurement Rules and Procedures
•Title 67, Chapter 28, Idaho Code
•Public Works Construction Bidding
•Threshold amounts for both formal and informal bidding processes
•Best interests of Agency from $0-$25,000 to $0-$50,000
•Informal bidding from $25,000-$100,000 to $50,000-$200,000
•Formal bidding from over $100,000 to over $200,000
•Public Procurement of Goods and Services Bidding
•Best interests of Agency from $0-$25,000 to $0-$50,000
•Informal bidding from $25,000-$50,000 to $50,000-$100,000
•Formal bidding from over $50,000 to over $100,000
•Idaho Code §67 -2320
•Professional Service Contracts with Design Professionals, Construction Managers, and Professional Land
Surveyors
•Idaho Code §54-4511
•Construction manager/general contractor
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Financial Reporting Requirements:
Audit, Annual Report, Budget and Other
•Audit and Annual Report
•Idaho Code §§50 -2006(c) and (d)
•Budget
•Idaho Code §§50 -2903(5) and 50-1002; see also 50-2006(d)
•Central registry and reporting portal (agency and financial information)
•Idaho Code §67 -450E
•State Tax Commission reporting portal (urban renewal plans)
•Idaho Code §50 -2913
•Amendment certification
•Idaho Code §50 -2903A (For plans adopted post-July 1, 2016)
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IMPLEMENTATION
BOARD ▪CREATION ▪PLAN ▪RECENT CHANGES ▪TAX COMMISSION
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Pioneer Corridor
Boise
Board Composition And Limitations
•The agency’s Board of Commissioners may have 3 to 9 members, who are
appointed by the Mayor and confirmed by the City Council or by County
Commission for County urban renewal agencies.
•Currently more than 40 Idaho cities have urban renewal agencies. Most of these
agencies have one or more City Council members on the Board of
Commissioners, but members of the local governing body shall constitute less
than a majority of the agency board members.
•Many of the agencies are staffed by city employees.
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Conflict Of Interest Laws
•Urban Renewal Law –Interested Public Officials, Commissioners or Employees,
Idaho Code §50 -2017
•Ethics in Government Act of 2015 –Chapter 4, Title 74
•Gifts/gratuities/events
•Prohibitions against Contracts with Officers –Chapter 5, Title 74
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Ethics in Government Act of 2015: Describes
the Public Trust and Fiduciary Obligation
POLICY AND PURPOSE.It is hereby declared
that the position of a public official at all
levels of government is a public trust and it is
in the public interest to:
1)Protect the integrity of government
throughout the state of Idaho while at the
same time facilitating recruitment and
retention of personnel needed within
government;
(2)Assure independence, impartiality and
honesty of public officials in governmental
functions;
(3)Inform citizens of the existence of
personal interests which may present a
conflict of interest between an official’s
public trust and private concerns;
(4)Prevent public office from being used for
personal gain contrary to the public interest;
(5)Prevent special interests from unduly
influencing governmental action; and
(6)Assure that governmental functions and
policies reflect, to the maximum extent
possible, the public interest.
I.C. §74 -402
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Ethics in Government: Defines Conflict of
Interest
•A serving board member has an
important fiduciary duty to that
entity.
•The Ethics in Government Act defines
a conflict of interest.
“Conflict of interest” means any
official action or any decision or
recommendation by a person acting
in a capacity as a public official, the
effect of which would be to the
private pecuniary benefit of the
person or a member of the person’s
household, or a business with which
the person or a member of the
person’s household is associated . . . .
I.C. §74 -403(4)
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Ethics in Government: Exception to
Conflict of Interest Provision
•Exceptions to the conflict of interest
provision:
•Where the actions of the public body
provide a benefit to a certain class of
people, and a public official happens to
be a member of that class.
•There is a de minimis value of goods
and services that a public official may
receive without violating any of these
provisions.
•A specific exception for non-
compensated public officials is set out
in I.C. §74 -405. This exception applies
only when the contract for services has
be subject to public bid and the
appointed official submitted the lowest
bid.
When a person is a public official by reason
of his appointment or election to a
governing board of a governmental entity
for which the person receives no salary or
fee as compensation for his service on said
board, he shall not be prohibited from
having an interest in any contract made or
entered into by the board of which he is a
member, if he strictly observes the
procedure set out in section 18-1361A,
Idaho Code.
I.C. §74 -405.
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Urban Renewal Law: Contains a Broader
Conflict of Interest Prohibition
•I.C. §50 -2017 prohibits board members
from having an interest in a contract or
real property connected to an urban
renewal project, whether or not the
urban renewal agency itself is a
contracting party or not.
•Provision has not been amended since
the Urban Renewal Law was enacted in
1965.
•Provision likely based on a model act
required by HUD to received federal
funding assistance.
•Provision was likely intended to prevent a
board member from investing in real
estate in an urban renewal area.
…voluntarily acquiring any personal
interest, direct or indirect, in any urban
renewal project, or in any property
included or planned to be included in any
urban renewal project in such municipality
or in any contract or proposed contract in
connection with such urban renewal
project. Where such acquisition is not
voluntary, the interest acquired shall be
immediately disclosed in writing to the
agency and such disclosure shall be
entered upon the minutes of the agency.
I.C. §50 -2017
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Urban Renewal Law: Exception to
Conflict of Interest Prohibition
There is an exception created for board
members that own property in the urban
renewal project area at the time the
member is appointed.
Provision is likely intended to address
those situations of appointing a board
member who may own property within
the urban renewal project area.
…If any such official, commissioner or
employee presently owns or controls, or
owned or controlled within the preceding
two (2) years, any interest, direct or
indirect, in any property which he knows is
included or planned to be included in an
urban renewal project, he shall
immediately disclose this fact in writing to
the agency, and such disclosure shall be
entered upon the minutes of the agency,
and any such official, commissioner or
employee shall not participate in any
action by the municipality (or board or
commission thereof), or urban renewal
agency affecting such property.
I.C. §50 -2017
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Conflict of Interest Under I.C. §18-1359:
Criminal Misdemeanor
Care must be taken that information
obtained in your position as Board
Member be disclosed or used which
would benefit you or a person in whose
welfare you have an interest (i.e. family
members).
Violation of I.C. §18-1359 is a criminal
misdemeanor.
“No public servant shall:
(a) Without the specific authorization of the
governmental entity for which he serves, use public funds
or property to obtain a pecuniary benefit for himself.
(b) Solicit, accept or receive a pecuniary benefit as
payment for services, advice, assistance or conduct
customarily exercised in the course of his official duties.
This prohibition shall not include trivial benefits not to
exceed a value of fifty dollars ($50.00) incidental to
personal, professional or business contacts and involving
no substantial risk of undermining official impartiality.
(c) Use or disclose confidential information gained in the
course of or by reason of his official position or activities
in any manner with the intent to obtain a pecuniary
benefit for himself or any other person or entity in whose
welfare he is interested or with the intent to harm the
governmental entity for which he serves
(d) Be interested in any contract made by him in his
official capacity, or by any body or board of which he is a
member, except as provided in section 18-1361, Idaho
Code.
I.C. §18-1359(1)(a) through (d)30
How Are Urban Renewal Areas Formed?
•Idaho Urban Renewal Law first adopted in 1965 states there exists in
municipalities deteriorating areas which justify the powers conferred by the Act
and use of public funds for that purpose.
•City Council (or County Commission) must make preliminary finding there are
one or more deteriorating areas within city (or county) (or competitively
disadvantaged border community) in order to activate an urban renewal agency.
•Mayor and City Council (or County Commission) appoint urban renewal agency
board members.
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Steps to Create a RAA
•Designate a study area for potential creation of an urban renewal district
•Determine whether conditions within the study area meet the criteria established
in State Law (Idaho Code §§50 -2903(8), 50-2018(8) and (9)) and make the requisite
findings in an eligibility report
•MDC typically retains independent, third party consultants to review area and
prepare study report. Supports credibility of findings.
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Definition of Deteriorated Area –I.C. §50 -2903(8)-see also, I.C. §§50-
2018(8) and (9)
"Deteriorated area" means:
(a) Any area, including a slum area, in which there is a predominance of buildings or improvements, whether residential or n onresidential, which by
reason of dilapidation, deterioration, age or obsolescence, inadequate provision for ventilation, light, air, sanitation, or open spaces, high density of
population and overcrowding, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such
factors, is conducive to ill health, transmission of disease, infant mortality, juvenile delinquency, or crime, and is detrim ental to the public health,
safety, morals or welfare.
(b) Any area which by reason of the presence of a substantial number of deteriorated or deteriorating structures, predominan ce of defective or
inadequate street layout, faulty lot layout in relation to size, adequacy, accessibility or usefulness, insanitary or unsafe conditions, deterioration of
site or other improvements, diversity of ownership, tax or special assessment delinquency exceeding the fair value of the land, defective or unusual
conditions of title, or the existence of conditions which endanger life or property by fire and other causes, or any combinat ion of such factors, results
in economic underdevelopment of the area, substantially impairs or arrests the sound growth of a municipality, retards the pr ovision of housing
accommodations or constitutes an economic or social liability and is a menace to the public health, safety, morals or welfare in its present condition
and use.
(c) Any area which is predominately open and which because of obsolete platting, diversity of ownership, deterioration of structures or
improvements, or otherwise, results in economic underdevelopment of the area or substantially impairs or arrests the sound growth of a
municipality. The provisions of section 50-2008(d), Idaho Code, shall apply to open areas.
(d) Any area which the local governing body certifies is in need of redevelopment or rehabilitation as a result of a flood, storm, earthquake, or other
natural disaster or catastrophe respecting which the governor of the state has certified the need for disaster assistance und er any federal law.
(e) Any area which by reason of its proximity to the border of an adjacent state is competitively disadvantaged in its ability to attract private
investment, business or commercial development which would promote the purposes of this chapter.
(f) "Deteriorated area" does not mean not developed beyond agricultural, or any agricultural operation as defined in section 22 –4502(1), Idaho Code,
or any forest land as defined in section 63-1701(4), Idaho Code, unless the owner of the agricultural operation or the forest landowner of the forest
land gives written consent to be included in the deteriorated area, except for an agricultural operation or forest land that has not been used for three
(3) consecutive years.
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Steps, Continued
•Agency Board concurs with the conclusions of the eligibility report and forwards
it to the City Council
•If the City Council adopts the findings in the eligibility report, then the City
Council directs the preparation of an urban renewal plan for the area; plan must
include certain information with specificity –see I.C. 50-2905
•Agency prepares and approves the plan and forwards it to the City Council
•City Council receives the plan and refers it to the Planning and Zoning
Commission for a determination that the plan is consistent with the City’s
Comprehensive Plan
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Steps, Continued
•City Council refers the plan to the affected taxing entities and provides at least 30-days’
notice of the public hearing
•Planning and Zoning Commission determines that the plan is consistent with the City’s
Comprehensive Plan.
•City Council holds public hearing; determines whether to adopt plan and form the
revenue allocation area.
•City Council adopts the plan, including a revenue allocation financing provision, by
ordinance
•Those cities/counties that did not already have an urban renewal agency established prior
to July 1, 2011, must seek voter approval to establish the agency
•Generally, the plan approval process takes about 6 months for a clearly defined project;
oftentimes can take 12+ months
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Additional Considerations
•Must demonstrate that the proposed area and plan of work is financially feasible
•MDC typically obtains an independent, third-party consultant to prepare the economic
feasibility study. Supports credibility of the findings.
•Must determine that the combined base assessment value of all existing urban
renewal districts and any proposed urban renewal districts does not exceed 10% of
the total city assessed value (taxable value comparison)
•Owners of “agricultural lands” and “forest lands” must provide written consent
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Deannexations
•Pursuant to Idaho Code §50 -2903A, deannexations to a RAA do not trigger a re-
set of the base assessment roll values.
•Deannexations are authorized by statute, but not much more guidance is
provided.
•The City Council cannot deannex parcels from a RAA without going through the
plan amendment process, which includes creation of a plan amendment, new
maps/legals, agency recommendation, 30 day notice of the public hearing,
transmittal of the plan and attachments to the taxing entities, city council public
hearing, and ordinance adoption.
•Revenue from the parcels to be deannexed, or the RAA, may be security for an
agency obligation requiring lender consent.
37
Deannexations, Continued
•County will have to provide information regarding the base and increment
values on a parcel by parcel basis
•In a deannexation there are two benefits: 1) full value of the property is available
to the taxing districts to be used in the budget-levy setting process; and 2)
increment value is placed on the new construction roll, which is used to calculate
a budget capacity increase (above 3% budget cap).
•In order to avoid significant levy swings, it is important for the deannexation
process to be completed (meaning ordinance published, recorded and
transmitted) no later than the 4th Monday of July, which means the process
must start early.
•Provide the STC with maps/legals as early in the process as possible to avoid
issues.
38
Urban Renewal Plan -Generally
•A revenue allocation area exists for 20 years (pre-2011 plans grandfathered for
longer term of 24 years)
•The urban renewal plan provides the Agency with a process and a basic framework
within which to consider and proceed with specific projects
•Due to the length of time a plan is in existence, the plan maintains some flexibility
to allow the Agency to respond to changing market and economic conditions.
•Amendments are limited by I.C. §50-2033 and 50-2903A
•Cannot amend plan to extend term beyond max term allowed by law
•Can amend plan one time to add geographic area –limited to 10% of existing RAA
•Permissible to amend plan to add new projects
•Plans adopted post-2016 cannot be amended without resetting the base value to current value; limited
exceptions
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Sample Analysis When Considering a New
Project
•Is the proposed project within the boundaries of an existing RAA?
•Is the proposed project permitted by the Urban Renewal Law or the Local Economic Development Act?
•Is the proposed project a municipal building or a multipurpose sports stadium complex?
•Is the proposed project consistent with the urban renewal plan?
•Is the plan a pre-or-post July 1, 2016, plan?
•Is a plan amendment possible or necessary?
•Is the proposed project within the jurisdictional boundaries of the city?
•Is the proposed project consistent with the City’s comp plan?
•Does the property at issue have an ag exemption, or has the property been used for ag purposes within the
last 3 years?
•Funding?
40
Property Acquisition
•Agency has the authority to acquire property; however, the definition of “urban
renewal plan” in the Law requires identification of property to be acquired by the
Agency. See, I.C. §50 -2018(12)
•The Agency may acquire property by negotiation or condemnation. See, Idaho
Code §50 -2010. The Agency has the authority to exercise the power of eminent
domain subject to the limitations set forth in Title 7, Chapter 7, Idaho Code,
specifically I.C. §7-701A.
41
Property Disposition
•Procedures for the disposition of property are set forth in Idaho Code §50 -2011.
Property cannot be given to a private person/entity/non -profit without going
through a competitive bidding process.
•Idaho Code §50 -2011(f): Property previously acquired or acquired by an agency for
rehabilitation and resale shall be offered for disposition within three (3) years after
completion of rehabilitation, or an annual report shall be published by the agency
in a newspaper of general circulation…listing any rehabilitated property held by
the agency in excess of such three (3) year period, stating the reasons such
property remains unsold and indicating plans for its disposition.
42
IMPACT OF RECENT
LEGISLATIVE CHANGES
2016-2020
43
Idaho Code §50 -2903A
Plans adopted post-July 1, 2016, are subject to base
reset upon modification except in limited circumstances.
The effect of a base reset is the loss of the increment value resulting in an immediate loss of
revenue to an urban renewal agency leading to default on existing obligations. This statute
will impact plans adopted post-July 1, 2016, and subsequent modifications to those plans.
44
Idaho Code §50 -2903A (continued)
A modification shall not be deemed to occur in the following limited circumstances:
(1)To make technical or ministerial plan amendments
(2)To make a plan amendment that increases the revenue allocation area boundary by up to 10%
(3)To de-annex parcels from a revenue allocation area. Provides statutory justification and process
(4)To make a plan amendment to support growth of an existing commercial or industrial project
in an existing revenue allocation area
This exception can only be used in limited circumstances and is subject to varying interpretations.
45
Effect of I.C. §50 -2903A -Summary
•Plans may be amended for any reason (subject to the statutory limitations set forth in
Idaho Code §§50 -2033 and 50-2904) without risk of a base re-set
•For plans adopted post July 1, 2016, there is no ability to amend the plan to support an
unanticipated economic development project without risk of a base reset.
•Required to comply with attestation
46
“With specificity” Idaho Code 50-2905
Idaho Code §50 -2905 was amended to address the contents of a plan
a.Requires that a revenue allocation area plan must state with specificity
details about the types of projects that are contemplated [no definition of
specificity].
b.Requires that any changes to an urban renewal plan be noticed and
completed in an open public meeting.
47
Plan specificity –what does that mean?
•Requiring “specificity” will limit an agency’s ability to respond to new
economic development opportunities.
•Additionally, as a plan is implemented, it is not uncommon for there to be
changes to the location of improvements. At what point does a change
deviate from the specificity requirement to require a plan amendment?
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Idaho Code §50 -2905A –Limitation on use of
TIF to fund construction of municipal
buildings and multipurpose sports stadium
complex
•Three-part test:
•After July 1, 2019, revenue allocation funds or revenue allocation funds aggregated with any other
“public funds” may not contribute to 51% or more of the total “project cost” (excludes federal funds and
federal funds administered by a public body); AND
•the project is for construction of a “municipal building,” or a “multipurpose sports stadium complex,” or
a remodel of either; AND
•the total project cost exceeds $1M
•Voter approval: if triggered, 60% of the participating qualified electors residing within the
borders of the qualified municipality; election subject to consolidated election laws
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Impact of I.C. §50 -2905A
•Definition of “public funds” includes funds collected or received by a “public body.” Excludes: grants or donations
from private entities or individuals to the public body, and federal funds or federal funds administered by a public
body
•Definition of “public body” refers to I.C. 50-2018(3), which means “the state or any municipality, township, board,
commission, authority, district, or any other subdivision or public body of the state.”
•Definition of “multipurpose sports stadium” is broad: indoor or outdoor venue for sports, concerts, or other
events with a field or other playing surface partly or completely surrounded by a tiered structure
•based on debate portable bleachers/stages, etc are not included in this definition
•likely captures amphitheaters in parks
•Definition of “municipal building” is limited: administrative building, city hall, library, courthouse, public safety or
law enforcement building, other judicial buildings, fire stations, jails and detention facilities
•not subject to property taxation
•are/intended to be owned or operated by or leased to a public body for the public’s
benefit
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I.C. §50 -2905A -Exception
•Exception to “project cost” –certain infrastructure improvements are not subject
to 51% limitation
•“any infrastructure or belowground improvements including, but not limited to, water,
sewer, storm drainage, electrical, natural gas, telecommunication, or other similar
systems and lines, streets, roads, curbs, gutters, sidewalks, walkways, parking facilities,
or unoccupied auxiliary structures.”
•presumably exception applies to hard costs, soft costs, admin costs and professional service
costs
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Idaho Code §50 -2913
State Tax Commission Repository
Idaho Code §50 -2913 established urban renewal reporting requirements and penalties for
non-compliance.
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HB587 (2020) –Highway District Levies
•For RAA first formed or expanded to include property on or after July 1, 2020, all
taxes levied by any highway district, unless the local governing body that
created the RAA has responsibility for the maintenance of roads or highways is
allocated to the highway district. Agency and highway district may enter into an
agreement for a different allocation. A copy of the agreement shall be
submitted to the state tax commission and to the county clerk no later than
September 1 of the year in which the agreement takes effect.
•IMPACT: Post-July 1, 2020, for new RAA, or amendment to an existing RAA to add
property, revenue from ACHD levies will flow to ACHD, not MDC, unless MDC and
ACHD enter into an agreement.
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ISSUES IDENTIFIED OVER THE YEARS
BY THE IDAHO LEGISLATURE AND URBAN RENEWAL CRITICS
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The Grove Plaza
Before “Makeover”
Issues
•Definition of blight/
deteriorating conditions
•The development of open
land/Greenfield
development
•Board composition/
qualifications /conflict of
interest/election
•Enforcement of the 10%
rule/compliance/punishment
if the limit is exceeded
•Perceived lack of
accountability/ transparency
to the general public
•Long term debt without
vote
•“Distinguish TIF use for
“blight” from economic
development/mixed use
projects
•Provide taxing entities with
meaningful input/
comment/consultation
•Rebates to taxing districts
•Property tax impact
•“Giveaways”
•Penalties for non-
compliance
•Limitations on types of
projects that can be funded
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URBAN RENEWAL
IN IDAHO
A Valuable Tool Worth Preserving
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