LOVELAND — Members of the Loveland Urban Renewal Authority board voted to ratify four intergovernmental agreements setting up a financing mechanism for the yet-to-be-approved Centerra South development.
In votes of either 9-3 or 10-2, the LURA board confirmed the agreements that had been negotiated with the Thompson School District, the Thompson Valley Health Services District, the Northern Colorado Water Conservancy District and the city of Loveland. LURA commissioners Jody Shadduck-McNally and Jackie Marsh voted against all four. Commissioner Steve Johnson cast a vote against the school district agreement, and commissioner Jon Mallo voted against the city of Loveland agreement.
The vote to create the urban-renewal area itself will fall to the Loveland City Council, a vote it plans to take on May 2. Discussions about the proposed Centerra South have been going on since late last year and have embroiled City Council meetings and meetings of other affected boards since that time. The council approved its piece of the financing agreement at its meeting last week, but sitting as the LURA, it needed to ratify the agreements negotiated with the other taxing entities.
LURA would have voted to ratify an agreement with Larimer County, but negotiations with the Board of Commissioners stalled when that board pulled back as it awaited clarification on whether ag land could be placed in a new URA. Legislation to clarify that is making its way through the Legislature. Shadduck-McNally, who is both a county commissioner and a LURA commissioner, has objected to the use of URAs to finance development. “The tool has been stretched beyond its intent,” she said.
But even if Larimer County concurrence does not occur, Brian Waldes, the chief financial officer for the city, said Centerra South could still move ahead without the county’s share of the financing. To do so, infrastructure would have to be scaled back and the city would have to pony up additional funding to make up the shortfall. The council will hear about those options May 2 if the county position remains fixed.
Waldes said that the proposal on the table with the county is for the county to share back 60% of the increased property-tax revenue that it would collect from incremental increases in property values in the development.
“The plan calls for that (money being available to the project) but we need to contemplate what happens if the county shares none,” Waldes said. He said the project “will still pencil” if public improvements — such as a railroad crossing on the south side of the property — are scaled back and if the city contributes more.
LURA heard many of the same arguments for and against during the course of the 3½-hour meeting.
Still, a few new arguments were raised, among them one that caught some by surprise.
In response to a question from Marsh to the attorney for McWhinney Development Services Inc. about whether McWhinney would commit in writing to forego oil and gas exploration at Centerra South, attorney Carolyn White said that she was authorized to say that “McWhinney would be pleased to negotiate” an agreement to permanently forgo development of oil and gas if the county returns to the table to negotiate its share of tax increment financing for Centerra South. McWhinney, which announced a year or more ago that it would establish a drill pad on or adjacent to Centerra South, pulled its drilling application when Centerra South became a subject of community discussion.
Described by one in the audience as “we won’t pollute your air if you push play” on Centerra South and by others as extortion, the offer was characterized by commissioner Steve Olson as “an olive branch, not a threat.”
In the end, most commissioners were consistent in their votes in favor or opposition to the financing agreements.
Former Larimer commissioner Johnson, who also served in the Legislature, approved of three agreements but objected to the school district finance agreement because of what it has the potential to do to other school districts in the state. Because the state would backfill the dollars that would be diverted from the Thompson District, he objected to the impact of the project elsewhere in the state. “I don’t want to use school finance money for economic development,” he said. He said while the development may generate more sales-tax revenue for the state — an amount projected by proponents to more than make up for the backfill — that only makes sense if the state is not having to refund money to taxpayers under TABOR, he said. While agreeing that Loveland would receive additional sales-tax money from the development, the state wouldn’t necessarily receive more because state residents only buy so much whether purchases are in Loveland or some other community.
Mallo voted against ratification of the city financing agreement, a vote consistent with how he voted when the City Council approved the agreement last week. He approved of the other three agreements.