Craig Urban Renewal Authority nears activation to help redevelop blighted areas
Nearly 130 acres of Craig are on their way to a classification that will make them easier to redevelop and improve.
The Craig Urban Renewal Authority is close to finalizing the first of two areas, mostly in the city but also some on the south side, that will offer property owners within their boundaries the opportunity to apply for financial help with capital improvements on the property.
“Urban renewal authorities are formed to help alleviate blight within certain areas,” said Craig’s economic development manager Shannon Scott, who is heading up the project’s administrative development. “That doesn’t necessarily mean the buildings are dilapidated or in bad shape; it can also mean there’s a need for infrastructure improvement, things like that.”
Essentially, by capitalizing on the anticipated increase in property tax revenue generated by an improved property relative to the unimproved existing property, the urban renewal authority can to issue bonds or other financial assistance to property owners interested in making those improvements.
This is called tax increment financing. It’s utilized from Steamboat Springs to Colorado Springs, as well as thousands of locations across the country.
“The properties or businesses within the zone, if they’re looking to do improvements, revitalization, redevelopment, whatever, they can apply through the urban renewal authority to see if they’re eligible,” Scott said.
The urban renewal authority has a number of options it can offer such a property owner. The money comes from that expected increase in property taxes after the improved property gets reassessed.
For example, if someone bought an empty building on Yampa Avenue, part of which is within one of the urban renewal areas being proposed, and that property owner redeveloped the old building into something more valuable to the space, that building’s property assessment would rise — say from $100,000 to $500,000 — and its property tax contribution with it. The urban renewal authority, expecting that $400,000 increase in tax revenue should the building be redeveloped, can issue varying degrees of financing to the property owner to help the redevelopment take place.
Where can this happen, and what needs to happen first?
There are two areas being proposed, named, simply, Urban Renewal Area No. 1 and Urban Renewal Area No. 2.
URA 1 is on the west side of town, encompassing the mall and stretching south along Mack Lane and Steele Street to Third Street, leaving out an island for the former Kmart building and its parking lot that won’t be part of the area. It covers 53 acres.
URA 2 includes a horizontal strip south of the center of town, from Ranney Street along First Street and angling up First Street to Stock Drive, then back along Stock Drive into town, and covering two little fingers of Craig that include downtown along Yampa Avenue and the area south of the swimming complex. It covers 74 acres.
“It’s really still in the formation stages, a lot of things need to be approved,” Scott said.
Five taxing entities levy property taxes on the two areas — the fire district, school district, city, county and community college district — and all have to agree to their potential tax dollars being apportioned this way. So far, that’s going well, Scott said, but there are a few remaining hurdles to clear.
“In June, we were able to get them all to agree to sharing their percentage,” she said. “Now we have those intergovernmental agreements approved, and the plans have to be approved by city planning, county planning, board of county commissioners, to make sure they’re all in line with the comprehensive plans.”
That’s a lot of hoops to jump through, but Scott said it’s one of the primary tasks she was given when she was brought on to the city staff.
Who controls the money?
The Craig Urban Renewal Authority is managed by a large board of directors, which includes all of Craig City Council, as well as representatives from each of the other four taxing districts.
“The board has the liberty to choose how to finance or whether to finance a project,” Scott said. “CURA can issue bonds as we generate revenue that will be paid back through the revenue generation; we can also offer sums that can be used as collateral, where an applicant could say they’ve got $200,000 agreed to come from CURA over the next 5 to 10 years, and that helps them get a loan,” Scott said. “And we’re talking about frontloading the fund where if we can find grant money to just put in there and be able to start getting projects going right away, but that’s iffy at this point.”
The two areas are in varying stages of proximity to being ready to accept applications. URA 1 is expected to meet City Council approval July 13, which, after the formality of notifying property owners in the area, will essentially activate that area. URA 2 needs a little longer, as property owners in the unincorporated parts of Moffat County included in the area decide on if they want their properties included or not.
Scott expects that last step to be completed in September.
“The goal is to provide areas that really need some remediation and revitalization with incentives for business and property owners to want to develop in those areas,” she said. “That’s the bottom line of it all. It’s a great program and it can do really good work here.”
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