Renewing urban renewal

By Seth Ogilvie, Idaho Reports

The Idaho tax commission recognizes 86 urban renewal districts in Idaho. House bill 217 will significantly change how they operate.

Boise_Library

The bill has been characterized by many as an attack on the Boise library and stadium projects, but the other 86 districts will have to follow the same rules.

The significant change coming to urban renewal in Idaho is how much money is required to force a vote. A vote, after Governor Brad Little signed the bill, would now be necessary if 51% of the money used on a project was urban renewal money or “any other public funds, not including federal funds or federal funds administered by a public body.” The project would also have to exceed one million dollars.

The election would work much like a school bond election, but unlike a school bond election that requires 2/3rds of the voters to pass, these elections would require only 60% of people to approve the project.

Proponents of the bill argue this will create more civic engagement and accountability within the system. They say people who live within the urban renewal district would have greater control over how their tax dollars are spent.

Senator Maryanne Jordan thinks the bill will have unintended consequences because the law does not distinguish between urban renewal money and other public funds.

Sen. Jordan laid out this example; “a city saves $2,000,000 to remodel their City Hall. The urban renewal district contributes $30,000 to a public plaza outside the building. A plaza is not an exception under the statute, so the whole project is forced to a vote.”

The project would then have to be delayed until the next scheduled election, or a special election would have to be called. “The special election will cost more than the urban renewal contribution,” said Sen. Jordan, “for what amounts to 1.5% of the project.”

The election could also have an unintended impact on contractor availability and costs. Developing construction bids for city projects that are still uncertain may be unappealing to contractors, driving up prices or leaving cities without options for building their projects.

Over the next few months, local government officials across the state will likely meet with lawyers and experts to find out if any of these unintended consequences will come to their town.

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