Urban Renewal Run Amuck 1


Boise City’s Urban Renewal Agency, Capital City Development Corporation, has been involved in both the failed Ada County Courthouse financing scheme as well as the failed $136 million University Place fiasco.

Idaho Code allows cities and counties to form Urban Renewal Agencies. One or more urban renewal districts are then created. While revitalizing blighted areas sounds good on the surface, let’s take a look at the hidden cost to taxpayers.

Urban Renewal Agencies (URA’s) obtain revenue through two means: they sell bonds, incurring long-term indebtedness without taxpayer approval, and they collect property tax dollars.

According to the Idaho Constitution, Article VIII, Section 3, “No county, city, board of education, or school district, or other subdivision of the state, shall incur any indebtedness, or liability, in any manner, or for any purpose, exceeding in that year, the income and revenue provided for it for such year, without the assent of two[-]thirds (2/3) of the qualified electors thereof voting at an election to be held for that purpose….”

The Idaho Supreme Court is now involved in determining whether URA’s have been violating the Constitution. The underlying issue in Ken Hart v. City of Rexburg, an Idaho Supreme Court case to be heard in November, is whether URA’s are city agencies. URA’s and the cities claim these creations of the cities are not part of the cities and are, therefore, exempt from Article VIII, Section 3.

Keep in mind, a city council creates the URA, they appoint the board members, can act as the board, and have the power to dissolve the URA with a simple vote of council members. It is my belief that URA’s are indeed part of the city and should therefore be subject to the Constitutional requirement of 2/3 voter approval prior to the sale of bonds.

Property taxes on all improvements and appreciation within an urban renewal district go to the URA, rather than to the city, county, ambulance district, highway district, etc.

Here are the problems with this whole “free money” scenario: new buildings require services such as roads, fire and police protection, paramedics, etc., yet the property tax dollars collected on the assessed value of those facilities are going to the Urban Renewal Agency rather than to the agencies that are providing the necessary services.

Skimming these property tax dollars off the top for the URA leaves the tax burden to the widow on a fixed income, and the single parent trying to make ends meet, to provide services for the developed property within the urban renewal district. Property owners outside the district are negatively impacted, even though they receive no benefits from the urban renewal district.

In addition, business owners within the urban renewal districts receive an unfair competitive advantage. They do not have to provide their own parking, landscaping, etc., because all of these perks are provided by the URA’s.

It’s high time for the Idaho Legislature to revisit urban renewal law in order to reign in these rogue agencies.


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One thought on “Urban Renewal Run Amuck

  • boiseriverparkguy

    Regarding the Jan 18th Statesman article about URDs.

    Sharon Ullman makes a good argument that Urban Renewal Districts (URDs) are sidestepping the long-term-financing-needs-to-go-to-the-onerous-2/3rds-majority-vote issue, phew. And there's an equally good argument CCDC has exceeded its original mandate with at least one of the current 3 downtown URDs. But I hope Sharon is not advocating throwing the baby out with the bath water.

    Quoting Sharon from comment at the 1-18 Statesman article; "… dispatch, police, fire, ambulance, roads, etc. – are subsidized by taxpayers. URA’s mean higher taxes for all property owners in the city and county but we taxpayers have no say over what they do..

    First, there's no proof that taxes would be lowered by ending URDs. Please provide some numbers rather than appeal to anti-tax emotion opinion.

    I will take your word that more 911 calls, per capita, happen downtown. But what does that even mean? Very few live in the downtown area, but downtown is frequently crowded due not only to the influx of workers but the influx of people for special events; parades, hockey games, awesome parks, the river etc. Where else do we hold these events?

    Next, let's look at ACHD. Since you didn't go to the trouble to back up your assertions with sources, I won't either. But I am willing to bet most of ACHD's expenditures since ACHD's inception in 72 or so, have been suburban.

    Downtown's infrastructure was/is already in place and needs only maintenance. Suburban growth has required brand new roads and bridges be built from scratch and right of way be purchased. And many other roads needed to be widened which also requires RoW purchase. I'm no ACHD accountant, but this has to be far far more expensive than maintenance of downtown streets. Why should those who live in the north, east and west ends of downtown have to pay for all the suburban expansion?

    Here's a real head scratcher.

    I'm sure you're aware a new URD is proposed for the west end of downtown. I know you advocate free markets and that the free market should play the central role in rebuilding west downtown. That would be great, but we don't have free markets and we don't have level playing fields.

    One: The Broadway-Chinden connector completed in 92 changed the traffic pattern forever in west downtown. Where there was once traffic to support car dealerships etc, there is now too little traffic. The gov't built the connector but I contend they didn't finish the job by omitting a plan to help mitigate the loss of traffic, which ironically was the goal of the connector.

    Two. Take last Saturday's fire at the warehouse beside Main Auction at 29th and Main. The owner may not be able to rebuild due to restrictions which didn't exist when that building was first built. To develop a property nowadays in that area, Boise City Code requires more parking. Codes also require parking to have storm water retention basins. Basins require land. The lots in west downtown are cut up and tiny. They got that way years ago before all these new legal requirements. The free market is of little help when faced with these restrictions and it's a problem which the suburbs don't face because large chunks of land are abundant.

    Furthermore, downtown core developments are NOT required to provide parking, and therefore no added expense of storm water catch basins and parking lots. A URD is needed for west downtown to try to buy up the small properties, reassemble them into something big enough to warrant mid-rise scale development, which was the recommendation from the urban planners involved with the 30th Street Master plan.

    Otherwise we're just going to be stuck with a ghetto. Though most Boiseans object to any and all taxes, I think many Boiseans also object to ghetto-fication. We're can do better than that. And really, what are we talking about? A $100 a year or so? Probably much less. There are other bigger siphons to go after.