Title
Gold Hill Mesa Commercial Project Urban Renewal Plan
(Legislative Matter)
Body
From:
Peter Wysocki, Planning and Development Director, Planning and Development Department
Summary:
Application File Number: CPC MP 04-00012-A1MJ15
This is a request by the Colorado Springs Urban Renewal Authority (CSURA) on behalf of Golden Cycle Investments to amend the existing Gold Hill Mesa Urban Renewal Plan (adopted by the City Council in May 2004) by bifurcating the commercial area from the residential area. Two separate Council actions are necessary:
1. Approve the Amended Gold Hill Mesa Urban Renewal Plan for the residential area. This URA plan will essentially remain unchanged, meaning there is no change to the taxing structure or the 25-year time clock, which will expire in 2029.
2. Approve the Gold Hill Mesa Commercial Area Urban Renewal Plan for the commercial area. This will essentially be a new URA plan with a new 25-year tax increment clock. A general sales tax sharing agreement between the City and CSURA will be reviewed at a later date.
Both actions are approved by adopting a resolution.
Previous Council Action:
The City Council approved the original Gold Hill Mesa Urban Renewal Plan in May 2004. Given that there has been no commercial development within this original urban renewal area, there is not a sales tax sharing agreement in place at this time.
Background:
Pursuant to Colorado Revised Statutes (C.R.S.), new urban renewal plans and substantial modifications to existing urban renewal plans must be adopted by the City Council. Prior to City Council consideration, urban renewal plans must also be reviewed by the City Planning Commission, which is to provide a recommendation to the City Council on whether or not the urban renewal plan is consistent with the City's Comprehensive Plan.
For a more detailed background and analysis, please see the attached Planning Commission staff report. For additional information regarding site and blight conditions, please see the attached conditions survey.
Currently, the commercial area is zoned Planned Business Center (PBC). The PBC zoning district allows a variety of neighborhood retail, commercial and office uses, and multi-family residential. The owner's intent is to develop the property as a mixed-use center compatible with the Gold Hill Mesa residential neighborhood, including approximately 75 attached dwelling units, and roughly 300,000 square feet of commercial. Given the location, staff and the owner anticipate that the commercial development will likely include a grocery store, in-line retail, services and dining.
Financial Implications:
URA TIF
Per C.R.S., the CSURA receives 100% of the property tax increment generated within the urban renewal areas. A portion of the City's 2% general sales tax is negotiated with the City via a separate municipal sales tax sharing agreement.
At the June 8, 2015, City Council Work Session, some Council members had questions regarding financial impacts the new urban renewal plan for the commercial area will have on the City. A draft financial impact memorandum has been prepared by the CSURA's consultant, Ricker/Cunningham, and is provided as Attachment 6. The analysis concludes the following after build-out:
Total Annual Expenses/Costs to the City: $439,374
Total Annual Revenues to the City: $1,717,215
Net Annual Gain or Loss: $1,277,841 gain
The assumptions used in the analysis include 75 attached residential dwelling units and 270,000 square feet of commercial retail space. The analysis does not make any presumptions as to the sales tax sharing. The sharing of the sales tax is part of the project pro-forma and will be determined based on the project costs, funding gaps and negotiations with the City. The final agreement will require approval by the City Council.
Metropolitan Districts
Also at the June 8th Council Works Session some questions were raised about the existing metro districts. Staff is not aware of any technical impediments or policy implications pertaining to these districts that would preclude or unreasonably complicate this proposed urban renewal area boundary change. Below is a brief summary of the approved and operative districts for the Gold Hill Mesa development.
The Gold Hill Mesa development is within three Metropolitan Districts - Districts 1, 2 and 3. The Districts were approved by the City Council and created in 2006. These Districts were created to reimburse the developer for eligible public improvement costs and also to provide certain ongoing operations and maintenance functions such as their recreation center, parks, trails, snow removal and entry features. The Districts area also authorized to perform activities related to the project's Voluntary Cleanup Plan (VCUP) associated with soil contamination prevalent on the site.
District 1 is a management district, District 2 is for the residential area, and District 3 is for the commercial area.
District No. 2 has a current property tax levy of 35.0 mills capped by the service plan at 30.0 mills for debt service and 10.0 mills for operations (total cap of 40.0 mills). In 2011, District No. 2 issued approximately $9.68 Million in debt in form of commercial bank loans, following City Council approval. Pledged revenues for this debt include the debt service mill levy from District No. 2 as well as certain capital fees and a share of the urban renewal property tax increment within District No. 2. Property tax sharing is stipulated in an agreement entered into between the Districts and CSURA, which sets the total maximum reimbursement of up to $18 Million for specified improvements.
District No. 3 has a current levy of 35.0 mills and is capped at 60.0 mills (50.0 for debt service and 10.0 for operations)
To date District No. 3 has been largely inactive because no commercial development has yet occurred in the project. This District has not issued any debt and is not liable for any of the debt issued by the residential district.
Board/Commission Recommendation:
The CSURA adopted both the new residential Gold Hill Mesa Urban Renewal Plan and the commercial area Urban Renewal Plan at its February 25, 2015 meeting, by resolutions recommending approval of the plans by the City Council.
At its May 21, 2015, the City Planning Commission held a public hearing and unanimously determined that both plans are consistent with the City's 2001 Comprehensive Plan and recommended approval of both plans to the City Council. There were no public comments either in favor or against the proposed plans.
Stakeholder Process:
Standard public hearing notification postcards were sent to property owners with the entire Gold Hill Mesa Urban Renewal Plan area. The postcards provided concise but detailed information. Staff received one phone call from a homeowner seeking additional explanation. No written comments were received.
Pursuant to C.R.S., notice of the City Council public hearing must be published in the newspaper at least 30 days prior to the hearing. In anticipation of the June 23, 2015, Council action, the notification was published in the Gazette on May 22nd.
A full City and external agency review of future projects will occur when land use applications are filed. At this point, no formal development applications within the commercial area have been submitted with the City.
Alternatives:
1. Approve the plans as recommended by the City Planning Commission and CSURA;
2. Defer the plans back to the CSURA for additional review and consideration;
3. Deny the plans.
Recommended Action
Proposed Motion:
City Planning Commission, Colorado Springs Urban Renewal Authority and City staff recommend that the City Council Approve Master Plan Amendment application CPC MP 04-00012-A1MJ15, amending the existing Gold Hill Mesa Urban Renewal Plan and Master Plan by:
1. Approving a resolution which adopts the Amended Gold Hill Mesa Urban Renewal Plan; and,
2. Approving a resolution which adopts the Gold Hill Mesa Commercial Urban Renewal Project Urban Renewal Plan.
Ordinance Language
Not applicable.