Title
A Resolution of the City Council of Colorado Springs, Colorado Approving the Proposed 2025 Operating Plan and Budget for the Gold Hill North Business Improvement District
Presenter:
Allison Stocker AICP, Planner II, Planning Department
Kevin Walker, Interim Director, Planning Department
Body
Summary:
The Gold Hill North Business Improvement District (BID) is a legal entity separate from the City of Colorado Springs. However, as required by State statute, it is necessary for City Council to review and approve the proposed 2025 Operating Plan and Budget for the BID.
The Operating Plan and Budget for this District anticipates they will primarily be engaged in improvement planning and possibly infrastructure work in late 2024 or early 2025. The District will certify an operating Mill Levy of 10.00 mills for 2025 and has issued 2024 bonds supported by future mill levies, URA, TIF, a possible pledge from related metro district and PIF.
This BID has a specific prior not-to-exceed $22.7 Million Council debt authorization (Resolution No. 42-22 approved on April 12, 2022). In fall 2024, the District issued series 2024A bonds in the approximate principal amount of $18,110,000 at a 6.5% interest rate and Subordinate Series 2024B bonds in the amount of $2,996,000 at an anticipated interest rate of 8.75%;
Background:
The District was organized in 2021, a special election for the District, consisting of debt and related issues and questions was held on November 2, 2021. The District is governed by an elected board of directors. The boundaries of this BID encompass about 52.346 acres initially, however, the District recently gained approval for an inclusion and an exclusion for a net gain of 2 acres, bringing the new acreage of the District to approximately 54.346 acres. By State law, any future district inclusions or inclusions must be approved by City Council.
This Operating Plan and Budget allows for a mill levy cap of up to 50.000 mills for debt service and up to 10.000 Mills for general operations and administrative expense. However, in 2024 the District will only be certifying the operating mill levy of 10.394 mills for General services and is imposing a new mill levy of 51.971 for Debt Service. Additionally, this BID proposes to make use of public improvement fee (PIF) revenues as an additional source of revenue for bonding. The nature and amount of these PIFs is not specified at this time and is not budgeted at this time.
This Operating Plan and Budget is provided in a format consistent with the standard template approved by Council in August 2022 for these documents.
Previous Council Action:
City Council approved creation of this BID in 2021 (Ordinance No. 21-62).
An inclusion, an exclusion and an issuance of debt were presented to City Council in the September 23, 2024 work session. This issuance of debt was approved by City Council by resolution on October 8, 2024. Both the inclusion and exclusion will be heard by City Council on October 22, 2024.
This item was introduced in a City Council Work Session on October 7, 2024.
Financial Implications:
On April 12, 2022, Council authorized issuance of up to $22.7 Million in Series A and B bonds by this BID subject to certain requirements and stipulations. This debt has not yet been issued. That resolution (42-22) is considered to still be in force and effect.
The District has issued debt in the Form of 2024A and 2024B bonds for a total debt of $21,106,000. The combined maximum debt authorization for this BID and the Gold Hill North Metropolitan District Nos. 1 & 2 is $90,000,000.
The District may enter into agreements with other districts encompassing adjacent developments in order to cooperate on infrastructure projects. At the end of 2024, it is anticipated that the District will have an outstanding developer advance obligation in the amount of $218,445.71 in principal and $34,045.14 in interest. For developer agreements entered prior to January 1, 2023, interest accrues at a rate of 7% for operating advances and 8% for capital expenses.
The proposed mill levy for the BID in 2025 is 10.394 mills for general operations and administrative expense, which is unchanged from 2023. However, the District anticipates imposing a 51.971 mill levy for Debt Service, which previously was not apart of the annual budget. As a separate legal entity, the financial activities of the BID are separate from those of the City. Its financial obligations are specific to the properties included in the BID and do not constitute an obligation of the City.
City Council Appointed Board/Commission/Committee Recommendation:
N/A
Stakeholder Process:
N/A
Alternatives:
N/A
Recommended Action
Proposed Motion:
Move to approve the Resolution approving the proposed 2025 Operating Plan and Budget for the Gold Hill North Business Improvement District
Summary of Ordinance Language
N/A