Title
A Resolution of the City Council of Colorado Springs, Colorado Approving the Proposed 2026 Operating Plan and Budget for the Interquest North Business Improvement District.
Related Files: N/A
Council District #2
Presenter:
Allison Stocker, Senior Planner, City Planning Department
Kevin Walker, Planning Director, City Planning Department
Body
Summary:
The Interquest 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 2026 Operating Plan and Budget for the BID.
The District will increase its mill levy from 1.043 mills to 1.041 mills for operations and will alter the debt service mill levy from 12.00 to 5 mills. The Operating Plan and Budget for this BID anticipates continuing development and public improvement activity within this BID, some of which includes routine maintenance of damaged infrastructure. There are no anticipated changes to the boundaries, board composition, permitted improvements, or new debt to this District in the upcoming reporting year.
Background:
The BID boundaries were established pursuant to an election in 2004, with an additional property inclusion approved by City Council in 2007. The properties encompass approximately 112 acres located northeast of the intersection of Interstate 25 and Interquest Parkway. The District’s elected board is comprised of individuals associated with Nor’wood Development Group. The District anticipates continued public improvement construction and the provision of operations and maintenance services in 2026, including, but not limited to, parking and street maintenance and operations, including snow removal, landscaping, stormwater, marketing, common area maintenance, and security services as needed.
In 2025 the District received approval from Council (Ord. 25-40) to include five acres of property into the District. This property is being developed for commercial/retail and will need utility and improvements to be constructed by the District. The inclusion property is generally located in the southwest corner of the District. The BID’s Operating Plan and Budget project adequate revenues to service the BID’s obligations and maintain positive fund balances. This newly added parcel is just one of many large retail stores that occupy the District.
This BID is somewhat unique in that it owns and operates a large parking lot, along with owning and maintaining stormwater facilities. Most BIDs own and maintain improvements (e.g. parking lots of landscaping) through the use of easements. This budget includes expenditures for maintaining District-owned and other common areas and properties.
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 formation of this BID in 2004 (Ordinance No. 04-237), along with its 2010 and 2016 bond issuances (Resolution No. 185-10 and Resolution 54-16) and has approved the BID’s Budget and Operating Plan annually since its formation. City Council approved a property inclusion in 2007 and an exclusion of property in 2016. An additional 13.151 acres of property were excluded by Council Ordinance No. 17-27 on March 14, 2017. In October 2018 City Council approved an increase to the District’s authorized indebtedness from $13 million to $25 million. In February 2019 Council approved a resolution approving the credit public improvement fee (PIF) agreement between the City, Scheels All Sports, Inc., and the BID. The PIF agreement (Resolution No. 32-19) will allow Scheels to collect a PIF of 1%, which is offset by a temporary 1% reduction of the 2% general municipal sales tax for a period of 25 years, this will result in total fees and taxes equal to what customers would have paid in absence of the PIF. In May 2019 a petition was presented to Council to exclude certain properties from the BID, this request was subsequently withdrawn in June 2019. In August 2020 City Council approved issuance of $13,735,000 in privately placed Limited General Obligation Bonds (Resolution No. 68-20).
As stated above, in 2025 City Council approved an Ordinance (Ord. 25-40) allowing the inclusion of approximately five (5) acres of land in the southwest corner of the District.
This item was introduced in a City Council Work Session on October 13, 2025.
Financial Implications:
The District issued $6,500,000 in Limited Tax General Obligation Bonds, Series 2010 for public improvements, with an interest rate of 8.5%, and subject to redemption at the District’s option. In 2016, this BID issued an additional $4,765,000 in Limited Tax General Obligation Bonds with an interest rate of 6.5%. In 2020 the District issued $13,735,000 in Limited Tax General Obligations Drawdown Bonds with an interest rate of 7.0%. The 2020 bonds are subject to mandatory redemption starting on December 1, 2024 and are subject to optional redemption beginning January 1, 2027. The initial draw in 2020 was $1,535,000, a second draw in 2021 was $6,340,000, and a third draw of $5,742,000 was done in 2023. As described in the 2026 Operating Plan, the District will annually review the interest rates on its bonds regarding market interest rate and evaluate possibilities to refund such bonds to the extent allowed, pursuant to the bond documents.
The proposed total mill levy for the BID in 2026 is 6.041 mills (1.041 mills for operating expenses and 5.000 mills for debt service) which represents a major decrease from 2025. Compared to 2025, the operations and maintenance mill levy will be decreased by only 0.002 mills, but the debt mill levy is being reduced by 7 mills. The intention behind the lower debt service mill levy is that the District anticipates a higher Public Improvement Fee (PIF) revenue in the coming years and there will be a better alternate revenue source over the current debt service mill levy. With the projected PIF increase, the District is hopeful that its bonds may be able to be paid off sooner than previously anticipated. The District anticipates receiving $2,875,000 in Public Improvement Fees (PIF) during 2026, which is just over $100,000 dollars more than in 2025. The amount of this PIF is 1.25% on all retail purchases.
The 2026 budget includes $3,400,000 in developer advances to fund capital projects. The developer advance balance is budgeted to be paid off in 2025. As of now, the District holds approximately 23 million in debt. Since the District is capped at 25 million in maximum debt, the District is not anticipating any debt issuances in 2026.
As a separate legal entity, the financial activities of the BID are separate from those of the City, and its indebtedness is an obligation of the property in the BID and not the City.
City Council Appointed Board/Commission/Committee Recommendation:
The BID Board of Directors recommends City Council’s approval of the 2026 Operating Plan and Budget.
Stakeholder Process:
N/A
Alternatives:
N/A
Recommended Action
Proposed Motion:
Approve the Resolution approving the proposed 2026 Operating Plan and Budget for the Interquest North Business Improvement District.
Summary of Ordinance Language
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