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Harris Ranch residents argue for stay on issuance of bonds to Harris Ranch developer in court as lawsuit continues

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A group of Harris Ranch residents is hoping to pause the issuance of bonds, payment to the neighborhood’s developer and the collection of a special form of property tax until their lawsuit concludes. 

Starting last summer, a group of Harris Ranch residents formed the Harris Ranch CID Taxpayers’ Association and began writing letters to the Harris Ranch Community Infrastructure District board alleging payments made to the neighborhood’s developers the Harris Family Partnership and Barber Valley Development were illegal. By the end of 2021, the group filed a petition for judicial review against the CID board asking the court to stop a $7.1 million payment to the developers and the issuance of $5.2 million of new bonds to cover the costs of reimbursing the developers for the cost of improvements in the neighborhood. 

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The Harris Ranch CID was established by the City of Boise in 2010 and covers a portion of the Harris Ranch neighborhood in Southeast Boise’s Barber Valley. The special taxing district charges an extra levy on a property owner’s tax bill – which goes to infrastructure improvements. It is administered by a board consisting of three members of Boise City Council – currently Patrick Bageant, Elaine Clegg, and Holli Woodings.

The case has been working its way through Ada County’s Fourth District court for the past several months with briefs flying back and forth between the Harris Ranch CID Taxpayers’ Association, LeNir Ltd and the Harris Family Partnership. On Tuesday, Judge Nancy Baskin heard a round of oral arguments in the case as both sides try to settle procedural matters before arguing the big questions in the legal fight later this year. 

This is the first time any CID in Idaho has been legally litigated since the law was changed allowing the special taxing districts in 2008, meaning there is no existing case law on this specific issue for the attorneys or judge to draw upon. The results of this case will set a precedent for future cases on CIDs down the road. 

To stay or not to stay? That is the question

One of the biggest questions at issue this week was the Harris Ranch CID’s request for the court to stay the district’s payments to LeNir, issuance of bonds and the collection of the additional property taxes levied by the district to pay for these reimbursements to the developer. Nicholas Warden, the attorney for the neighbors, argued allowing these payments to move ahead while the court hadn’t made a final decision would be harmful to the neighbors. 

Warden said pausing the payments to the developer wouldn’t hurt their business due to the years of low-interest rates they have been able to take advantage of and the fast pace of development in the neighborhood fueling their business. 

Courtesy Harris Family LP

“The stay is necessary to prevent irreparable harm,” he told the judge. “The imposition of millions of dollars of taxes when that decision may be unlawful would result in irreparable harm to the homeowners.”

The developers don’t see it that way. Melodie McQuade, an attorney with Givens Pursley representing the Harris Ranch CID, said pausing these payments will hurt the developer, as well as the neighbors themselves.

“It’s the residents overall who will be harmed if there is a delay order in issuing bonds,” McQuade said in her argument. “As interest rates continue to climb more and more of the money available on the bond will be spent on interest instead of infrastructure projects. The whole purpose of the district is to fund infrastructure projects, not pay for interest.”

What should be in the record?

The bulk of the hearing was spent debating what documents should be included in the record down the road. 

The purpose of this suit is for Warden and the Taxpayers’ Association to challenge the legality of bond resolutions and approvals to reimburse LeNir back in October. And under the statute right now, Warden is only allowed to refer to documents that were related to those specific items in October. Part of his request was for Baskin to allow him to expand the record to enable him to access and use arguments based on documents going back to 2010 when the CID formed. 

“(The CID board’s) authority to do what they did on October 5 2021 had nothing to do with what happened on October 5 2021,” Warden said. “The authority to which they took those actions is driven from events that came before. The court is incapable of inquiring to the authority to do what the district did on October 5 unless it is permitted to review documents that occurred prior to October 5 2021.”

Baskin had several pointed questions for Warden on this matter. She opened the hearing by pointing out that the section of Idaho code governing CIDs doesn’t have any section allowing for an expansion of the legal record, leaving her wondering what the legal standing for doing so would be. 

She pointed out that if the Taxpayers’ Association wanted this information in the record, they should have filed a public records request for it and submitted it along with their letters and other items opposing the bond issuance and payments to LeNir in the first place. 

“The development agreement, the (CID) election, all of those events are not part of this judicial appeal,” she said. “It’s not. I understand how you can argue that this statute is constitutional or unconstitutional but I am not revisiting the election or the development agreement. I’m not. You’ve only appealed the resolution and the bond.”

Correction: An earlier version of this story misidentified which entity the Harris Ranch Community Infrastructure District makes reimbursement payments to. It has been corrected to reflect that reimbursement payments are made to the Harris Family Limited Partnership. An earlier version of this story also incorrectly described who was a party to the suit. It has been corrected to reflect that only the CID Board was subject to the request for judicial review.

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Margaret Carmel - BoiseDev Sr. Reporter
Margaret Carmel - BoiseDev Sr. Reporter
Margaret Carmel is a BoiseDev reporter focused on the City of Boise, housing, homelessness and growth. Contact her at [email protected] or by phone at (757)705-8066.

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