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City of Boise still might end downtown urban renewal area, shift funds to city coffers

BoiseDev Exclusive

A story BoiseDev members got first.

The City of Boise might wind down one of its five urban renewal districts early, potentially shifting millions of tax dollars from urban renewal to the city’s general funds.

BoiseDev first reported on the possibility in March. At the time, the city said the move was in response to Senate Bill 1108, which died in the legislature this year.

But an April public records request indicated the idea didn’t go away when the legislation did. In fact, the city and urban renewal agency continue to look at shutting down the River-Myrtle Old Boise urban renewal district before its 2025 scheduled termination date.

River Myrtle Old Boise district boundaries. Via CCDC

The so-called “RMOB” district is a sprawling area of Downtown Boise, covering more than 60 blocks. According to a CCDC estimate provided to BoiseDev, it represents more than 60% of the planned capital improvement budget over the next five years.

The CCDC 2021 budget forecasts a total of $11.7 million in tax increment collections from the area, or 60.56% of revenues from TIF.

‘Legislature likely to try again’

On March 22nd, City of Boise Clerk Lynda Lowry wrote mayor’s chief of staff Courtney Washburn saying the city should continue to study the idea of ending the River-Myrtle area early, even after SB1108 failed to pass muster at the Statehouse.

“My thinking is that because it failed, now is actually the time to early retire if we are going to (and try to capture 100% of the resulting property taxes),” Lowry wrote. “The legislature is likely to try again next year, and we would be again at risk of capturing something less than 100% of the (tax increment financing) or none as has been proposed in previous bills.”

“We should discuss it further,” Washburn replied. “We have a meeting coming up with that group soon.”

The group included representatives from both the City of Boise and CCDC. From the city, attorney Jayme Sullivan, council president Elaine Clegg, Lowry, and Washburn participated. From CCDC, board members Dana Zukerman and Gordon Jones, outside attorney Ryan Armbruster and several staff members, including executive director John Brunelle took part. Boise Mayor Lauren McLean, who also sits on the CCDC board, was also part of the group.

City of Boise spokesperson Seth Ogilvie said the meeting – held on April 19th, was to look at logistics of how winding down the urban renewal area early might work.

“The city is taking all the correct steps to protect Boise’s ability to manage growth and be fiscally responsible with residents’ money,” Ogilvie told BoiseDev. “Legislation being discussed by the legislature and in the interim property tax committees could significantly impact cities. Boise is not taking any of these decisions lightly and believes it would be irresponsible not to ask questions and pursue opportunities that may benefit Boise residents.”

After SB1108 died, the legislature later passed a different piece of legislation aimed at property tax relief – house bill 389. It includes a provision that could mean the city could only add 80% of the tax increment gained from an urban renewal district back to the tax roll, instead of 100% as before. According to experts we talked to, the provision is limited to districts established after 12/31/2006 – the language in the new law would not impact the RMOB area.

The city says it is still considering how the new legislation’s other provisions might impact the decision but “continues to study” the idea.

Fiscal impact of a decision

If the city decided to end RMOB early, it would potentially curtail significant spending. CCDC planned to spend $48 million from fiscal year 2022 through FY 2025. Plans include $1.6 million for 11th Street streetscapes, $4 million for “mobility infrastructure,” and large-scale improvements to Grove St. we’ve previously detailed. It could also impact a project to break up a “superblock” near CW Moore park.

It would also mean the City of Boise could collect most if not all of the $48 million itself, and allocate the funds to a variety of city services.

While a wind-down would disrupt the urban renewal agency’s plan to build out projects in the RMOB area, a spokesperson says it would not impact staffing levels.

“Staffing is 4% of our overall budget,” CCDC’s Jordyn Neerdaels said. “It’s a small part of overhead.”

She said other urban renewal areas, including Westside and Gateway East continue to grow in tax collections. She also said the agency planned to add three new project management positions that it is currently holding off on.

To wind down the district, a majority vote of the Boise City Council and Capital City Development Corp.’s board of commissioners would be required.

Don Day - BoiseDev editor
Don is the founder and publisher of BoiseDev. He is a National Edward R. Murrow Award winner and a Stanford University John S. Knight Fellow. Contact him at [email protected].

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