A small upcoming election could bring nearly $1 billion in taxes in a future Treasure Valley neighborhood.
The Spring Valley Community Infrastructure District north of Eagle will go to voters in May and ask for an increase in bond authority. The election would consider taking out up to $600 million in debt, with an additional $311.5 million in interest — for a total of $911,560,484, to be paid back over 30 years. Only ‘qualified electors’ in the CID boundaries can vote – but if the bond issue is passed, it means future residents will be responsible for paying back the nearly $1 billion in future property taxes.
Long stalled project
Spring Valley is a master-planned community in the foothills north of Eagle, to the west of Avimor. It first started to gain traction in the mid-2000s, but work stopped during the Great Recession. It again started to gain momentum in 2012, when the CID first proposed a bond issuance – at the time for up to $250 million in debt, with approval of four of six qualified electors – or voters.
Now, the CID board says the latest developer of the project wants to increase the bond amount by more than double – to the $600 million level, before interest.
“The Spring Valley CID was formed in 2012,” Pam Giss with Launch Development Finance Advisors said in a public hearing last month. Launch is contracted with the City of Eagle and the CID board to oversee the administration of the district. “At the time of formation, the district was authorized to issue $250 million dollars worth of GO bonds to finance the public improvements. It was expected at that time that the project would move immediately. “
But the project didn’t move immediately. Spring Valley has been mired in issues over the last 20 years. As BoiseDev reported last year, The Clyde Companies of Orem, Utah acquired the property and has started work to begin development. It could feature more than 7,000 homes, as well as hotels, restaurants, an equestrian center, and even a public gun range park.
Giss said the developer hopes for the increase in debt — because of the increase in costs over the last nearly decade.
“Now in 2022 we are pushing forward. As a result of that, everything has gotten more expensive. The developer is asking that we increase that bond obligation from $250 to $600 million dollars, with the idea that there’s an additional cushion in there so the developer doesn’t have to come back to the board and say ‘we’ve had significant cost increases.’ There should be plenty for the continued build-out of the development.”
Who can vote? Few
To vote in a CID bond election, someone must be 18 and a “bona fide resident” of the district or a “bona fide owner of property” in the district.
One of the two resolutions passed by the CID board notes that the developer is the “owner of all real property in the district.”
Ada County Clerk Phil McGrane said his office is still working to understand how many “qualified electors” would be able to vote in the May bond election, but they don’t yet know. But, in response to BoiseDev he confirmed it “won’t be many.”
In short, the election now with a small group of people, will mean thousands of future residents will pay additional property taxes for up to 30 years.
CIDs are different
Unlike a typical subdivision, where developers pay for infrastructure costs and include them in the sales price of land or homes – the CID provision in Idaho code instead allows the developer to use a public bonding process to repay the costs incurred for public infrastructure like roads and parks. The buyers of the homes or lots would then pay back the costs of the infrastructure – plus interest, by paying additional property taxes on top of normal tax for things like fire and police services.
In Boise, the state’s first CID, in the Harris Ranch neighborhood, has come under scrutiny in the last few years. Residents of the district have mounted a series of complaints – and a legal challenge – to everything from the way the district was formed, to the nature of reimbursement to developers.
The idea of a CID – is that houses might cost less up front, because the infrastructure costs would be paid on the tax bill over 30 years. But as Harris Ranch CID board member Holli Woodings pointed out, in the case of that CID, that wasn’t necessarily happening.
“When you’re seeing properties across the street in the CID and those that don’t have the same value, well that shouldn’t be, because people should be willing to pay a little bit less in the CID understanding they’ll be paying for that infrastructure,” Woodings said.