The City Council will likely vote this evening to enter into an exclusive negotiation with Brinkman Partners, a Ft. Collins based real estate developer, to sell the former Home State Bank property in Downtown Loveland for 80% less than what the city paid. See story
A subsidy by any other name, the City of Loveland purchased the property using mostly CEF’s (Capital Expansion Fees) which were collected from taxpayers for the sole purpose of expanding the city’s museum. These funds cannot be used to subsidize a private development. Therefore, the city will sell the property to only Brinkman Partners it bought in 2007 for $1.1 million for $200,000.
To recover the lost $900,000 in CEF’s due to what City Manager Bill Cahill described almost tongue and cheek as “adverse market conditions” the city intends to reach deep into the county and school pockets with a complicated and unprecedented Urban Renewal bait and switch scheme.
It is a complicated story but merits your attention. School Superintendent Ron Cabrera is so confused he wrote a memorandum to the city supporting their bait and switch tax scheme which by his own inaccuracies reveals a deep misunderstanding by Cabrera of what the city proposes doing. On November 22, Larimer County Administrator Frank Lancaster can also be heard in the meeting calling the bait and switch scheme a “wash” for the county financially because he thought taxes will be diverted anyway from the county until 2027.
The critical piece missing for both administrators is that an Urban Renewal Authority (URA) must have bond debt outstanding to divert property taxes. The Lincoln Place URA in downtown Loveland is near satisfying its public bond debt even though the term of the district runs until 2027. Instead of allowing the $150,000 plus in property taxes to flow back to schools and county as the law intends, the city is hoping to re-draw the boundaries of the URA to pay for the museum expansion using new debt.
While the sale of Home State Bank and the URA bait and switch are being considered together – they are completely different governmental actions that should each be considered each on its own merits and not necessarily together. By combining the two staff has confused council, the county and schools not to mention some in the local media.