Timnath victor in lawsuit

By Dan MacArthur
Fossil Creek Current

Timnath's formation of an urban renewal authority has survived Larimer County's legal challenge.

Larimer County District Court Judge Dave Williams on Aug. 26 granted Timnath's motion to dismiss the county's suit contesting the town's action as an abuse of the state's urban renewal law.

The county contended that the URA designation would force all county residents to subsidize Timnath's growth while depriving the county of at least $25 million in property tax revenues badly needed to provide services.

Williams acknowledged that Larimer County could conceivably demonstrate that it would suffer damages as a result of Timnath's declaration. But ultimately, he said, previous cases established that the county had no legal standing to bring the lawsuit against Timnath.

"The consistent theme in these cases is that counties, as creatures of state government enjoying only limited powers and authorities, do not have a legally recognized right to contest urban renewal plans--which plans are, after all, adopted by fellow subordinate subdivisions of state government," Williams wrote.

Ultimately, Williams concluded, "how much, if any judicial review of urban renewal plans is desirable and who should be able to invoke such reviews are political questions." Only the state legislature, he ruled, had the power to grant counties the authority to seek such judicial review.

County Commissioner Kathay Rennels said although the legislature didn't go that far, last session, it did pass a law giving counties greater say in creation of urban renewal authorities.

The law still does not give counties legal standing to challenge URAs, Rennels said, but it does require municipalities forming such authorities to first prepare an impact statement. Counties affected by a proposed URA could demand binding arbitration as a vehicle for dealing with those impacts.

Rennels said the bill, hammered out in at least a dozen negotiating sessions, provided an acceptable middle ground addressing the counties' concerns about URAs while protecting towns and cities from lengthy lawsuits that could cause indefinite delays. Had the law been in effect earlier, she said, the county's lawsuit against Timnath probably would not have been necessary.

The lawsuit was filed after Timnath late last year formed the URA and adopted an urban renewal plan. Town trustees took that action after determining the area within its expected boundaries met most the conditions necessary for designation as a "blighted" area.

Creation of the urban renewal authority enables the town to keep tens of millions in "tax-increment financing" dollars during the next 25 years to pay for public improvements such as roads, bridges and drainage structures. The URA designation freezes the amount of taxes collected by other governments to the sum collected at the time of the designation. The town then can retain any increased sales or property tax revenues resulting from its greater property value following development or redevelopment.

Rennels said she wishes Timnath well because she believes the town still will have costly capital improvement needs well in excess of the tax-increment dollars that will be available. "They have their work cut out for them," she said.

When those revenues do start coming in to the authority, Timnath trustee Charlie Snider said, the first order of business will be replacing the money temporarily transferred from the general fund to fight the county lawsuit. In mid August, he estimated those legal bills at more than $27,000.

"I feel like we're throwing money away," said Snider.

Rennels said the commissioners will discuss what, if any, additional action to take.