Upload
marlene-booth
View
216
Download
0
Tags:
Embed Size (px)
Citation preview
El Paso County Title 32 Special District Issues
NEPCO Meeting
January 12, 2008
Carl F. Schueler, AICP
Long Range Planning Division Manager
El Paso County Development Services Department
(719) 520-6316
I am used to being taken seriously on issues I supposedly know about
First Caveat
I know little and can say little about Tri-View Metropolitan District
A Few County-wide Numbers
El Paso County Population- 585,000 Tax Parcels in County- 255,000 Active Taxing Entities- 251* Unique Geographic Tax
Combinations- 1,000
The last 2 numbers are growing faster than the first 2
*40 more added just this year
Why Have Title 32 Special Districts in the Unincorporated County?
1) Here to Stay/ We have had some for about 50 years
2) Governmental entity for essential services including fire protection; water and sewer
3) Regional Financing Tool
4) Provide tax exempt financing vehicle for public infrastructure-also shifts costs to end users of facilities and services
Fire Districts- 2006
merger
New oneMetro- dist
service
Water and Sanitation Districts- 2006
County Metropolitan Districts- 2006
About 25 more created or in process
Total Numbers in El Paso County Unincorporated About 110 Total Title 32 Districts
75 primary districts; rest are sub-districts
About 60 Municipal Primary and sub- or related-districts
----------------------------------------------------------------
24 new or amended unincorporated districts in 2006 Plus a bunch in cities
Financial Information
Total Outstanding Debt:
$145 Million +
Total Authorized G.O. Debt:
$1.27 Billion +
Based on partial information tabulations
Trends
Metropolitan districts Activity in cities and in un-incorporated County Financing versus service function “Master” or multiple districts Higher mill levies and caps Including “the kitchen sink” Smaller districts (little guys don’t want to be left out) Increasing interactions Districts have become big business The next Service Plan almost always presents
something new
Policy Areas
Mill Levy Caps Tax Overlap/ Authorized
Debt Market Studies Master Districts Proliferation Developer Districts Local Versus Regional
Improvements
IGAs Material Modifications Amendments Private Placements Purchase of Assets Disclosure Developer Funding
Agreements HOA Replacement
Developer Districts
Vote is pre-ordained Property owners move in to the project with
many of the financing obligations in place. Later they may take over the Board
Multiple or Sequential Districts
Conventional representative districts than are sequenced to the developer can control the financing decisions for a phase of the project before relinquishing control of the phase. There is a legitimate rationale for this in the
sense that the developer often makes his/her money on the last phases of the project
Master Districts
Maintains developer control over the Board through the life of the project by using a combination of service/control districts and financing districts
IGAs done at the front end Financing districts have limited control over
financing decisions The major concern (besides complexity) is
one of ultimate representation
Special Citizen’s Advisory Councils
Board of County Commissioners-appointed Substitute for the lack of formal controlling
representation by citizen’s in master districts. May not really be needed in many master-
district situations Current EPC proposal is to possibly reserve
the BOCC option for CACs, but not implement unless there are complaints
Disclosure
Standard Forms required with Service Plans, plats and annually
Recorded, and will be posted on web What is disclosed
Mill levies (actual and potential) Attempt to distinguish from County taxes Limited representation (in case of master
districts) Contact information (push questions back to
districts
Sample Contact Information
Mill Levy Caps- Full Service District
50 Mills for Debt Service 10 More for Operations Maybe 15 More for Fire Service- limited
geography Maybe 10 More for HOA Functions
Proliferation
Statute and County Policy recommend against
))))) But this is a bit like pushing a rope
For at least 3 reasons: Financing Districts are inherently development
specific Districts are sometimes purpose specific Trend toward master and multiple districts
Tax Overlap Argument
Premise is that maybe it is unfair that developer districts can de-TABOR any amount of debt while existing local governments have to fight the good fight to get any debt at all approved.
And, the further premise is that once these homeowners are saddled with combined triple-digit mill levies, they will be disinclined to vote in bond issues for the governments still under TABOR (cities, town, counties, school districts, fire district etc.)
Experience does not always bear this out In El Paso County the areas with the highest
Metropolitan District tax burden seem to vote in school increases
At least so far…
Market Studies and Financing Plans
El Paso County is probably moving away from these Financing Plans tend to be a best-guess
snapshot- are helpful in evaluating the feasibility of the Service Plan
Unrealistic to make binding Market studies are a lot like appraisals
Tough to do in a dynamic environment Pretty highly disclaimed anyway County is focusing more on limits in Service
Plans and in statute- and on disclosure
Local versus Regional Improvements
In the old days (not that long ago) Districts financed water, sewer and the big
facilities Developers privately financed the local roads,
curb gutter and sidewalks etc. as part of subdivision process
Now the trend is toward district financing of the local improvements
And, under Gallagher there is less residential bonding capacity
Kitchen Sink - continued
Shift from private to public financing may reduce sale tax income from building materials Maybe not that big a deal
Also, should we worry about the priority of what gets funded?
HOA Function
New statutory authority Enforcement and common area maintenance
There is current overlap on common area maintenance
Creates incentive to increase mill levies and caps
Potential concern with representation if no HOA boards (with master districts)
Potential concern with tax equity across larger districts
Shift from HOA Assessments to District Financing Equates to Much Higher Property Taxes
Assume $150/ month in HOA assessments = $1,800 per year
This is well in excess of what most homes in El Paso County pay in total property taxes now- even those in Metropolitan Districts
Developer Funding Agreements
These typically are loans (advances) from developer to district in advance of bonding or sufficient tax or fee revenue.
Agreement (limited) of the district to issue debt once it has bonding capacity
Some reliance is par for the course with developer districts Costs typically accrue prior to revenues and/ or
prudent bonding County concern is the early “piling on” of these future
debt obligations could outstrip the capacity of the district
EPC Approach to Developer Funding Agreements Allow for up to 20 years
This creates the potential for a 50-year debt No compound interest, or interest greater
than 2% more than prime rate. Describe in Service Plan Disclose in Annual Report and Disclosure
Statement
Abstruse Issue
Effect of all these districts on credit ratings of general purpose local governments, and other established taxing entities
Relationships Among and With Districts Developer Agreements IGA’s
Cooperative or “Dueling” Districts Districts as active or passive applicants
Approval of location Eminent domain District as land use applicant Cost recovery applicant Site Plan approval
Carl’s house in City of Colorado Springs (2005 taxes) EL PASO COUNTY 6.142 EPC ROAD and BRIDGE SHARE 0.784 CITY OF COLORADO SPRINGS 4.944 EPC-COLORADO SPGS ROAD & BRIDGE SHARE
0.784 COLO. SPGS. SCHOOL NO. 11 44.045 PIKES PEAK LIBRARY 3.515 SOUTHEASTERN COLO WTR CONSERVANCY
0.941
Total 61.155
Similar house in Meridian Ranch
EL PASO COUNTY 6.142 EPC ROAD and BRIDGE SHARE 1.568 Falcon Fire District 5.712 FALCON SCHOOL NO. 49 45.547 PIKES PEAK LIBRARY 3.515 Upper Black Squirrel District 0.706 Woodmen Road Metro District 10.800* Meridian Ranch Metro District 25.000**
Total 98.990*can go to 25.0 **Can go to 50
Home in Jackson Creek
Difference
62 % (Unlikely) Potential to go to 119% higher with
mill levy caps Focus of BOCC is disclosure
El Paso County Approach
Update and Maintain Data Increase Disclosure
Standardized Annual Report and Disclosure Form Create Assessor’s Web interface
Update Polices Revise Procedures Model Service Plans
Single Multiple Master