Lakewood staff give primer on urban renewal areas, metro districts and TIF

City of Lakewood staff on April 21 gave a detailed, non-decisional briefing to the joint Lakewood City Council and Lakewood Reinvestment Authority (LRA) on urban renewal areas and metropolitan districts, explaining how each is created, how the two tools can be used together and the financing mechanisms commonly used for public infrastructure.

The presentation was led by Holly Bjorklund, the city’s chief financial officer and LRA treasurer, with detailed explanations from Nicole Stair, revenue manager, and Katie Feltas, acting economic development and LRA manager. Bjorklund opened the session as an education item and emphasized there was no decision on any specific project during the presentation.

The staff framed an urban renewal area (URA) as “a designated blighted area which a city has targeted for redevelopment,” and said its purpose is to “improve health and safety, and restore economic and community vitality.” Katie Feltas told the board URAs rely on statutory definitions of blight and typically use tax increment financing (TIF) to fund public improvements. Nicole Stair explained TIF in plain terms: the city takes a snapshot of current tax revenue as a baseline, and the incremental tax revenue that accrues as property values rise is used to finance infrastructure for the URA for a set period (commonly up to 25 years).

Stair and Feltas described metropolitan districts (often called metro districts) as separate quasi‑governmental entities organized under Colorado’s special district laws that can issue debt, levy property taxes (a mill levy) and enter into agreements to fund and operate infrastructure (water, sewer, drainage, streets and parks) within a development’s boundary. Staff explained metro districts are subject to open-meeting and election requirements and that they are governed independently from the city.

Staff outlined the typical procedural steps for each tool: for URAs, a blight study and notice to taxing entities, negotiation of TIF‑sharing agreements, Planning Commission review, and city council approval followed by administration and oversight; for metro districts, preparation of a service and financial plan, council review and typically an on-boundary election, formation of the district, then implementation and annual reporting.

On using the two tools together, staff said they can be complementary: a URA provides access to TIF revenue while a metro district offers authority to issue bonds and levy mill levies, expanding financing options that are localized to the project area. Staff also warned of complexity: “multiple parties involved” (developers, taxing entities, the county, the city, metro district trustees) can lengthen negotiations, and revenues are not guaranteed and depend on development success. Feltas noted a URA can last up to 25 years while metro districts can operate longer.

Council members asked how a city can place “guardrails” on URA/TIF negotiations— for example to encourage mixed‑use development rather than all‑housing— and staff replied that the negotiated agreements with developers and taxing entities can include conditions (for instance, affordable housing commitments) tied to public‑improvement funding, although TIF revenue itself must be used for eligible public improvements. Legal counsel John (last name on transcript) confirmed the city and LRA have discretion to recommend or decline creating a URA even if statutory blight conditions are met; council has final authority.

Council members also asked for examples of local metro districts; staff cited multiple existing metro districts in and near Lakewood including several in Belmar and developments such as Red Rocks Ranch and Green Gables. Staff advised that a statewide database (Colorado Information Marketplace) and property tax records are public sources to see whether a parcel lies within a metro district.

Stair summarized TIF mechanics and limitations: the taxing entities retain the baseline revenue for the 25‑year URA funding window while the increment (the new revenue above the baseline) is pledged to eligible public improvements; after the term ends, taxing entities receive both base and increment going forward.

The presentation concluded with staff emphasizing that each tool should be used according to project needs, and that combining URAs and metro districts expands the city’s negotiation leverage and available financing options but increases complexity and administrative burden.

Ending: Staff said the presentation was intended as background education only; no URA or metro‑district application was decided at the April 21 meeting. Council members were directed to consider the procedural and statutory distinctions if specific projects come forward for quasi‑judicial hearings.