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Eagle URA warns House Bill 670 could force return of tax-increment funds and stall projects
Summary
Eagle Urban Renewal Agency leaders told the board Feb. 17 that proposed House Bill 670 would allow fire and ambulance districts to withdraw tax-increment revenue if certain obligations are not explicitly defined, potentially forcing the URA to return funds earmarked for projects and undermining multi-year plans.
Ashley, the agency’s executive director, warned the board that a recently printed version of House Bill 670 would change when a fire or ambulance district can withdraw revenue-allocation proceeds. “The agencies shall not deny a fire protection districts or ambulance service districts request to withdraw if there are no outstanding bonds, contractual obligations, or other indebtedness being funded by the district's revenue allocation proceeds,” Ashley said during the executive director’s report, reading the bill text aloud to the board.
Ashley said the language—especially an “or” construction and omission of definitions for key terms—shifts the burden to the URA to prove money is contractually obligated. She summarized the fiscal stakes: “We don't have any money to play with,” and cited roughly $5,500,000 in contracted obligations the agency currently carries. Counsel present said the measure includes an emergency clause and would take effect immediately if passed, which could force the URA to return funds before new contracts could be executed.
City attorney Ben Lehman, representing the agency on legislative matters, said staff will prepare written legal analysis and lobby materials and likely testify if the bill advances. “We're going to be drafting letters for our lobbyists in Meridian,” Lehman said, and urged the board to press for clearer definitions in the bill to avoid unintended withdrawals. Board members raised specific questions about whether MOAs, OPAs or carryover savings would qualify as contractual obligations; counsel said the bill as drafted does not clearly define "outstanding bonds" or "other indebtedness," creating legal uncertainty.
The agency identified several projects at risk if funds must be returned, including State Street beautification and other multi-year commitments. Ashley listed several line items the URA counts as obligations — including a roughly $1,300,000 commitment to a Hemingway project — and estimated last year’s contribution from the larger fire district at about $436,000. The board agreed to prepare testimony, coordinate with counsel, and consider an executive session at a future meeting to discuss settlement strategy for pending litigation related to the same matter.
