The Hailey City Council voted unanimously Monday to loan $50,000 to a proposed Gateway Urban Renewal Agency District, the first of its kind in Hailey. The money will be spent on legal expenses, consulting and marketing efforts associated with a program that could bring in millions in tax revenue to the city, while providing incentives to businesses wanting to relocate to Hailey.
“With all indications that property values have reached their lowest point, there is no better time to establish the Gateway District as Hailey’s first revenue allocation area,” wrote Community Development Director Micah Austin in a memo to the council.
The Gateway District comprises a two- to three-block wide swath of downtown Hailey, stretching from the airport terminal to Cobblestone Lane near McDonalds. The district includes River Street.
Urban renewal agencies are funded through tax increment financing, meaning they get the additional amount of property taxes that result from property value increases, above a base rate, during the time of the URA’s existence, usually about 20 years. The money is used to invest in urban renewal projects.
“We will aggressively try to bring in economic development to raise that property value as quickly as possible,” Austin said in an interview.
Austin issued a report to the City Council on Monday that identified $5.5 million in capital projects that could be completed within five years using URA funds. They include a $4.5 million upgrade of River Street and its underground water mains.
Austin said that to meet those goals, the city would have to increase property values in the target area, using a bond or loan made by a bank to the URA for major improvements.
“The agency’s goal is to develop public infrastructure for businesses and development to occur,” Austin said. “Property values are not going to go up magically in the area. They only will go up based on improvements in your area.”
Austin identified an additional $17 million in other projects that could be funded by the Gateway URA over the next 20 years.
Austin said that while working as community development director with the city of Jerome, he closed down a 14-year-long URA district that brought in $140 million of property valuation to the city’s tax rolls.
Austin said that when the URA in Jerome closed down, after paying off all associated loans, and the incremental tax revenues began to be paid to Jerome County, the county reduced property taxes by 15 percent.
“Tax levies are based on the need of government, rather than the tax rate,” he said. “The taxing districts suddenly had an additional $70 million.”
For more information on Hailey’s URA, call Austin at 788-9815 ext. 13.
In other Hailey news:
( The City Council voted to increase water base monthly fees from $7.45 to $8.32, with a rise in the cost per 1,000 gallons, up to 30,000 gallons, from 20 cents to 25 cents.
( The council voted to increase waste water base monthly fees from $11.24 to $13.59, with a rise in the rate per 1,000 gallons from $3.24 to $3.94.
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