Steamboat City Council won’t pay bill from school board over base area URA
Steamboat Springs — The Steamboat Springs City Council will not pay a $148,000 bill from the Steamboat Springs School Board for financial harm the board believes has occurred because of the use of tax increment financing at the base of the Steamboat Ski Area.
According to the school district, tax increment financing started causing financial harm to the district in 2010, when a state funding shortfall meant the state would no longer be able to backfill funding for districts where taxes have been diverted for an urban renewal authority.
When the city council approved the base area urban renewal authority and tax increment financing In 2005, it included a clause stating that, if tax increment financing caused financial harm to the school district, the city would foot the bill up to $30,000 per year.
“This $30,000 (a year) loss factor, it can’t even be proven,” council member Walter Magill said before he moved Tuesday night to return the bill to the sender and declare it void. “We have someone in accounting who proved it’s a non-event.”
The city and the school district continue to disagree over the amount of financial harm the base area URA has had on the district.
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The city’s calculations claim less than $10,000 is potentially owed to the school district due to the impact of the tax increment financing at the base area.
The school district calculates about $621,000 in harm has been done, and the city should have paid $148,000 over the last five years per the clause in the 2005 resolution, it claimed.
Magill said the bill from the school district was “past due” and questioned why the district had not billed the city on an annual basis for the harm.
In rejecting the bill from the school board, some city council members also cited an email the council was forwarded on Monday from Mary Christel, a principal consultant for the Colorado Department of Education’s School Finance Division.
In the email, Christel was asked six questions regarding the impact urban renewal authoriteis and tax increment financing have on school districts.
Christel said URA funds are not deducted directly from schools, and not all URA funds are added to the negative factor.
Council member Tony Connell — who has been attending recent meetings between school district and city staff regarding the bill and the amount of financial harm from the URA — said the council had three options to consider.
It could have a third-party arbitrator familiar with Colorado state finance formulas look at the city and school district calculations and see which one is correct, it could do nothing or it could accept the bill and pay it from the general fund.
Connell appeared swayed by the information he received from Christel.
Before he voted with the other five council members to reject the bill, Connell held up the email from Christel and said “this is our third-party auditor right here.”
Education reporter Teresa Ristow contributed background to this story
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