How Urban Renewal Works

What is urban renewal?

The purpose of the program, which is authorized by state law, is to help communities improve and redevelop areas that are deteriorated, unsafe, have a lack of infrastructure such as streets, utilities and sidewalks, and have vacant and underutilized property. In addition to being unsightly and unsafe, there areas often impose a burden on city services and can be costly to city taxpayers.

How does urban renewal work?

The idea is to take an area that needs improvement, where the property values and tax revenues are low, and draw a line around it. Then, a plan is developed that incorporates streets, green spaces, utilities and other improvements that will attract significant new private investment, the creation of jobs and housing opportunities. The Urban Renewal Agency can issue bonds or notes to pay for the planned improvements. As the implementation of the plan takes place, private investors are encouraged to develop or expand the area.

The result of such planning is that the city as a whole gains new public assets and private investment. Because of the additional tax base created by the new private development in the urban renewal area, the city is able to finance other public benefits such as parks and enhanced greenways and can encourage a concentration of commercial building and housing complexes within the district.

How does an urban renewal area affect taxes?

The formation of an urban renewal district does not result in new taxes. When an urban renewal area is formed, the assessed value within that district is established. The difference between the established assessed value and the increases in value from the resulting new private investment and increases in existing property values is called the “tax increment.”

New urban renewal activities usually are financed by bonds, and/or notes. The bonds and notes are repaid from the property taxes generated by the increase in value (tax increment) of the properties within the district. When the financing is paid off, all of the tax revenues go back into the normal property tax collection system.

How does a community start and carry out an urban renewal program?

The community must prepare a document called an urban renewal plan for the area in which it wants to work. The plan details what the community intends to do in the area and how and when it intends to do it. Renewal plans must be prepared with involvement of the general public. A renewal plan can be adopted by the City Council only after it calls for and conducts a formal public hearing on the plan. After the plan is adopted, the Urban Renewal Agency is responsible for directing and making the major decisions to carry out the plan.

The Coeur d’Alene City Council formed the existing Urban Renewal District in December 1997. A sevenmember volunteer citizen Board of Commissioners appointed by the mayor and approved by the City Council governs the work of the agency.

The Coeur d’Alene Urban Renewal District area includes Midtown (Fourth Street, Indiana to Harrison), Northwest Boulevard and Appleway (from interstate 90 to Garden) and the Downtown Central Business District.

Two sidebars appeared with the story: 1. COEUR D’ALENE’S URBAN RENEWAL PLAN GOALS

The assembly of land into parcels suitable for efficient, integrated development.

The planning, design and development of undeveloped areas which are stagnant or inefficiently utilized.

The strengthening of the economic base of the project area and the community by the installation of needed site improvements to stimulate new commercial expansion, employment and economic growth.

The provision of adequate land for parks and open spaces, pedestrian walkways and parking facilities.

The establishment and implementation of performance criteria to assure high site design standards and environmental quality and other design elements which provide unity and integrity to the entire project.

Encourage funding of arts programs.

The elimination of environmental deficiencies in the project area, including, among others, obsolete and aged building types, substandard streets or rights-of-way, inadequate and deteriorated public facilities and improvements.

The strengthening of the tax base by encouraging private development, thus increasing the assessed valuation of properties within the revenue allocation and the project area as a whole, and benefiting the various taxing districts in which the Urban Renewal Area is located.

The provision and improvement of streets, rights-of-way and other public infrastructure and public facilities in the project area.

The enhancement and improvement of transportation for vehicles, bicycles and pedestrians in the area.

The improvement of aesthetics in the area.

To do all other things necessary and appropriate to arrest decay and deterioration and the impairment of sound growth.

2. THE EXPLAINER

Curious about how something works in local government? Just ask us, and we’ll ask for a thorough written explanation from the agency involved. Reach us by e-mail at kens@spokesman.com, by fax at 765-7149, or by mail at 608 Northwest Blvd. Suite 200, Coeur d’Alene, ID 83814.