A Public Improvement Fee (PIF) is not a tax increase. It’s a self-imposed fee by the owners of the property for a period of time to pay for public improvements instead of using sales or property tax increment (TIF). Some PIFs are a combination of both the PIF and TIF and is paid by the shoppers on their purchases. Colorado Mills has a PIF and collects sales tax. The taxes and fees are listed on the sales receipt.
The beauty of the PIF is that shoppers only pay the extra fee if they choose to shop at that location. And the taxpayers are not subsdizing the development.
For the 38th & Wadsworth Blvd project, I encouraged the following Monday night (2/9/2015) at the City Council meeting:
- A full PIF instead of TIF (taxpayers are off the hook)
- The property owners sell their property at fair market value to the developer to lower the overall costs of the development
- The major retail grocery anchor brings money to the table to build the public improvements
If these three actions align, the taxpayers are not subsidizing the development unless they shop there. And the City would be collecting its full 3% sales tax now and in the future.
The motion made during the City Council meeting (2/9/2015) asked the developers to go back to the drawing board and find an alternative or alternatives to a TIF, which included looking at a PIF. The financing agreement for the project needs to come back to City Council for approval if a TIF or PIF is involved. No timeline was set, so the developers may decide to move on or come back to Council with financing alternatives. Time will tell.
UPDATE: In my opinion, the proposed development project at 38th & Wadsworth Blvd. does not warrant a TIF, especially since the proposed anchor is a retail grocery anchor. There already is a grocery anchor across the street. To warrant a TIF, in my opinion, the project should bring new services, new primary jobs and/or new amenities to the site and area. Wheat Ridge can do better with a little patience and vision. We have a plethora of great projects happening in the City. This project could be great also with the right developer and vision.
The City Council does not have to approve the TIF for the current proposal. The developer can build right now since they have the proper zoning and use-by-right. Instead, the developer wants the taxpayers to subsidize the 1980s looking project. If the free market does not warrant the project, and the land is over priced, the taxpayers should not be asked to subsidize it.
I know that these programs can be confusing, but I have been involved in these public policy decisions for 19+ years and always enjoy working with citizens to understand the concepts. Please feel free to contact me if you have any questions. Thanks.