Coos Bay Government and Politics STOCK

COOS COUNTY — Coos County’s commissioners are deciding whether or not to eliminate the Coos County Urban Renewal Agency's North Bay District.

The 9,000-acre urban renewal area was created in 1986 to assist with infrastructure needs to help spur development on the North Spit.

Earlier this year, the CCURA set out to amend its plan that will expire in 2018.

In the last nine years, the district has collected more than $2 million in property taxes, $1.1 million of which was from a special levy. In that time, the agency has helped fund two projects, according to those involved in the agency.

One project put $2,000 towards helping a Boy Scout troop cleanup and construct fencing on the North Spit overlook property earlier this year. The other URA-funded project helped realign the Trans Pacific Parkway in 2010.

After several public hearings and meetings, the urban renewal plan was amended in October to eliminate the special levy, which served as an additional tax on property owners.

Urban renewal agencies use tax increment financing to implement redevelopment projects in blighted or underdeveloped areas. In order to do this, URAs have a maximum amount of indebtedness, which determines how much redevelopment can occur. North Bay’s maximum indebtedness is $55,126,344.

Urban renewal projects are funded through bonds and bond holders receive a return on their investment through interest payments over the duration of the bonds. The payment against urban renewal’s debt comes from the “increment” or growth in assessed property value. When the urban renewal area is formed, the assessed property value with the URA is frozen. Any property taxes collected above the frozen base are considered “increment.”

The argument is that additional tax revenue generated from a URA will eventually go back to the other taxing districts when the district is dissolved, creating added money that wouldn’t be there had the district not existed.

While property taxes wouldn’t change if urban renewal areas were eliminated, the funding for other taxing districts would.

Forgone revenues

Each year the state has to backfill funds for Coos County’s school districts that are siphoned into the urban renewal area, according to the Oregon Department of Education.

The state school fund would’ve had an additional $62,902 this fiscal year if the North Bay URA wasn’t in place. By 2038, that number jumps to $3.7 million, according to the North Bay Urban Renewal Plan Amendment Report.

Elaine Howard, a consultant for both Coos County’s and Coos Bay’s URAs, said in essence, the URA is keeping the money local rather than sending it to the state school fund.

“There’s some fewer monies that they’ll (the school fund) be able to draw from, but they backfill from other sources,” Howard said.

Even if those dollars were sent to the state’s school fund, Coos County's school districts would still receive the same amount of money because it funds schools on a per student basis.

However, the other taxing districts aren’t able to backfill forgone revenue. The taxing districts include: Coos County, Coos Bay, North Bend, the library district, port districts, rural fire districts, health districts, parks and recreation districts, drainage and diking districts, water districts, road districts, sanitary districts, and the 4H/extension service district.

Coos County is currently forgoing $12,000 in property tax revenue this fiscal year that goes to North Bay’s urban renewal. By 2028, the amount of money forgone is expected to be 10 times that, according to the URA report.

When asked about the county’s current amount of forgone revenue, Coos County Commissioner John Sweet said it was a small price to pay for redevelopment. Sweet also pointed out that some of the urban renewal funds have been used as “seed money” to leverage grants.

Port of Coos Bay

The Coos County URA board serves as the governing body for the agency.

Members of the Coos County URA board include: Joe Benetti, Jennifer Groth, Howard Graham, Mike Erbele, Eric Farm, Brianna Hansen, Todd Goergen, Adam Foxworthy, Melissa Cribbins and John Sweet.

The Port of Coos Bay is contracted by Coos County to provide administrative services to the Coos County URA. The renewal agency pays the port $12,000 a year for that service.

Fred Jacquot, director of port development for the Port of Coos Bay, is the project manager for the plan amendment.

Jacquot said there have been discussions with entities that are interested in the North Spit, but want additional infrastructure.

“Again, we’re bound by confidentiality when we're approached by potential projects, but there’s been projects that have needed additional water infrastructure, projects that have needed additional power infrastructure,” Jacquot said.

He said the area is competing with ports along the West Coast and stands to benefit from providing incentives.

“If there’s an opportunity to capture development on that site by incentivizing expansion of power we want to have that tool available,” Jacquot said, “It’s about maintaining flexibility so we as a community are prepared if an opportunity presents itself.”

The big-budget items on the tier one project list reflect those infrastructure goals.

Water, natural gas and stormwater utilities have a combined $20 million in projected project costs.

The Trans Pacific Parkway has also been highlighted as a major infrastructure need for the area, because of flooding and potholes.

“The Port of Coos Bay has done a lot of strategic planning in the last couple of years and has direction to do a lot of development down in that area,” Howard said, “People are encouraged by the fact that the port is being proactive.”

In an email to The World, Howard wrote that the total amount of new development needed to meet the projections in the report is approximately $336 million over the next 20 years.

Jacquot recalled the last project that the URA helped fund was the $1.35 million realignment of the Trans Pacific Parkway in 2010.

Before that, the Coos Bay Rail Line Spur Extension was completed in 2006.

When asked by The World for a list of URA-funded projects, Jacquot said they were before his time and he didn’t have all the records together.

Coos County Commissioner Melissa Cribbins has been on the agency’s board for the last five years and only remembers the URA helping fund the Boy Scout project.

Cribbins said it is responsible fiscal management to accrue money and to wait to do projects until the agency has an idea of what the development might be.

“I don’t think it’s responsible to just go out there and do a bunch of development and say ‘who’s interested?’” Cribbins said, “We don’t have that much money. $1.1 million sounds like a lot, but it’s not that much when you start doing infrastructure projects.”

A little over $1 million is what Cribbins said had been accrued in the URA's fund. 

In regards to the other million dollars the agency has received in the last decade, Cribbins said it was used to help repay a loan and the $12,000 a year administration fee. 

When asked by The World what the loan was for, Cribbins speculated that it was for the area's roadway.

Jacquot said the outstanding loan was used for previous project expenses "likely including the realignment," in an email to The World. 

The project manager wrote he was unable to provide a breakdown on how much the CCURA provided to the Trans Pacific Parkway realignment at this time.

Jordan Cove

Howard said if the Jordan Cove LNG export terminal is built, there probably wouldn’t need to be an urban renewal district.

Jacquot disagrees. He said that Jordan Cove isn’t going to pay for the infrastructure needs of neighboring properties.

Concerns over how the massive energy project’s taxes would be distributed in the absence of a community enhancement plan were discussed back in 2014. 

In 2013, Coos County Commissioner Bob Main said there was no longer a need for a URA, because the infrastructure needs on the North Spit had already been met. 

Main had concerns with the North Bay's plan amendment during a public hearing on Oct 30. One concern was that the administration costs for the plan appear to go up in the absence of a levy.

Jacquot didn’t have an answer as to why the cost goes up, but told Main he would find out.

Three years ago, it was speculated that 99 percent of Jordan Cove’s property taxes would end up going to the North Bay Urban Renewal District. The concern was addressed in one of the plan’s amendments.

One of the amendments in the new plan allows for under-levy triggers, which gives county commissioners the discretion to decide how much of any new developments’ taxes would go to the urban renewal district. It also includes an option to re-distribute the money garnered from the expiration of a business’s tax abatement.

SouthPort Lumber Co is receiving an enterprise zone tax abatement until 2020, exempting $800,000 of assessed value, according to the North Bay report.

Howard said the under-levy was specifically put in the amendment so people know it’s been thought about.

“If a large development happens, the Coos County Commission can make a determination to terminate the URA,” Howard said, adding that they have the ability to terminate the district at any time.

A new levy

Just as Coos County is talking about removing the special levy for the North Bay district, Coos Bay added a levy this spring.

Coos Bay created the levy to address road problems by taxing 30 cents per $1,000 of assessed value. For a $200,000 home that’s an extra $60 on Coos Bay resident’s property tax bills.

Coos Bay’s two urban renewal areas account for the lion’s share of urban renewal funds. Combined, they are taking in $1.9 million this fiscal year.

The Coos Bay’s Downtown URA has used its funds to restore the Egyptian Theatre, expand the Eastside Boat ramp, and do a seismic upgrade to City Hall.

According to the city’s website, it estimates that urban renewal has enhanced the city by $46 million.

One of the more recent projects was the Empire Blvd renovation, which Coos Bay’s Empire Urban Renewal district helped fund to the tune of $970,000.

Coos Bay City Manager Rodger Craddock said that urban renewal investments help improve the overall prosperity of the area.

“The thought is that that investment over time is the same as the rising tide, it floats all ships,” Craddock said.

At their core, urban renewal areas leverage the rising tide argument to implement levies and taxes that would otherwise be going to the county, cities, libraries, parks and rural fire districts, among others.

Cribbins said she's seen other counties and cities fall victim to another cliché; ‘if you build it, they will come.’

“I’ve seen other counties and cities just build stuff in the belief that if it’s all built somebody will come and unfortunately there’s a lot of times that infrastructure just sits there and nothing comes,” Cribbins said, “It’s like the idea of the bridge to nowhere.”

The next public hearing is scheduled for Dec. 13 at the Owens Building in Coquille. Written input on the plan amendment must be sent by Dec. 1.

Reach Saphara Harrell at (541) 269-1222 ext. 239 or by email at saphara.harrell@theworldlink.com

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