Covering costs of growth is about balance, report says

The cost of growth in Commerce City is a complex calculation that can add up to positive revenue for the city — revenue that benefits residents — according to a city-commissioned analysis.

The analysis, conducted by consultant Economic and Planning Systems, was presented at Tuesday’s Planning Commission meeting.  The study was first presented to the City Council in November and will be presented again to the council in March given that it picked up new members in last November’s election. The previous council suggested it also would be beneficial to the city’s Planning Commission to get briefed on the analysis.

Growth, said Brian Duffany, presenting the analysis, involves a balance between residential projects and commercial projects. 

While property tax revenue from residential development doesn’t necessarily cover needed capital expenditures, he explained, there’s another side to the equation.

“Residential does have a negative fiscal impact in Commerce City.” Said Duffany, “but retail makes up the gap in revenue.” 

Another offset for net negative residential revenue is provided by the metro districts that accompany residential development and help it pay its own way.  The districts add mill levies to a homeowner’s property taxes to fund basic infrastructure such as streets and other improvements.

The approach is not always met with enthusiasm. City Mayor Steven Douglas contended a day earlier at Monday night’s City Council meeting that “homeowners are affected” by these levies.

At Tuesday’s Planning Commission meeting, Duffany went on to suggest that “good growth patterns” should be established to ensure net positive revenue streams with a healthy dose of revenue-generating development such as retail, especially big-box retail, which pay the lion’s share of property taxes compared with residential taxes.

The question, said Duffany, is “Does new development pay it’s way?” 

He indicated that it does if the balance between revenue and capital expenditures is met through property taxes and sales taxes from residential and commercial development, and contributions from metro districts.