Developers of Fourth Street Crossing in Silverthorne lay framework for financing
August 27, 2018
Silverthorne is in the process of setting up two new special districts to help finance construction and ongoing operational costs tied to the Fourth Street Crossing project.
Fourth Street Crossing is an estimated $80 million development that comes as Silverthorne's effort to dramatically remake the downtown area into a vibrant, thriving, pedestrian-friendly "Main Street" commodity.
Creating special districts is a common governmental tool that requires businesses or property owners within a defined area — the district — to pay additional taxes and fees to fund specific projects in that area.
"It's a great tool that's used across the state of Colorado to finance these sort of projects when there's heavy public requirements and no apparent source of public equity backing the project aside from sharing tax revenue," explained Tim Fredregill, a development executive for Milender White, the firm tasked with spearheading the project.
Most basically, a special district allows for the creation of a new stream of income by pulling funding from a number of different sources, be it property taxes, fees or other monies. That income can be borrowed against and in turn provides a mechanism to pursue public projects with little to none of the money upfront.
"It's a great way to pay for $13 million of stuff without having to go to the citizens and ask for $13 million," Fredregill added.
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Stated in a letter from the development team to council town, creating two special districts would allow the districts to impose different mill levies, fees and other financing tools for Fourth Street Crossing by separating its commercial and retail assets from the residential components.
Because Fourth Street Crossing is a mixed-use project, the commercial and retail properties would be included in the business improvement district while the residential units would be folded into the metro district.
On Wednesday, Silverthorne Town Council pushed forward by approving a handful of agenda items paving the way for creation of the special districts.
Based on the developers' letter to council, which describes how each district would function, both would be authorized to assume debt, collect taxes and impose fees on the properties included in their district.
That money would then go toward construction, operating costs and ongoing maintenance of public improvements associated with the project, which will be managed in a partnership between the special districts.
The proposed service area for both districts is expected to consist of about 3.8 acres, covering the entire block between Third and Fourth streets west of Blue River Parkway.
Developers are anticipating about $12.6 million worth of public improvements for the project, though that figure could fluctuate as designs are finalized. While the districts would be authorized to incur debt to shoulder some of those costs, the town would not assume any responsibility for that debt.
Also, any mill levy imposed by either district would be capped at 50 mills. For a residential property appraised at $300,000, that would equate to about $1,080 a year, according to the developers. Additionally, the mill levies would not be allowed to exceed limits set by state law.
Once the project is complete, the business improvement district would continue to work in conjunction with the metro district to fund ongoing operations and maintenance costs at Fourth Street Crossing. The districts would also be charged with filing an operating plan and budget every year with the town clerk.
With the town's consent, the development team expects to form the new business improvement district later this year.
Once formed, the business improvement district would be governed by a board of directors, first appointed by town council and then voted in by electors from the district after that.
"The intent over time is to roll control of the district over to the people who operate businesses within the district," Fredregill said.
There's still much work to be done before they can break ground, he said, but assuming all of the proper approvals and other items fall into place, they're hope to break out the shovels as early as next spring.
"But the best answer is just as quickly as we can," Fredregill said.
He added that anyone with inquires about retail space or the residences at Fourth Street Crossing can reach out to the development team through the project website, FourthStreetCrossing.com.