Independence Institute • 13952 Denver West Parkway, Suite 400 • Golden, Colorado 80401 • 303-279-6536 • i2i.org/cad.

aspx

New Urban Renewal in

Colorado’s Front Range

by Jennifer Lang
Issue Paper 2-2007
February, 2007
New Urban Renewal in Colorado’s Front Range
by Jennifer Lang
Independence Institute
13952 Denver West Parkway, Suite 400
Golden, Colorado 80401
303-279-6536
i2i.org/cad.aspx
Issue Paper 2-2007
February, 2007
 Contents
Introduction .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..5
Urban Renewal Authorities .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..6
New Urbanism .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 10
Denver. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 11
Lakewood . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 12
Louisville .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 13
Conclusion . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 14
Appendices .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 15
I. Front Range Urban Renewal Authorities .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 15
II. Denver TIF Districts .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 15
III. Current and Recent Urban Renewal Projects in the Denver Metro Area. .. .. .. .. .. .. .. 15
References .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 16

Cover: The Denver Pavillions, a shopping mall supported with more than $30 million in urban-renewal funds.
City of Denver photo.

Your tax dollars at work: Denver spent close to $300 million subsidizing row houses and other high-density, mixed-
use developments at Stapleton.
New Urban Renewal in Colorado’s Front Range 5

Introduction
Colorado is home to more than four million increasingly used for another purpose: to shape
people with most of the population settled development that would have taken place in
along the Front Range of the Rocky Mountains any case so that it follows the latest planning
between Fort Collins and Colorado Springs. At fads instead of market demands. Whether a
the center of this region is the mammoth city of neighborhood is blighted or not is less important
Denver and its numerous sprawling suburbs. than whether planners have decided to transform
From Aurora to Wheat Ridge, more than forty the neighborhood to meet their vision of what a
cities and seven counties make up the Denver residential or business district should look like.
metropolitan area. Developers who might build to meet market
Colorado law gives cities the right to form demand are encouraged by subsidies instead to
urban renewal authorities that can use public build to follow planners’ dreams.
money to eliminate blight and promote urban This trend is likely to accelerate with passage
revitalization. About half of the cities in the of the FasTraks rail transit program. Part of this
Denver metro area have created such an authority program calls for concentrating development
(see list in appendix I).1 within a quarter- to a half-mile of rail stations
Despite its good intentions, urban renewal so that more residents and businesses can
can have many unintended consequences, one be accessible to rail transit. Residents of
of which is that it gives planners opportunities to neighborhoods near planned rail stations
impose their vision of how Coloradans should live. are likely to find planners declaring their
This paper examines some of the urban renewal neighborhoods to be blighted so that the cities
authorities along the Front Range, evaluates the can use urban-renewal money and eminent
processes used to advance development, and domain to transform the neighborhood.
describes how these authorities are affecting the Traditional urban renewal has been criticized
landscape of the Denver metropolitan area. for eliminating affordable housing and eating
Urban renewal puts municipal government into property taxes that would otherwise go for
in the development business. The Denver Urban schools, fire, police, and other essential services.3
Renewal Authority candidly describes itself as This new form of urban renewal will likely
a “civic entrepreneur.”2 The original purpose create additional controversy by subsidizing
of such urban renewal was to take blighted and unmarketable transformations of neighborhoods
run-down neighborhoods and districts that that, by most measures, are far from blighted
were attracting little or no private investment solely because those neighborhoods happen to
and stimulate the transformation into attractive, be near a planned rail station.
thriving areas.
In recent years, however, urban renewal is

Move to Colorado, the land of wide open spaces, so you can live in a row house?
6 New Urban Renewal in Colorado’s Front Range

Urban Renewal Authorities

Whether they are called an urban renewal authority, “faulty lot layout,” and “inadequate public
economic development authority, redevelopment improvements” allow planners to declare just
authority, or downtown development authority, about any neighborhood as blighted. As one
most Colorado development authorities operate Louisville resident complained during a debate
under similar laws. Whatever the name, the over an urban-renewal plan, such conditions
urban renewal authority consists of a commission could be found in “virtually every neighborhood
that is either identical to or appointed by the city in Louisville.”6 Despite the prevalence of such
council. “blight,” Louisville was named one of the “five
The commission can identify urban renewal best cities to live” in the U.S. by Money magazine
districts in which it plans to target assistance for in 2005.7
redevelopment. In order to qualify as an urban- Moreover, an authority can also declare an
renewal district, the commission must show area blighted even if it meets only one of the
that the area is blighted.4 Under Colorado law, above criteria provided that the landowner is
the following conditions are characteristic of willing to agree that “in its present condition”
blighted areas: the property “substantially impairs or arrests
1. Slum, deteriorated, or deteriorating the sound growth of the municipality, retards
structures; the provision of housing accommodations, or
2. Predominance of defective or inadequate constitutes an economic or social liability, and
street layout; is a menace to the public health, safety, morals,
3. Faulty lot layout in relation to size, adequacy, or welfare.”8 This allows canny landowners to
accessibility, or usefulness; have their property declared blighted due to,
4. Unsanitary or unsafe conditions; say, a “faulty lot layout” or “inadequate street
5. Deterioration of site or other layout,” and then receive subsidies for whatever
improvements; development the city wants them to build on
6. Unusual topography or inadequate public that property.
improvements or utilities; To fund urban renewal, the commission
7. Defective or unusual conditions of title cannot increase property taxes, but it can keep the
rendering the title nonmarketable; property taxes collected on all new or incremental
8. The existence of conditions that endanger development within a district for up to twenty-
life or property by fire or other causes; five years. This is known as tax-increment financing
9. Buildings that are unsafe or unhealthy for (TIF) because the urban renewal is financed out
persons to live or work in because of building of the increment that is added to the tax base
code violations, dilapidation, deterioration, after the district is created.
defective design, physical construction, or If the development includes retail shops, the
faulty or inadequate facilities; authority can also increase the local sales tax
10. Environmental contamination of buildings and use that sales tax for urban renewal. This
or property; or sales tax is known as a property-improvement
11. The existence of health, safety, or fee (PIF). To keep local retailing competitive,
welfare factors requiring high levels of some authorities have offset this increase with a
municipal services or substantial physical reduction in the sales taxes that otherwise would
underutilization or vacancy of sites, be spent on other municipal needs.
buildings, or other improvements.5 Typically, the commission estimates the
The law requires urban renewal authorities to amount of taxes that will be collected from the
find at least four of the above eleven conditions new development and then sells bonds that will
before the authority can take land by eminent be repaid by those taxes. The proceeds from bond
domain. However, the use of vague and unclear sales are then invested in the district to promote
terms such as “inadequate street layout,” redevelopment. In the case of a downtown
New Urban Renewal in Colorado’s Front Range 7

development authority, a vote of the people is County, 1.6 percent of property tax collections go
required to approve bond sales; in all other cases, to urban renewal.17 In Arapahoe County, just 0.5
no such vote is required.9 percent of revenues go to TIF districts.18
The commission can use eminent domain to Bond sales of $20 million or more for recent
purchase property in urban-renewal districts urban-renewal projects include:
and can use tax-increment financing to fund such • $294 million for Stapleton;
purchases. It can also use such money to add • $36 million for the Pepsi Center;
infrastructure or as direct grants to developers • $35 million for Lowry;
to encourage them to redevelop the area. • $33 million for downtown Denver’s Adams
As a cure for urban blight, urban renewal Mark Hotel;
has a dubious history. What some people call • $31.5 million for Denver Pavillions on the
“blight” other people call “home.” Between 16th Street Mall;19
1950 and 1980, urban renewal displaced around • $95.5 million for Belmar in Lakewood;20
one million families. Since 80 percent of them • $74 million for Northgate in Westminster;21
were black, urban renewal was sometimes • $40 million for Mandalay Gardens/Shops at
called “Negro removal.” Since urban renewal Walnut Creek in Westminster;22
often replaced slums with luxury housing, one • $61.8 million for the Arista transit-oriented
study found that urban renewal “succeeded development in Broomfield;23
in materially reducing the supply of low-cost • $45 million for Arvada city center;24
housing in America.”10 Another study concluded • $36.7 million for the North Washington
that urban renewal cost the average displaced Street Corridor in Thornton;25
family “20 to 30 percent of one year’s income.”11 • $30.2 million for Englewood CityCenter;26
In 1961, an architecture critic named Jane • $20 million for the Boulder Valley Center.27
Jacobs fought an urban-renewal project that Cities rarely use the entire 25 years available
threatened to wipe out her neighborhood. Her to them to repay these bonds. But, as anyone
book, The Death and Life of Great American Cities, who has priced a home mortgage knows,
compared urban planning to “the pseudoscience when interest and finance charges are added,
of bloodletting.”12 Many years later, The Economist repayment will ultimately cost far more than the
wrote that Jacobs’ book “stopped America’s value of the original bond sale. The $39 million
urban renewal movement in its tracks.”13 In fact, bonds for Denver’s Lowry redevelopment
urban renewal is alive and well in Colorado. were paid off in just ten years, but the total cost
As of 2005, the city of Denver alone has diverted including interest was $65 million.28
taxes on $399.5 million worth of improvements Urban-renewal advocates point to revitalized
from schools and other services to repay bonds areas, such as the 16th Avenue Mall in downtown
sold to subsidize those improvements.14 That Denver, as successful examples of their policies.
represents 4.47 percent of the total assessed Yet careful studies of such projects show that
value of all property in Denver. In 2005, these tax they come at a heavy cost. Redeveloped areas
diversions cost Denver schools $15.4 million and consume urban services, such as fire and police
cost other city services $10.9 million. Assuming protection, sewers, and schools. Yet they make
an average cost per pupil of $10,000 per year, little contribution to such services while their
the school money diverted to Denver urban- taxes are used to repay bonds. This means that
renewal projects could have supported about other taxpayers must either accept lower quality
1,500 students in the Denver school system. services or increased taxes to maintain services.
Other Front Range counties are in similar In Northglenn, for example, the North Metro
situations: Urban-renewal projects in Broomfield, Fire Protection District recently asked voters
for example, divert 4.8 percent of property taxes for a tax increase to fund their services. Wendy
to developers, with similar consequences for Krajewski, who works for the fire district,
Broomfield schools, fire, and other services.15 In explained that one reason for the tax increase
Boulder County, 3.7 percent of assessed value is was that urban-renewal districts within the fire
in urban-renewal districts,16 while in Jefferson protection district have cost the district $1.4
8 New Urban Renewal in Colorado’s Front Range

In other words, developers come to expect that

existing residents will subsidize new growth
using tax-increment financing and only plan new
developments when they can get subsidies.
In recent years, Denver has used tax-increment
financing for such things as the Pepsi Center,
moving Elitch Gardens to its current location,
refurbishing downtown buildings, and building
a nine-story parking garage. This raises obvious
questions such as:
• What do the owners of Lakeside Amusement
Park think about their competitors getting
more than $30 million in public subsidies,
Denver spent millions subsidizing expensive yuppie including a $10.9 million TIF bond?33
lofts in places like the Denver Dry Building. . . • What do owners of other downtown Denver
parking garages think about the opening of
million a year in lost revenues.29 In general, a new $5.8 million garage partly financed
growth pays for itself out of new taxes—but not with a $2.1 million TIF bond?34
if those new taxes are diverted into subsidizing • After Denver subsidized the refurbishment
that growth by paying costs that would otherwise of such downtown buildings as the Adam’s
be paid by developers. Mark Hotel, the Denver Dry Building, the
A second problem with tax-increment Rio Grande Building, and Boston Lofts, why
financing is that it is a zero- if not a negative- would any owner of a downtown building
sum game. It does not typically increase
regional growth; it merely channels that growth
to selected property owners and developers.
Moreover, because it imposes higher overall tax
rates, it may actually reduce regional growth.
In addition, repeated use of TIF creates a
moral hazard for developers: with so many other
developments being subsidized, a developer
would be foolish to commit funds to a project
that has to compete with one that is subsidized.
The result is that developers may actually reduce
investments in regions that use TIF.
This is supported by an Illinois study that
found, “economic activity that would have
occurred outside the TIF district moves inside the
district, and less economic activity seems to take
place overall than would have occurred in the
absence of the TIF district.”30 As another study of
235 cities in the greater Chicago area confirmed,
“cities, towns, and villages that had TIF districts
actually grew more slowly than municipalities
that did not use TIF.”31
A study in Iowa found that “the overall
expected benefits [of TIFs] do not exceed the
costs.” Instead, the liberal use of tax-increment
financing has effectively created an “entitlement . . . and then spent millions more subsidizing a parking
for new industry and housing developments.”32 garage for urban dwellers to park their SUVs.
New Urban Renewal in Colorado’s Front Range 9

be foolish enough to renovate their building Nebraska has witnessed the unsubsidized
without public subsidies? revitalization of a portion of its downtown area
Urban-renewal supporters often claim that known as the Old Market. “All big redevelopment
these projects “pay for themselves” because projects are, by definition, high risk, because no
at least some of the bonds sold to subsidize one really knows how they will affect city life,”
the projects are repaid out of taxes paid on the says Omaha architect Martin Shukert. “Thus,
improvements. But the developments don’t the truly worthwhile urban renewals are always
pay for themselves because they aren’t paying those that happen gradually and by themselves—
for police, fire, schools, and other things that by accident, almost.”36 The Old Market was
those taxes would otherwise go for. Supporters revitalized incrementally, by property owners
respond that, when the bonds are repaid, those and developers, in the complete absence of
government services will receive more tax any funding or planning by an urban renewal
revenues on the developments than they would authority. “The Old Market works because it
have received if the subsidized developments was never really planned,” Shukert says. “A few
had not taken place. Yet those revenues people took a risk and started opening foreign
are in the distant future and depend on the restaurants and retail stores, and then more did. It
developments’ long-term success—something was an organic process, not a grand scheme.”37
not guaranteed in a world of rapidly changing Perhaps the biggest urban renewal disaster
tastes and demands. Schools and other urban in Colorado history took place in Englewood.
services would be better off getting more tax In 1985, the city sold $27 million in bonds
revenues today on unsubsidized and possibly to subsidize a retail development known as
less elaborate developments than waiting for the Trolley Square. Few shops leased space in the
promise of more money decades later. development, and by 1991 the TIF revenues
In short, urban-renewal districts create were inadequate to cover bond repayments,
winners and losers. The winners are the so the Englewood Urban Renewal Authority
property owners and developers who receive defaulted.38 The development was bulldozed a
the subsidies. The losers are the other property few years later as an eyesore.39 Given the huge
owners and businesses in the city who must pay subsidy, the developer may not have analyzed
higher taxes (or receive lower urban services) the market as carefully as someone risking their
and whose property values are lower because own money. It is possible that, if no subsidy were
development that might have taken place on available, a development would have taken place
their land has been attracted by the subsidies to on the site that would be productive today.
the urban-renewal areas. Urban renewal remains Urban renewal effectively transfers the risk
politically feasible because few of the losers lose from a few developers to the taxpayers in general.
enough to protest while the winners gain huge If an urban-renewal district is a spectacular
windfalls and may contribute a share of those failure, the authority might default on its bonds.
profits to particular political campaigns. If it is only a partial failure, taxpayers end up
Fiscal conservatives and academics are not the receiving lower urban services or paying higher
only critics of TIF. The Front Range Economics taxes while the urban renewal authority takes
Strategy Center, a progressive group with ties more time than expected to repay the bonds.
to labor unions, has written a three-part series Either way, the developers face far lower risks,
of reports asking “Are We Getting Our Money’s which explains why such developments are so
Worth” from TIF and urban redevelopment popular among the development community.
in Denver. The reports note that most of the It is likely that recent nostalgia and market
subsidies go to national chains, that the jobs at demand for old towns and historic districts
TIF-supported developments tend to pay low could allow gentrification of such areas without
wages, and that much of the housing subsidized any subsidies. But planners today have a
by TIF is not affordable to ordinary workers.35 more ambitious agenda that goes well beyond
It is questionable whether taxpayer support revitalizing blighted areas. They want to reshape
is even needed for urban revitalization. Omaha, the way Americans live.
10 New Urban Renewal in Colorado’s Front Range

New Urbanism
In the late 1980’s, a number of architects proposed are supposed to have mixed uses, so residents
that higher density, mixed-use developments can walk to shops and even to work. They are
would encourage people to drive less and supposed to be pedestrian friendly, so walking
increase residents’ sense of community. These and cycling are encouraged as alternatives
ideas became known as New Urbanism, and to to driving. These designs all aim to promote
promote them architects and planners formed “accessibility in lieu of mobility.” For times
the Congress for the New Urbanism in 1993. when people want to go beyond the confines of
Ironically, New Urbanism is partly inspired their dense neighborhoods, the developments
by Jane Jacobs’ book, The Death and Life of Great are supposed to center on a transit station, if
American Cities. Jacobs had argued that the high- possible a rail station. Several cities in the Denver
density, mixed-use neighborhoods that urban metropolitan area have used urban-renewal
planners had targeted for urban-renewal were funds to build such mixed-use developments,
not blighted but living, vital neighborhoods.40 and many more are on the drawing boards.
Jacobs specifically warned that her analysis did Planning for transit-oriented developments
not apply to the suburbs.41 Yet today, New Urban accelerated with the passage of the $4.7 billion
planners want to bring the benefits of the high- FasTracks referendum in 2004. While rail
density neighborhoods Jacobs’ fondly described transit is not a requirement for transit-oriented
to the suburbs. “There’s no question that her development, it provides an excuse for cities
[Jane Jacobs’] work is the leaping-off point for our on FasTraks routes to plan transit-oriented
whole movement,” says the executive director of developments near FasTracks stations.
the Congress for the New Urbanism.42 Who will live in these developments? Many
The Congress for the New Urbanism argues planners believe that retiring baby boomers,
that, “All development should be in the form empty nesters, singles, and childless couples will
of compact, walkable neighborhoods and/ favor the New Urban lifestyle.47 While it is true
or districts.”43 They further advocate for “the that people who live in New Urban communities
reconfiguration of sprawling suburbs into have few children, this does not mean that
communities of real neighborhoods,” meaning everyone without children wants to live in a
neighborhoods that meet New Urbanist dense, mixed-use neighborhood. Polling done
principles.44 While some members now explain for the National Home Builders Association and
that this is merely “aspirational,” some planners National Association of Realtors found that only
have attempted to promote New Urban 18 percent of Americans aspire to live in a “home
development with tax breaks and other subsidies in the city, close to work, public transportation,
or mandate it through the use of zoning codes. and shopping.” The remaining 82 percent prefer
Such coercive planning and zoning has come to a single-family home in the suburbs.48
be called smart growth. The Denver metro area already has more
Smart-growth advocates call for reversing the than enough multifamily housing to saturate the
trend of low-density suburbanization, which they demand for such a lifestyle. This would explain
say makes Americans too “auto dependent.”45 why the region has a glut of condominiums on
The goal of smart-growth planning is to provide the market, a glut that has caused realtors to coin
people with “accessibility in lieu of mobility,” the name “Condo-rado.”49
meaning that people should be able to reach Nevertheless, the Denver Regional Council of
employment centers, shopping, schools, and Governments (DRCOG) envisions that, by 2030,
recreation areas without driving.46 “the Denver region will be a dynamic mixture of
So-called transit-oriented developments are distinct pedestrian-friendly urban and suburban
an important part of smart growth. These communities within a limited area.”50 To give
developments are supposed to be dense, with people an extra incentive to live in high-density
a high percentage of multifamily housing. They developments, DRCOG has drawn an urban-
New Urban Renewal in Colorado’s Front Range 11

growth boundary outside of which development as a funding mechanism” and that “RTD will
is limited or forbidden. DRCOG’s Metro Vision support requests by local jurisdictions for the
2030 plan specifically calls for increasing the ability to use” TIF and (by reference to “future
regions’ population density by 10 percent and retail uses”) PIF.56
building homes on smaller lot sizes and more The city of Denver is planning transit-oriented
multifamily housing throughout the region.51 developments around nearly thirty FasTracks
The growth boundary creates a land shortage stations within the city limits.57 The city says
that limits the low-density “sprawl” that most that it plans to use TIF to fund such things
Americans prefer but planners dislike. The as “affordable housing, parks, plazas, street
Denver metro area has “the highest housing improvements and public parking” in these
prices of any state without a coastline,” says developments.58 The city of Longmont expects to
Metro Denver Chamber of Commerce Executive use at least $500,000 in TIF and to waive $820,000
Vice-President Tom Clark.52 These high housing in fees to subsidize redevelopment of the “Flour
prices are a direct result of the growth boundary Mill” area, which is on a planned FasTracks
and other land-use rules (such as growth limits line.59
in Boulder and Golden).53 The dirty secret of To see what these developments might be
smart-growth planning is that such unaffordable like, it is useful to examine recent developments
housing encourages people who would built by urban-renewal authorities in Denver,
otherwise prefer low-density neighborhoods of Lakewood, and Louisville.
single-family detached homes to live instead in
transit-oriented developments. Denver
Still, given the condo glut, artificially high
prices for single-family homes aren’t enough The city and county of Denver currently has
to create an unlimited demand for housing in twenty tax-increment finance or TIF districts (see
transit-oriented developments. Another goal of appendix II). The two largest developments are
the Metro Vision 2030 plan is to build some 70 the former Lowry Air Force Base and the former
high-density, mixed-use “centers” in the region, Stapleton Airport. The Lowry development
many of which will be on planned FasTracks is 1,866 acres that are being developed into a
lines.54 To encourage developers to build this mixed-use urban village.
many developments with limited market appeal, In a typical suburban subdivision, developers
many cities in the region recognize that they will pay for the roads, the sewer and water lines,
have to use urban-renewal funds, including TIF and—if the development is large enough (as
and PIF, to subsidize them. the Lowry and Stapleton developments surely
The arguments in favor of transit-oriented are)—even parks and schools. But for the Lowry
development are circular. One of the justifications and Stapleton developments, the Denver Urban
for FasTracks was that it would enhance the
value of transit-oriented developments then
being planned. With regard to a transit-oriented
development in Arvada, a pro-FasTracks report
stated, “If new transit is not brought into the
Ridge Home development, the development
timeline and mix of uses [in the development]
would likely need to be revised.”55 Now that
FasTracks has been approved, RTD argues that
more transit-oriented developments are needed
to make FasTracks work.
RTD’s Strategic Plan for Transit Oriented
Development calls for such developments around
most FasTracks stations. The document notes Some of the New Urban housing in Lowry looks little
that cities “can use tax increment financing better than the barracks typical of a military base.
12 New Urban Renewal in Colorado’s Front Range

Renewal Authority is covering these costs out and “a new direction in the evolution of the
of bond sales that will be repaid through tax- American Dream.”62 Forest City Enterprises
increment financing. planned this development with the model of
No doubt many families with children will New Urbanism and aim of sustainability.
move to Lowry, but for up to twenty-five years According to city of Denver documents, the
the taxes they pay will not cover the costs of their city sold $75 million worth of bonds in 2001 and
children’s schooling, fire and police protection, $200 million worth in 2004 to subsidize streets,
public health, or other urban services. Instead, drainage, and other infrastructure. The taxes
their taxes will be used to repay the $34 million paid on the new properties will repay the bonds
in bonds, plus interest, that subsidized Lowry.60 plus 8 percent interest.63
In a Denver Post article titled, “Row houses? “TIF is used only when an area or property
In Denver?” Lowry development builder can’t be redeveloped without public investment,”
Jim Hartman comments “Beforehand, there claims the Denver Urban Renewal Authority.64
wasn’t enough density, synergy or energy. But But considering Denver’s high housing prices,
what we’ve been doing in the Town Center it is inconceivable that developers would not
neighborhood is creating a more modern have eagerly redeveloped Stapleton and Lowry
European mix, so now we can create this mixed- without public subsidies. In all probability, such
use thing all in one building.” Yet he conceded developments would have included homes with
“that it took awhile for the concept to take hold,” large yards, and they would have separated
suggesting that initial sales were slow.61 residential from retail and commercial uses. For
At 4,700 acres, Stapleton is even larger than the most part, they would not have been New
Lowry and is supposed to be the nation’s largest Urban developments with tiny lots, excessive
infill development. Considering Denver’s hot multi-family housing, and mixed uses. Urban
housing market, developers would have been renewal is no longer about fixing blight. It is
eager to build single-family homes on large lots about imposing planners’ utopian ideals on
in the area. But Denver wanted the development urban families.
to follow New Urban principles, so it declared the
area blighted. This allowed the city to subsidize
homes that might otherwise be less marketable
Lakewood
to typical buyers, such as houses on tiny lots and Another example of a redevelopment that would
houses in mixed-use developments. probably have taken place without subsidies is
When completed, Stapleton will provide the Villa Italia mall in the City of Lakewood. With
12,000 homes and apartments, three million the help of a $95.5 million bond to be repaid with
square feet of retail space, and ten million square TIF and PIF, this 104-acre site was transformed
feet of office space. This enormous tract of land into a New Urban mixed-use development called
has been hailed as the “rebirth of urban America” Belmar. Without the subsidies, redevelopment
would probably have taken place, but the new
development would probably have been retail
and commercial only, with no residential uses.
The Lakewood Reinvestment Authority
envisioned this development as a re-creation
of a mainstreet-style downtown. In addition to
TIF, Lakewood applied a property-improvement
fee, or PIF, of 2.5 percent. This is, in effect,
an additional retail sales tax to repay bonds
used for streets, lighting, sidewalks, and other
property improvements. To keep Belmar retailers
These Stapleton row houses seem designed with the idea competitive, Lakewood waived half of the
that, if the neighborhood looks enough like Brooklyn, regular city sales tax for Belmar retail purchases.
residents will drive as little as Brooklynites do. However, total sales tax collections must meet
New Urban Renewal in Colorado’s Front Range 13

Louisville
Another urban-renewal controversy took place
in Louisville, a growing city in Boulder County
northwest of Denver. A series of three public
hearings in late 2006 generated heated testimony
from opponents who argued that redevelopment
of the former “Pow Wow Grounds,” on Colorado
42, did not require a $77.5 million subsidy. The
area is near a planned FasTracks line and the
redevelopment plan called for building a New
Urban, mixed-use development.69
The Denver metro area has some of the most expensive After hearing this testimony, the city council
housing in the nation’s interior, a problem that will
initially rejected the plan by a 4-to-3 vote in
not be solved by subsidizing row houses that sell in
“the $300s.”
November, 2006.70 However, after receiving a
report from a consultant that claimed that the
a minimum threshold before some are used as project would produce a net increase in tax
PIF, and as of 2005, taxes have not reached that revenues to the city, the city council approved
threshhold.65 the plan by a 5-to-2 vote in December, 2006.71 Yet
Approval for Belmar, and especially for the the study did not ask whether the net increase
$95.5 million in bonds to be financed by TIF in taxes might be even greater if redevelopment
and PIF, encountered some resistance from local took place without any subsidies.72
residents and other government agencies. The At some point, cities in the Denver metro area
West Jefferson County Metro Fire Protection will saturate the limited demand for New Urban
District was “shocked” to realize that tax- developments, if they have not already done
increment financing would siphon more than so. This has happened in Portland, which has
$20 million from its tax revenues over the life of built numerous transit-oriented developments
the project, including a cost of $108,000 the first that suffer from high vacancy rates. Portland
year.66 Some tenants of Villa Italia did not want also discovered that so-called transit-oriented
to vacate, and had to be evicted using eminent developments only work if there is plenty of
domain.67 Lakewood approved the project parking.73 People who are inclined to drive will
despite these problems, making Belmar the most not give up their cars just because they have
heavily subsidized shopping mall in the Denver been forced by high housing prices to live in
metro area. New Urban developments.
One of the goals of New Urban development
is reduce auto driving by mixing residences with
potential employers. However, the latest study
about Belmar indicates that only 10 percent of
renters and 5 percent of homeowners actually
work at Belmar.68 Of course, the project will not
be fully completed until 2010 or 2011.
Developers have offered numerous incentives
to move into Belmar, such as a free Vespa scooter
upon purchase of a condo. Condo prices range
from the $200’s to the $900’s if an unobstructed
view of the mountains is desired. Although
designed with wide sidewalks in order to
be pedestrian friendly, the auto has not been
Belmar has the “skinny streets” typical of a New
forgotten and is accommodated in numerous
Urban community on the unverified theory, as stated
parking garages. on the sign (inset), that narrow streets are safer.
14 New Urban Renewal in Colorado’s Front Range

Conclusion
Urban renewal has become a way for Colorado issues. Despite the legal requirements that
cities to coin money. Despite TABOR, it allows cities declare an area blighted, no one really
them to effectively increase property and sales thinks that subsidies were needed to stimulate
taxes without a vote of the people. Those taxes redevelopment of such places as Stapleton
then go into a giant slush fund that can be used Airport or Villa Italia. Instead, it is all about
to support favored developers or the latest promoting a change in American lifestyles—at
planning fads. taxpayer expense.
The historical argument in favor of urban • Why should planners be allowed to socially
renewal is that it allows cities to rapidly restore engineer Coloradans so that they live in an
blighted areas. But often, the obstacles to environmentally-correct manner?
private recovery from blight are not financial • Why should Coloradans who want to live a
but regulatory. Strict planning rules, lengthy New-Urban lifestyle be subsidized by those
permitting processes, and (in downtown who do not?
areas) congestion are more likely to discourage • Will subsidized New Urban developments
redevelopment than lack of funds. produce the benefits claimed for them, such
When Anaheim, California decided to as reductions in per-capita driving?
redevelop its core area, it did so by relaxing • What happens when cities saturate the
such regulations. The only subsidies were fee limited demand for such communities?
waivers for home-based businesses and some If areas can be redeveloped without
building permits. The result? Billions in private subsidies, planners should not use subsidies to
investments in retail, restaurant, and office space, promote their private utopias. If an area cannot
including the construction of more than a dozen be redeveloped without subsidies, cities should
high rises.74 Yet most cities prefer to promote examine whether other actions, such as reducing
redevelopment through subsidies rather than by land-use regulation or streamlining lengthy
relaxing regulation. permitting processes, will do as much or more
Historically, urban renewal has always raised to promote redevelopment as the subsidies.
a number of disturbing questions: If deregulation is insufficient to promote
• Why should cities become developers, that redevelopment, we have to question whether
is, why should they take risks with taxpayers’ cities can possibly get their money’s worth (or
money that developers themselves might taxpayer’s money’s worth) from investing in
not take? redevelopments that private developers would
• Why should some developers and property not do, especially if those developments are
owners be favored with subsidies when primarily aimed at lifestyle changes, not fixing
their developments directly compete with urban blight.
unsubsidized retail, office, and housing The Center for the American Dream
projects? recommends that the Colorado legislature repeal
• What happens to the people and businesses all laws allowing cities to use tax-increment
evicted by eminent domain? financing and property-improvement fees to
• What happens when developers refuse to finance urban renewal. The legislature should
do any more developments unless they are also strictly regulate urban-renewal authorities
all subsidized? to insure that they do not invest any taxpayer
The addition of New Urbanism into the dollars in projects whose aim is to alter people’s
mix simply doubles the number of disturbing lifestyles rather than just restore blighted areas.
New Urban Renewal in Colorado’s Front Range 15

Appendices
I. Front Range Urban Elitch’s
Northeast Park Hill
Renewal Authorities Pepsi Center
Point Urban
Aurora Urban Renewal Authority South Broadway
Broomfield Urban Renewal Authority St. Lukes Hospital #1
Commerce City Urban Renewal Authority St. Lukes Hospital #2
Edgewater Urban Renewal Authority Stapleton Development
Federal Heights Urban Renewal Authority Westwood
Boulder Urban Renewal Authority 38th and York
Central City Redevelopment Agency
Englewood Urban Renewal Authority
Fort Collins Urban Renewal Authority
III. Current and Recent
Arvada Urban Renewal Authority Urban Renewal Projects in
Brighton Urban Renewal Authority
Colorado Springs Urban Renewal Authority the Denver Metro Area
Denver Urban Renewal Authority
Estes Park Urban Renewal Authority Arvada City Center
Golden Urban Renewal Authority Arvada Ralston Fields
Greeley Urban Renewal Authority Arvada Jefferson Center
Lakewood Reinvestment Authority Aurora City Center
Loveland Urban Renewal Authority Aurora Fitzsimmons Medical Research Campus
Pueblo Urban Renewal Authority Aurora/Fletcher Plaza Original Downtown
Sheridan Urban Renewal Authority Boulder Valley Regional Center
Superior Urban Renewal Authority Boulder 9th & Canyon
Lafayette Urban Renewal Authority Broomfield West 120th Avenue Gateway
Thornton Development Authority Corridor
Littleton Riverfront Authority Broomfield Hunter Douglas Project
Northglenn Urban Renewal Authority Broomfield Shopping Center
Sterling Urban Renewal Authority Broomfield U.S. 36 Interlocken Business Center
Westminster Economic Development Authority Broomfield Events Center, Arista TOD
Wheat Ridge Urban Renewal Authority Englewood City Center/TOD
Golden Safeway
Golden Bent Gate/Outdoor Gear
II. Denver TIF Districts Golden Gem/office/retail
Golden Clear Creek Commons Senior Center
Alameda Square Golden Clear Creek Square/Jackson Ct
American National Golden Gateway Station/PUD
California St. Parking Garage Lakewood Belmar
City Park South Lakewood Creekside (Colfax-Wadsworth)
Downtown Denver Thornton 104th to 84th Avenue
Executive Tower Hotel Westminster Mandalay Gardens
Guaranty Bank Westminster NorthGate, 72nd-Federal
Highlands Garden Village Westminster South
Lowry Urban Development Wheatridge Town Center
Mercantile Square Wheat Ridge 38th Ave Corridor
16 New Urban Renewal in Colorado’s Front Range

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1. “Colorado URAs,” September, 2004, 3 pp.; 19. Tony Robinson & Chris Nevitt, Are We Getting
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Denver, Denver Urban Renewal Authority, CO: Front Range Economic Strategy Center,
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5. Colorado Revised Statutes (CRS) 31-25-103(2). 23. Broomfield Urban Renewal Authority, 2006
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8. CRS 31-25-103(2)(l). 25. Mark Graham, Englewood Senior Planner,
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(Indianapolis, IN: Bobbs Merrill, 1964), p. 3. 27. Brad Power, Boulder Redevelopment Director,
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New Urban Renewal in Colorado’s Front Range 17

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38. Rocky Mountain News, “Englewood Urban 58. City of Denver, Transit-Oriented Development
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Demolish Trolley Square,” Rocky Mountain News, Update,” City of Longmont, August 22, 2006,
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41. Ibid, p. 16. 60. Denver Urban Renewal Authority, Lowry
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shape cities,” November 23, 2000, archives.cnn. 61. Alana Jefferson, “Row houses? In Denver?”
com/2000/books/news/11/23/jane.jacobs.ap. The Denver Post, August 16, 2006, tinyurl.com/
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New Urbanism,” (Chicago, IL: CNU, 1996). 63. City of Denver, Joint meeting summary,
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com/3xmovw. yqr2uq.
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Decentralization—An American Perspective, paper Urban Renewal,” tinyurl.com/3ytylp.
presented at the International Conference on 65. Development Research Partners, Economic and
Cities on the Threshold of the 21st Century, Utrect, Fiscal Impacts of the Belmar Reinvestment Project
the Netherlands, 1998, p. 1; www.uctc.net/ 2002-2005, August 2, 2006.
papers/443.pdf. 66. Minutes of the Lakewood City Council meeting
47. Dowell Myers and Elizabeth Gearin, “Current of June 23, 2003; tinyurl.com/2hgkbe.
Preferences and Future Demand for Denser 67. Christopher Swope, “After the Mall,” Municipal
Residential Developments,” Housing Policy research and Services Center of Washington;
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48. National Family Opinion, Consumers Survey 68. Vicki Stack, Lakewood Council member, e-mail
Conducted by NAR and NAHB (Washington, DC: message to the author, August 20, 2006.
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tinyurl.com/y5n9yd. Boulder Daily Camera, November 9, 2006; tinyurl.
49. Al Lewis, “Condos a Tough Sell These Days,” com/2fn86q.
Denver Post, August 12, 2006. 70. Ibid.
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Vision 2030 Plan (Denver, CO: DRCOG, 2005), p. Boulder Daily Camera, December 6, 2006; tinyurl.
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51. Ibid, p. 14. 72. Dan Guimond, Andy Knudtsen, and Josh Birks,
52. Erin Johansen, “Home prices hurt efforts at Highway 42 Revitalization Area Technical Review
eco-devo,” Denver Business Journal, July 4, 2003, (Denver, CO: Economic & Planning Systems,
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Growth Makes Housing Unaffordable (Golden, Oriented Developments (Portland, OR: Cascade
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articles/3-2006.pdf. 74. Steven Greenhut, “The Anti-Kelo,” Wall Street
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Independence Institute • 13952 Denver West Parkway, Suite 400 • Golden, Colorado 80401 • 303-279-6536 • i2i.org/cad.aspx

About the Center for the American Dream

The Independence Institute’s Center for the American Dream works to give people freedom of choice
in land use and transportation while protecting urban livability and environmental quality. The
“dream” of the Center for the American Dream is affordable homeownership, mobility, a clean and
livable environment, and personal freedom for all Americans, not just an elite few.
The Center for the American Dream does not advocate that people drive everywhere or take
public transit, live in low-density suburbs or high-density urban centers. All of these are legitimate
lifestyles. The Center supports free-market solutions to urban problems such as value-priced roads
and competitive transit, and opposes coercive planning efforts that attempt to engineer lifestyles
through subsidies, regulation, and limits on personal and economic freedom.

About New Urban Renewal

Designed to help cities improve blighted areas, urban renewal has often been the source of shady
real-estate deals in which a few lucky property owners or developers get heavy subsidies at everyone
else’s expense. The average property owner loses twice: by having to pay higher tax rates to subsidize
the urban-renewal areas and by having lower property values because developments are attracted
away from their land to the urban-renewal districts.
Today, urban renewal has morphed into taxpayer support for New Urbanism, a planning concept
that calls for high-density, mixed-use developments with narrow streets and, sometimes, limited
parking. New Urbanism is supposed to reduce driving, but cities are planning for it without verifying
whether it really changes people’s travel habits or otherwise improves urban life.
In the Denver metropolitan area, urban renewal financial schemes such as tax-increment
financing and property improvement fees are being used to subsidize the construction of New Urban
transit-oriented developments along existing and planned rail transit lines. The logic behind such
developments is circular: we have to subsidize rail transit to promote a more compact region and we
have to subsidize compact development to support rail ridership.
In the end, it is hard to determine what the real goal of New Urban Renewal is other than giving
subsidies to a few lucky developers. These subsidies are costing Denver metro-area residents millions
of dollars each year, which they must pay either in the form of reduced funding to schools, fire,
police, and other urban services or higher taxes.

About the Author

A native of Topeka, Kansas, Jennifer Lang has a bachelor’s degree in biology from Baker University.
She moved to Denver in 2005 and is currently writing her master’s thesis on property rights conflicts
at the University of Denver. She wrote this paper based on research she did for the Independence
Institute in 2006.