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Charter Amendment Limiting Development Subsidies

Sign on left lists Home Depot, Kohl's, Petco, Deluth Trading, and Carmax. Sign on right shows King Soopers.
Development Deals of the 1990s - Click to enlarge

Tonight, City Council will be voting to amend a long-standing part of our city charter. I asked Don Parker, a Golden-based attorney who led the effort to limit subsidies for developers, to explain why the limit was enacted in the first place.

By Don Parker

I was part of the group of people who circulated petitions in 1999 and 2001 to get a charter amendment on the ballot to limit development subsidies.  We were inspired by the City having given six figure subsidies for development of a couple of shopping centers and their having given smaller subsidies for various commercial developments.  Also the City as well as the County and the State governments had offered subsidies to encourage a Nike headquarters to be built on the top of South Table Mountain in 1997.  Our group wanted to limit the City government from giving or even offering development subsidies in the future.  We lost in 1999 but we tried again in 2001 and that time it passed.  (We also put an Amendment for direct election of the City’s Mayor on the ballot in 2001 which also passed.  Before that the Mayor had been elected by the City Council from among its members.)

Unfortunately (in my view) it is a common practice in Colorado and many other states to give development subsidies, and for developers and businesses to benefit from communities competing for sales tax revenue and for other developments.  It is usually a transfer of money from taxpayers to usually wealthier folks.  So we wanted an extra check on that power by requiring voter approval for most development subsidies. 

The Charter Amendment that passed says in part that “ The City may not grant development subsidies or incentives in connection with the establishment, expansion, retention , or replacement of a business or any commercial, industrial, or residential development except…”   The exceptions are: 1) anything voters approve, 2) amounts limited to $100,000 for low-income housing, senior housing, and improvements to historic structures, and 3) $25,000 for anything else. 

The charter amendment does allow for inflation increases in those limits.  So the City Council is planning to consider increasing those limits by the inflation rate since 2001 at its upcoming Council meeting on Tuesday May 28.  That will raise the limits to about $177,000 and $44,000 and then allow for automatic annual inflation increases each year thereafter.  Council members and staff have expressed interest in bringing more affordable housing developments to Golden so the focus now on raising the limits may be related.

The Charter Amendment also requires that the recipients of the subsidies place and maintain a sign on the property for five years thanking the taxpayers and stating the dollar value of the subsidies and incentives given.