Reposted from the Las Cruces Bulletin, June 17, 2011
Las Cruces repays large debt in record time
Revitalizing Downtown takes big bucks, but thanks to the combined efforts of the Downtown Las Cruces Partnership (DLCP), Downtown property owners, the City of Las Cruces, Doña Ana County and our local legislative delegation, generating the cash to complete the project became a little easier in 2007.
That’s when a majority of Downtown property owners and registered voters ap‑ proved the formation of a Tax Increment Development District (TIDD) in a special election.
The purpose of the TIDD is to create an income stream that can support the repay‑ ment of tax‑exempt bonds issued by the city to fund Downtown infrastructure improve‑ ments. The district is bounded by Picacho Av‑ enue on the north, Alameda Boulevard on the west, Campo Street on the east and California Avenue on the south.
Here’s how it works:
The gross receipts and property tax bases within the TIDD are “frozen” at the prede‑ velopment levels for bookkeeping purposes. The state, city and county then return to the district 75 percent of the taxes derived from increases in assessed values and gross receipts brought about by new development in the area for the next 20 years. Typically, the increased taxes would be added to the city, county and state general funds.
The first distribution of the city’s GRT increment was $1,485 in March 2009, according to city of Las Cruces Downtown Development Coordinator William Slettom. Through April of this year, the city’s contribution to the TIDD was more than $1.1 million. During the same period, Doña Ana County’s contribution totaled more than $178,000, although the county has not yet provided any funds derived from increases in property taxes. The state began contributing its portion of the collected taxes in October 2010, adding an additional $740,000 of the fund. Total income for the TIDD through April of this year was almost $2.1 million, Slettom said.
The first use of TIDD funds was to close the $1 million gap between the amount needed to fund the opening of the northernmost blocks of Main Street and the amount of funding the city had on hand for the project. To close the gap, the city borrowed $1 million from its re‑ serve fund. The loan was amortized more than 15 years, but was repaid last month – just one year from the date the funds were borrowed.
The TIDD funding is designed to cover approximately $8 million of the estimated $12 million required to complete Downtown revitalization projects, which includes the opening of the southernmost blocks of Main Street. In addition, plans are in place to use TIDD funds to finance the reconfiguration of Water and Church streets to accomodate two‑way traffic, and to redesign the portions of Las Cruces and Griggs streets that run be‑ tween Alameda Boulevard and Church Street.
If you haven’t been Downtown lately, you may not be aware of the vast amount of public and private investment that’s been made to date. New businesses are opening, street im‑ provements are well underway and economic development is in full swing. As the motto of the Downtown Las Cruces Partnership states, “It’s Really Happening!”