Improvement Districts for Colorado Counties, Cities, and Towns

• Publication year: 2001
• Pages: 53

30 Colo.Law. 1 Colorado Lawyer 2001.

2001, January, Pg. 53. Improvement Districts for Colorado Counties, Cities, and Towns

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53

Vol. 30, No. 1, Pg. 1

The Colorado Lawyer
January 2001
Vol. 30, No. 1 [Page 53]

Specialty Law Columns
Government and Administrative Law News
Improvement Districts for Colorado Counties, Cities, and Towns
by Dee P. Wisor, Kimberley K. Crawford

Facing unprecedented growth and the limitations of the Taxpayer's Bill of Rights ("TABOR"),1 Colorado counties and municipalities are increasingly looking for ways to finance improvements and services that do not impact the general budget of the municipality or county. This article reviews various statutory alternatives available for these purposes

The acronyms SID, LID, GID, PID, and BID each refer to types of districts Colorado counties and municipalities can use to finance many kinds of public infrastructure. Special improvement districts ("SIDs") and general improvement districts ("GIDs") are organized by a municipality under CRS §§ 31-25-501 et seq. and CRS §§ 31-25-601 et seq., respectively. Local improvement districts ("LIDs") and public improvement districts ("PIDs") are organized by a county under CRS §§ 30-20-601 et seq. and CRS §§ 30-20-501 et seq., respectively Business improvement districts ("BIDs") are hybrid entities organized by a municipality under CRS §§ 31- 25-1201 et seq. The scope of this article is limited to these districts and does not cover special districts organized pursuant to Title 32, CRS, or Underground Conversion Districts organized pursuant to Title 29, Article 8, CRS

SIDs and LIDs

There are some minor differences between these two districts, but the basic difference is that a SID is formed by a municipality, while a LID is formed by a county. Both can include property from another jurisdiction with the consent of that jurisdiction. SIDs and LIDs are often referred to as "assessment districts" because of the unique way in which they raise revenue.

SIDs and LIDs are not separate political subdivisions, and they have no independent existence apart from the municipality or county. They are geographical areas within which improvements are constructed and assessments levied. They have no board of directors, but are governed by the governing body of the municipality. Home rule municipalities may provide their own procedures for SIDs.2

Types of Improvements

SIDs and LIDs can be used to finance improvements that confer a special benefit to the property adjacent to the improvements. The types of improvements generally financed through these districts include roads, sidewalks, water lines, sewer lines, and other local improvements. The improvements provide a benefit to the abutting properties that is different than a general benefit to the government as a whole. Under the statutes, assessments cannot be used for maintenance, although some home rule municipalities may do so.

Revenue Raising Power

Both SIDs and LIDs raise revenue primarily through special assessments levied against individual properties benefited by the improvement.3 In order to be valid, special assessments against any particular property must be in an amount not greater than the special benefit conferred on such property by the improvements. Thus, the method by which assessments are distributed over the benefited properties must be formulated to equitably distribute those assessments based on benefit received.

There are a number of different methods of assessment, and any method may be used as long as it reasonably allocates the burden of the assessment on the benefited properties. The most common methods of assessment include the front-foot method, the area method, and the per-lot method. In any case, courts will not enforce an assessment that exceeds the increase in the market value of the property.4

Organizational and Assessment Procedures

Creation of a district is initiated either by petition filed by the property owners or by ordinance or resolution adopted by the county or municipality. In either event, the governing body must publish and mail notice of intent to form the district. After notice, a hearing is held on the creation. If a petition for improvement is signed by 100 percent of the owners of property to be assessed and it contains a request for waiver, the governing body may, at its discretion, waive any or all of...