Despite rapid growth along the Front Range in recent years, it’s easy to forget that some areas continue to lag in terms of economic development.
That’s why it’s good to see the city of Greeley, the state of Colorado and the federal government propose common-sense incentives to encourage projects in underdeveloped areas.
In Greeley’s case, the city has advanced a proposal to expand its incentives for development downtown, along the Eighth Avenue corridor, the University of Northern Colorado campus, areas east of downtown and the Greeley Mall. The city will reimburse 25 percent to 100 percent of building and impact fees, and sales and use taxes, depending on the size of the project.
The program comes as welcome news to developers eyeing projects downtown and along Eighth Avenue, including the Richmark Cos., which has been acquiring real estate in the area. Richmark recently made a compelling case for why it costs more to develop in such an area versus a “greenfield” development, including lower property values, deferred maintenance on historic buildings, parking concerns, higher construction costs, outdated infrastructure, etc.
One of Richmark’s first projects will be South Maddie, a mixed-use development on Eighth Avenue between 15th and 17th streets. One of the initial projects will be a 220-unit development with ground-floor retail and restaurants.
Greeley’s incentives promise to give developers — including Richmark — the assurance they need that projects such as South Maddie can be viable in these underserved areas.
As for the state and federal governments, a new incentive program comes through the federal Tax Cut and Jobs Act, passed in December. The measure included a provision for creation of “opportunity zones,” where investors can secure reduction or elimination of capital-gains taxes from investments made within the zones.
The Colorado Office of Economic Development and International Trade on March 23 designated 126 census tracts as “opportunity zones,” including areas in Boulder, Brighton, Dacono, Estes Park, Evans, Fort Collins, Greeley, Lafayette, Longmont, Loveland and eastern Weld County.
The zones must be approved by the U.S. Treasury Department and will be administered at the federal level.
Both the Greeley incentives and the federal opportunity zones reflect an acknowledgement that — despite the booming economy — not all areas have shared in that prosperity. Modest incentives can help tip the balance to move some projects forward.
We look forward to seeing what lies ahead.