Sterling’s Urban Renewal Authority (SURA) wants more tax breaks. An open email to my local governmental entities re. SURA.

Sterling’s Urban Renewal Authority (SURA) wants more tax breaks. Part 1.

This is part 1 of a 2 part post on urban renewal authorities, using the recent decision to try and extend the geographic area of Sterling Colorado’s urban renewal authority as an example. Part 1 will cover what is going on, part 2 will loosely be about how they’re financed and what impact that has on you. I tacked on one post beyond that which contains my open email to the relevant local authorities.

The language about urban renewal authorities can be confusing and technical. You could argue whether or not this is intentional, but it is reality.

Do not, however, lose sight of the following:

It is a tax break given to someone (developers and businesses usually) in order to lure them to come in and build something, a hotel, a business, apartments, etc.

There is no magic in the world. If you collect fewer taxes from something, you will either have to cut services or increase taxes on the other part of the tax base to make it up; i.e. governments cannot generate wealth, they only take it.

The article linked at bottom is the same link I used in Friday’s newsletter to discuss Logan County’s moratorium on permits for renewables. Later on in the article was a blurb about how the Sterling Urban Renewal Authority (SURA) wants to add to its current area of influence.

Quoting the article:

“Right now, there are three existing plan areas within the SURA district – Gateway, which includes Walgreens, Bank of Colorado and Family Food Market, Downtown, and the Excel, which is the area where Sterling Ethanol and Trinidad Benham are located, and all of their Tax Increment Financing (TIF) expires in the next five years. ‘The Downtown is where we’ve been able to do a lot of work with some of the small property owners, small businesses and things and help get those improvements done in those buildings, which is extremely costly in those old structures, old infrastructures,’ Miller said. They have also helped with sidewalk work. Now, SURA is planning to add a new area, the West Main Street Urban Renewal Area, which stretches all the way down W. Main Street and a block north and south. Walmart is not included in the designated area, but the Pioneer Park softball fields are, due to conversations that have happened in the past about potential needs at that site.”

Originally developed as a way to fight urban blight, urban renewal authorities are governmental entities that offer tax breaks to businesses and developers in order to convince them to come into an area that needs redevelopment.

In my time up here in Sterling, I have seen some remarkable transformations both in downtown and along Main Street. Whether or not this has been due to SURA, whether it was due to economic activity that would have happened anyway, I’m less certain of.

This is one of the tougher questions about urban renewal: did the new development happen because of the incentives or was it a case of the incentives being icing on a cake already baked.

There’s another issue with regard to urban renewal. Who gets to define blight and how bad is it?

The screenshot labeled “Blight” comes from the second link below (see also “Related”). As you can see by reading, the definition of blight here is, well, expansive. I have also heard tale of farmland (yes, farmland) being called blighted.

This vagueness and wiggle room for governments and urban renewal authorities to call a bit of land blighted is a common complaint many have about them.

Knowing the definition, I now point you to the area of Sterling that SURA wants to call blighted and bring under their wing. See screenshots 1 - 7 attached. They are from Google Street Map images up and down Main from the area of proposed expansion. Sterling residents will note that not all of them are from the same time period, but there is no real substantive change.

Consider the scenery as you drive up and down Main St or look through the pictures and ask yourself whether or not you think what you see looks blighted.

Old? Yes, in parts. In some parts, see picture 7 as an example, are brand new.

Vacant, tumbledown buildings? Yes, in parts. In some parts, some of these vacant buildings are already being rented and used. Picture 3 is a great example. This was a Mexican restaurant on Main that sat empty for years. Wholly and completely without urban renewal incentives, though with the help of marijuana’s legalization, it’s now occupied.

That’s why I’m a little skeptical of why SURA needs to extend along Main. I question whether it’s needed, I question whether it would help, and I question the underlying assumption that there’s blight there to fix in the first place!

This would be a more academic question if it weren’t for the fact that the incentives used to supposedly lure business didn’t have the potential for harm. They can either deprive existing tax-funded things like schools and fire departments of revenue, and/or they can cause increases in the taxes property owners pay.

We’ll get to that in post 2.

https://www.journal-advocate.com/2025/10/07/county-to-put-moratorium-on-wind-solar-battery-storage-and-data-center-projects/

https://www.sehinc.com/insights/how-colorado-communities-can-benefit-urban-renewal-authority

Related:

Presented in the interest of balance, the site below is quite the cheerleader for Urban Renewal Authorities and presents some facts about them (as well as a list of positives).

https://www.sehinc.com/insights/how-colorado-communities-can-benefit-urban-renewal-authority

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Sterling’s Urban Renewal Authority (SURA) wants more tax breaks for developers. Part 2.

This is part 2 of a 2 parter on urban renewal authorities, using the recent decision to try and extend the geographic area of Sterling Colorado’s urban renewal authority as an example. You won’t necessarily have to read Part 1 to understand this, but it would be helpful as it has some context which I won’t explain here.

In this part, let’s look at the rudiments of how the tax breaks that necessarily come with urban renewal are paid for. In other words let’s look in more detail at the second maxim I offered you in the first post:

“There is no magic in the world. If you collect fewer taxes from something, you will either have to cut services or increase taxes on the other part of the tax base to make it up; i.e. governments cannot generate wealth, they only take it.”

The bargain that urban renewal proposes is that you offer a tax break to a business or developer, something which reduces current revenue, in order get more tax revenue later. You also get the benefit of getting rid of urban blight. Sounds like a good deal. This is all the better when it’s sold as the development paying its own way.

Tax Increment Financing (TIF) is how they claim the development pays for itself.

TIF is a subsidy. Plain and simple. One way or another a developer or business gets money or a tax break from the government. You may often hear that a TIF takes no money directly from the government. This may be technically true, but it is yet another example of a government two-step.

Quoting the Wikipedia explainer below:

“To provide the needed subsidy, the urban renewal district, or TIF district, is often drawn around additional real estate beyond the project site to provide the needed borrowing capacity for the project or projects. The borrowing capacity is established by committing all normal yearly future real estate tax increases from every parcel in the TIF district (for 20–25 years, or more) along with the anticipated new tax revenue eventually coming from the project or projects themselves. If the projects are public improvements paying no real estate taxes, all of the repayment will come from the adjacent properties within the TIF district.”

In simple words, what they’re saying is that they tax breaks or other incentives are paid for by everyone else paying more. This is not done by the government coming to you (if you live in the district) and taking from you to hand a check to a developer. In that sense the TIF doesn’t come directly from government appropriations.

It is paid for by you in the sense that the revenue the government foreswears from the blighted property while it’s being revamped comes either by the government spending less or by taxing you more.

This could take the form of a direct tax increase, or it could take the form of the revamped properties raising property values everywhere. Since you pay property tax based on a percentage of your property’s value, a higher property value (real or imagined by the assessor) means more money out of your pocket.

That’s not all.

As the formerly blighted properties are improved, as more people come into an area, the need for services goes up. Inflation also raises prices. The developer/business/apartment building, with their tax breaks usually don’t pay this for years.

Screenshot 1 attached is from that same Wikipedia article and gives a visual for this dynamic. The flat solid line is the frozen (subsidized) tax the new development pays, while the rising lines are the costs.

That red triangle? That’s going to be what you’ll be required to make up, or what the local governments (schools, fire districts, county coffers) will have to trim to make the budget work.

Again, the message is clear: there is no magic. When you give someone a subsidy, the budget either has to be cut or someone has to pay more. End of story.

Another quote from the Wikipedia article sets up what I want to end with.

“The completion of a public or private project can at times result in an increase in the value of surrounding real estate, which generates additional tax revenue. Sales-tax revenue may also increase, and jobs may be added, although these factors and their multipliers usually do not influence the structure of TIF.”

It is fair to note that urban renewal can bring in more revenue, sometimes enough to pay for itself in the long run. Perhaps. This is why I labeled it a bargain (gamble) above.

Every gamble has a downside and risk. There’s no guarantee it will pay for itself. There’s no guarantee it will cost you more. It’s a question of what you find valuable and worthwhile. It’s a question of what you’re willing to risk.

In the last post of the day, I will outline what my thoughts are via an open email to the local governments that would have to interact with the Sterling Urban Renewal Authority.

https://en.wikipedia.org/wiki/Tax_increment_financing

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An open email to my local governmental entities re. the Sterling Urban Renewal Authority (SURA)

At the end of the last post I said I’d outline where I stood via an open email to the relevant local governments. I will, but in just trying to write and send an email, I came upon a couple of questions to answer first.

Who do I send the email to? I.e. who is it that ultimately decides whether to let SURA expand? Does anyone?

In the article I link to in today’s first post, there is a line near the end that says SURA has been making the rounds to various local governments that would be effected by their proposed expansion: the city, the county, the school district, water conservancy districts. The article hints at SURA needing, by state law, to finalize Intergovernmental Agreements with these entities.

That isn’t quite the same as asking permission, however. It’s just a contract spelling out how they’ll all work together.

I am not a lawyer, but I reached out to former county commissioners for Logan County as well as an actual lawyer to see who you would bring a question to, who might be persuaded to put a stop to SURA blighting Main St. The impression I got from all was that once the authority has decided to expand, only court action based on a failure to meet Colorado law can stop it.

This impression was bolstered by reading through the relevant bits of the state law in the first link below.

In the absence of certainty about who to send it to and who, if anyone, can pump the brakes here, I decided to broadcast the message far and wide. I decided to write a quick open email and send it to the members of SURA as well as the local governments above.

The text of that open email follows the link.

https://codes.findlaw.com/co/title-31-government-municipal/co-rev-st-sect-31-25-107/

An open email to the governing body of SURA, the RE-1 Valley School District, the Logan County Commissioners, the City Council of Sterling, and the board of the Lower South Platte Water Conservancy District

To the various commissioners and board members,

My name is Cory Gaines. I am a resident of Sterling. Perhaps I am a bit too late, but I read in a recent Journal Advocate article that the Sterling Urban Renewal Authority (SURA) is considering an expansion of its territory to go West along Main St. all the way to Pioneer Park.

I wanted to write this open letter to share my concerns as a taxpayer about this proposed expansion. I invite anyone else reading this letter to also reach out with their concerns.

It’s my understanding from the article I read that this expansion would be funded with Tax Increment Financing (TIF). TIFs sound good, but I am old enough now to not believe in magic, and I realize that you cannot give a subsidy to someone without either a cut to government services, taking more from other taxpayers, or both.

November’s ballot up here in Sterling has the City asking to increase taxes. It has the county asking to keep an existing tax. It has RE-1 Valley asking to fund a bond.

And on top of all this asking for our money, we see that SURA wants to effectively do the same: either force those entities to make do with less or reach into the pockets of some taxpayers so that the money could go to businesses and developers.

The argument for urban renewal districts is often that they’re necessary to fund improvements and that the increased revenue from those improvements makes a net positive.

In answer to this, I’d like to make a few points.

First, I invite anyone reading to drive down Main and consider whether it’s truly blighted or not. Then I want you to note that the definition of blight for urban renewal is so general as to mean nearly anything can be a sign of blight. Got a crack in your sidewalk? That’s blight. Got “unusual topography”? Oh, that’s blight.

Second, I invite anyone reading to note that a few businesses (the new vape shop next to McDonalds being one) have opened along Main in recent memory. This has happened wholly without an urban renewal district.

Lastly, I’d like to point out that any net positive from urban renewal subsidies are a gamble, said gamble being years in paying off. In the meantime, something or someone will have to make up any revenue shortfall.

Let’s reconsider this move. Let’s reconsider whether or not, in a year where you ask us for more of our money to fund what you keep telling us are necessary services, we want to limit the ability to raise revenue. Let’s think about what signal that sends to voters.

Thank you,

C

Related:

After sending my open email, I received a response from Andrew Fritzler who heads SURA. He sent me the quoted text below in an email and the link at bottom is the report he references.

Dear Mr. Gaines,

Thank you for taking the time to share your thoughtful comments regarding the proposed new district of the Sterling Urban Renewal Authority (SURA). We appreciate residents who engage in these discussions and care deeply about the fiscal health and future of our community.

We understand your perspective and recognize that parts of West Main Street have benefitted from private investment, which is encouraging. However, many properties and infrastructure challenges still limit the area’s full redevelopment potential. Expanding the urban renewal area would simply add another tool to help address those needs where appropriate, it is not a blanket subsidy or mandate.

SURA remains committed to transparency and open to community dialogue. The proposed expansion will require a formal planning process that includes public notice, and opportunities for input from all taxing entities and citizens before any final decision is made. We welcome your continued participation in that process.

Once again, thank you for sharing your perspective. We value your voice and encourage you to attend an upcoming SURA meeting or reach out directly if you’d like to discuss this further.

I have also attached a copy of the Sterling Conditions Survey prepared by Pioneer Development Company, a 3^rd party company hired by SURA for the new district.

Andrew Fritzler

SURA President

https://drive.google.com/file/d/1iceFvu-ks-wJT8YmcbID8AXrn97f1tJS/view?usp=sharing