An estimated 2,500 Denver residents and qualifying businesses will have an extra ballot question to vote on in November that their neighbors will not.
The City Council on Monday agreed to put the future of the Denver Downtown Development Authority — and thus potential funding for more than half a billion dollars in infrastructure and other projects in the city’s downtown core — in the hands of those qualified electors.
Mayor Mike Johnston announced his ambitions to greatly expand the little-known taxing authority at a press conference outside Union Station in May. At the time, he described the tsunami of new public investment that expansion could bring as a means to snap the downtown “doom loop” of falling commercial activity and rising crime that emerged at the outset of the COVID pandemic.
The city’s core is experiencing what is believed to be record levels of office vacancy, according to real estate firm JLL.
The authority, abbreviated DDDA, derives its income from collecting a portion of sales and property taxes from participating property owners within its boundaries. It uses that money to pay for approved development work that is identified “with an eye towards stimulating economic growth and alleviating deterioration of conditions,” Dawnna Wilder, a project manager with the city’s Department of Finance, told council members at a committee hearing earlier this month.
The district was launched in 2008 to pay off an estimated $400 million in public debt that was taken on to pay for infrastructure around the station when that facility was undergoing its major overhaul.
The ballot question that council members referred to voters on Monday would authorize the city to take on up to $570 million in new debt on behalf of the DDDA to pay for both public facilities and projects and possibly improvements to private property as well. The measure would set a repayment cap of $847 million on that debt, factoring in a 5% interest rate and other costs, Wilder said in that committee hearing earlier this month.
The debt would not be on the city’s books. It would belong to the DDDA. The authority is authorized to collect shares of tax revenue through 2038. Approval of the measure would not increase taxes on participating properties, city leaders emphasized.
Only property owners, residents and tenant businesses in the district’s existing boundaries will vote on that question in November. Those boundaries cover Union Station and several blocks immediately surrounding it and the city block that was formerly home to the Regional Transportation District’s Market Street Station, city maps show. The City Clerk and Recorder’s Office is handling outreach to qualified electors.
The council will come to bear on other key elements of Johnston’s plan in the months ahead.
Council members are expected to vote in October on whether or not to expand the district’s boundaries to include the entirety of the city’s Central Business District and even reach across Broadway into the North Capitol Hill neighborhood.
The council will also vote on a new development plan that will specify how any newly raised debt or other funding can be used, Wilder said.
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