Many Colorado Springs business leaders suffer from severe cases of Denvy (short for “Denver Envy”). Denvy attacks can occur at any time, but are most often associated with yet another announcement of a Denver-area megaproject.
DIA, Coors Field, the Colorado Convention Center, the Denver Art Museum, the Museum of Contemporary Art, RTD’s light rail project, the Union Station renovation, the transformation of the Central Platte Valley, the Scientific & Cultural Facilities tax … enough, already!
But Denver never sleeps. Consider the National Western Stock Show project.
The Stock Show has been a part of Denver since 1906. In recent decades it has suffered from benign neglect. Its aging facilities needed expensive upgrades, while the event itself was to some an embarrassing reminder of Denver’s past as a dusty little cow town.
City leaders hemmed and hawed, fought off a half-hearted attempt by Aurora to steal the event from Denver and slowly created new plans to renovate, restore and reimagine the sprawling site.
The plan, as touted in the purple prose that tends to accompany such proposals, “… represents a visionary transformation of the National Western Stock Show Complex and Denver Coliseum sites into a must-see destination and regional asset, enhancing these current Denver landmarks through creative year-round activity. With a combined 130 acres of redeveloped land, the Stock Show Complex will support Denver’s global standing as a world-class hub for the Western way of life.
“The master planning effort will bolster a variety of opportunities through the involvement of our partners including Colorado State University, the Denver Museum of Nature & Science (and) History Colorado. … In short, the NWC can become an international model for a synergistic educational and R&D community — with those entire words writ broad and adapted to the evolving definitions of mid-21st century populations.”
Plans include a new 10,000-seat arena to replace the Denver Coliseum, a Colorado State University center, a CSU equine sports medicine facility, a new Stock Show pavilion, a trade show/exhibition hall, the repurposing of the old Stock Show pavilion into a vast public market, the improvement of more than a mile of the South Platte waterfront and a dozen other initiatives.
Estimated cost: $1.1 billion.
The financing plan is fairly straightforward. The state will contribute $250 million toward Colorado State University’s buildings in the form of legislatively authorized lease-purchase agreements funded by certificates of participation. That’s how the state aided the construction of the University of Colorado’s Anschutz Medical Center in Aurora 10 years ago.
Legislative approval seems all but certain — HB 1344, introduced with bipartisan support by House Majority Leader Crisanta Duran, D-Denver, and Rep. Jon Becker, R-Fort Morgan, cleared the House last week on a 52-12 vote. Thanks to this unusual coalition between Denver-area Democrats and rural Republican legislators, there appears to be no significant opposition in the Senate.
Denver also has applied for $116.9 million in funding through the Regional Tourism Act. In its application, a united city government cited multiple partnerships with regional entities, and undertook to raise $673.3 million for the project. Additional funding will come from the Stock Show itself, which has committed to raise $50 million, and CSU, which will contribute $16.2 million.
The project’s rationale seems compelling. The application notes that despite aging and functionally obsolete structures, the Stock Show attracts nearly 1 million visitors annually and contributes substantially to the regional economy. The reimagined complex could draw twice as many and revitalize adjoining neighborhoods, as well as housing a major university facility.
The financial calculus
Asked a skeptical senior financial analyst for the city of Colorado Springs: “$673 million? Where are they going to get the money?”
Where, indeed? The city and county of Denver’s population is about 650,000, roughly equivalent to El Paso County. But Denver punches way above its weight.
The total assessed value of all real property in Denver is $11.36 billion. Of that, $4.9 billion is commercial and $4.6 billion is residential. In El Paso County, total assessed value is $6.4 billion, with $3.6 billion residential and $1.7 billion commercial.
Denver’s general fund mill levy, at 13.362, isn’t significantly higher than the combined mill levy of El Paso County (7.791) and Colorado Springs (4.279), but its property tax receipts are far higher, thanks to multiple special levies. Those levies, including those for bond interest and principal, for fire and police pensions, for social services and for capital maintenance, bring the mill levy up to 33.055, resulting in total collections of $376,339,480. That’s far above the $70,193,774 collected by Colorado Springs and El Paso County.
Denver levies a 3.65 percent sales tax, which was projected to raise $619.5 million in 2015. Denver’s overall sales tax rate, including 2.9 percent to the state, 1 percent to RTD, and .10 percent to the cultural facilities district, is 7.62 percent.
Curiously, Colorado Springs and El Paso County’s overall sales tax rate is virtually identical to Denver’s. The city/county rate is 3.73 percent, which combined with the state’s 2.9 percent rate and the 1.0 percent collected by the Pikes Peak Rural Transportation Authority gives an overall sales tax rate of 7.63 percent. For 2015, the city’s 2.5 percent tax is projected to raise $147.8 million.
Denver’s edge over Colorado Springs is most apparent in the difference between lodging and automobile rental taxes. Denver levies a 10.75 percent lodging tax and a 7.25 percent car rental tax, compared to Colorado Springs’ rates of 2 percent and 1 percent.
Show me the money
To finance the Stock Show project, in November, Denver voters will be asked to extend and possibly increase the rates of both taxes. Those revenues will in turn secure bonds that will help fund Denver’s share of the project.
It’s still not clear whether other municipal funding sources will be tapped, but Denver is scarcely strapped for tax revenue. As noted in the 2015 Colorado Springs budget, Denver spends more than three times as much per capita ($2,447) than Colorado Springs ($718).
Of course, statistics can be deceptive, especially since Denver’s total governmental funds expenditures include those related to wastewater services and DIA, together totaling more than $500 million.
So there you have it. Denver bootstraps $673 million of the $1.1 billion project, scoops up another $250 million by partnering with Colorado State University and Republican legislators, and now seems on track to pick up $116.9 million in RTA funds.
It’s an example of what can be achieved by multiple regional partnerships, by unity among elected officials and by a powerful business community.
“If they can pull it off, it’ll be amazing,” said a fervent supporter of the local City for Champions project. “They made deals with everybody, and we can’t even make deals with each other.”