Towns OK sales-tax sharing

EAGLE COUNTY - It's a deal. The towns of Eagle and Gypsum officially approved a sales tax revenue sharing agreement Tuesday that officials hope will level the playing field when dealing with potential big-box retail developers.

Under the terms of the agreement, if a major retailer lands on specified parcels of land in either town, half of the sales tax revenues will be shared in a 60-40 split. The "host" town would get the larger percentage of the sales tax.

The agreement gives either town a little more bargaining power when dealing with potential large-scale retail developers, who often play adjacent communities against one another while shopping around for the best deal for their projects.

"I do think we are close to having at least one major retail anchor in the lower valley," Eagle Mayor Jon Stavney told the Gypsum Town Board. "The town (of Eagle) realizes we ought not to be in competition."

Gypsum Town Manager Jeff Shroll agreed.

"Nobody seems to know exactly when a big-box store is going to come ... but they've been kicking a lot of tires around," said Shroll, referring to consistent reports that bulk-retailer Costco is looking at Eagle and Gypsum.

Both towns collect a 4 percent sales tax. However, 2 percent of Gypsum's sales tax is pledged to specific purposes - 1 percent goes to the new recreation center, and 1 percent goes for the town hall and other capital projects. Thus, both towns agreed that only 2 percent of their sales tax collections would be subject to revenue-sharing.

In Eagle, the parcel affected is Red Mountain Ranch, on the east end of Chambers Avenue. Developer Merv Lapin wants to build a shopping center and homes there, but a final vote had not yet been taken. Lapin has indicated that if he can't get approval for his project, he'll sell the parcel.

Stavney says the 80-acre parcel, located between Interstate 70 and Highway 6, is still the logical place for commercial development.

"If Red Mountain Ranch goes away, something else will be back," he said.

In Gypsum, the revenue sharing agreement applies to the Airport Gateway commercial subdivision; or, at the Lehman gravel pit parcel, west of Gateway.

Stavney said that if the big-box retailer lands in Gateway, the revenue sharing would help the town of Eagle deal with increased traffic. If the big-box lands at Red Mountain Ranch, the revenue sharing would help Gypsum bolster its revenues.

The agreement specifies that the revenue sharing agreement is a 15-year deal, good through July 2020. However, that stipulation is not binding, because the state law prohibits town councils from binding future boards to such financial agreements.

"This could be overturned by voters, who choose new board members that might not want to share the revenue stream," admitted Stavney.

Some board members from both towns continued to express uneasiness with the proposal.

Gypsum Councilman Tim McMichael accused the Eagle Town Board of being "less than truthful" when the two boards met in March. He said Eagle didn't actively pursue revenue sharing until rumors surfaced that Costco was going to land in Gypsum.

"Had that situation not risen, they wouldn't be before us now," he said.

In Eagle, Town Board member Kraige Kinney warned Red Mountain Ranch opponents that the sales tax agreement did not resolve Eagle's revenue issues. He said that $14 million worth of highway widening work would be necessary in Eagle to accommodate big-box store traffic headed to Gypsum. He estimated the revenue sharing would generate abut $800,000 a year for the town.

"It would take 15 years (to pay for the improvements). In my mind, that's not the best solution," he said.

The Eagle Town Board had already unanimously approved the revenue sharing agreement. In Gypsum, McMichael cast the only dissenting vote.



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