Photo credit: Scheels.com
At SpringsTaxpayers, we have been reporting since February on the ‘sweetheart Scheels deal’ that will allow Scheels to charge its customers a 1% Public Improvement Fee (PIF) instead of a 1% sales tax, but then pocket that the estimated $16,000,000 they collect from shoppers. We reported that this is unfair to the other property owners, to taxpayers ($16,000,000 won’t be going to the City coffers,) and that the deal was not necessary to attract a top-level retailer to the growing area.
To add further insult, the City has been rushing through a request to allow for the removal of Scheels from the special district, so they don’t have to pay the higher property taxes. The special district is known as the Interquest North Business Improvement District, or INBID. That would leave the remaining district bond debt on the shoulders of the other 15 or so district business owners. Scheels would not have to pay a dime for the infrastructure already built around their store. We think that’s just wrong.
At the June 11thColorado Springs City Council meeting, there was a 20-minute discussion about business owners who object to the exclusion. It starts around the 3-minute mark. In the video, Tim Leonard, who is representing Burger King and Cheddars, addressed Council. He had previously written a letter to Council, detailing why his clients object to the exclusion. The letter is pretty common sense and refers to, among reasons, the unreasonableness of Scheels, “free-loading off its neighbors.” We like Leonard’s straight shooting! Leonard is asking that Council deny the exclusion.
There was further conversation among the Councilors about how the electors (made up of property-owners and tenants) would be informed of the exclusion request, and what the process would be. Councilman Murray expressed, “suspicion” because Council was previously told there were no objections from electors. A representative for Scheels seemed surprised that there were objections because the exclusion, “just makes sense.” If you are a political and process nerd like we are, please watch the whole 20 minutes. You won’t be disappointed.
In the end, this City Council agenda item has been postponed until the June 25thmeeting. We will keep a sharp eye on this.
The Scheels deal is just the tip of the iceberg, as there are thousands of these special taxing districts statewide, with a combined debt of over $19 billion. We will cover the most egregious examples as we find them.