Below is a copy of a letter I intend to send to our Attorney
General to request a legal opinion on recent action by the Moscow
City Council. The chances of getting an opinion
increase with more and important signataries to the letter.
If you would like your name to appear on the letter, please
let me know.
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3362 Blaine Rd.
Moscow, ID 83843
August 22, 1995
Al Lance
Idaho Attorney General
Statehouse, Room 210
Boise, ID 83720-1000
Dr. Mr. Lance:
We are writing you this letter as concerned Idaho residents to request
your legal opinion regarding a resolution recently passed by the Moscow City
Council. We believe the issue of the legality of this resolution to be of
importance not only to the residents of Moscow, but to other Idaho
municipalities that may rely on Moscow's interpretation and usage of Idaho
Code pertaining to the Urban Renewal Act (50-2001 50-2018) and Local
Economic Development Act (50-2901 50-2912). Your opinion will help
clarify the relationship between these two acts to determine whether
municipalities may lawfully create an Urban Renewal Agency for the express
purpose of utilizing the financing mechanisms provided for in the Local
Economic Development Act.
Background
The Moscow City recently passed Resolution No. 95-08 (see enclosed
copy) which designated Moscow as a "competitively disadvantaged border
community" and which created a 5 member Urban Renewal Agency using the
provisions of the Urban Renewal Act (I.C. 50-2001 through 50-2027). The
necessity for the City Council resolution was stated in part as, "The City of
Moscow requires a means by which it may promote development of properties
suitable for permanent location of locally originated companies...Revenue
allocation financing is the only tool available to the City for the promotion of
such development."
The City intends to use 2 provisions of Idaho Code, the Urban Renewal
Act and the Local Economic Development Act, to sanction, and possibly
underwrite financially (as provided for in I.C. 50-2015(d)(4)), the development
of a business park on farm land on the eastern edge of Moscow. To do this,
the resolution created a 'urban renewal agency' as provided for in 50-2006.
The urban renewal agency would then issue bonds to pay for construction of
the business park infrastructure. The bonds would be paid back with proceeds
from property taxes associated with the business park.
The Moscow City Council would appear to be using the Idaho Urban
Renewal Law, a law specifically intended to renew, rehabilitate, and redevelop
deteriorated and blighted areas to promote the development of agricultural land
into a business park. The Urban Renewal Law specifically defines a
deteriorated area as:
"an area in which there is a predominance of buildings or
improvements, whether residential or non-residential, which by
reason of dilapidation, deterioration, age or obsolescence,
inadequate provision for ventilation, light, air, sanitation, or open
spaces, high density of population and overcrowding, or the
existence of conditions which endanger life or property by fire
and other causes, or any combination of such factors is
conducive to ill health, transmission of disease, infant mortality,
juvenile delinquency, or crime, and is detrimental to the public
health, safety, morals, or welfare. I.C. 50-2018(h).
The definition for "deteriorating area" is similar to the above definition
but includes such things as defective or inadequate street layout, faulty lot
layout in relation to size, diversity of ownership, tax or special assessment
delinquency exceeding the fair value of the land, defective or unusual
conditions of title. I.C. 50-2018(i).
In Moscow, few developed areas would actually meet the above
definition, let alone undeveloped and productive farm land. Is it not correct
that the Urban Renewal Act was intended to redevelop and rebuild deteriorated
areas in cities? The only reference to undeveloped land that occurs in the
Urban Renewal Law is in the section which discusses the preparation and
approval of plan for urban renewal (I.C. 50-2008). Section (d) states that if the
urban renewal area consists of an area of open land to be developed for non-
residential uses, the:
"local governing body shall determine that such nonresidential uses are
necessary and appropriate to facilitate the proper growth and
development of the community in accordance with sound planning
standards and local community objectives, which acquisition [by the
Urban Renewal Agency] may require the exercise of governmental
action, as provided in this act, because of defective or unusual
conditions of title, diversity of ownership, tax delinquency, improper
subdivisions, outmoded street patterns, deterioration of site, economic
disuse, unsuitable topography or faulty lot layouts, the need for
correlation of the area with other areas of a municipality by streets
and modern traffic requirements, or any combination of such factors...
[Emphasis added].
When the Moscow City Council passed resolution number 95-08, did it
act unlawfully by failing to follow the prescriptions for creating an Urban
Renewal Agency as provided in the Urban Renewal Act? Idaho Code 50-2005
specifically states:
No urban renewal agency and no municipality shall exercise the
authority hereafter conferred by this act until after the local governing
body shall have adopted a resolution finding that: (1) one or more
deteriorated or deteriorating areas as defined in this act exist in such
municipality; (2) the rehabilitation, conservation, redevelopment, or a
combination thereof, of such area or areas is necessary in the interest of
the public health, safety, morals or welfare of the residents of such
municipality; and (3) there is a need for an urban renewal agency to
function in the municipality. [Emphasis added]
The resolution, as passed by the Council, appears to fail to meet
condition number (1) stated above because the City Council, in its resolution,
cited and based their findings on the definition of "deteriorated area" from the
Local Economic Development Act, not from the Urban Renewal Act. Section
1 of Moscow Resolution No. 95-08 states, "That the City of Moscow is in its
entirety a competitively disadvantaged border community area as defined by
Idaho Code 50-2903(6) and a deteriorated area as defined by Idaho Code 50-
2903(7e)."
The City of Moscow has the authority to designate itself a
disadvantaged border community area and it also has the authority to create an
Urban Renewal Agency. But the exercise of authority under Urban Renewal
Law requires that the City of Moscow have deteriorated areas as defined in 50-
2018(h) or 50-2018(i) and adopt a resolution to support such a conclusion.
Resolution 95-08 as passed, contains no reference to deteriorated areas as
defined in the Urban Renewal Act, but rather substitutes the definition of
"deteriorated" from 50-2903(7e).
The definition of "deteriorated" as defined in the Urban Renewal Act
does not appear to provide for disadvantaged border communities. In your
opinion, is there a provision within the Urban Renewal Law that would allow a
municipality to substitute the "deteriorated" definition from the Local Economic
Development Act to meet the very specific definitional requirements found in
50-2005? In other words, can the "finding of necessity by local governing
body" requirement (50-2005) be satisfied by a definition outside the act when
the act clearly states definitional requirements must come form the Urban
Renewal Act itself?
Would you agree that to lawfully utilize the tax increment financing
measures as provided in the Local Economic Development Act, a municipality
must, as a pre-condition to creation of an Urban Renewal Agency, have
deteriorated areas as defined in 50-2018(h) or 50-2018(i) because these
definitions provide the basis for the exercise of authority under the Urban
Renewal Act in the first place?
Your interpretation of the City of Moscow's use of the two laws is
important to both residents of Moscow and other municipalities that may wish
to enact similar ordinances. We hope you will take the time to give your legal
opinion on this important issue that affects many communities in Idaho.
Sincerely,
Greg Brown
-- Greg Brown (gregb@uidaho.edu) Computer Services Adjunct Assistant Professor, College of Forestry,Wildlife,& Range Sciences University of Idaho Moscow, ID 83843 (208) 885-2126 Fax: (208) 885-7539