Six One Five Collective

ese districts were created in the 1980s to help solve a very practical problem. Colorado’s economy was under signi cant pressure as employment nosedived in government, retail, and hospitality due to enormous speculation in the state’s housing market. As a result, local government tax receipts declined and caused them to be nancially unable to support new infrastructure and community development projects even as the state’s population increased.

Metro districts o ered tax-hobbled jurisdictions an alternative nancing model for infrastructure projects. Instead of only using tax subsidies, metro districts can raise debt from private investors by selling bonds and use those proceeds to fund construction. ese districts then collect property taxes from homeowners to pay for their maintenance expenses.

In 2000, there were about 200 metro districts in Colorado. Today, there are more than 2,300 metro districts in Colorado, according to the Special District Association of the Division of Local Government. Groups like the Colorado Association of Home Builders say metro districts can improve housing a ordability by reducing the per unit infrastructure costs by between $30,000 and $40,000. But homeowners like Sorensen think there need to be more safeguards in place to limit the amount of debt that metro districts can issue.

For example, the more than $760 million in bonds that the Baseline Metropolitan District can issue is about 72% greater than the city and county of Broom eld’s total outstanding debt, according to Broom eld’s latest comprehensive nancial statement. Collectively, the 2,300 metro districts in Colorado hold more than $1 trillion in debt, which dwarfs the state of Colorado’s more than $37 billion of total debt.

“Unchecked, some of thesenancial structures could easily lead down a road of mass foreclosures or whole communities defaulting,” Sorensen said.

Metro districts also don’t seem to be helping to make Colorado homes more a ordable. Colorado’s median home price has skyrocketed by more than 93% over the last decade from about $288,000 to more than

$558,000 as of March 2023.

Rents for a two-bedroom apartment in major cities like Denver and Boulder have also increased signi cantly. In Denver, rents have increased by 120% from about $830 in 2013 to about $1,967 today, according to data from RentCafe. Boulder’s average rent has increased by 137% over the same time period, from about $1,060 to more than $2,300, according to RentCafe.

Recent reform e orts

Despite some glaring issues with metro districts, legislative reform e orts have been hard to come by in part because of the strong lobbying e orts from developers.

Colorado lawmakers introduced multiple bills during the 2023 legislative session aimed at metro districts. One bill, House Bill 23-1090, sought to prohibit the directors of metro districts from purchasing the bonds that they issue through another entity. It was introduced by Democrat Rep. Mike Weisman of Aurora and Sen. Robert Rodriguez of Denver.

Weisman told the House Finance Committee that the bill is designed to create “higher restraint” on the part of metro district directors before they issue debt on behalf of the homeowners they represent.

“I want to be clear that there is a role for government debt. e state has it for school and re districts,” Weisman told the committee. “But in just about every other case, those who purchase the debt do so at an arm’s length from those who issue it.”

However, HB23-1090 attracted signi cant pushback from groups like the Associated Builders and Contractors Rocky Mountain Chapter, the International Council of Shopping Centers, and the Colorado Chamber of Commerce to name a few. e Senate Local Government & Housing Committee voted to postpone the bill inde nitely by a 4-3 margin at the end of March.

Instead, lawmakers passed Senate Bill 23-110, a bipartisan bill that explicitly allows metro district directors to purchase this kind of debt. SB23-110 also requires additional transparency from metro districts regarding the debt issued and re-

SEE REFORM, P21