Homeowners want special Boise tax district abolished. Judge casts doubt on key argument
Taxpayers in Boise’s Harris Ranch began their challenge of a special tax district by trying to establish what exactly they are opposing.
Their court case, which began Thursday, centers on who is responsible for paying for public infrastructure such as new streets and parks: taxpayers or developers?
The property-tax district that covers Harris Ranch in Boise’s Barber Valley was formed in 2010. Two of the leaders of the fight against it have said that they want it dissolved entirely, because of how it was created.
It was formed with just three votes. The first two came from the developers, Barber Valley Development and Harris Family Limited Partnership. The third came from the only resident at the time in what would become the district: a farmhand and tenant.
But the state law allowing these tax districts says any district board action can be challenged only within 60 days.
So Thursday’s courtroom discussion focused on what exactly can be included in the taxpayers’ case against the Harris Ranch Community Infrastructure District.
The taxpayers can’t explicitly contest the district’s creation — that would be outside the 60-day window. But Nicholas Warden, the attorney representing the taxpayers association, argued that prior actions are necessary to consider, because those gave the district’s board the power to carry out two Oct. 5 resolutions that did fall within the 60-day limit when the court case was filed in December.
The two items the resolutions authorized were $7.1 million in payments to Harris Ranch’s developers and the issuance of $5.2 million in bonds, which were supposed to cover the costs of roads and stormwater ponds.
Paying off that $12 million would fall to the owners of the roughly 1,000 homes within the district, all of which have been built since 2010.
The tax district was Idaho’s first of its kind. The district reimburses developers for infrastructure. It’s intended for growth to help pay for itself rather than to burden existing taxpayers.
Leaders of the taxpayers association said in previous interviews that they believe the three-person election was unlawful.
Judge considers what’s debatable
Whether the case is expanded to include decisions made before October 2021 will be decided by Nancy Baskin, a judge in Ada County’s Fourth District. These could be key components of the taxpayers’ argument. Though she didn’t make an official ruling, Baskin made clear that she likely won’t consider parts of them.
“The development agreement, the election, all of those events are not part of this petition for judicial review. It’s not,” Baskin said during Thursday’s hearing. “I understand how you can argue that this statute is constitutional or unconstitutional, but I am not revisiting the election or the development agreement.”
People living in the district argue that they have to pay 30% more in property taxes than nearby neighbors who don’t. Doug Fowler, president of Barber Valley Development, has acknowledged that the district lines were drawn to exclude existing houses, such as those in Harris Ranch’s Spring Creek subdivision, because they thought those voters would reject a tax increase.
Bill Doyle and Larry Crowley — two homeowners living in the district — and the Harris Ranch CID Taxpayers Association are the petitioners in the case. The Harris Ranch Community Infrastructure District and district board members Holli Woodings, TJ Thomson and Elaine Clegg are respondents.
The three were Boise City Council members, serving as required by state law to provide public accountability for the district’s spending. Thompson is no longer on the council but was in October; Woodings and Clegg still serve.
Warden, the taxpayers’ lawyer, argued that the October resolutions couldn’t be evaluated “without examining events prior to that date,” because the taxpayers believe the district shouldn’t have had the power to approve those resolutions in the first place.
“I’m not reading it the way you’re reading it,” Baskin replied. “It doesn’t open up what was done in 2010. To interpret this statute how you’re arguing, you would go back to when a city was formed, when a district was formed. … That date has passed.”
In an April 26 brief arguing against the expansion of the case to earlier decisions, the attorneys for Harris Family Limited Partnership wrote that their opponents are “trying to use the narrow October resolutions as a Trojan horse to offer broad and untimely objections and challenges to the initial formation of HRCID.”
Doyle, one of the taxpayers association’s leaders, argued in another brief that community infrastructure districts don’t help growth pay for growth but offer “a clever way for large real estate developers to avoid having to finance for themselves the substantial costs of building out the public infrastructure.”
Taxpayers request a stay on payments
Warden also requested a stay on the payments, authorized by the October resolutions, until the judicial review is complete. He argued that there would be irreparable harm for taxpayers if they have to pay before a ruling in their favor.
Melodie McQuade, representing the district, argued that a stay would result in higher interest rates and could hurt taxpayers in the long run, because the “purpose of the district is to fund infrastructure projects, not pay interest.”
Since the development agreement caps the reimbursements at $50 million, more money would be going to interest rather than infrastructure projects, McQuade said.
This is the first time an Idaho community infrastructure district has been challenged in court, so there’s no precedent from prior cases.
