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A Metro District (short for Metropolitan District) is a financing tool used by developers to fund new development and the necessary infrastructure to support that new development. In this system of financing, developers use bonds (an issuance of debt) to build new development and then impose a mill levy (property tax) on residents of the district to pay off those bonds. In this system of financing, only the residents of a Metro District pay an additional property tax for the development of the district, as opposed to all residents of the Town paying for new infrastructure.
Residents of a Metro District pay an additional property tax. For a newly constructed home, this tax activates two years after purchase. Before purchasing a home in a Metro District, buyers should review the impact of an additional property tax on their annual budget and factor that into the overall cost of the home.
A Homeowners’ Association (HOA) is not a type of Metro District or governmental entity and does not, therefore, have any taxing powers. An HOA is a private entity created to enforce restrictive covenants and/or maintenance of HOA-owned common areas. A neighborhood can have both an HOA and a Metro District. The Metro District, however, is responsible for the creation and maintenance of infrastructure specifically. Each neighborhood is different so residents should research who is responsible for maintenance of shared community spaces (such as parks) for their respective neighborhood.
A Metro District is governed by a Board of Directors, who are elected by the registered electors within the District. Eligible electors who reside within the District or who own taxable property within the District are eligible to serve on the Board of Directors and they become eligible to join as soon as they move into or purchase property within the District.
The approval of a District Service Plan is at the sole discretion of the Town of Erie’s Board of Trustees. The Board of Trustees may reject, approve, or conditionally approve Service Plans on a case-by-case basis. The Board of Trustees retains full authority regarding the approval, terms, conditions, and limitations of all Service Plans. To read more about what the Board of Trustees evaluates when reviewing a District Service Plan, read Town of Erie Metro District Review Policy.
Metro Districts follow the same “sunshine” laws as any other governmental entity in Colorado, as well as additional requirements in the Metro District statutes and in the Town of Erie’s Metro District Policy. Specifically, a Metro District must notice all meetings by posting the time and place of the meeting at three locations within the district and publish notices in a widely distributed publication. In addition, all State-required annual financial reports are published on the Department of Local Affairs website and viewable by the public.
In addition to these steps required by the State, the Town has included requirements in the Town of Erie’s Metro District Review Policy. It is important to note that the requirements in the Review Policy do not apply to Metro Districts that were approved prior to July 26, 2022, when the Board of Trustees approved the Review Policy. Also, once a Metro District is formed, the Town of Erie is not responsible for the day to day management of the district. Like any other governmental entity, the members of the Metro District Board of Directors are responsible and residents of the district should reach out to them with questions or concerns. The role of the Town occurs only at approval.