RIO RANCHO, N.M. — The City of Rio Rancho has agreed to move toward supporting the Los Diamantes development with future gross receipts taxes in the subdivision.
The city and the developer of the business and residential subdivision have started the process to from a tax increment development district (TIDD) in which the developer will be reimbursed for building infrastructure outside of his property through a share of gross receipts taxes.
At the Rio Rancho Governing Body meeting Thursday night at City Hall, members voted unanimously, with Councilor Jennifer Flor absent and Councilor Paul Wymer recusing himself for employment-related reasons, to approve a resolution of their intent to form the district.
The development of Los Diamantes and the location of Joe Harris Elementary within it have been a partnership among developer Pierre Amestoy, the city, Rio Rancho Public Schools and the Southern Sandoval County Arroyo Flood Control Authority.
Amestoy said he paid for construction of water and sewer lines to serve the new Harris Elementary, as well as paving Westside Boulevard with four lanes and storm drains for about a mile and a quarter west of Unser Boulevard. The road work, which started in January, required the relocation of electricity, gas and fiber-optic lines.
“We did that in a remarkable amount of time,” Amestoy said of the 90-percent completed road work.
The city used $3.2 million in environmental GRT income to install new utilities along the freshly paved section of Westside. Mayor Gregg Hull said Los Diamantes LLC spent nearly $10 million on the road.
Amestoy said the storm-drain system and lift station would serve 700 acres in the area, not only his 300-acre subdivision. Developments like Los Diamantes can’t be done with private money only, and need reimbursements like the TIDD, he said.
Under the TIDD, 75 percent of municipal, hold-harmless, infrastructure and state-shared gross receipts taxes generated from the sale of goods and services in the 170-acre commercial area of Los Diamantes would be returned to the developer, according to city information. The city would still receive the full income from higher-education and environmental gross receipts taxes.
According to the city, the district will last for 25 years from the issuance of its first debt, or until the TIDD has received $14.2 million in GRT revenue.
“Everything we do out there is going to generate money for the city for future operations,” Amestoy said.
He expects Los Diamantes to generate more than 700 construction jobs for each of three phases, almost $280 million in construction costs over those phases and almost $53 million and 140 jobs from economic activity.
Albuquerque attorney Justin Horwitz said the resolution approved Thursday wasn’t binding but started a process of public notice and hearings before a final governing body vote. Any debts or other obligations the TIDD acquired would be its own and not the responsibility of the city, he said.
“There is not a tax or levy imposed with respect to the district,” so there’s no risk to residents or businesses who move there, Horwitz said.
The GRT will be generated largely after the development is done.
In other business, governing body members:
• Approved a second reading of the repeal of city ordinances against battery, assault, petty-misdemeanor aggravated battery and assault on a police officer. Those offenses will now be sent to magistrate court instead of municipal court. The councilors voted to leave the offense of driving on a revoked or suspended license, which generates five times the charges of the other offenses, among city ordinances.
• Heard Dan Darnell of Waste Management report that contamination of recyclable items with trash had gone up from 22 percent to 28 percent so far this year. Having to dispose of trash sorted out of recyclables drives up costs, he said. Items that should not go into recycling carts include plastic bags, even if they’re holding recyclables; yard waste; hard-plastic toys; and hoses.
• Awarded a $700,000 contract to TLC Plumbing and Utility for reconstruction of Santa Fe Hill Boulevard, the first project funded by 2020 general obligation bonds;
• Awarded a $1.3 million contract to Franklin’s Earthmoving Inc. for the extension of Broadmoor Boulevard to the second senior center;
• Approved the fiscal year 2020-21 final budget; and
• Voted down land-use zoning changes for the Lomas Encantadas subdivision. Councilors Bob Tyler, Jeremy Lenentine and Jim Owen voted for the change, and Councilor Dan Stoddard voted against it. Wymer and Hull had recused themselves. Because the item was an ordinance, it required four votes to pass, regardless of the number of councilors present. At Tyler’s prompting, the four voting councilors put off a decision on another zoning change for Lomas Encantadas until the unspecified time of when public-gathering restrictions were lifted.