Are Big Property Tax Bills Painting Denver Arts Districts Into a Corner?

Are Big Property Tax Bills Painting Denver Arts Districts Into a Corner?
Jay Vollmar
Potter Macy Dorf settled into his ceramics studio at 747 Santa Fe Drive nearly forty years ago, long before the area was an official arts district, even before Denver conceived of the idea of official arts districts. In 2001 he purchased the building for $351,000 that today houses Artists on Santa Fe Gallery and Studios, landlord to dozens of artists who rent studios there.

Other art concerns were beginning to pop up along Santa Fe at the time, like the well-regarded Sandy Carson Gallery and 910 Arts. “All of a sudden a group decided we should have an art district,” remembers Dorf. “And I did the dumbest thing in the world: I agreed to become president of the new art district in 2003.”

Although he stepped down after two years, the Art District on Santa Fe persevered. Sixteen years later, it’s grown into one of Denver’s most successful arts districts — a dense and walkable corridor of galleries, cultural centers, studios, small businesses and eateries that comes alive with art-walkers every First Friday.

But behind that successful veneer, many of the ADSF’s 100 members, about a third of them galleries and artists, are suffering growing pains. Like so many other once-borderline neighborhoods pioneered by artists before corporate entities moved in to redevelop them, the arty heart of the La Alma/Lincoln Park business district could be a victim of its own success.
click to enlarge First Friday on July 5; some gallery owners are feeling gloomy. - MICHAEL EMERY HECKER
First Friday on July 5; some gallery owners are feeling gloomy.
Michael Emery Hecker
Rents are going up, making it impossible for some galleries with small budgets to stay in their current spaces.

Even landlords that aren’t wooed by businesses with bigger wallets find it necessary to pass on some of their own higher costs. And the few arts organizations that had managed to scrape together the cash to buy buildings now find themselves with huge property bills as their properties are assessed higher and run into the realities of the Gallagher Amendment. Passed in 1982, this state measure was designed to ease the annual property-tax load on homeowners by putting the onus for higher taxes on commercial property owners. Now they’re seeing tax assessments double and triple as land values rise in these once undesirable areas.

Earlier this year, Dorf opened his new Denver property-assessment letter and learned that his building’s valuation had just doubled: to $1,775,700, up from $895,400 in 2017. That means his property tax will be going up, too (he has yet to receive his bill), and as he worried about having to raise studio rentals in his building — which now range from $150 to $450 a space — he began thinking about how others up and down the street might be affected.

“I have 29 people in my building. It’s going to hurt some people; it’s going to be a huge tax,” he says. “I have no idea how many renters are on the street, but if the property taxes on their buildings have gone up like mine have, they have a huge problem.”

Not long ago, the smaller Navajo Street Art District dissolved under the weight of higher property taxes. Most of the co-op galleries that had thrived there for years left when building owners Chandler Romeo and Reed Weimer were forced to raise rents they’d kept low for decades in order to meet higher costs. Romeo and Weimer, artists themselves, were early members of Pirate Contemporary Art, which wound up moving to Lakewood, and founders of Zip 37, which closed altogether.
click to enlarge Zip 37 closed after property values (and neighbors) soared. - CHANDLER ROMEO
Zip 37 closed after property values (and neighbors) soared.
Chandler Romeo
“What I feel is that we need to have a cap on how high you can raise those valuations,” Romeo says. “On land where there was once a little house, there’s now a three-story hotel — and you’ve been sitting there all this time, operating a small business and creating a benefit to the neighborhood for decades. The mom-and-pops keep doing the same old thing they’ve always done; it’s someone else who’s making the changes.”

After talking over his concerns with Romeo, Dorf took his assessment letter to current ADSF president Shaina Belton and “opened a can of worms,” he says.

“I’m concerned that something like this could eviscerate the entire district in a year,” Belton explains. “It’s how you kill cities. When Macy showed me that paper, it was like seeing gentrification in print.”

With a tight budget already stretched to pay for maintenance and street improvements, and a staff of just one full-time coordinator, the ADSF’s options looked limited, Belton says. Hiring a lawyer, for instance, could well be beyond the district’s means.

Still, Belton quickly took action, informing the district’s building owners, galleries and small businesses of the high assessments and what they could signify to the arts district. A letter of protest to Mayor Michael Hancock, Denver City Council and other city officials was drafted with help from Andrea Barela, who heads both the neighborhood Business Improvement District and the resident NEWSED Community Development Corporation, which has been overseeing the street for 46 years.

“We also own properties here — quite a few properties — and so we have a vested interest in the success of the business corridor at attracting small businesses, building new jobs and so on,” Barela says. “When we see longtime people leaving, it’s heartbreaking. It’s devastating, systematic.”
click to enlarge Inside the Center for Visual Art on First Friday. - MICHAEL EMERY HECKER
Inside the Center for Visual Art on First Friday.
Michael Emery Hecker
Barela charges that the city hasn’t been proactive in supporting small businesses in the corridor, and that inaction extends beyond dealing with rising property valuations. After the Denver Office of Economic Development eliminated its business support offices four years ago in favor of creating BIDs, which supply business corridors with maintenance and project funds through a tax levy, the Santa Fe Business Improvement District was formed in January 2015. “But BIDs are hard to establish, and they don’t really replace support offices in what they do,” she says. “We are a high-maintenance corridor.”

But the rising assessments — and soon-to-skyrocket property taxes — are what most concern business owners. Asked about the pinch that puts on creative industries, Denver Arts & Venues director Ginger White Brunetti offered this statement: “Arts & Venues believes that creative districts are important to the community as a place to showcase local talent, spur cultural tourism and foster vibrant neighborhoods. For years, we have supported Denver’s creative corridors, like the Art District on Santa Fe, by providing funding that sustains the development and capacity of these volunteer organizations. As an agency, we always encourage creative district leadership to engage with the City on issues that may impact their membership, such as property valuations.” She referred further questions about appraisals to the Denver Assessor’s Office.

“Throughout Denver, data over a two-year period demonstrates for us where values are trending,” explains Denver Assessor Keith Erffmeyer. “It’s meant for us to value properties at the most probable selling price. Some areas of Colorado are not changing much, but in Denver, some areas continue to change dramatically.”
While property owners can protest their assessments, there’s not much the city can do for those in arts districts beyond reconsidering valuations. “There’s not a lot of leeway,” says Erffmeyer. “In theory, the market should adjust somewhat.”
Last year, the Chicano Humanities and Arts Council moved down the street from its longtime home. - CHAC
Last year, the Chicano Humanities and Arts Council moved down the street from its longtime home.
On Santa Fe Drive, the market is adjusting rapidly. Last year the Chicano Humanities and Arts Council, a cornerstone of the area for more than twenty years, was priced out of its longtime rental space at Eighth Avenue and Santa Fe and moved to another building six blocks south. (Neighboring Garage Vintage has taken over CHAC’s former home.) While technically still part of the district, the new location at 222 Santa Fe is a bit of a hike for First Friday art-walkers. Without the foot traffic it used to enjoy, CHAC has struggled to stay afloat.

The Kanon Collective co-op, CHAC’s former neighbor, left Santa Fe altogether not long after; it landed at 40 West, an arts district in Lakewood that, like ADSF, is one of the state’s 22 certified Colorado Creative Districts. More recently, CORE New Art Space, which had shared a building at 900 Santa Fe with Spark, Denver’s oldest co-op gallery, also abandoned the area for 40 West.

Spark is still mounting shows at 900 Santa Fe, which is now owned by artist Kat Payge, who bought it from the estate of “Blue Bear” sculptor Lawrence Argent. He’d purchased the building from its longtime landlord in 2016 and replaced the Fresh Art studio spaces in back with his own workplace. Payge, who’s moved her studio to 900 Santa Fe, says that a new co-op, D’art Gallery, will take over the Core space in late July. According to spokeswoman Susan Hazaleus, D’art will host the soft opening for an inaugural member show on August 1, with a “noisy” grand opening to follow on August 9. Meanwhile, the Fresh Art portion of the building is back in play, with a pop-up gallery space and four artist studios dubbed Back Alley Studios.
click to enlarge Joel Clower's art is on display at the new Rule space through August 10. - COURTESY RULE GALLERY
Joel Clower's art is on display at the new Rule space through August 10.
Courtesy Rule gallery
There are other bright spots on the street. In a novel example of how a property owner can work with a tenant, Wayne Rogers, the owner of the building at 808 Santa Fe, whose assessment increased 300 percent this year, recently ceded the space occupied by his adventurous 808 Projects to Rule Gallery. Though Rule is not a member of the ADSF, its presence lends cachet to the neighborhood. “Wayne wanted a steady renter,” says gallery director Valerie Santerli. “We already had a good relationship with him, and he offered us a rent that’s well below market value.” Rule moved in last month, and an exhibition of works by Joe Clower is there through August 10.

At Rule’s previous home at 530 Santa Fe, building owner Mary Mackey is opening Urban Mud, a member-driven clay studio and fine art gallery. Urban Mud’s inaugural show, a solo by ceramics artist Judith Cohn, opens on July 19.

But sooner or later, these creative businesses might run out of creative solutions. As they’re replaced by corporate entities, these districts could lose their art...and soul.

The demise of the Navajo Street Art District left six others in Denver city limits: the Art District on Santa Fe, the RiNo Art District, the Golden Triangle Creative District, the Tennyson Street Cultural District, the Westwood Creative District and South Pearl Street. All report rapidly rising assessments and little useful advice from the city on how to deal with them.

“My kilns will stay,” says Dorf, speaking as a Santa Fe Drive building owner. “We will survive without an art district, because we have an established clientele. But I don’t want to see it go. People worked hard to get it going, and to see it all disappear because the city is unable to perceive its duty to these tiny businesses is hard.”

“It’s damaging the character of the city, and pushing small local businesses out of the city,” says Romeo. “I’m sad that there’s no champion for us at the city, no one who’s taking the lead on this. I feel the city’s back has turned on us. If they really cared about preservation and art districts, they would be doing something about it.”

Barela agrees. “We can’t pull miracles out of our ears. If we don’t address this in a unified voice, we won’t be paid attention to,” she says. “Maybe we need to shut down Santa Fe Drive in protest during rush hour. I don’t know what we need to do, but we will not be ignored by the city. We need to see some action on their side. We need to know that they are hearing us.”
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Susan Froyd started writing for Westword as the "Thrills" editor in 1992 and never quite left the fold. These days she still freelances for the paper in addition to walking her dogs, enjoying cheap ethnic food and reading voraciously. Sometimes she writes poetry.
Contact: Susan Froyd