SPOKANE - It is the subject of controversy in Idaho, but is the envy of neighboring Washington.

It is tax increment financing, the stuff urban renewal districts are made of.

"I wish we had it," said Cary Bozeman, chief executive officer of the Port of Bremerton. "Border states have it."

Bozeman addressed about 400 in the real estate industry as the keynote speaker at the 2010 Real Estate Market Forum Feb. 25 at the Spokane Convention Center. He explained how that city of 50,000, slightly larger than Coeur d'Alene with 45,000, renovated its downtown over five years with public-private partnerships.

While the Navy port may seem to have little in common with the Lake City, there are several similarities other than population.

Both have significant parcels of waterfront, some private and some public, and in Bremerton a boardwalk added as part of a five-year economic development program that began in 2004.

"Waterfront access to the public is a huge value," Bozeman said.

In Bremerton, as in Coeur d'Alene, some of the waterfront property was used for parking, though in significantly larger parcels.

In Bremerton, public-private partnerships converted that space to fountains and commercial space. In Coeur d'Alene, there is debate over what is the best use of the Independence Point parking area. Some would like to see no change, while others believe grass would be better than asphalt for public use.

While not part of the Lake City Development Corp., the Coeur d'Alene entity that uses tax increment financing to pay for infrastructure for new development, the parking could go elsewhere to make more public space, said Tony Berns, LCDC executive director.

Tax increment financing is "the only economic incentive tool we have other than STARS (sales tax anticipation revenues, which will be used to build an Interstate 90 interchange near Cabela's in Post Falls)," Berns said. "It's huge for us."

Among the amenities in Bremerton is an ice skating rink, an item on the list of possible items for funding by LCDC.

"If you want growth you have to build things for kids," Bozeman said.

Bremerton even has a hanging flower basket program, similar to the Coeur d'Alene Downtown Association's summer decorations.

"The public loves this stuff," Bozeman said.

All the improvements brought in large projects, he said.

"That stuff created economic investment," Bozeman said.

Like Coeur d'Alene, Bremerton also got carried away with its optimism about condominiums.

"We got greedy, and overbuilt," Bozeman said. "Only half are sold."

There are many who do not like the way tax increment financing has been used in Coeur d'Alene, and overbuilding condos is among their concerns.

"Look seven miles west," said Dan Gookin, two-time candidate for Coeur d'Alene City Council. "Post Falls is using (tax increment financing) not to build empty condos."

That city's urban renewal districts were used instead to add jobs, he said, which should be the top priority.

"LCDC's first duty was not to bring in jobs," he said. "What they did here was crap."

According to LCDC, projects the organization partnered in have created 1,377 new and 496 retained jobs at the US Bank call center, NightHawk Radiology and the Kroc Center.

George Carter lives in McEuen Terrace, the first project built with LCDC participation 11 years ago, and believes some of the money was wasted.

"It is a great deal for big businesses owners, but it sucks for us," he said. "The developers borrow $50,000 to make improvements and never have to pay it back."

In most cases, developers make the initial investment in infrastructure such as sewers and water lines, and recover their money through the increased taxes on the project when it is occupied.

"Nobody writes a check," said Steve Griffitts, president of Jobs Plus. He says without the tax increment many projects would not make financial sense. "It's a great thing, an incredible value. We want to make sure we don't get away from the opportunities associated with infrastructure."

And though Washington state does have some of its own programs, such as enterprise zones, "the fact they don't have tax increment, perfect."