POST FALLS - The Post Falls City Council tonight will consider extending the life of the East Post Falls Urban Renewal District to the full 24-year term to 2026.

The special meeting and public hearing starts at 6 p.m. at City Hall, 408 N. Spokane St.

The Legislature passed a law effective Friday that sets a 20-year limit on districts.

The Urban Renewal Agency on June 10 decided to ask the council to consider extending the district's life to generate more tax increment funds to fund an Interstate 90 overpass or interchange at Greensferry Road and complete commercial pads in the Tullamore project west of Highway 41.

The district, formed in 2002, is currently set to expire in 2015. In 2005 it was expanded three years from its original 10-year timeline.

The Environmental Impact Statement and Interchange Justification Report on the Greensferry project - both required for construction - aren't expected to be completed until late July at the earliest. The project has been in the works for nearly a decade.

An interchange would cost an estimated $31 million; an overpass $20 million.

An interchange is preferred by local officials, but if the Federal Highway Administration says it isn't justified, agencies would have to settle on an overpass.

"The goals outlined for this improvement in the first place were to enhance economic development, provide for better vehicular and pedestrian mobility and improve public safety response," city administrator Eric Keck said. "With either of the two options - interchange or overpass - these goals would be met."

The City Council would be able to close the district earlier than 2026 for whatever reason should that option arise. Also, if the Greensferry project hits a roadblock, closure of the south and central sub-districts can be done.

Post Falls prided itself on becoming the first agency in the state to close a district when West Seltice in the area of Kimball Office was closed several years ago.

Closing districts early is preferred for taxpayers because that frees up money that would have earlier gone to taxing districts.

"However, if the improvements can be made in the East Post Falls district as proposed, then the revenue diet will have been worth it for the community," Keck said.

But Len Crosby, former URA chairman and a tax watchdog, questions the proposal to extend the district.

He believes the decision needs to be made based on current economic conditions and the recession shouldn't be the time to rush decisions on public funds through.

"Extending the life of this urban renewal district, which collects approximately $2 million in tax increment per year, and then telling the citizens of Post Falls that the city needs to increase real estate taxes to give public employees a raise seems a bit convoluted," Crosby said.

During a recent budget workshop, the council gave staff permission to craft a proposed budget based on a 2 or 3 percent tax hike to pay for raises, maintain service levels and other reasons.

The council will hold a public hearing on the budget on Aug. 16 at 6 p.m. and make a final decision on a tax hike afterward.

Other projects in the East Post Falls URD include extending Spencer Street from Second to Seltice Way and creating a pedestrian/bike trail along Highway 41 from the Ross Point interchange to Sonic.

Both projects will be covered by tax increment under the district's existing life.

Meanwhile, Vision First, the developer of Tullamore, is no longer involved in the project due to financial problems, officials say. The development has gone back to Panhandle State Bank, which is seeking a developer to take it over.

"It would certainly be a benefit to the community to have a different party with greater financial strength move the project forward," said Tom Lien, the URA's executive director.

Vision First's phone number in Eagle, Idaho, is no longer in service.