*Boomsplainer is short for “Boomtown Explainer,” articles that are intended to simplify timely and critical issues the community is facing. We’ll write more on the MRA as it proceeds, assuming Council keeps nudging it along. What are your questions about it? What other explainers would you like us to tackle? Write us: editors@boomtownlosalamos.org
Story by Stephanie Nakhleh
Photographs and illustrations by Minesh Bacrania
Downtown Los Alamos has been stuck in a rut for over a decade, with one revitalization effort after another falling flat. But some county officials think they've finally found the secret sauce: establishing a Metropolitan Redevelopment Area, or MRA.
Here's the deal: by designating a section of downtown as an MRA (see more here), the county can unlock a whole new set of tools that private property owners can use to spruce up the place. Picture renovated buildings, more housing options, and a shot in the arm for the local economy.
But not everyone's ready to pop the champagne just yet. Some residents and business owners, burned by past letdowns and comfortable with the status quo, are wary of how an MRA might shake things up.
What the heck is an MRA?
An MRA is basically a way for the local government to get new investment flowing in areas that have seen better days. The “MRA Toolkit” provided by New Mexico MainStreet (see resource list below) describes conditions of “decline and stagnation” as necessary for the designation. Examples of decline are vacant buildings, potholes, a lack of housing options, and businesses struggling to hang on.
Words like “blight” and “decline” create a slightly tricky political problem for municipalities when they draw up these districts: property owners bristle at those words. However, it’s important to understand that while an MRA has to show some disinvestment to qualify, there can also be thriving businesses within the designation: it would be too complicated to draw a squiggly map around only “blighted” properties and leave the unblighted ones out. It would also be pointless. Whether they are struggling or not, any property owner within the designation can apply for MRA funds if a project meets certain “community benefit” criteria. All developers and property owners inside an MRA suddenly have access to funds, fast-tracked permitting, land donation, loans and grants, and a host of other benefits not available to those outside the district.
The county has been working on this for a while. In May and December 2023, they conducted a thorough assessment of the area, confirming its eligibility for the MRA designation. Los Alamos MainStreet has been engaging with local businesses and property owners since late 2018 to discuss the benefits of an MRA zone. On May 7, 2024, the County Council approved the proposed boundary for the East Downtown Los Alamos MRA.
New Mexico’s pesky anti-donation clause
Imagine you're a developer who has a brilliant idea for transforming a run-down part of town into a vibrant community hub. But there's a problem — you need a little help from the government to make it financially viable. Normally, that would be a no-go, thanks to New Mexico's anti-donation clause.
This piece of the state constitution, dating back to 1912, says that the government can't just hand over public money or resources to private individuals or businesses. The idea is to prevent corruption and ensure that public funds are used for the greater good.
But some feel those good intentions have resulted in unforeseen consequences. MainStreet’s MRA Toolkit states it this way: “A literal application of the anti-donation clause seems reasonable; that public funds should not benefit private interests. However, this is fundamentally inconsistent with the existence of a mixed economy, where many projects are a collaboration between public and private interests.”
Where does the money come from?
Once an MRA has been designated, that’s only a line on a map, which, of course, won’t help develop anything. For development you need money. So where does that come from? The state’s anti-donation clause prevents public entities, like Los Alamos County, from simply giving money to developers, so a more complicated solution needs to underlie the public-private partnership: Tax Increment Financing (TIF). This financing method, which has only recently become available in New Mexico, could be a game-changer for both the White Rock and east downtown Los Alamos MRAs.
Here's the scoop on how TIF works: When municipalities draw up an MRA, they take a snapshot of how much money that area is putting in the county piggy bank from property and sales taxes. That's the "base value" of the MRA. This number doesn’t change over the lifetime of the MRA. As new stuff gets built and the area gets a facelift, the tax revenue from the MRA goes up, providing a positive "increment” over and above the base value. This increment is a special lockbox just for MRA projects: It's like the county taking a cut of the increased property taxes and putting it in a special account just for sprucing up downtown. During the period the TIF is active, developers can apply to access the funds in the lockbox to execute projects within the MRA. After 20 years, the TIF goes away and the new tax money flows normally again. The justification is that without the MRA doing its magic, you wouldn't have gotten that bump in taxes at all, so it's only right to plow it right back into the area.
For residents of Los Alamos, regardless of whether you live in the MRA or not, it's important to note that property taxes on your home or anything else would not go up any faster due to the MRA/TIF than they would otherwise.
On the Los Alamos County side, there is some caution and skepticism about all this. Paul Andrus, Community Development Director for Los Alamos County, said that while other communities in New Mexico have seen their implementations of an MRA work, our own county government is still pondering the legalities. An important ethical safeguard on the MRA is that anyone applying for those public funds must spell out exactly what they’ll give the public in return, he said. If not, the county can claw back those incentives.
Why these boundaries?
The proposed east-downtown MRA boundary is intentionally small, encompassing approximately 21 parcels over 29 acres, including the Mari-Mac shopping center, the former Hilltop House site, apartment buildings north of Central Avenue, and commercial properties along Trinity Drive. The area was chosen for its potential to serve as a visually impactful gateway to Los Alamos.
“It's one of the first ways you know you’ve arrived in Los Alamos, when you hit that roundabout,” said Jacquelyn Connolly, executive director of Los Alamos MainStreet and Creative District. “From all the conversations in the walkabouts, the photographs, looking at the downtown master plan, [we decided] this is the area that we wanted to designate.” While some further-west downtown property owners expressed interest in being included in the boundary to access an MRA's public-investment tools, Lauren McDaniel, executive director of the Los Alamos Commerce & Development Corporation (LACDC), explained that matching the MRA boundaries to those of the entire Downtown Los Alamos district is not possible because the conditions of blight aren’t as severe. “The state said, 'Absolutely not, your [full] downtown will not qualify for an MRA,’” she said. “But the site-specific MRA met the criteria.”
The current boundaries are designed to be small enough “that they [the county] can handle it all in-house and it won’t cost the county anything,” McDaniel added.
Opposing voices
While many property owners, business people, and residents support revitalization efforts, some have expressed concerns about the inclusion of specific properties within the MRA boundary. Owners of the apartments north of Central Avenue questioned their inclusion, citing high occupancy rates and a lack of blight.
Residents also voiced fears of encroachment into residential neighborhoods and the potential loss of affordable housing. “Leave the apartments and leave the neighborhoods alone," urged local resident Sandy Walters at the May 7 Council meeting. "Concentrate on what is really the blight in Los Alamos.”
George Chandler, a resident who lives downtown, wrote a letter raising the specter of gentrification arising from the MRA designation, arguing that the designation is “the latest attempt to transform older residential areas to higher density high-rise multifamily housing. As usual, it is justified by the mythical non-existent Los Alamos housing crisis.”
Others, like small-business owner Dr. Lisa Shin, have objected to the inclusion of their properties, stating, “we take care of our own maintenance and repairs, so we really don’t need this kind of assistance to maintain our building.”
Addressing misconceptions
County officials and consultants have sought to address these concerns, emphasizing that the MRA designation does not mean everything inside the area is blighted. It also doesn’t mandate participation from property owners, raise taxes (or reduce them), enable eminent domain, or damage property values.
If a property owner wants to be “left alone,” they will be, clarified McDaniel: whether to avail themselves of the tools is up to them. "It just opens up opportunities for developers to partner with the community for the public benefit,” she said. “And property owners may choose or not choose to participate.”
McDaniel also noted that rather than hurting affordability, the inclusion of apartments in the MRA could help maintain their affordability by providing access to public funds for improvements, reducing the need for property owners to raise rents to cover costs.
At the May 7 Council meeting, Councilor Randy Ryti pointed out that if the owners of downtown apartments wanted to tear them down and replace them with high-density, luxury housing, nothing in the current development code is stopping them from doing that — the MRA designation doesn’t change that. Later, in our interview, McDaniel agreed. “Those property owners could [build that luxury housing] right now, today, if they so choose. But if there's public funding involved, then it's a different story.”
The MRA does not supersede the existing land-use code requirements, Andrus said. “For instance, neighborhood protections next to downtown are still applicable in order to ensure there’s a transition between densities and intensities of uses.” Neither does MRA allow property owners to ignore building heights, parking requirements, or any other land-use provision laid out in the code, he said.
The MRA plan has yet to be written: if the community wants affordability written into it, now is the time for them to say so, said McDaniel — and not just with housing. “There was concern that we needed smaller spaces that were more affordable to smaller businesses,” she said. “If the community as a whole and business owners are seeing that need, then they need to express that need during the upcoming town halls.”
Lessons from Las Cruces
Our southern neighbor, Las Cruces, implemented an MRA in 2006 with significant success. City Councilor Becky Corran, in an interview with Boomtown, shared insights that address common concerns about MRAs.
Regarding government interference: “If a property owner wants to be left alone, they will be,” Corran said. Whether to make use of MRA tools is up to each business or property owner, she said, noting that nobody to date has turned down cash for storefront beautification when offered. “Many businesses have taken money from us toward a nice window or to have a new site. I think it's up to about $25 grand.”
On gentrification, she said, “There's zero chains [stores] in our MRA. … It's kind of kept its homey feel. It's not like [buildings] were all razed and replaced with high rises.”
When asked about legal concerns and the anti-donation clause, Corran said Las Cruces hasn't faced legal challenges regarding their MRA. “We're very transparent when we talk,” Corran said. “We speak openly about [working around] the anti-donation clause. So far, that hasn't been a conversation or a challenge that we've experienced.”
Rather, Las Cruces’ downtown MRA “has been extraordinary," Corran said. “We've gone from having few functional businesses to now having five or six super-thriving dinner and bar places.”
While Los Alamos and Las Cruces differ in size and character, Las Cruces' experience suggests that MRAs can be powerful tools for revitalization when implemented thoughtfully, potentially addressing concerns about gentrification, government overreach, and legal challenges.
So what happened in White Rock?
In 2022, Council had a crack at trying out an MRA designation to get development going in White Rock Town Center, but that MRA hasn't made much of a splash yet. To understand why, remember that a key part of the puzzle is finding the money to finance more development within the MRA. The method for establishing that fund is the TIF. Unfortunately, this financing method was missing when the White Rock MRA was first established: it was only passed by the NM State Legislature two years ago.
TIF does require a separate resolution from MRA, so if White Rock and Los Alamos want to add that tool to the MRA toolbox, Council will need to make those decisions after the MRA plan is approved — if it is. The good news is the county can have one MRA team and money pot to cover both areas.
The path forward
Because the County Council has approved the MRA designation and boundary, the next step (after the town hall) will be to create an MRA plan identifying specific redevelopment projects and priorities. This process will involve public engagement through community workshops and surveys. Once the plan is approved by Council, there will still be work to do, such as establishing a TIF.
“We don't just want to do the plan and then put it on the shelf,” said Amy Bell, a principal with Groundwork Studio, which is a contractor to New Mexico MainStreet. Bell is providing her services through state funding at no cost to Los Alamos County. “We want to create the plan so that it is really primed for implementation.”
Andrus acknowledged that while the MRA is a valuable tool, it is not a silver bullet. “We can set the environment and say we've got resources to assist, but we don't have anything until someone comes forward with a project proposal,” he said. In other words, the MRA is a toolkit, but like any tool, it’s inert until someone comes along and picks it up. It can’t do any magic on its own.
One way to think about an MRA: the worst that can happen is nothing happens at all. Consider it more like an experiment: the status quo isn’t working, so the county is trying something new, and it’s relatively low risk.
When asked about metrics for success, Connolly said, “I think for us it would be that we don't have empty lots and vacancy in our core downtown. That would be massive. But at this point, I'm hoping in the next year or two we have some catalytic projects. I'm going to feel really good when that happens.”
Connolly remains optimistic about the potential for the MRA to drive meaningful change. “We know this area means a lot to the community and to visitors,” she said. “We've had failed projects in our community, and everybody's really upset when that happens. Now we're putting some mechanisms in place to maybe prevent that from happening in key areas.”
As Los Alamos weighs the benefits and challenges of the MRA designation, the community's input will play a crucial role in shaping the future of its downtown core. The MRA planners believe that with thoughtful work and engagement, the MRA has the potential to breathe new life into this gateway to Los Alamos while balancing the needs and concerns of all stakeholders.
Want to get involved? Hear more? Join the MRA town hall on Thursday, June 27, from 6:30 - 8:30 p.m. at Fuller Lodge. (Note that while Pac8 will record the meeting, it is in-person only.) You can also reach out to Paul Andrus, paul.andrus@lacnm.us, or Sobia Sayeda, planning manager for Los Alamos County, sobia.sayeda@lacnm.us.