HomeMy WebLinkAbout20090411.tiffEsther Gesick
From:
Sent:
To:
Subject:
Attachments:
Record of
'oceedings - Transc.
Bruce Barker
Wednesday, January 07, 2009 3:35 PM
Esther Gesick
FW: Beebe Draw - Record of Proceedings Email #2
Record of Proceedings - Transcript of Public Hearing (00152107).PDF
Original Message
From: Kathryn Garner [mailto:kgarner@CCCFIRM.COM]
Sent: Friday, January 02, 2009 4:31 PM
To: Bruce Barker; Paul Cockrel; MaryAnn McGeady; Richard N. Lyons
Cc: Cyndy Giauque; Kristin Bowers
Subject: Beebe Draw - Record of Proceedings Email #2
Attached is document # 10 (the Transcript of Public Hearing) from the
October 20th meeting.
Kathryn L. Garner
Collins Cockrel & Cole
390 Union Boulevard, Suite 400
Denver, Colorado 80228-1556
303.986.1551 Telephone
800.354.5941 Toll Free
303.986.1755 Facsimile
PRIVILEGED COMMUNICATION. This email may contain attorney -client or
otherwise privileged and confidential information intended only for the
use of the individual or entity named above. Dissemination,
distribution or copying of this communication is strictly prohibited.
If you are an attorney or law firm, consult Title I of the federal
Electronic Communications Privacy Act of 1986. If you believe that this
email has been sent to you in error, please reply to the sender that you
received the message in error and delete this email.
ATTACHMENTS. Although this email and any attachments are believed to
be free of any virus, the files should be virus scanned before opening
them.
Original Message
From: Bruce Barker [mailto:bbarker@co.weld.co.us]
Sent: Monday, December 22, 2008 10:32 AM
To: Paul Cockrel; MaryAnn McGeady; Richard N. Lyons
Cc: Cyndy Giauque; Kathryn Garner
Subject: RE: Beebe Draw Farms Metropolitan District
Paul, MaryAnn and Dick:
In our discussion today regarding the procedures for the appeal on the
exclusion
for the above -referenced District, we confirmed the following schedule:
1
2009-0411
Objection to jurisdiction (possible that none of the Appellants
filed a written objection with the District Board) must be filed with
the Board of County Commissioners (BOCC) by 3 p.m., 12/24/08. If such
an objection is filed with the BOCC, then Dick will have until 12/31/08
to
respond. The BOCC will consider that issue at its Board meeting on
1/5/09 at 9 a.m.
Record of the District Board hearing must be filed with the BOCC
by 5 p.m., 1/5/09.
Appellant's brief shall be filed with the BOCC by 5 p.m.,
1/16/09.
Appellees' response briefs shall be filed with the BOCC by 5
p.m., 1/23/09.
Appellant's reply brief shall be due by 5 p.m., 2/3/09.
a.m.
has a
The BOCC hearing on the matter shall be 2/11/
Upon further reflection, I would prefer 2/18/
little extra time to read through all of the
This appeal is not de
proceeding before the
shall be considered.
novo, but, rather, is on the
District Board. No evidence
No public testimony shall be
Thanks for your help on this!
Have a Merry Christmas and Happy New Year!
Bruce.
09 or 2/18/09 at 10
09, so that the BOCC
written materials.
record of the
outside that record
heard by the Board.
OCTOBER 20, 2008 DISTRICT NO. 1 BOARD MEETING
# 10. TRANSCRIPT OF PUBLIC HEARING PREPARED BY INDEPENDENT
COURT REPORTER
RECORD OF PROCEEDINGS
MINUTES OF THE SPECIAL MEETING OF
BEEBE DRAW FARMS METROPOLITAN DISTRICT NO. 1
HELD
OCTOBER 20, 2008
The Board of Directors ("Board") of the Beebe Draw Farms Metropolitan District
No. 1 ("District") held a Special Board Meeting open to the public at 16502 Beebe Draw
Fanns Parkway, Platteville, Colorado, at 5:30 p.m. on October 20, 2008.
ATTENDANCE Directors in Attendance Were:
Stephen Cooper
Christine Hethcock, who did not participate in the public hearing
Thomas A. Burk
Linda Evans Cox
Director Absent Was:
Daniel R. Sheldon, whose absence was excused
Also in Attendance:
Paul Cockrel of Collins Cockrel & Cole
Sharon Mau of Collins Cockrel & Cole
Kathryn Garner of Collins Cockrel & Cole
Mary Ann McGeady of McGeady Sisneros
Kristen Bowers of McGeady Sisneros
Whit Sibley of Sibley and Associates
Property owners and residents as set forth on the attached list
NOTICE
(00141215.DOC /)
It was noted that notice of the meeting of the Board had been posted
at least three days prior to such meeting in three public locations
within the Districts' boundaries, and the notice was filed with the
Weld County Clerk and Recorder for posting on the bulletin board.
The notice also included the agenda items.
1
RECORD OF PROCEEDINGS
CONFLICTS
OF INTEREST Director Hethcock has filed a Disclosure of Potential Conflict of
Interest Statement with the Board and the Secretary of State in
accordance with statutory requirements pertaining to her relationship
with REI Limited Liability Company ("REI"), PLR, LLC and
Gibraltar Companies, LLC. Such Statement is attached hereto and
incorporated herein by this reference.
All disclosure of potential conflicts of interest statements previously
filed are deemed continuing for all purposes and are incorporated
into the minutes of the meeting.
It was noted that Director Burk does not have a conflict of interest.
A transcript of the Board meeting and public hearing on the Petition
of Exclusion of the unplatted property owned by REI Limited
Liability Company within the District was taken by an independent
court reporter, is attached hereto and incorporated herein by this
reference, along with the following documents referred to therein,
which are also attached hereto and incorporated herein by this
reference:
1. Disclosure of Potential Conflict of Interest Statement of
Christine Hethcock,
2. Slide Presentation by Mary Ann McGeady, and
3. Statement of Concern from certain residents, which was
accepted by the Board,
and constitute the minutes of the meeting of the Board for these
proceedings.
{00141215.DOC I)
2
RECORD OF PROCEEDINGS
ADJOURNMENT There being no further business to come before the Board, the
meeting was adjourned.
Secretary for the Meeting
ecc Etta.--r—O ic
Linda Evans Cox
Christine Hethcock
Thomas A. Burk
{00141031.DOC /)
9
1
Beebe Draw Farms Metropolitan District No. 1
Hearing on the Exclusion of Real Property From the Beebe
Draw Farms Metropolitan District No. 1
Before the Board of Directors of the Beebe Draw Farms
Metropolitan District No. 1
Heard at the Community Center
16502 Beebe Draw Farms Parkway
Platteville, Colorado
Monday, October 20, 2008
5:50 p.m. - 8:05 p.m.
Applicant: REI, Limited Liability Company
APPEARANCES:
Board of Directors present:
Steve Cooper, Chair
Linda Cox
Tom Burke
Christine Hethcock
Paul Cockrel
Collins Cockrel & Cole
390 Union Boulevard, Suite 400
Denver, Colorado 80228-1556
(303)986-1551
For the Board of Directors.
MaryAnn McGeady
Kristin Bowers
McGeady Sisneros, P.C.
450 East 17th Avenue, Suite 400
Denver, Colorado 80203-1214
(303)592-4380
For Applicant.
Vince Toenjes
Gorrell Giles, P.C.
1331 17th Street, Suite 1000
Denver, Colorado 80202-1566
(303) 996-7200
For Applicant.
2
1 MR. COOPER: The meeting of the Beebe Draw
2 Farms District Number 1 is called to order at 5:50 on
3 October 20, 2008, at the Community Center of Beebe Draw
4 Farms, Platteville, Colorado, by Chairman Cooper. We'll
5 have the roll call of directors now.
6 Ms. Cox?
7 MS. COX: Present.
8 MR. COOPER: Present. Burke.
9 MR. BURKE: Present.
10 MR. COOPER: Hethcock.
11 MS. HETHCOCK: Present.
12 MR. COOPER: Chairman Cooper is present. And
13 Director Sheldon is excused.
14 Public members who wish to comment should
15 check the box on the sign -in sheet allotting the speaker
16 to speak up to four minutes.
17 This meeting will be transcribed for the
18 record. Each speaker shall state their name and status,
19 being -- status being if they're from REI, the PLR
20 resident, or director, or from the public before their
21 comments for the record.
22 The Chairman now recognizes Paul Cockrel,
23 counsel for the districts, concerning conflict of
24 interest and of this public hearing. Paul?
25 MR. COCKREL: That sounds real formal, Steve.
3
1 Hi. I'm Paul Cockrel. I've met most of you or at least
2 some of you, and I am the attorney for the two
3 districts, Beebe Draw Farms Number 1 and Beebe Draw
4 Farms Number 2.
5 My responsibility is to advise the Board
6 and -- in all of its deliberations at this proceeding
7 tonight. And what I'm going to do initially is kind of
8 summarize for you these processes so that you
9 understand. If you have any questions, you're welcome
10 to ask me initially, and then we'll get into the hearing
11 part, which gets a little more formal, and I'll explain
12 why that is.
13 The members of the Board -- there are three
14 members of District Number 1 Board here who will be
15 voting tonight. Steve, Linda, and Tom. None of them
16 have conflicts. Dan Sheldon, who is a fourth member of
17 the Beebe Draw Farms Board, does not have a conflict,
18 because he is no longer associated with REI, but he's
19 not here. I think he's shooting elk or something. So
20 he was unable to make this.
21 MR. COOPER: Hopefully.
22 MR. COCKREL: Hopefully. And Christine
23 Hethcock, who you all know, is also here, but because
24 she is associated with REI, she will not be
25 participating in the hearing or voting at the hearing.
4
1 So those are kind of the preliminaries. The
2 minutes will reflect these various conflicts or
3 nonconflicts, and we'll move into the public hearing
4 part of this.
5 This is a hearing on a petition to exclude
6 the REI undeveloped property from the boundaries of
7 District Number 1. The -- the statutes that govern
8 special districts provide specific procedures and
9 processes to conduct these hearings and to make final
10 decisions by the Board. The purpose of the hearing is,
11 again, to approve or disapprove this petition for
12 exclusion. You're going to hear a lot of information
13 from the representatives of REI, MaryAnn McGeady,
14 Kristin Bowers, Vince -- Vince?
15 MR. TOENJES: I am here to consult.
16 MR. COCKREL: To consult only. Vince Toenjes
17 is also -- all these three are attorneys for REI, the
18 developer of the property in the District. They will be
19 making this presentation.
20 The Board's involvement in this is to make
21 the decision. And in fact, they are required -- once a
22 petition is filed -- any landowner can file a petition
23 for exclusion under the statute. You simply have to be
24 the fee owner of the property involved.
25 Once that has been published in the
5
1 newspaper -- we publish that in the Greeley Tribune.
2 Notice was posted for the meeting. The public hearing
3 is conducted. And then once we go through the public
4 hearing -- and there will be an opportunity for public
5 comment at one point during this hearing -- the hearing
6 will be closed, meaning your participation, REI's
7 participation, will be limited at that point in time,
8 and the Board then will make its deliberations and
9 decide what action to take. The actions are basically
10 to approve the petition, to disapprove the petition, to
11 attach conditions to any approval, and/or whatever else
12 might come up.
13 Formally, I mean, if you look at it under the
14 law, what this -- they are really the deciding, kind of
15 the judges. They are -- we call this a quasi-judicial
16 proceeding, but they make a determination based on the
17 facts presented and these standards that are set forth
18 in the statute.
19 For example -- I can't read those -- among
20 other things, the Board will decide specifically whether
21 this exclusion would be in the best interests of the
22 District, of the property itself, the REI property,
23 whether the relative costs and benefits justify the
24 exclusion, whether the District will be able to provide
25 economic and sufficient service to the remainder of the
6
1 property in the District. And we go down, and there are
2 about 10 of these categories that the Board must decide
3 has been met as they go through this process.
4 Once the hearing is concluded and the Board
5 makes its decision, then it enters an order. Once that
6 order is finalized, the proceeding then is moved up to
7 the District Court. We present the petition to the
8 District Court. The District Court rather summarily
9 enters an order approving the petition or the order of
10 the Board. And the order becomes final. The Court
11 enters an order that gets recorded in the public
12 records.
13 So my major point to you is to understand
14 that this is all controlled by statute. There are
15 statutory processes. We don't make this up. We follow
16 the law, and the decisions are made based upon that.
17 Now, we tend to make it a little less formal
18 here, just because it would becoming overwhelming to
19 each of us if we turned this into a courtroom. The
20 record is made. That's why you have a transcriber here.
21 There is a court reporter who is transcribing the
22 proceeding. There is an ability to appeal a decision.
23 And if necessary, there will be a record of this
24 decision made this evening so that that information is
25 available.
7
1
2
3
4
5
6
7
8
9
10
11
It looks like we've got a slideshow,
PowerPoint. All that will be included in the record of
the proceeding. Your comments, if you have comments,
will be included in the record of the proceeding. If
you have written statements -- I didn't receive any
written statements, but if any written statements are
received, they will be in the record of the proceeding.
Linda, you have a question.
SPEAKER: Just to clarify, when you said that
the proceedings will be closed for Board discussion.
Doesn't mean for the people to leave.
12 MR. COCKREL: No.
13 SPEAKER: We just don't get to comment.
14 MR. COCKREL: Yes. The public hearing part
15 is concluded at that point. The Board needs to make
16 more serious suggestions at that point. No, the only
17 time the Board does not act in public is when it goes
18 into executive session. It has a right to do that to
19 seek my counsel or for other various matters. But it
20 has to go in a back room and talk in a small group and
21 come back out here.
22 They can't -- the Board -- no board can make
23 a decision in closed session like that. All the
24 decisions and actions have to be taken in a public
25 session, by law. It's like City Council in that regard.
8
1 There's really no difference. We operate under the same
2 open meeting laws as city councils or county
3 commissioners. They're all the same. Yes, sir.
4 MR. WELCH: Speaking of which, I guess I
5 don't understand the procedure. Does it go to the --
6 you said it goes to the District Court. At any time,
7 does it go before the County Commissioners?
8 MR. COCKREL: No. It can. There can be a
9 process, if this -- if the Board disapproves -- I mean,
10 the petition for exclusion submitted by REI, REI has a
11 right to appeal that to the Board of County
12 Commissioners. In that case, then the record is
13 transmitted to the Board of County Commissioners. They
14 conduct what we call a de novo hearing -- actually, they
15 do not conduct a de novo hearing. They conduct a
16 consideration of the record made at this meeting, but
17 they do make an independent decision.
18 It's a little different from some appeals,
19 where the courts will look at a little bit less of a
20 standard for appeal. Most likely, they'll uphold the
21 lower court or tribunal decision, unless it was kind of
22 arbitrary or capricious. Here, based on the records
23 presented this evening, the County Commissioners will
24 make that decision whether the Board's denial of the REI
25 petition is correct or incorrect, and they can enter a
9
1 whole new order of approval or disapproval, based on the
2 record. And ditto, the same thing can happen. They can
3 go on to a different level beyond that. It can go to
4 the District Court for a similar consideration. Yeah.
5 MS. McGEADY: This is MaryAnn McGeady. I ask
6 before you speak, if you can say what your name is,
7 because the stenographer needs to know each person. So
8 the person who asked the last question.
9 MR. WELCH: I'm sorry. My name is Michael
10 Welch.
11 MR. COCKREL: Thanks, Michael. Did that
12 answer your question?
13 MR. WELCH: Thank you.
14 MR. WORDELL: Roy Wordell, related question.
15 You said it can -- I could appeal. Can anybody -- who
16 can appeal the decision?
17 MR. COCKREL: That's a good question. The
18 certainly, REI can appeal. You have to be a party of
19 interest to appeal. And frankly, I've only -- I've only
20 had an appeal taken by a -- by an affected property
21 owner. How far the statute goes beyond that, I'm not
22 certain, frankly.
23 MR. WORDELL: In other words, as a resident,
24 may I appeal?
25 MR. COCKREL: I'm not -- I think the answer
10
1 is maybe. I've never seen a court case that decides how
2 far down the line you can go to appeal that, frankly. I
3 don't know. I don't know if an interested party has
4 been determined to be any property owner in the
5 District, a property owner who only participates in
6 the -- as an interested party in this hearing, or if
7 they actually have to be an owner of the property, the
8 subject property that's being excluded or not excluded
9 from the District. Yes.
10 MS. POWELL: Angie Powell.
11 MR. COCKREL: Ann?
12 MS. POWELL: Angie.
13 MR. COCKREL: Angie.
14 MS. POWELL: Yes. If there is an appeal,
15 does it have to be made in this evening's meeting?
16 MR. COCKREL: No. No. The appeal is made
17 within statutory time frames. The appeal -- you don't
18 have to stand at the end and say, I appeal, I disagree,
19 whatever. And the appeal is taken, actually, also when
20 the Board makes its final decision, which may be the
21 this evening. It may not be this evening. But the
22 appeal, the time to make your appeal, wouldn't run until
23 that decision is made.
24 MS. POWELL: No statement has to be made in
25 this meeting prior?
11
1 MR. COCKREL: You do not have to state your
2 intent to appeal, no.
3 MS. POWELL: Thank you.
4 MR. COCKREL: Not to my knowledge.
5 MS. McGEADY: One comment I would make is
6 that when you go into a City office or you go into a
7 County office, there's usually a sign up front that
8 says, anyone who works for this government doesn't give
9 legal advice to people who aren't their client. I don't
10 know, Paul, if you want to make a comment on that. But
11 in this proceeding, I represent REI. And I don't mean
12 any offense when I stay this. We give legal advice to
13 REI. I think Paul, your client is?
14 MR. COCKREL: The District.
15 MS. McGEADY: And so what you're asking for
16 him to do is giving you advice to how to challenge his
17 client's. Are you giving advice on how to challenge
18 your client's decision today?
19 MR. COCKREL: No, I would never do that.
20 I've giving you my honest response. If I'm wrong, I'm
21 wrong. You need to get your own counsel if you plan to
22 appeal. I think that's Mary's point.
23 MS. McGEADY: Right.
24 MR. COCKREL: I'm going to argue that my
25 client made the right decision, whatever the decision
12
1 is. I don't know what it will be. It's my duty to
2 defend them. I'm sure they will make the right
3 decision. I have full confidence. That doesn't mean
4 you will agree with that decision and your right to
5 appeal -- I mean, if you were to disagree with that or
6 MaryAnn wants to disagree with that, then you'd want to
7 consult your own attorney.
8 MS. BLACK: There's a difference between
9 procedure and advice. I hear procedure.
10 MR. COCKREL: Yes.
11 MS. BLACK: Linda Black.
12 MR. COCKREL: Thanks, Linda. You can be my
13 co -counsel.
14 MS. BLACK: Rock on.
15 MR. COCKREL: Okay. Enough for the
16 exclusion. Let me just touch on one other thing. Let's
17 deal with stuff that's going on in the community, and I
18 understand that everyone is vitally interested in this,
19 and that's why you're here tonight. You could be home
20 watching the football game. But this is an important
21 issue, and I know it's getting a lot of serious
22 attention by REI and the Board, so thanks for coming
23 out.
24 Also you know that the recall -- a recall
25 petition has been filed to recall three of the
13
1 directors, Christine and Dan and Tom, from the Board of
2 District Number 1. And Sharon Mau is the designated
3 election official back there. She's responsible for
4 discharging her duties under the statute to conduct this
5 election. If you weren't aware of it -- and I have some
6 dates here. I should give those to you.
7 The petition was actually filed on October
8 15th, and -- by October 29th, Sharon will have reviewed
9 all the petition signatures and determine, verify,
10 whether or not there are sufficient numbers of
11 signatures on the petition and whether or not the
12 signatories to the petition are electors of the
13 District.
14 I'm not going to say more beyond that,
15 because she's involved in that process, and we want --
16 don't want to affect any of her decisions. But I just
17 want you to know that that is ongoing, that that recall
18 is ongoing, so we are moving forward with that.
19 Again, we do not make up our own procedures.
20 The State law has very definitive timelines by which we
21 must do these things. I have, in fact, a preliminary
22 list of these time lines that are three pages long, by
23 the time we start this process until we get to the end
24 of the process. And we have to report independently to
25 various people.
14
1 The committee that was formed to conduct the
2 recall, eventually, to the District Court. So we just
3 follow the statute and move right on down the line on
4 these, and we really do try to be as impartial as we
5 possibly can be.
6 We get a lot of interested people who call
7 and want information from us, which is understandable.
8 That can be a little overwhelming at times, because, you
9 know, we charge by the hour, and it's expensive. It's
10 an expensive process. These recalls take a lot of time,
11 so we -- if you -- if you have questions or procedures,
12 I think what we would ask is to the extent you can go
13 through the committee, or if you have questions that
14 need to be answered through Steve so that we can -- he
15 can e-mail those questions to us, and we'll answer them
16 so we're doing it impartially for everyone's benefit and
17 not just this. It's not directed to anyone. But it's
18 just to help us expedite this process and make it as
19 economic as possible.
20 In that regard, I probably should just
21 mention the 2008 election, a couple of questions that
22 had come up on that. The -- there was an election in
23 May that was canceled. It was canceled, actually, on
24 March 6th. We had previously published notice of
25 nominations for fall on February 12th.
15
1 Again, all the election procedures are
2 conducted in accordance with statutory requirements,
3 specific time frames. It is very common -- in fact,
4 we've done it before out here, and in a lot of other
5 districts -- when we publish the call, and when the
6 directors who are running for reelection have the
7 opportunity to file self -nomination forms with a
8 designated election official.
9 If there are no more petitions or nomination
10 forms filed in the number of candidates to be
11 election -- to be elected, the election itself is
12 canceled. It's done by statute. There's no point in
13 conducting an election, because you can only elect the
14 people who follow these nominations requirements.
15 That's why the election was canceled. There
16 was no interest. We're quite confident we followed
17 statutory procedures in many of these issues that have
18 come before and, I think, arisen since then. That's
19 unfortunate, but I did want to address that point,
20 because I don't think it's relevant to the hearing
21 that's coming up in about 30 seconds here.
22 We've gone through the election cancellation
23 process for the May election. Elections are held every
24 two years in special districts. May of even -numbered
25 years. So the next election would be in May of 2010.
16
1 If in that time frame there is a vacancy on the Board,
2 then the Board itself acts to -- to appoint someone to
3 fill that vacancy.
4 The appointed director serves until the next
5 regular election, whenever that is. This would be in
6 May of 2010, for example. Even if it's for a term that
7 would have ordinarily gone beyond 2010, most -- all
8 terms are four years, but if there's a -- if there's a
9 vacancy within the first couple of years of a director's
10 term, then they can only serve until the next regular
11 election. Enough said on that, Steve?
12 MR. COOPER: Yes.
13 MR. COCKREL: Okay. I'll turn it back to
14 you.
15 MR. COOPER: Thank you, Paul. The scope of
16 the hearing is as follows: REI will present their
17 petition for exclusion. The Board will invite public
18 comments to REI after their presentation. The Board
19 will not answer -- will not answer any questions at this
20 time, your Board sitting right in front of you. It's to
21 REI.
22 Upon completion of the questions to REI, the
23 public meeting will be closed. The Board will then
24 discuss the petition among themselves in front of you
25 and ask questions concerning the proposal for exclusion.
17
1 The Board will also ask Counsel Cockrel to discuss the
2 Intergovernmental Agreement between District 1 and
3 District 2 and any ramifications thereof to the
4 Intergovernmental Agreement. Upon Board discussion and
5 response from counsel, the Board will decide to accept,
6 deny, or to require conditions for the Board's final
7 decisions.
8 REI will now make their petition for
9 exclusion.
10 MR. COCKREL: I think it's up to you,
11 MaryAnn. I introduced MaryAnn McGeady.
12 MS. McGEADY: Thank you, Paul. I think the
13 first thing I'd like to ask is if Sharon -- do you have
14 a copy of the certification of the publication of the
15 notice of this hearing? I just want to make sure that's
16 part of the official record of tonight.
17 MS. MAU: Yes.
18 MS. McGEADY: So the certification will be
19 made and published --
20 MS. MAU: Yes.
21 MS. McGEADY: -- of the public hearing.
22 MS. MAU: Yes.
23 MS. McGEADY: And you have a copy of the
24 petition here.
25 MS. MAU: The group publication?
18
1 MS. McGEADY: No, the actual petition for
2 exclusion is here.
3 MS. MAU: Yes.
4 MS. McGEADY: If anybody wants to see that or
5 have a copy of that, it's also part of the public
6 record. What we thought would be easiest in terms of
7 presentation -- and we're very thankful and grateful
8 that you all have taken time to come down and hear our
9 presentation. It's not often we get a chance to speak
10 to this many people at once, especially when there's a
11 Bronco game on, so thank you very much for coming.
12 This presentation that we're going to give,
13 we also have in paper format, hard copy format, so we'll
14 submit that to be part of the official record at the end
15 of this presentation so that you can have this for easy
16 reference as well.
17 The purpose of this presentation is to
18 explain the applicant's perspective and -- on the
19 potential exclusion and also to request the Board to
20 consider favorably our request for exclusion.
21 SPEAKER: Sorry.
22 MS. McGEADY: In the beginning of this
23 particular development, the Beebe Draw Farms,
24 approximately 4,120 acres of real property located
25 was encompassed within the project. Approximately 50
19
1 homes have been constructed to date in the project.
2 There is approximately 800 single-family residences
3 projected to be here when the project is filled out,
4 with a population of 1,860 at full build -out.
5 This project map gives you an indication of
6 the future development area of what is generally
7 referred to as Filing 2. You might recognize the area
8 where your current residents are as Filing 1, which is
9 kind of in the middle of the green platted area shown on
10 that. But the project that is the subject of the
11 petition for exclusion today is in the green area,
12 correct?
13 SPEAKER: Correct.
14 MS. McGEADY: All right. The history of this
15 Beebe Draw Farms Metropolitan District is that
16 originally, there was one district serving the entire
17 community. It was organized in 1986.
18 The purpose of the District was to provide
19 for the financing of public improvements and amenities
20 and the cost of operation and maintenance of those
21 amenities. There was water, sewer -- I'm sorry, not
22 water, sewer -- streets, drainage improvements, safety
23 protection, television transmission and relay,
24 transportation, mosquito control, and park and
25 regulation facilities, including pool, clubhouse,
20
1 equestrian, and nature preserve facilities.
2 The original Service Plan anticipated a very
3 short development period and anticipated construction of
4 all public improvement immediately. Development was
5 stalled due to adverse market conditions and financial
6 difficulties of the original development group.
7 So in 1989, there was a reorganization of the
8 District and a creation of the District, so you now have
9 serving your community District Number 1 and District
10 Number 2. The original district would have been
11 financially strained if it were required to construct
12 all these improvements as once, which was in the
13 original service plan.
14 REI planned to develop the property over an
15 extended period of time and in phases in order to meet
16 the new market demands and conditions. A new
17 Consolidated Service Plan, referred to as the Beebe Draw
18 Farms -- because you had both District 1 and 2 in the
19 same Service Plan that was approved by the County
20 Commissioners -- was prepared so that there was a
21 reorganization of the districts and allow for the
22 improvements to be constructed in a phased methodology
23 as opposed to total installation at once.
24 The consolidated district structure, having
25 the two districts, D1 and D2, would ensure uniform
21
1 property tax levies and reasonable tax burden on
2 property as development commences and continues to
3 completion. The consolidated structure assures that
4 existing District Number 1 bonds are paid and
5 improvements will be provided and financed as needed,
6 instead of phased in and done ahead of time.
7 The consolidated part of the plan assures
8 that the costs of the improvements are allocated fairly
9 over the entire development and avoids disproportionate
10 burdens being imposed on the initial phases of
11 developments; assures that no area within the
12 development becomes obligated for its share of the costs
13 of improvements; and assures that all areas pay for its
14 fair share.
15 The public improvements and amenities
16 constructed to date, I think that everyone here is
17 probably familiar with. There's over a thousand -acre
18 reservoir with a marina and boat dock. 1600 acres of
19 open space and nature preserves. Miles of riding and
20 walking trails. A community swimming pool and cabana.
21 Play area. Community lodge. Horse lots. Outdoor
22 riding arena. And then the basic infrastructures, the
23 street, water, and drainage improvements for the
24 existing development.
25 In the future, the intention in completing
22
1 the public improvements would have included the
2 following amenities: A more advanced, I guess, major
3 equestrian center is how we have it referred to; tennis
4 court; basketball court; multi -purpose court; additional
5 equestrian facilities; putting green, cross-country
6 riding course; and of course, additional water, streets,
7 and drainage for the future development areas.
8 Under the Consolidated Service Plan, both
9 District 1 And District 2 have the discretion to approve
10 inclusions or exclusions. District Number 2 has the
11 power to impose property taxes within its boundaries
12 and, District 2 is authorized to provide public services
13 and facilities throughout both districts.
14 The reason I mention this at this point is
15 because not all this property, including the property
16 being petitioned for exclusion from District 1, is
17 currently within the boundaries of District 2, so the
18 property currently in the bounds of this petition today
19 is currently in District 1 and District 2.
20 On October 7, 2008, REI submitted a petition
21 for exclusion of 2,226 acres of REI undeveloped property
22 that is currently in the boundaries of District Number
23 1. This property is already included within the
24 boundaries of District 2, and District 2 will be able to
25 provide the services to the property more efficiently
23
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
while still being subject to the terms of the
Intergovernmental Agreement that will be between the two
districts.
The exclusion will ensure uniform property
tax levies on all property within the development and
will ensure that all amenities will be available to
current and future residents of the development. And
when we refer to the phrase "development," we mean all
of Filing 1, all of Filing 2, the entire original 4,000
acres. Another purpose here is to assure that there's
resident control of District Number 1 on the Board of
Directors.
What we've done here is identify what the
statutory standards are for exclusion, that need to be
considered by the Board. And included in the
presentation is our assertion of what factual basis the
report supports each of these conclusions. One standard
to be considered is whether the exclusion would be in
the best interests of property to be excluded. It is
REI's perspective that this exclusion of property is in
the best interests of the property to be excluded, as it
facilitates the financing, construction, operation, and
maintenance of the capital improvements. This is set
forth in the Service Plan.
We also think it's in the best interests of
24
1 District Number 1, which is the district from which the
2 exclusion is proposed, again, because we think it
3 facilitates the financing, construction, operation, and
4 maintenance of the capital improvements set forth in the
5 Service Plan in the most efficient way.
6 We think it's in the best interests of the
7 County, and the reason is we think the benefits for the
8 County for the project to build out efficiently and for
9 the future development of Filing 2 to be completed and
10 also the original amenities that were expected to be
11 financed, constructed, and available to the entire
12 community, that they be available in the most efficient
13 way possible.
14 And how that benefits the County, we think,
15 is one, we think it implements the plan that they
16 approved, not only the Service Plan but the approval of
17 Filing 1 development plan and also, in the future, the
18 approval of Filing 2 development plan.
19 The relative costs and benefits to the
20 property to be excluded from the provision of the
21 special district's services: We believe the relative
22 costs and benefits of the property justify the
23 exclusion, as the property to be excluded will remain in
24 the District, and the relative costs and services to be
25 provided by District 2 will be provided more
25
1 efficiently.
2 Another standard is the ability of the
3 district -- the special district to provide economical
4 and sufficient service to both the property to be
5 excluded and all the properties within the special
6 district's boundaries.
7 We don't believe that the exclusion of this
8 property will impair District l's ability to provide
9 services to the remaining property for the same costs as
10 prior to the exclusion. Because currently, the
11 districts function together under an Intergovernmental
12 Agreement to assure that the same mill levies are
13 imposed on the same property and that all the
14 improvements are constructed. So changing whether the
15 district's property is in District 1 or District 2 at
16 this point in time does not change what's required under
17 the Service Plan or under the Intergovernmental
18 Agreement.
19 The effect of denying the petition on
20 employment and other economic conditions in the special
21 district and surrounding area: We believe -- again,
22 because we think the improvements will be more
23 efficiently provided. With that basic plan being
24 excluded from 1 and being developed under Number 2, that
25 it will have a positive impact on the employment and
26
1 other economic conditions in the District and the
2 surrounding areas, as it facilitates the development of
3 the amenities, the capital improvements, to serve the
4 current residents and the future residents.
5 There are a lot of standards, as we continue.
6 The economic impact on the region and on the special
7 district, surrounding area, and the state as whole if
8 the petition is denied or the resolution is finally
9 adopted. Again, we think that granting this petition
10 will have a positive economic impact on the region, the
11 District, the surrounding region, and the state as a
12 whole.
13 Now, whether an economically feasible
14 alternative service may be available. We believe that
15 the more economically feasible alternative service will
16 be provided to the property by District 2 in the form of
17 capital improvements being constructed, operated, and
18 maintained that will directly serve the property.
19 The additional costs to be levied on the
20 property within the special district if the exclusion is
21 granted. And I think the focus of this question is, if
22 this property is excluded from District Number 1, will
23 that result in an increased cost to the residents or the
24 other property owners within District 1? And our
25 position is no, it will not; and again, because the
27
1 property continues to be governed by the District 2,
2 under the Intergovernmental Agreement, with District
3 Number 1.
4 Now, focusing a little bit more on the
5 existing Intergovernmental Agreement. And I'm going to
6 digress a little bit from the presentation to put in my
7 own reflections at this point. Right now, you have --
8 District 2 has no mill levy, and District 1 Has 40
9 mills. Is that correct, Paul?
10 MR. COCKREL: Correct.
11 MS. McGEADY: Thank you. The reason for --
12 the reason for that structure is that all the property
13 is in both districts. So District 2 imposes zero mill
14 levy. District 1 imposes 40 mills. District 1 pays the
15 current amortization on the bonds, hands over the money
16 to District 2. District 2 provides the maintenance and
17 operations out of the money that comes out as the basis
18 of that 40 mills.
19 So what has happened here, when we remove the
20 property, if it's approved by the Board, from the
21 District 1 tax base and put it into only District 2 --
22 and actually, it's only in District 2, so we don't need
23 to move it to be in District 2 -- it will be subject
24 only to the District 1 service mill levy. So we do need
25 to coordinate in a slightly different way between
28
1 District 1 and 2 how the mill levies are imposed so you
2 have the same result, which is all property pays 40
3 mill.
4 Towards that end, we're requesting that the
5 Board also consider amending the Intergovernmental
6 Agreement, if it grants our request to approve the
7 exclusion, so that we can have the relationship between
8 the districts and the terms of the Intergovernmental
9 Agreement effect what is reflected in the Service Plan,
10 which is, yes, District 2 does have the power to impose
11 property taxes within its boundaries, but we need to
12 have a mechanism that assures that all the property
13 owners are paying the same tax and that there's no
14 double tax.
15 Okay. It's very complicated. I'm hoping I'm
16 being clear. Maybe to go back one second. Okay. So
17 what would happen post -exclusion is District 1 would
18 impose a debt service mill levy. That debt service mill
19 levy would be not only on District 1 property that
20 remains in District 1, which is the Filing 1, which is
21 where all of you live, but would always continue to be
22 imposed on the District's property.
23 So, for instance, if District 1 needed to
24 impose -- well, if District 1 wants to impose a district
25 mill levy, you'd look at what is being imposed by 1 and
29
1 2. You'd look at what is needed to meet its current
2 debt service. Say it's 10 mills. District 1 would
3 impose 10 mills. That would be on all the property.
4 Then it will impose 10 mills for the debt and 30 mills.
5 And District 2 would have the same 10 mills for debt,
6 and 30. So everyone, Filing 1 or Filing 2, would still
7 be paying 40 mills.
8 But, again, the Intergovernmental Agreement
9 needs to be amended to coordinate that process to assure
10 that there wouldn't being anyone who would pay more or
11 less than anyone else. And what would continue to be
12 the case is District 1 would distribute any revenues it
13 had available after it paid the current debt service.
14 So under the example I gave, the money that come from
15 the 30 mills for operation would continue to be handed
16 over to District 2 for the District to continue to
17 budget and provide for improvements that you have.
18 All right. So REI is requesting that the
19 petition for exclusion be granted, subject to the
20 approval of certain amendments to the Intergovernmental
21 Agreement as I've described.
22 The property is currently within the
23 boundaries of District 1 and 2 and, upon exclusion,
24 then, will only be within the boundaries of District 2.
25 And again, as I just described it, we think it's
30
1 necessary to amend that IGA so we don't end up with any
2 properties taxed less than any other property or don't
3 end up with properties taxed twice.
4 We do also want -- we want to be clear and
5 have it be clear that the funding priorities that have
6 always been implemented between the two districts
7 continue to be implemented, which is why we want to make
8 sure that all property owners have access to all
9 amenities and all public facilities and that there be no
10 change in the financial obligations for property taxes
11 and funds that are available for public improvements
12 that are identified in the Service Plan.
13 So we ask, again, that you approve the
14 exclusion and the approval of the exclusion would assure
15 that the 40 mills will continue to be imposed for
16 funding of the approximately $25 million in the capital
17 improvement program on all REI property and all property
18 throughout District 1 and 2, as provided in the original
19 Consolidated Service Plan. Also assures that those
20 remaining capital improvements are completed and that
21 the remaining amenities get completed for the benefit of
22 all the future residents. Also assures that services
23 are provided to the property as efficiently as possible
24 and that the funds continue to be available as well for
25 continued access to amenities.
31
1 The effect of exclusion would be that the REI
2 property will still be required to pay its proportionate
3 share of District l's existing bonds. Again, to step
4 back and talk to that. When a district issues bonds,
5 the property that is within the district's boundaries at
6 the time that the bonds are issued is obligated to pay
7 the debt service mill levy that's imposed by the
8 district to make payment of the debt.
9 If that property is subsequently excluded
10 after that issue, it continues to be responsible for the
11 payment of that debt. So it is -- it's not a function
12 of agreement. It's a function of the State statutes;
13 and so, again, if all that evaluation requires 7 mills
14 or 10 mills or 12 mills, it's going to be the same on
15 everybody, if that property is excluded or included.
16 That is the process of taxes with
17 establishment of the Intergovernmental Agreement and the
18 Service Plan. So your Service Plan says that everybody
19 needs to pay the same on that operating amount, and the
20 Intergovernmental Agreement says that everybody needs to
21 be the same.
22 Would you like to ask a question? And your
23 name is?
24 MR. WELCH: Michael Welch. The additional
25 $25 million would still be controlled that District 2
32
1 could be issued? Would that be under both Filing 1 and
2 2, it would be the responsibility of both District 1 and
3 2? Or would that be excluded to just District 2?
4 MS. McGEADY: Okay. That's a good question.
5 I'm going to think -- because I want to try to be less
6 confusing than more. So maybe I will try to restate
7 your question, and you tell me if this is your question.
8 After the exclusion -- okay. Prior to the
9 exclusion, there's one Consolidated Service Plan and
10 one Intergovernmental Agreement. And how that
11 consolidated plan and agreement currently functions is
12 that District 2 is responsible for the occurrence of
13 debt and the provision of capital improvement, and
14 District 1 is responsible for imposing a mill levy and,
15 after it pays current the debt that's already
16 outstanding, hands that money over to District 2 to pay
17 for those things. That's your understanding of the
18 current --
19 MR. WELCH: That is my understanding, yes.
20 MS. McGEADY: Okay. And is your question,
21 post -exclusion, will any of that change?
22 MR. WELCH: Yes.
23 MS. McGEADY: Okay.
24 MR. WELCH: Who is responsible for -- if any
25 more bonds are issued, who would be responsible for
33
1 that?
2 MS. McGEADY: Okay.
3 MR. WELCH: In District 1 or District 2 or
4 both?
5 MS. McGEADY: I cannot predict what the Board
6 will decide, but what is REI's request is that that not
7 change, that the relationship between District 1 and 2
8 continue to be that . . . am I okay? Okay -- that
9 District 2 continue to be the Board that does the
10 planning to implement what's in the Service Plan; that
11 it continues to work with District 1 to develop, you
12 know, what those plans would be in terms of
13 implementation.
14 Obviously, the Service Plan defines what
15 improvements would be financed. But then District 2 is
16 the determiner of the phasing of those improvements, the
17 financing of those improvements, the occurrence of debt
18 for those improvements, and everybody continues to pay
19 the same mill levy.
20 So if there's more debt issued for District
21 2, it will be paid for out of the revenues that come
22 from the mill levies on all the properties at the same
23 rate.
24 So in that dynamic, District 1 would impose,
25 again, the 40 mills, pay the current debt, hand over
34
1 that money to District 2. District 2 would first pay
2 the debt; second, the operations and maintenance; and
3 three, provide future capital for future debt.
4 Paul, is that correct?
5 MR. COCKREL: Yes. The short answer is,
6 District 2 would have to issue that. District 1 only
7 has the authority under the Service Plan to issue about
8 a million dollars, more or less, for the additional
9 debt. So if you're talking about $25 million worth of
10 debt, that would have to be issued by District Number 2.
11 Now, MaryAnn is absolutely correct in the way
12 that the revenues flow. But Filing 1 would be
13 responsible for that. Its responsibility is limited to
14 the revenue distributed out of the IGA. It would not be
15 the issuer of that. Do you know what an issuer is?
16 MR. WELCH: I think I do.
17 MR. COCKREL: It's the person that's
18 obligated under the bonds.
19 MR. WELCH: So what you just said, I think
20 directly contradicts what she said.
21 MR. COCKREL: No. District Number 1 would
22 not issue additional bonds. If bonds are issued, it
23 would be done through District Number 2. That's what
24 she said.
25 MS. McGEADY: Okay. For clarification,
35
1 there's two different questions, perhaps. Who issues
2 the bonds.
3 MR. WELCH: And who's responsible.
4 MS. McGEADY: Whose money is paying for the
5 bonds. Do you have both those questions?
6 MR. WELCH: Yes.
7 MS. McGEADY: Okay.
8 MR. WELCH: I understand who would be issuing
9 it, but who's responsible?
10 MS. McGEADY: And Paul and I, I believe,
11 described the same process. District 2 would be the
12 issuer of the bonds. Paul and I said the same thing,
13 which is, the revenue of the bonds would come from the
14 taxes paid by every property owner in Filing 1 and
15 Filing 2, regardless of whether you were in District 1
16 or District 2, because that's what your Service Plan
17 says. Everybody pays their tax at the same rate, and
18 all the revenue goes to pay for all the improvements,
19 all the debt, and all the operations of community. It's
20 one community where everybody is paying the same. Paul,
21 do you concur with that?
22 MR. COCKREL: I think it --
23 MR. COOPER: That's our attorney. Why don't
24 you complete your presentation before you answer.
25 MS. McGEADY: Okay.
36
1 MR. COOPER: Because you've used up your four
2 minutes already. So I'd appreciate if you do the
3 presentation to conclusion. Then the questions can be
4 asked.
5 MS. McGEADY: Okay.
6 MR. COOPER: Thank you.
7 MS. McGEADY: I apologize. You might guess,
8 this is my life's passion, so I can discuss this topic
9 all night long.
10 So where were we. Do I need to finish that
11 one? So thank you for reining me in.
12 MR. COOPER: Well, you're always welcome.
13 MS. McGEADY: So the -- again, I believe
14 we've covered all these. We can go to the next slide.
15 The facilitation of the resident control. One of the
16 consequences of this exclusion is that all of the
17 developer's interest and the developer -related
18 facilities have their interest in the real property that
19 is being proposed for exclusion. So upon approval of
20 the court order for the exclusion, none of the
21 developers will be qualified to sit on the District 1
22 Board. So the only people who will be qualified would
23 be the people who are residents and property owners
24 within the Filing 1 area.
25 We tried to give an illustration of how the
37
1 taxes would be imposed by the two different districts if
2 the exclusion being requested by the REI petition are
3 approved. And so, let's see. If you look -- this area
4 is generally green, the Filing 2 area kind of more
5 green, the Filing 1 area -- the State Land Board land
6 and Outlet A is kind of a khaki color. Going for
7 yellow, but it looks a little more khaki.
8 All of the green and all of the khaki yellow
9 will be subject to the debt service mill levy as I
10 described a little bit earlier. The green area will be
11 subject to the O&M mill levy of District 2 in addition
12 to that District 1 Debt service mill levy. And the
13 khaki green area -- I'm sorry, the khaki yellow area
14 will be subject to the District 1 O&M mill levy plus the
15 debt service mill levy. But, again, the effect should
16 be, even those different entities, the total mill levy
17 will be identically the same.
18 MR. COOPER: Does that kind of conclude it,
19 Mary Jane (sic)?
20 MS. McGEADY: I believe so. I believe other
21 than providing you with a copy of the presentation, I
22 think that concludes our report.
23 MR. COOPER: MaryAnn. Excuse me. MaryAnn.
24 MS. McGEADY: Thank you.
25 MR. COOPER: So it's time for questions. You
38
1 were asked before, if you want to speak, you can sign
2 in, and only two people signed in for questions. One is
3 Mike, and the other one is -- Michael Welch. And the
4 other one is Jennifer Keys.
5 SPEAKER: I think I was undecided.
6 SPEAKER: I was undecided as well. I signed
7 it.
8 MR. COOPER: What is the question?
9 SPEAKER: We put undecided. We wanted to
10 hear it first.
11 MR. COOPER: It says, do you want to speak,
12 yes or no. If you want to speak, put yes.
13 SPEAKER: How would we know if we wanted to
14 ask, is the question. That's why I left it undecided.
15 SPEAKER: Can you make me a yes, please?
16 SPEAKER: Put me down for a yes also. I have
17 a question, though.
18 SPEAKER: I can't start?
19 MR. COOPER: I'm brain -dead. Who wants to
20 speak? It's on the list. We have a long, long meeting
21 that's going to go quite a few years. Might be till
22 midnight. So let's get this thing moving along.
23 MS. TEETS: Okay.
24 MR. COOPER: Are you?
25 MS. TEETS: Sure. I put a yes, please.
39
1 MR. COOPER: Please address to Mary Jane.
2 MS. McGEADY: If you could state your name
3 first. Mr. Court Reporter -- if you can just say your
4 name, he can transcribe who's speaking accurately.
5 MS. TEETS: Okay. My name is Jennifer Teets,
6 and my question is to Mr. Cockrel. And my question is,
7 if the Board approves the withdrawal of REI's land from
8 District 1 tonight, can you tell me what protections
9 from the lost revenue our community, the County, and the
10 District has if the sequence changes to the
11 Intergovernmental Agreement and/or the Service Plan are
12 not approved by the Board and/or the County?
13 MR. COCKREL: I'm going to address those more
14 fully later, so I'm going to defer the hard answer to
15 your question. And I'll go through a number of
16 conditions that I'm going to recommend to the Board if
17 their action is to approve the exclusion.
18 But I will simply say that all of the changes
19 that we are suggesting, all of the amendments to the
20 Intergovernmental Agreement that we are suggesting, will
21 assure that the districts will continue to operate as
22 they presently do, and that there will be no real --
23 either substantive change in the operations of the
24 District or that there certainly will be no adverse
25 financial impact as a consequence of that. And I'll go
40
1 through those conditions a little later and explain
2 those in more detail to your satisfaction.
3 MS. TEETS: Okay.
4 MR. COCKREL: Okay.
5 MR. COOPER: Jennifer, do you have any other
6 questions?
7 MS. TEETS: I would like to read this.
8 MR. WELCH: Or just submit it.
9 MS. TEETS: Or just submit it to the Board.
10 It says, To the Board of Directors of Beebe Draw Farms
11 Metro District 1 And 2.
12 Various residents within the metro districts
13 have reviewed the notice posted by the metro districts
14 for the meetings to be held on Monday, October 20th,
15 2008. We noted that REI is asking the Metro District
16 Board to allow them to exclude 2,231 acres of land from
17 District 1 boundaries.
18 Our understanding is that the land being
19 excluded is substantially all, if not all, of the land
20 in Beebe Draw filing. We would like to express concern
21 about this transaction and ask that both metro district
22 boards table the decision until the economic impact to
23 the districts, the residents' oil and gas interests, and
24 the County can be evaluated thoroughly and properly by
25 all parties.
41
1 As best as we can tell from the limited
2 information that has been shared prior to this meeting
3 by the metro boards or REI, the petitioner, the impact
4 may be negative to one or more parties. The impact of
5 such change may also constitute a material modification
6 to the Service Plan which would need to be approved by
7 the County Commissioners.
8 Respectfully submitted.
9 MR. COOPER: Duly noted. Jennifer, I think
10 your four minutes are up. Let's just go down the list
11 here, with formal questions to REI. Now, Glenn and
12 Sandy Adkins both said yes. So Sandy Adkins is next and
13 has the floor.
14 MS. ADKINS: Sandy Adkins, on Essex.
15 I guess my main question is, why the need
16 now? That's the first part. And the second is, where
17 does this put the oil and gas royalties, the moneys?
18 MS. McGEADY: Okay. Thinking about what
19 sequence to answer your question. I guess -- I don't
20 know if it's appropriate or not, but I think -- Paul, is
21 it appropriate for me to address the comments that are
22 read into the record at this point, or should I address
23 those at the end? Do you have a preference?
24 MR. COOPER: No.
25 MS. McGEADY: Okay. If you don't mind, that
42
1 way, I don't have to keep a footnote in the back of my
2 mind to come back to those comments and I can more fully
3 focus on the questions you have raised.
4 We have spent a lot of time reviewing the
5 District's records, going back through the original
6 Service Plan, the Consolidated Service Plan, all of the
7 election questions of the District, all the agreements
8 of the District. And I have practiced as a special
9 district attorney for 26 years in the State of Colorado,
10 and I am absolutely confident that there is no Service
11 Plan amendment required to approve the exclusion, or we
12 wouldn't stand before you and petition the Board and
13 request this exclusion.
14 I have referenced in the presentation several
15 times and want to reiterate, in case I was not clear,
16 that all of the properties will pay the same taxes, all
17 of the same valuation for certification by the assessor
18 will continue to be taxed. They will either be taxed by
19 District 1 or 2.
20 The current Service Plan has language in this
21 that will allow for the exclusion or inclusion of
22 properties out of District 1 or 2, I believe, allowing
23 for the ability of the developer and the property -- the
24 other property owners within the District to manage how
25 these properties are taxed and coordinate that taxation
43
1 so long as you work within the confines of that Service
2 Plan, which is everybody pays the same mill levy and the
3 improvements get coordinated and financed together in a
4 unified way.
5 So we have tried to -- I believe we have
6 submitted a petition that is consistent with the Service
7 Plan, and we have requested amendments to the IGA so
8 that, again, you don't have any properties that aren't
9 intact and you don't have any properties that are
10 double -taxed. I don't know if that addresses the
11 questions you raised in the letter that you read to your
12 satisfaction, but that is our position.
13 Now, your question was more specifically, how
14 to assure -- or is there any concern that the oil and
15 gas rights won't continue to be taxed and that won't
16 continue to be available to the community? Is that
17 correct?
18 MS. ADKINS: Correct.
19 MS. MCGEADY: And I think it's a repeat of
20 the same answer, which is, the -- okay. To talk through
21 the process. What happens is the boundaries, the taxing
22 boundaries, of the District are certified to the County
23 Assessor, and the County Assessor looks within that
24 boundary and picks up all of the properties, whether
25 they're property values, whether they're the gas
44
1 producing rights, whether they're in the real property
2 rights, whether they're personal property rights within
3 that tax boundary, and they will tax to District 1 or
4 District 2, whichever district it can.
5 In this exclusion process, that property is
6 either going to stay in 1 or it's going to be in 2, but
7 it will not be outside of either of those places. So it
8 will continue to have the mill levy imposed by 1 and 2,
9 and the same revenue will continue to be available, and
10 it will end up in the District 2 budget the same way as
11 it has historically for the community.
12 There were two parts of your question. What
13 was the other part?
14 MS. ADKINS: Why now?
15 MS. McGEADY: Okay. Good question. So why
16 now? I believe what is motivating this request by the
17 District to -- by the REI property owner is that the --
18 this property is undeveloped. And I think up to this
19 point in time, the property owner has been comfortable
20 under the IGA the way it exists today and the
21 overlapping boundaries as it exists today, that the
22 funds will continue to flow to expedite development in
23 its property.
24 I think they are now not as comfortable with
25 that overlap, and they prefer to have the property not
45
1 overlap that is not yet developed. And again, if you
2 look at the Service Plan, the intent -- the option to do
3 it the way it has been done in the past or to have the
4 property just be in District 2 until it's developed and
5 then be included into a resident control district in the
6 future is an alternative option that is available to
7 them.
8 At this point in time, they feel that things
9 will be -- improvements will be provided more
10 efficiently if it's managed that way. So that's why
11 today. And I think they prefer to have the tax dollars
12 in the District used efficiently to provide the
13 improvements. And their concern is under the current
14 structure that it won't be as efficient.
15 MR. COOPER: Sandy, did you get the full
16 explanation or --
17 MS. ADKINS: Yeah, they want control -- yes,
18 it's been answered
19 MR. COCKREL: Okay. Thank you, Mrs. Adkins.
20 Next on the list is Linda Black, resident.
21 MS. BLACK: Thanks. So my question is
22 similar to Sandy's, in terms of, if the intent of the
23 petition is to facilitate efficiency for REI within
24 District 2, and the outcome will be a
25 resident -controlled Metro 1.
46
1 MS. McGEADY: Correct.
2 MS. BLACK: It's no secret that a tax has
3 been contentious out here. I'm concerned about
4 deadlock. If we get a resident board that can't work
5 with Metro 2, aren't we, in a sense, shooting ourselves
6 in the foot by separating these two boards, just in
7 terms of the functioning of this community? I mean,
8 isn't that a risk by separating these boards out?
9 MS. McGEADY: I think that the nature of the
10 timing on the development is going to result in resident
11 control of District 1.
12 MS. BLACK: I'm not opposed to that. I'm
13 thinking about, if these two boards have to work
14 together to set mill levies, to determine amenities,
15 there's a lot of things they have to do together. And
16 part of my concern is I think that resident voices are
17 important and critical to this development.
18 And diverse opinions are important. Don't
19 get me wrong. But I worry about, ifwe have separate
20 entities, how well -- I mean, do you see that working
21 together? I don't see any benefit from that.
22 MS. McGEADY: I think the concern is, again,
23 with the overlap. That you may end up with development
24 stopping because there would be a dominance of the
25 perspective, perhaps, that funds should be able for
47
1 improvement, funds should be available for new
2 amenities, so there might not be a voice for the
3 perspectives that want those amenities, and
4 particularly, representation of that vacant land area
5 that meets the development of additional capital
6 improvements. And it would also come out in the end,
7 because the plan requires that, but the question is, how
8 much tax dollars are anticipated in that discourse
9 without any constructive result.
10 SPEAKER: Correct.
11 MS. McGEADY: So again, the thought is that
12 if you had, for residents, a board where the residents
13 can have their voice for District 1, and then you have
14 the developing areas expressing their voice as District
15 2, that you would necessitate more dialogue, but I think
16 you have a more constructive outcome.
17 MS. BLACK: I have one other question. I
18 don't know if it belongs here.
19 MR. COOPER: Thank you.
20 MS. BLACK: Am I done?
21 MR. COOPER: No, go ahead.
22 MS. BLACK: I have one more.
23 MR. COOPER: The clock's running.
24 MS. BLACK: All right. Is yours actually
25 running? Because you have more costs -- maybe this is
48
1 to you, Paul -- because at some point, there has been
2 cost to the District, as you mentioned earlier about the
3 recall and other things.
4 I would like it in the record of this
5 District to know how much we spent as a District on the
6 recall and managing time-share. Because that's our tax
7 dollars, right, that we're all spending. And I would
8 like at some point to have an accounting. Is that
9 possible?
10 MR. COCKREL: Absolutely. I can't give you
11 one tonight.
12 MS. BLACK: That's all right. I don't need
13 one tonight.
14 MR. COCKREL: We did one in Evergreen that
15 was really contentious, and it was different points of
16 view how the community should operate. It was not a
17 developer situation at all. It was a, who was a good
18 guy, who was a bad guy thing. They spent well over
19 $50,000, because it was a huge district, and they had
20 the recall election, and it got really contentious.
21 You're not going to do that
22 MS. BLACK: Yeah, I'm cool with that. I just
23 think that as a resident, we need to know all the costs
24 from all the sides.
25 MR. COCKREL: If the recall doesn't proceed,
49
1 obviously, you spend less.
2 MS. McGEADY: Can I make a comment, Mr.
3 President? With regard to the exclusion process, it is
4 the responsibility of the applicant to pay for the
5 exclusion process, the cost of the stenographer, the
6 cost of the publication of the petition. The cost of
7 Mr. Cockrel's office being involved in this process are
B the cost of the applicant, not of the taxpayers.
9 MR. COOPER: Okay. I can see about half the
10 residents have a problem in reading. I've got four or
11 five or six or seven question marks here. I will go in
12 the next line here. John Cox, you said perhaps. Are
13 you going to speak?
14 MR. COX: No, I'm not.
15 MR. COOPER: Thank you, John.
16 Roy. Wordell, yes. Roy?
17 MR. WORDELL: I have questions.
18 MR. COOPER: You have the floor
19 MR. WORDELL: Roy Wordell. I guess you have
20 that part. There's a lot more oil and gas development
21 going on in this area. That 40 mill -- from what I
22 understand, that 40 mill is going to continue to be
23 assessed on the total value of Metro 1 and 2.
24 MS. McGEADY: That's correct.
25 MR. WORDELL: That money will come and be
50
1 available to the two districts.
2 Two questions related to that. How does
3 that -- how does the proportionate money in the future
4 get divided between 1 and 2?
5 MS. McGEADY: Okay. Can you go back to the
6 slide where we show the mill levies being proposed?
7 Okay. Try this. Okay. The debt service mill levy will
8 be sustained over all the properties.
9 Okay. So let's assume it's 10 mills that
10 pays for all costs to keep them that current. Whether
11 the oil and gas well is here or here or here, somewhere,
12 or, I don't know, maybe in an open space area here, all
13 of it will pay 10 mills just like all of other
14 properties will be 10 mills.
15 For operations -- well, and that 10 mills
16 will be set aside and distributed to the debt holders
17 for District 1, the bond holders of District 1. The
18 operating mill levy will be imposed on the greens by
19 District 2; by khaki yellow, by District 1; but just as
20 it is today, all the Intergovernmental Agreement -- all
21 the tax revenue received from these properties, from
22 District 1, gets transferred over to District 2 so that
23 District 2 can pay for the operations and maintenance of
24 all the improvements and the capital infrastructure
25 investment that needs to be made in the future
51
1 amenities, the water systems, the streets, what have
2 you.
3 So just like it is today, the money will be
4 collected by 1 and handed over to -- unless District 1
5 and 2 boards decide to change that, but that is not
6 something the applicant is requesting to change. Does
7 that answer your question?
8 MR. WORDELL: Probably does, but I'm not sure
9 I'm understanding that.
10 MS. McGEADY: Okay.
11 MR. WORDELL: So in terms of amenities for
12 District 1
13 MS. McGEADY: Yes.
14 MR. WORDELL: Is that appropriate wording?
15 District 1 is first filing, right?
16 MS. McGEADY: Correct. If the exclusion gets
17 approved, District 1 boundaries will be principally
18 Filing Number 1.
19 MR. WORDELL: So -- the 30 mills will be
20 available for amenities and capital expenditures for
21 both districts, right?
22 MS. McGEADY: For the whole community, yes.
23 MR. WORDELL: When you say the whole
24 community, you mean District 1 and 2.
25 MS. McGEADY: I mean all of it. Yes. The
52
1 Service Plan needs --
2 MR. WORDELL: Maybe I should state, my
3 concern is whether there's going to be the same amount
4 of money to do amenities here as there was before
5 MS. McGEADY: Correct.
6 MR. WORDELL: -- and how does that decision
7 get made?
8 MS. McGEADY: Okay. The answer is yes.
9 Under the current Service Plan, no matter how you move
10 these boundaries around, the mill levies need to be the
11 same on all the prompts.
12 MR. WORDELL: I understand that.
13 MS. McGEADY: So the dollars will be same.
14 Under the Service Plan, the District is the provider of
15 these amenities advertise and the financier of the
16 improvements with the money it receives from the mill
17 levy and the mill levy from District 1. So the same
18 amount of money will be available to build the same
19 things and the same money will be transferred over to
20 District 2 to provide those services and build those
21 improvements.
22 Am I not answering you question? Paul, do
23 you have a comment on how the current IGA works and the
24 Service Plan works?
25 MR. COCKREL: If you read beyond the terms of
53
1 the contract, Roy, what has been happening in practice
2 is that everybody sits down and decides what the amenity
3 program should be. And that gets implemented during the
4 budgetary process. Christine, Steve, Linda, have sat
5 down and taken their surveys, and the amenity programs
6 are identified, and then they get implemented on a
7 budgetary basis annually with some priority as you
8 generally decide in the public hearing, and you list
9 your high priority. I don't see any of that changing.
10 Tactically speaking
11 MR. WORDELL: I get from this, there will be
12 different emphasis by different people or different
13 people on the two boards in terms of their interests.
14 MR. COCKREL: As things change, there will
15 undoubtedly be some change. But I think some of the
16 suggestions we're going to make to modify the IGA will
17 at least address the area of your concern so that the
18 intent would be to make this transition seamless, to
19 make it operate in the future the way it's operating
20 currently.
21 MR. WORDELL: Just to follow up on that, if
22 there's more oil and gas -- and that's where a lot of
23 our tax money comes from. If that property value goes
24 up, which I assume it does -- it's going up at the
25 moment -- does that mean more tax money available to the
54
1 District? There will be 40 mills applied to get that
2 increased value; is that correct?
3 MS. McGEADY: That's correct. There will be
4 more revenue available.
5 MR. WORDELL: There should be. Okay. The
6 other question is, when I first thought of this, I
7 thought, uh-oh, it sounds good -- I mean, the other
8 land, the -- the time that they've had money invested,
9 it's not paying well, all of that. Is there any plan to
10 or reason not to sell the part that you're excluding?
11 MS. McGEADY: I don't know if I can answer
12 that question. Vince, do you have any?
13 MR. TOENJES: I don't.
14 MR. WORDELL: That was my first thought, are
15 you going to separate it and sell it.
16 MS. McGEADY: I will say, I have not heard,
17 but I don't know that I can answer that question.
18 MR. TOENJES: Speaking for REI, I don't know
19 any plans on the drawing board for sale of that
20 property.
21 MS. McGEADY: No.
22 MR. WORDELL: So the plan is to continue to
23 work to developing it.
24 MS. McGEADY: That's the discussion we've had
25 with the applicant. That's correct.
55
1 SPEAKER: Could it sell separately?
2 MR. COOPER: Susan, you're out of order.
3 Roy?
4 (Unreportable general conversation.)
5 MS. McGEADY: I'm the attorney representing
6 the applicant. I would say the conversations we've had
7 with the client, the requests we're making for this
8 boundary change, has not come from a desire to split the
9 community and sell it off to somebody else. That has
10 not been the subject of discussion.
11 But I do believe that as long as somebody
12 owns a piece of property, just like you could sell your
13 house to somebody else, they could sell the property to
14 somebody else. But I don't know that that's what -- is
15 a part of any of this. Christine, do you have a
16 comment?
17 MS. HETHCOCK: Like Vince said, there is
18 definitely no imminent sale plan. It's to, you know,
19 divide the two different districts so that it makes
20 sense to logically continue on doling it the way we have
21 been and providing amenities.
22 MR. WORDELL: Actually -- Roy, again. That's
23 reassuring. I just have to say in my nonlegal mind, it
24 seems like it would just be more efficient in terms
25 of -- there doesn't seem to be very many changes being
56
1 talked about here in terms of how the money is
2 allocated. It doesn't seem to quite make sense that
3 we're going through all this, for -- and maybe not
4 cite -- cite it, for efficiency sake.
5 MS. McGEADY: It does make sense, because the
6 majority of the tax -- if all of these petitioner's
7 requests are granted, the majority of the tax dollars as
8 we move forward are going to come through the District 2
9 Board directly rather than coming through 1 and having
10 to be transferred over to 2.
11 So if there is conflict between 1 and 2, by
12 the time it takes to resolve those things, the money
13 will be flowing to continue to providing the amenities
14 and continue to providing the new infrastructure while
15 those issues get worked out, and it will get worked out,
16 because there's an agreement that identifies how they
17 get worked out.
18 But there's a difference between what the
19 agreement says and what happens as the people are
20 disagreeing in what the agreement says. So I think that
21 is a change. Paul, am I accurately describing the
22 change?
23 MR. COCKREL: I think that's a fair comment,
24 yeah. It's a security issue.
25 MR. WORDELL: Security. Access to funds.
57
1
2
3
4
5
MR. COCKREL: That's right.
MR. WORDELL: Okay. Thank you. That helps.
MR. COOPER: Are you done, Roy?
MR. WORDELL: Yes.
MR. COOPER: Thank you, Roy.
6 The next on line with a question mark is
7 Steven and Debra Street. Do you have a question, Steve?
8 Okay. Thank you very much. And we all
9 appreciate it.
10 MR. BURKE: We know your question was already
11 asked and answered by somebody else.
12 MR. COOPER: Rita Yeader. Rita? You have a
13 question mark.
14 MS. McGEADY: Did I hear you right?
15 SPEAKER: Me?
16 MS. McGEADY: I thought I heard something --
17 SPEAKER: Oh, okay, thank you.
18 MR. COOPER: Rita, you've got a
19 MS. YEADER: No.
20 MR. COOPER: No. Thank you very much. Don't
21 want to pass up any. She said no.
22 Michael, you spoke about an hour and a half
23 ago.
24 Angie Powell. You spoke -- yeah, you have
25 one other thing have you? Yes?
58
1 MS. POWELL: Yes.
2 MR. COOPER: You're one of the few people
3 that put down yes. Thank you. Go ahead.
4 MS. POWELL: In your discussion, you said
5 that by doing this exclusion of the property, that it
6 was going to not only benefit our community but it was
7 going to also benefit the outside surrounding areas for
8 economical purposes. Please explain how that --
9 MS. McGEADY: Okay. I think that the
10 purpose -- I'm projecting a little bit here, but I think
11 the purpose of the County Commissioners approving the
12 development plans for this community and also approving
13 the Consolidated Service Plan for this community was
14 because they thought it would benefit not only this
15 immediate community but the economic development impacts
16 that occur offsite when the community is successful,
17 would be positive for the whole county.
18 So, for instance, as the streets are
19 developed, you have contractors working here, the water
20 lines are being worked on here, and we drove past people
21 laying pipe today, or whatever those big things are,
22 driving trucks around, so this developing is happening
23 not only in this community, but in the county, and in
24 the state.
25 MS. POWELL: So am I hearing correctly that
59
1 by changing the districts the way they want to change
2 the District, that in effect they will continue on with
3 the infrastructure in a timely manner that they're
4 wanting to do?
5 MS. McGEADY: That's correct. And to
6 clarify, we're not necessarily changing the districts
7 themselves, just moving the boundaries around.
8 MS. POWELL: Right.
9 MS. McGEADY: Okay. And yeah, that's the
10 thought, is that more of the dollars that come through
11 with the use of the capital improvement will then be
12 used for operational maintenance of facilities and less
13 dollars used for dispute resolution. That's -- that's
14 the thought.
15 MS. POWELL: Okay.
16 MR. COOPER: Okay? Angie?
17 MS. POWELL: Yes.
18 MR. COOPER: Okay. Thank you.
19 Howie, are you signed in?
20 SPEAKER: No. No.
21 MR. COOPER: Would you like to speak?
22 SPEAKER: No.
23 MR. COOPER: Thank you very much, and I
24 appreciate it.
25 Susan Beard would like to speak. Susan, you
60
1 have the floor.
2 MS. BEARD: Thank you. I have a question. I
3 have a few, actually, but do them one at a time.
4 MS. McGEADY: Thank you.
5 MS. BEARD: Okay. In a financing arena, when
6 we look to finance property, when we have property that
7 is in litigation, it's quite difficult to find financing
8 for that. Has this move and separation for the
9 exclusion got anything to do with trying to sell it in
10 the economic market that we're in?
11 MS. McGEADY: It is the perspective of the
12 applicants that it would be, again, more efficient for
13 the financing for District 2 to have more of the dollars
14 coming through 2 directly rather than having to rely on
15 the dollars transferring from 1 to 2, because of the
16 possibilities of friction and disagreement and
17 protracted discussion, resolution of those issues, while
18 you're trying to find things. So yes would be the
19 answer.
20 MS. BEARD: Second part to that question. If
21 a property did sell in District 2, would that bring it
22 into District 1?
23 MS. McGEADY: The idea is for, when
24 property -- when a home is built --
25 MR. BEARD: Yes, because it would not be
61
1 developed in most of the developed pieces in District 1.
2 MS. McGEADY: Right. The idea would be that
3 that piece would end up back in District 1 or a
4 resident -controlled district so that -- yeah, because at
5 that point, its infrastructure is done. The resident
6 has moved in, and there's no need for it to continue to
7 be within the District 2 structure.
8 MS. BEARD: Okay. Does that get annexed in
9 as they sell them, type of piece? You sell one lot, get
10 annexed in?
11 MS. McGEADY: Potentially.
12 MS. BEARD: Potentially.
13 MS. McGEADY: Potentially, it could be done.
14 MS. BEARD: Does it have anything to do with
15 the assessment issue that's going on in the development
16 right now, as far as assessment dues or past dues?
17 MS. McGEADY: I don't understand the
18 question.
19 MR. COCKREL: The HOA, I think.
20 MS. BEARD: The HOA.
21 MS. McGEADY: No, they're totally unrelated
22 issues, because in my mind -- I don't understand HOA
23 issues. Do you work with the HOA issues?
24 MR. TOENJES: I do work with them, and I
25 would agree with MaryAnn that they're completely
62
1 separate issues.
2 MS. BEARD: Okay. I know a lot of questions
3 have been asked about what would inhibit funds becoming
4 available for amenities. Would we still have the same
5 structure we have as far as having committees and
6 advisory council to come up with what amenities we've
7 got going as far as putting in amenities and looking at
8 what that order is? Would we still have that same type
9 of structure?
10 MS. McGEADY: That's my understanding, is
11 there would continue to be that time of community
12 facilitation and input, but that's what helps the
13 developer to give authority to the District Board as
14 well in deciding what amenities make sense for the
15 community. The developer of the property and the
16 residents, I think, have collaborated in that way. And
17 I don't see that anything in the structure would affect
18 that.
19 MS. BEARD: Thank you. And I think if we
20 look at the proposed exclusion -- I mean, I'm sorry,
21 amendments to the Intergovernmental Agreement, why do
22 these changes need to make the developer more confident
23 with the changes that we see?
24 MS. McGEADY: I'm trying to think how to say
25 this a different way. I'm thinking of the same answer.
63
1 I apologize if I'm being redundant. But again, what's
2 important to the developer is to see the community
3 amenities and infrastructure financed and completed in
4 the most efficient way possible. So looking at the
5 different structures that could be created underneath
6 the current Service Plan without any need for amending
7 the current Service Plan; this is the alternative they
8 would like.
9 MS. BEARD: And what would have to happen for
10 the Service Plan to change? You mentioned dates, that
11 it was something at one point in time and morphed into
12 something else. What creates that effect there so it
13 may not happen again?
14 MS. McGEADY: Well, I can tell you what the
15 process would be.
16 MS. BEARD: Thank you.
17 MS. McGEADY: The process would be to have
18 the district boards go to the County Commissioners,
19 redefine how the properties were taxed, redefine what
20 improvements would get built and what wouldn't get
21 built, and have the County Commissioners approve of
22 that. It's a long process. It doesn't happen quickly.
23 It would go through the Planning Commission, a hearing
24 at the Planning Commission, and the County Commission,
25 at some level.
64
1 MS. BEARD: And what voice would the
2 residents have at any point?
3 MS. McGEADY: I'm trying to think. Off the
4 top of my head, I don't remember all the requirements of
5 Weld County policy for plans, but generally under the
6 State statutes, you would all have notice, notice of
7 what's occurring. All the documents would be available
8 about the public hearing. They are public documents and
9 would have to be available in advance. You would have
10 an opportunity to speak at the County planning level and
11 County Commissioners level. And I think you would have
12 sufficient standing before them, because that's -- it's
13 your community.
14 I appreciate the question. And one thing I
15 would like to say is when many consumers purchase into a
16 community like this, there are these amenities and
17 future amenities in common. This whole area is going to
18 be developed as part of this community. They rely on
19 that, you know.
20 And I think one of the reasons why the
21 developer is interested in making this application for
22 exclusion and requesting the minor modifications to the
23 IGA is that -- is so that everybody who bought in here,
24 relying on what is this original plan, will not have
25 that vision frustrated.
65
1 Basically, that blueprint that was there in
2 the County Commissioners plan that is in place, so that
3 Service Plan would be implement. And I think the
4 concern of the applicant right now is it's starting to
5 fracture a little. So it needs to be modified so we get
6 back to the vision that you originally had. And I think
7 there are different structures that can implement that,
8 but at different times, the life of the structure will
9 be implemented in different ways, and right now, we feel
10 this way is a better way, and that's why we're
11 advocating it.
12 MS. BEARD: Now, the accessibility for the
13 equestrian community is in the other part. Would it
14 become part of District 1, because it's this type of
15 structure, where's it's not a building, but an arena.
16 MS. McGEADY: Paul, can you answer that
17 question?
18 MR. COCKREL: Would it part of --
19 MS. BEARD: Of District 1.
20 MR. COCKREL: I will address that, but
21 basically, all public improvements throughout each of
22 the districts will be open for equal access by everyone.
23 It doesn't make any difference what the physical
24 location is. You have the ability to use them,
25 regardless.
66
1 MS. BEARD: So just because I know you say
2 it's developed -- and we probably don't all call a fence
3 around a piece of dirt "developed."
4 MR. COCKREL: You should have seen us 20
5 years ago.
6 MS. BEARD: A lot more trouble with this.
7 MR. COCKREL: Right now, under the IGA,
8 they're all maintained, controlled, by 2. That's still
9 true, but there's equal rights of use, just as there is
10 today. You haven't noticed any difference on who owns
11 or controls that. And none of that would change.
12 MR. COOPER: Susan, are you --
13 MS. BEARD: I believe I'm done.
14 MR. COOPER: Have you concluded?
15 MS. BEARD: I have. I'm sorry.
16 MR. COOPER: Do you have anything else?
17 MS. BEARD: No, thank you
18 MR. COOPER: Darren Diederich. You have a
19 question. Would you like to speak, sir?
20 MR. DIEDERICH: Roy and Susan got me.
21 MR. COOPER: Is anyone else here that said
22 they did not want to speak but changed their mind and
23 I'll give you one -- anyone else?
24 MR. WELCH: One question, Roy.
25 MR. COOPER: One question, Mike.
67
1 MR. WELCH: Two parts.
2 MR. COOPER: One. Go ahead.
3 MR. WELCH: When will the additional bonds be
4 issued, and when will Phase 2 be filing for development?
5 MS. McGEADY: Well, Filing 2, filed for
6 development?
7 MR. TOENJES: Again, I don't think there's
8 any plans imminent. What you've seen up there for
9 Filing 2 is a preliminary PUD submittal to the County,
10 but I think it all depends on market forces and a lot of
11 other issues. I don't know if I can -- and I'll defer
12 to Christine -- I don't know if I can tell you a date
13 that those things are going out. Christine, can you
14 answer that?
15 MS. HETHCOCK: That's correct. There are no
16 plans for the Filing 2 currently under process.
17 MS. McGEADY: And I can't answer the question
18 about when District 2 would issue debt, because I
19 represent a property owner. I don't know if the
20 District Board can answer that question.
21 MR. COCKREL: Under the Service Plan, the
22 intent and, in fact, the practice over the last several
23 years has been to cash -fund improvements. Not to incur
24 debt to do that. If debt had to be incurred based upon
25 future revenue, it will be through District 2 if and
68
1 when those facilities are needed.
2 Typically, you don't build in advance of some
3 development pressure. If REI would decide to develop
4 Filing 2, then you would begin to consider financial
5 alternatives at that time. But nothing else is under
6 consideration presently.
7 MR. COOPER: Mike. Do you have one more
8 short question?
9 MR. WELCH: No, that was --
10 MR. COOPER: Thank you. Any more questions?
11 Well, I have recognized half of the people
12 here, and they have spoke, and then the other half, so
13 it's been very successful for me. So thank you very
14 much, REI, for the presentation, and the hearing is
15 closed.
16 But don't go away. Because the rest of the
17 work is starting.
18 MS. McGEADY: I'm sorry. Can I ask a
19 question?
20 MR. COOPER: We do have a couple of
21 questions, though, from the Board to you, so I guess
22 we're not quite closed.
23 MS. COX: She had a question first.
24 MS. McGEADY: I was going to ask a question.
25 I don't know if you wanted to take a five-minute break.
69
1 MR. COCKREL: If the Board is going to ask
2 questions, then the hearing should remain open so that
3 we can transcribe those questions and answers. And you
4 can direct your questions to MaryAnn now. MaryAnn wants
5 to introduce all this material in the record, I assume.
6 MS. McGEADY: That's correct.
7 MR. COCKREL: We'll have any written comments
8 also included in the record, along with, of course, the
9 publication affidavit, all those things, that you would
10 expect. But I think now is the appropriate time to ask
11 those questions of MaryAnn, and then you can close the
12 public hearing and you can go into your own
13 deliberations. If you want to take a two -minute break
14 for people to stand up, that's up to you.
15 MR. BURKE: When does your presentation
16 begin?
17 MR. COOPER: Once we go into deliberations.
18 MR. COCKREL: Mr. Burke, do you have a
19 question for REI?
20 MR. BURKE: Not at this time.
21 MR. COOPER: Ms. Cox, do you have a question
22 for REI?
23 MS. COX: I do. You mentioned that there was
24 no plans right now to -- for the development to be sold
25 or anything that -- one part to be sold and not the
70
1 other. But is there a provision in place -- and that
2 could be either one of you to answer the question
3 that if it was sold, that we would still have our
4 protections and the same financing coming into the
5 District 1?
6 MS. McGEADY: I think maybe Paul can answer
7 that question as well. My observation, from looking at
8 the Intergovernmental Agreement and the Service Plan, is
9 that there shouldn't be any change, that the protections
10 are embedded in the plan and the IGA, and that the
11 thought being that the amendment of the IGA would only
12 clarify. The protections would not change. But Paul?
13 MR. COCKREL: I agree, and the conditions I
14 propose you make to the IGA will basically address those
15 issues.
16 The one thing that I think is really
17 important to understand, Linda, is we -- there are two
18 protections that are basically afforded to the District,
19 the property owners, in Filing Number 1. One is by
20 statute, and one is by contract, to assure that these
21 things get accomplished.
22 As MaryAnn indicated previously, by statute,
23 when this property is excluded from District Number 1,
24 it still remains responsible for paying off all of its
25 proportionate share of the bonded indebtedness of the
71
1 District. So that doesn't change. It can't change by a
2 matter of law.
3 REI -- the tax area for payment of the
4 District's debt service levy, is effectively the same in
5 the future as it is today, okay. So none of that
6 changes by law. The REI property remains responsible
7 for paying its share of the outstanding bonds.
8 By contract, we will also obligate this
9 property and, through District Number 2, to continue to
10 pay its equal share of the operation and maintenance
11 mill levy, what I call the general levy, and we'll get
12 into that more. So all the taxes remain the same. The
13 tax obligations do not decrease, and they have the same
14 funding responsibilities whether REI opens this property
15 or XYZ Development Company, who they sell it to. It's
16 the property itself that's responsible, not the
17 individual owner of that property.
18 MR. COOPER: Okay. Cooper has a question to
19 REI. Why does REI request this exclusion, REI real
20 property, from the Metropolitan District? I know you've
21 touched base on that. But is there a possibility that
22 you are trying to remove personal property from any
23 possible litigation which would tie up the land?
24 MS. McGEADY: Not that I can think of. If I
25 understand your question, is your question --
72
1 MR. COOPER: It's two -fold. Why are you
2 asking the exclusion of REI property from the District.
3 MS. McGEADY: Okay.
4 MR. COOPER: And secondly, is there a
5 question with REI that they may want to remove --
6 exclude this from -- your property, who you represent
7 from possible future litigation which would tie up the
8 land?
9 MS. McGEADY: Okay. The -- if I understand
10 your question, the -- two questions. The timing is --
11 is motivated by the concern of the applicant that at
12 this -- going forward from this point on, they would
13 feel more comfortable that there would be efficient
14 service provided if the property were excluded from 1
15 and be served by 2 until it were developed.
16 And I think the concern about litigation -- I
17 think litigation might be a strong characterization of
18 the concern. I think more the -- the dissipation of
19 dollars that can occur through disagreement and
20 friction.
21 I mean, I think -- the hope is that with the
22 two district representations, resident boards on
23 District 1 and more developer presentation and
24 representation on District 2, that there be more
25 constructive discourse and resolution of conflict. So
73
1 that -- and reduce the possibility of litigation.
2 MR. COOPER: So in essence, from the first
3 question, REI -- what I'm getting from you is the REI,
4 without the exclusion, would be under the jurisdiction
5 of a group of people who are not party to -- to that
6 property, and then you would lose control of -- over the
7 property.
8 MS. McGEADY: Yeah, and although --
9 MR. COOPER: That's good enough for me.
10 MS. McGEADY: Okay.
11 MR. COOPER: It's good enough. Thank you
12 very much.
13 MS. McGEADY: You're welcome.
14 MR. COOPER: Now, Mr. Cockrel, can we close?
15 MR. COCKREL: If there are no more comments.
16 MaryAnn, would you like to make any closing comments?
17 MS. McGEADY: Just to clarify what our
18 request is. Our request is for the Board to consider at
19 this time excluding the REI property as described in the
20 petition from the boundaries of the District and to
21 consider amendments to the Intergovernmental Agreement
22 to be sure that it's clear what the priority is for the
23 funds to be used for and be sure there's no properties
24 left out of taxation and properties taxed. That's the
25 extent of our request. Thank you.
74
1 MR. COOPER: Thank you very much, MaryAnn.
2 And the hearing from REI for exclusion is now closed.
3 Now we have a lot of other questions beyond
4 that. And we had talked to Mr. Cockrel, our counsel.
5 You wanted to make a presentation on the interagency
6 agreement which may be lengthy. But we took executive
7 privilege, us three up here, and want to ask him
8 questions right now in front of everyone about our
9 concerns. So overriding you, Mr. Counsel, which may or
10 may not be a bad idea.
11 MR. COCKREL: I'm going to leave.
12 MR. COOPER: But if you would get up front
13 here.
14 MR. COCKREL: I'm going to stand up here.
15 MR. COOPER: Because after your questions, we
16 will be asking you -- the chair will be asking you to go
17 through that lengthy IGA business.
18 MR. COCKREL: I can go through it quickly,
19 Steve.
20 MR. COOPER: We will start, and feel free to
21 jump in, Tom, on our questions, and there's quite a few
22 of them, and one is from Cooper. Would exclusion change
23 the present flow of revenue to the districts?
24 MR. COCKREL: The answer is that the tax
25 revenue will be the same. But you will have two
75
1 district levies, so the flow of funds does
2 mechanically -- changes a little bit. You'll have
3 District 1 levying its property tax -- first of all,
4 let's start with a debt levy. Go back to the map.
5
The debt levy will be extended by District
6 Number 1, and it will not only affect -- and let's just
7 assume it's 10 mills, so 8 and a half mills due. So
8 that 8 and a half mills gets taxed to your property,
9 Filing 1, and the REI platted lots in the filing. And
10 Section 16 land, which is State Land Board land, is not
11 affected by this proceeding, and all of the REI
12 undeveloped property, which we've been calling Filing
13 2 -- technically, it's not Filing 2, but it's not
14 platted, so it's Filing 2 for our purpose.
15 So that 8 and a half mill levy is the same
16 across the board. Those tax dollars come in just like
17 they're coming in today. What we'll be proposing, then,
18 Steve, that each district -- and we tax up to 40
19 mills -- keep that 40 mills constant. That's what the
20 Service Plan -- Service Plan contemplates. Then the
21 balance of the -- what is that, 31 and a half mills
22 would be taxed in each district, in District 2 and in
23 District 1. Total levies, 40 mills.
24 The tax dollars go to different treasuries.
25 Then they all get put back in the common bucket the same
76
1 way they work today. So the tax dollars are identical.
2 Their funds are -- they go back to the comment bucket to
3 use for the priorities that you establish under the IGA.
4 It doesn't affect the assessed valuation on
5 properties, including your homes, the vacant land, or
6 oil production. All that is determined by State law, by
7 the County Assessor, and they just certify those
6 valuations to us. So we don't change any of the
9 underlying valuation.
10 The only thing the two boards do is set up
11 the mill levies, and they certify the mill levies to the
12 County, and the County collects the dollars on your
13 behalf, and the money ends up in a common bank -- I
14 shouldn't say that -- it ends up in a bank account used
15 for the common good.
16 MR. COOPER: I was going to say, there are
17 two separate bank accounts.
16 MR. COCKREL: There are two separate bank
19 accounts.
20 MR. COOPER: Thank you, Paul. And the next
21 question is going to come from Linda. We're taking
22 turns here. But I want to remind all of you here. Paul
23 Cockrel is the counsel for the Metropolitan District.
24 He's not the counsel for REI. Linda.
25 MS. COX: Okay. Should there be a decrease
77
1 in the oil tax revenue, which certainly isn't looking
2 that way right now, but how would District Number 1 be
3 affected by that?
4 MR. COCKREL: Again, I tend to look at the
5 total tax revenue coming into the districts, regardless
6 of where the mill levy is. By shifting properties
7 around, you get different tax flows out of 1 and 2.
8 Right now, everything comes out of 1, because there's
9 only one mill levy. If there's two mill levies, it will
10 go above 40 mills. So there are 40 mills over the
11 entire property. The oil production revenue we receive,
12 it's like 93 percent of the total revenue received by
13 the district, that won't change.
14 The amount of revenue changes from year to
15 year. The preliminary assessed valuation for this year
16 is slightly lower than last year. I can't explain that.
17 My guess is that there were new wells this year and that
18 there's also higher -- taxes always lag one and a half
19 to two years, and there's more production each year.
20 Dollars that the oil companies are making, we all know,
21 are a lot higher because you're paying more for gas and
22 oil, and we project that actual revenues are going to go
23 up in the future.
24 So the revenues go up and down. But the
25 amount of revenue would be the same regardless of
78
1 whether we do the exclusion or not.
2 MR. BURKE: So basically, what you're saying
3 is because of the way it's structured in the IGA, it
4 doesn't really matter, as far as the revenue that's
5 available to service the debt, because the debt levy is
6 on the entire property. So if we know that we need, you
7 know, 8.5 mills or whatever it is for debt service,
8 that's going to be collected by the County.
9 MR. COCKREL: And it doesn't matter on the
10 general levy side. That general levy goes to pay the
11 operation and maintenance for the community building,
12 the pool, all those things which are important to you.
13 That won't change, either, nor will the funding for
14 infrastructure amenities. Those dollars will be the
15 same at the end of the day.
16 MR. COOPER: Thank you, Paul. Question from
17 Cooper. Would exclusion -- some of these questions
18 are -- border very closely to the ones before. But
19 they're all important. Would exclusion change the
20 present general levy or debt levy of the districts,
21 plural?
22 MR. COOPER: No. And one of the -- the
23 Service Plan needs, again, to be modified somewhat, but
24 what it will specify --
25 MS. McGEADY: Service Plan?
79
1 MR. COCKREL: I'm sorry. IGA. We don't
2 intend to change the Service Plan. The IGA recognizes
3 that there will be a District 1 debt levy that covers
4 all the property in all of District 1 and District 2.
5 And then each district will have a uniform mill levy for
6 the general levy. So if it -- it doesn't have to be 40
7 mills. But it has been 40 mills over the years, because
8 that produces the maximum amount of revenue for us
9 for you to have the marina, the pool, et cetera.
10 So assuming that you can continue to do that,
11 that -- whatever the mill levy -- the mill levy may
12 change from year to year because your valuations go up.
13 So if the debt levy were to go down to 5 mills, you'd
14 have 35 mills from each district for the general levy.
15 It'll be in the same in each district, and the total tax
16 revenue collected from both districts will be the same.
17 MR. COOPER: Thank you, Paul. Never ask an
18 attorney a yes or no question.
19 MR. COCKREL: Yes.
20 MR. COOPER: Linda, you're next.
21 MS. COX: The 40 mills levy; is that set in
22 the Service Plan?
23 MR. COCKREL: Uh-huh.
24 MS. COX: Does that need to change to go
25 higher -- if that ever were to change, how would that
80
1 happen?
2 MR. COCKREL: The only reason that -- well,
3 the real protection is in the IGA, and it specifies that
4 the District Number 1, your property tax levy, as a
5 resident, will never go beyond 40 mills without --
6 unless there is a approval by the County. So you've
7 locked that in. And we will -- that provision will
8 apply going forward. So your mill levy can't go beyond
9 40 mills. Theoretically, it could but . . .
10 MR. COOPER: Thank you.
11 MR. BURKE: Can I ask a question related to
12 that?
13 MR. COOPER: Yes, sir, Mr. Burke.
14 MR. BURKE: Thank you. What about the bonds?
15 Those are limited --
16 MR. COCKREL: No, they are general obligation
17 bonds, meaning you can have any tax levies necessary to
18 pay those bonds. It happens right now that you've got
19 25 million in assessed valuation; you've got about a
20 million and a half of bonds. The coverage is huge.
21 It's -- it's -- your coverage factor would mean that
22 you'd have to stop producing oil out here, because there
23 really would be an issue with you paying debt service or
24 increasing that 40 mill levy. And the oil productions
25 generally, revenue generally goes up, not down, on flows
81
1 in those ranges.
2 MR. BURKE: It does, but as the wells
3 deteriorate in years, it can certainly go down. But
4 it's to our advantage to have more development spread
5 around that obligation to more people.
6 MR. COCKREL: From a tax basis standpoint,
7 the answer to your question is yes. It's definitely
8 beneficial to put more rooftops out there, because those
9 rooftops add tax base. That means you're not as
10 dependent on oil.
11 What I read in the newspaper yesterday, you
12 shouldn't be too worried about the Wattenburg fields.
13 But those additional rooftops, which are -- which occur
14 from development and the building of infrastructure,
15 when there's a demand as determined by the developer,
16 will result in a higher tax base and improve everyone's
17 financial position.
18 MR. BURKE: Thank you.
19 MR. COOPER: My next question, which Tom must
20 have been looking over my shoulder, would exclusion have
21 any effects on outstanding bonds or future bonds of the
22 district?
23 MR. COOPER: No, for the reasons I --
24 MR. COOPER: No is the answer?
25 MR. COCKREL: No is the answer --
82
1 MR. COOPER: Thank you very much.
2 MR. COCKREL: Wait a second. I didn't hear
3 that future bond part. With respect to the outstanding
4 bonds, none. Those bonds are issued by District Number
5 1, so they are the obligation, basically, of District
6 Number 1.
7 MR. COOPER: Yes.
8 MR. COCKREL: District -- the IGA presently
9 provides that District 1 will incur no future
10 obligations.
11 MR. COOPER: That's probably the real answer
12 I'm looking for.
13 MR. COCKREL: Yes, and that was to protect
14 the residents and owners of property in District 1 from
15 any additional liability in the future. The intent of
16 the Service Plan, again, was to have District 2 be the
17 issuer of future debt. So if there's a problem, we have
18 to rely upon the revenue they get pursuant to the IGA,
19 but it doesn't transfer back to the properties.
20 The obligation is to pay the 40 mill levy,
21 put it in the bucket. If the developer can't operate
22 with that, they'll have to figure it out.
23 MR. COOPER: Thank you very much, sir. Linda
24 has a -- and Tom, butt in if you want. Linda has the
25 next question.
83
1 MS. COX: Would it make sense to the District
2 to establish a bond reserve or reserve for maintenance
3 for the present and future capital improvements?
4 MR. COCKREL: You know, reserves are helpful.
5 In fact, one of the -- one of the things that we --
6 we've been considering, I've discussed with REI
7 representatives, is that we do establish a bond reserve.
8 Given the present coverages, I don't think it
9 needs to be significant, but I think we ought to have a
10 couple hundred thousand dollars sitting aside in a
11 savings account just to make sure if there's some
12 variation. You know, we've got a year, at least, to
13 plan for it. So that's what I'm going to recommend.
14 MR. COOPER: Okay with that?
15 MS. COX: I'm okay with that, yeah.
16 MR. COOPER: Then say thank you very much,
17 Paul.
18 MS. COX: Thank you very much, Paul.
19 MR. COOPER: Then I know you're done.
20 Paul Cooper, again, for the record. Should
21 an executive committee consisting of equal members of
22 each board be established to enable interaction between
23 the two districts between meetings, or whenever?
24 MR. COCKREL: The answer is, yeah, and again,
25 there is -- that's one of the provisions we want to
84
1 change. Right now, there is no formal process. People
2 kind of work cooperatively.
3 I want to tell you one thing, that you always
4 better work cooperatively with the developer. That is
5 the reality of these types of developments. If you guys
6 don't work together, there will be problems. And it
7 doesn't matter if all the residents control District 1
8 Board, and all the developers control District 2 Board.
9 The reality is you must work together or you will have
10 problems.
11 So what we want to do is to put in provisions
12 in the IGA that really do facilitate that. And REI is
13 nervous because of the recall. So we just need to deal
14 with reality, and the reality is, we need to make sure
15 there are protections to both sides, for you, the
16 residents, the owners, and the developer, and that's
17 what this is all about.
18 MS. COX: My next question is, should the
19 Service Plan be amended to assure that any future
20 districts did not overlap the existing service area?
21 MR. COCKREL: One of the REI concerns was
22 they had the ability to create additional districts in
23 the green area. And as -- first of all, if they were to
24 do that, the Service Plan would have to be amended. The
25 Service Plan doesn't contemplate that. Even if they
85
1 create what we call a sub -district, potentially, they'd
2 have to amend the Service Plan.
3 So being given that option -- but what we
4 don't want them to do is create any district within
5 District 1. So we have to have restrictions on that.
6 It doesn't -- we don't have to change the Service Plan
7 today, but we want the IGA to recognize back -- I mean,
8 even though we're going to put that into the contract
9 between the two districts by law, we can't do that. 2
10 can't try to form a district in 1 without your approval
11 as the Board. But we're going -- we're going to
12 double -barrel that and make sure it doesn't happen.
13 MS. COX: Right. I think we also have to
14 realize that this filing was pretty big. It's going to
15 take 10 years to get it in. It's going to take another
16 20, if things go the way they're going for Filing 1 to
17 be filled.
18 MR. COCKREL: I'm sure Christine would like
19 to sell all the lots within three years. It's unlikely
20 to happen. Historically, that's certainly been --
21 absorption is close. Some people like that. It's
22 probably why you're here. You don't want to move into
23 high absorption. So what we're trying to do is deal
24 with it as it happens --
25 MR. BURKE: So basically, based on the
86
1 original assumptions and original projections, this
2 whole thing with a hundred lots was sold out 15 years
3 ago, so --
4 MR. COCKREL: Actually, I worked with Don's
5 dad, who was the originally developer out here. He was
6 a great guy and had a real vision for this place. I
7 have to admit, the first time I saw these sand hills, I
8 had a hard time seeing that, but he -- I mean, he -- and
9 many of these things are coming to pass. It just takes
10 a little while to get it into place.
11 MR. BURKE: There were a few things that kept
12 it from happening.
13 MR. COOPER: A few things.
14 MR. BURKE: The recession in the '80s slowed
15 things down, made that developer not able to finish it.
16 These guys came in and did a great job. Then you had
17 9/11, which basically took things to a grinding halt,
18 and that's one of the reasons, you know, why we're
19 looking at doing two districts to begin with, is to
20 establish a little bit of time for the developer just to
21 recover from what had happened.
22 MR. COCKREL: One final comment, Linda. I
23 don't -- right now, I don't envision any -- being any
24 need for a third district, but I don't think we should
25 just arbitrarily say they can't have them. We just need
87
1 to put boundaries on that and make sure everybody is
2 protected and that that's necessary.
3 MR. BURKE: But it can't affect District 1.
4 That's the --
5 MR. COCKREL: It won't affect District 1.
6 MS. COX: Thank you. I'm through.
7 MR. COOPER: Thank you, Linda.
8 For the record, Cooper's asking this
9 question. And I know that REI has touched on this, and
10 I know that after our questions here, you're going to
11 discuss, also, the IGA concerns which many of these are.
12 So my question to you, Mr. Cockrel, is:
13 Would exclusion restrict community rights for
14 utilization of present and future amenities, public
15 facilities, or means of egress through the proposed
16 excluded REI properties? That's question one of a
17 two-part question, so I'll stop there.
18 MR. COCKREL: Can I answer that before you
19 confuse me? Public property is purely public property.
20 It's open to the public. It doesn't make any difference
21 which district owns it. Public is public. Anyone can
22 regulate it. Governments can regulate the use of
23 property, but we will write into the IGA and clarify
24 there will that will be no discrimination in use of
25 these facilities. So the pool, nothing is going to
88
1 change.
2 Now, I can't -- you know, what REI does on
3 their property is up to them. We don't have any
4 control, frankly, over private property. But it won't
5 affect any of the public properties.
6 MR. COOPER: So the horse trails across there
7 and walks trails and et cetera would remain.
8 MR. COCKREL: Yeah. I don't think -- I can't
9 envision any change. I mean, there -- again, we're not
10 dealing -- with all of the District facilities -- I
11 don't know if there are additional POA facilities that
12 might -- but it wouldn't be affected by this anyway. So
13 this exclusion does not affect any of the use of the
14 public facilities owned by the districts.
15 MR. COOPER: And that property. Owned by the
16 District.
17 MR. COCKREL: The district's property, no.
18 No. It won't affect any of the district's properties.
19 MR. COOPER: And would those rights remain
20 with the property if it's sold to others?
21 MR. COCKREL: If the -- if REI sells the
22 development property, will anything change? It won't
23 change the district's property. I should emphasize
24 that. It doesn't make any difference who owns the green
25 property, because they've got to pay taxes. Whoever
89
1 that developer is has to pay taxes.
2 The tax load is determined by the
3 Intergovernmental Agreement between the districts. So
4 if REI heads off down the road, the -- whomever is
5 governing this District Number 2 Board has still got to
6 honor the contractual obligations in the
7 Intergovernmental Agreement, and that's why we want to
8 make these changes, so that there aren't any unforeseen
9 adverse impacts in the future.
10 MR. BURKE: Okay. Well, there's always
11 something that's unforeseen, right?
12 MR. COCKREL: We try to cover it.
13 MR. BURKE: My point is, you've got two
14 districts signing the Intergovernmental Agreement.
15 That's what this IGA is about, is between District 1 and
16 District 2. So District 2, after they're excluded, they
17 can't decide to unilaterally change that agreement.
18 It's an agreement between two parties.
19 MR. COCKREL: Correct. It has to be mutually
20 changed. Everybody has to agree. And you're going to
21 end up -- again, as MaryAnn indicated, the -- the
22 qualifications of Christine and, actually, Tom and Dan
23 Sheldon are on property outside of Filing 1. So once
24 the exclusion is effected, they will be in District 1.
25 That was another question that, I think,
90
1 Linda, you raised. And if I can just go on a tangent.
2 On this deadlock situation, does this make it more
3 likely that there will be deadlock, because we're
4 separating things?
5 The likely -- you're going to -- I think the
6 likelihood is that if you don't do something, you're
7 going to process the recall. The recall, if it's
8 successful, meaning if the directors are recalled,
9 you're going to end up with two different boards anyway.
10 And I think what we're trying to do is put measures in
11 place which make this -- this inter -district
12 relationship functional for everyone so that we do not
13 end up with deadlock. That's really been my focus on,
14 you know, making sure there are equal protections there.
15 MR. COOPER: Paul, to be clear -- and this is
16 mainly for them, the residents that are sitting here --
17 you've been asked before, to be clear, would exclusion
18 affect any change in present revenue flow or debt
19 service to District 1? I asked you that question
20 before, and I want to ask you again.
21 MR. COCKREL: And my answer was, yeah, the
22 mechanics of the revenue flow do change, because you
23 have two mill levies now. But they end up in a common
24 bucket. The revenue amounts don't change. They end
25 up -- you know, after you impose your mill levy, you'll
91
1 have the same dollars with the collected mill. But they
2 do go through two sources. I don't know how else to say
3 that. It's not diminished. It's not increased. It's
4 the same.
5 MR. COOPER: Okay. And the second -- my last
6 question, thank the Lord, would exclusion change the
7 manner in which District 1 and District 2 conduct the
8 business between the two of them?
9 MR. COCKREL: Hopefully not. I don't know.
10 Time will tell.
11 MR. COOPER: Are there any further questions
12 from the Board?
13 MR. BURKE: No.
14 MS. COX: Finished.
15 MR. COOPER: No?
16 MS. COX: No.
17 MR. BURKE: Thank you.
18 MR. COOPER: You have a reprieve from the
19 Board for a few moments, and I understand we'd like --
20 since we have damaged your presentation for the IGA, I'd
21 like you to continue and present your IGA questions.
22 MR. COCKREL: And I'm going to be real brief.
23 I have worked on this in advance of the meeting. I have
24 consulted with Linda and Steve and, to a lesser extent,
25 with Tom to tell them what my ideas are and communicated
92
1 that with REI, because there is some negotiation
2 involved in this process, so that all parties are
3 recognized.
4 So these are -- what I want -- and we've
5 touched on, I would say, 75 percent of the issues that
6 I'm going to go through. And what I would recommend is
7 that if you do approve this exclusion -- MaryAnn has
8 presented the REI case. She's listed the statutory
9 things.
10 I know that there was one issue -- let me see
11 if I can get my bearings here. I think, Angie, you
12 asked the question about, like, what's this benefit
13 outside the District? That is one of the statutory
14 findings that you have to make.
15 And so, you know, when we lawyers go through
16 these proceedings, we want to address all the statutory
17 findings. In reality, it's kind of inconsequential, in
18 the total terms of this discussion. But that's what
19 MaryAnn was doing. She wasn't making a big emphasis
20 that it's going to -- you know, more people are going to
21 be -- it's going to benefit people outside the District.
22 That wasn't the intent. She was just addressing the
23 statute.
24 But I have mentioned most of these issues.
25 So I'm going to go through them, and what I'm going to
93
1 do, Steve, is recommend -- in fact, Sharon, will you
2 pass this sheet out to the Board -- we have a couple
3 extra, but we don't have a lot -- that you would attach
4 these as conditions to the approval of any of the
5 exclusions of this property, and the way that we would
6 do that is -- is to -- if you're in agreement with these
7 conditions, and District Number 2 Board must also be in
8 agreement with them, we will draft an amendment to the
9 IGA that both parties would sign.
10 And then any -- your final action on the
11 exclusion would be contingent upon these IGA changes
12 being -- being completed and approved by District Number
13 2 so that you know that when the property is excluded,
14 you've got these protections. That's how we do that.
15 Then you have the contract between the parties that
16 everybody has got to follow.
17 Did I lose anyone so far? Okay.
18 With respect to mill levies, you've heard
19 this. There will be two components of the District 1
20 mill levy: The debt levy, which pays current debt
21 service on the bonds, and a general levy, which is the
22 balance of up to 40 mills of the -- of the net of the
23 debt levy.
24 District 2, because the REI property is
25 already exposed to the District 1 debt service levy,
94
1 would pay the same general levy as District Number 1.
2 So if -- if -- if they -- if RE -- if it's decided that,
3 in a future year, that you don't need the full 40 mills,
4 you only needed a 25 mill levy, because oil production
5 has gone crazy out here, you don't want to just generate
6 excess revenue. If District 2 would decrease its
7 general levy, District 1 would get a decrease in the
8 general levy, too. It would be uniform.
9 The combined mill levy can't exceed 40 mills.
10 I've given you examples, but I don't need to go through
11 that. I did list an example here for you using 15 and
12 25. But the intent, again, is that there's two
13 components. Probably, when you look at your property
14 tax, you see 40 mills. But when we certify the tax to
15 the county, actually, it has two components: One for
16 the debt service levy, one for the general levy.
17 So that's what I tell -- when I split that
18 up, that's what that means. It's more of a technical
19 term. But the property tax translation to you is 40
20 mills.
21 Funding priorities. Right now, the agreement
22 is not real specific about that, so we establish funding
23 priorities. Generally, under the agreement, the first
24 priority is to pay the existing bonds. You pay them
25 down per schedule. Now, we want to create some
95
1 flexibility in there so if there is a beneficial reason
2 to redeem the finance -- meaning pay off the bonds
3 earlier, we put that option in. Both boards must
4 approve. Again, you've got to work cooperatively. Both
5 boards have to approve.
6 Second level of funding priority would be
7 O&M. Keep the pool now -- you know, in a good
8 operational state, this building. Roads. All the
9 public facilities. That's the second charge against the
10 annual revenues.
11 The third, I am recommending that you create
12 a bond reserve with one year's debt service, which is
13 $200,000. That would mitigate any -- any unexpected
14 decrease in future oil production taxes or assessed
15 valuation in general.
16 If -- if -- if you decide in the future you
17 need to go beyond that for any reason, you've only got
18 10 years left to pay these bonds. If you need it to go
19 beyond that, you would negotiate that, and increase it
20 at the time.
21 The next level of improvements would be
22 infrastructure improvements. Those are the -- the
23 paving of additional roads. All the infrastructure
24 development, referring new tax base, if that's
25 necessary. And then any additional amenities, to
96
1 continue funding the amended program.
2 SPEAKER: That's both districts?
3 MR. COCKREL: Yes. They will be equally
4 basically, again, I'm looking at this as a common bucket
5 of money. And what we do is pay out of that bucket.
6 Even though it ends up in -- technically, that's not
7 true, but figuratively, it's true. And we pay out of
8 that bucket.
9 SPEAKER: Can I ask a follow-up question to
10 that?
11 MR. COCKREL: Sure.
12 SPEAKER: One bucket, but I understand that
13 District 2 has control of the money.
14 MR. COCKREL: They hold the buckets.
15 SPEAKER: They hold the bucket.
16 MR. COCKREL: They're the dispenser of
17 bucket.
18 SPEAKER: Right.
19 MR. COCKREL: The revenue is coming from two
20 sources. The first comes in collectively from all the
21 property on the debt service revenue. It goes into the
22 bucket, and it's the first thing out. And you're paying
23 for debt service on the bond, just like your mortgage.
24 You bring your paycheck home, and you pay the banker
25 first.
97
1 So we do that. And then -- and then what we
2 have the two mill levies, but -- again, using our
3 example of 10 mills and 30 mills. The 30 mills general
4 levy will flow into the bucket from each source. You
5 know, from back here in Filing 1 on your home
6 improvements, from basically the land improvements and
7 the oil and gas production in what we're calling Filing
8 2. That all goes into the common bucket.
9 And then it gets used in this bucket. First,
10 O&M. Make sure --
11 SPEAKER: O&M?
12 MR. COCKREL: Operation and maintenance of
13 existing facilities. Make sure the roads are in good
14 condition, et cetera. Snakes are killed. Algae out of
15 the lake. Fund the bond reserve. Fund into
16 infrastructure improvements as needed. Again, you're
17 not going to go out and build a bunch of infrastructure
18 that's not needed.
19 SPEAKER: You say "as needed." The two
20 boards have -- District 2 has the decision about where
21 to use that money.
22 MR. COCKREL: That's right. That's right.
23 It does. But it's going to work collaboratively to come
24 up with funding recommendations. I'm going to get to
25 that.
98
1 MR. BURKE: Paul?
2 MR. COCKREL: And then additional amenities.
3 MR. BURKE: That's the way it is right now,
4 though. That's not really changed because of the
5 Intergovernmental Agreement. So, you know -- do you
6 follow?
7 MR. COCKREL: Tom, you're right, in practice.
8 That's the way it's happening. We're going to set that
9 out.
10 MS. COX: Paul, can I go back to something.
11 With respect to the mill levy, you said that District 1
12 has debt service and general obligations. But when you
13 went to District 2, you just talked about general
14 obligations, but they have debt service as well.
15 MR. COCKREL: They don't. The only debt,
16 Linda, in this District is the $2 million in general
17 obligation bonds issued back in 1998 by District 1
18 before District 2 was even created.
19 MS. COX: Okay. So if we use that 10/30
20 split -- and that's why I'm confused. If I live in
21 District 1, and I have 10 percent of my debt or 10 mills
22 going to debt levy and 30 percent going to the general,
23 right?
24 MR. COCKREL: Uh-huh. 30 mills.
25 MS. COX: So District 2, they also have that
99
1 30 mills. Where's their equitable tax base?
2 MR. COCKREL: Okay. The other 10 mills that
3 you're missing is also applied to the REI property in
4 District 2, because under law, don't forget,
5 statutorily, they are still responsible for the District
6 Number 1 debt levy assessment, even though the property
7 has been excluded from 1.
8 SPEAKER: I'm sorry. Can you say that again?
9 MR. COCKREL: Yeah. This -- right now, this
10 is all District 1. And it imposes a 10 mill levy for
11 debt service. Once the green properties are excluded,
12 okay, and they all -- the green properties still remain
13 responsible under State law for payment of that 10
14 mills.
15 The 10 mill levy, the District 1 levy,
16 effectively goes out against these REI properties that
17 are excluded. It's as though the exclusion never
18 occurred. Now, the way that actually, if you want the
19 details on how it happens on the assessor's maps, they
20 create different taxing codes. And so that 10 mill levy
21 continues to apply for the excluded property just like
22 it applies to your property.
23 SPEAKER: Okay. So -- just so I can close
24 the loop here. When that debt is paid off, when this
25 1.5 is done -- and say we don't have any other debt out
100
1 there at the time.
2 MR. COCKREL: There is no other debt.
3 SPEAKER: So then what we need for general
4 obligation -- general levies is 30 mills, we all pay 30
5 mills.
6 MR. COCKREL: Correct. You've got it.
7 SPEAKER: So ultimately -- they're ultimately
8 responsible for the $1.5 million of debt that District 1
9 holds.
10 MR. COCKREL: I missed the first part of your
11 question.
12 SPEAKER: They're ultimately still
13 responsible for the $1.5 million debt.
14 MR. COCKREL: They --
15 SPEAKER: You're just calling it something
16 different.
17 MR. COCKREL: Yes.
18 SPEAKER: Okay.
19 SPEAKER: And that 10 mill that District 2
20 pays will be going to the debt of District 1.
21 MR. COCKREL: Correct. The only distinction
22 is that District 2 doesn't levy that -- doesn't itself,
23 as a board, levy that tax. The levy is actually made by
24 the District Number 1 Board, and it applies against the
25 excluded property. So District 2 Board, the developer
101
1 board, has no control over that.
2 SPEAKER: Okay.
3 MR. COCKREL: If you only levy what's
4 necessary to pay that debt service, number one, the
5 Board can't go crazy and just levy 40 mills. It's got
6 to levy what's necessary to pay. But District 1 Board
7 remains in control of that levy.
8 SPEAKER: Yeah, I just had a blank when I
9 got --
10 MR. COOPER: That's my fault.
11 THE WITNESS No, I'm good. Thank you.
12 MR. COCKREL: Okay. We're through that. The
13 next thing I'm recommending is that we formally
14 recognize in the IGA executive committee that would make
15 these general management decisions between the boards,
16 continue to work on a more formal structure. There
17 would be two members from each of the boards, and
18 they're basically like any executive committee. They
19 meet before the board meetings, because these boards
20 have not met except maybe for quarterly, and often, not
21 even that frequently.
22 So if you meet semiannually, if things need
23 to get done during the year, and you -- that way, your
24 residents and their two representatives from the
25 District 1 Board would meet with the developer and their
102
1 two representatives, and they would work on implementing
2 these programs.
3 A lot of this is fuzzy, but it's my belief
4 about that, that's fine. We create the -- kind of the
5 institutional structure, and I really believe that
6 cooperative people will work well together, and I'm
7 assuming that's going to happen and that will be the
8 intent, that you would work cooperatively to implement
9 the IGA and the Service Plan.
10 We haven't spoken a lot about the Service
11 Plan today. The Service Plan is kind of a charter
12 document also, and it controls what we're doing. And as
13 MaryAnn indicated to you in her testimony, I don't
14 believe that an amendment to the Service Plan is
15 necessary as a matter of law, as long as we do these
16 things, because all we're doing is we're following many
17 of the processes and many of the contractual provisions
18 that have already been put in place. We just have to do
19 a better job of it.
20 SPEAKER: Do you have a recommendation of how
21 that executive committee is compiled?
22 MR. COCKREL: No. I trust Steve and Linda to
23 come up with that and come up with their own solutions.
24 I think, you know, this is a community, it's got to work
25 as a community, and I fully think you guys are doing a
103
1 great job, personally, right now. You know, I mean, I
2 look around, and I see what you've accomplished out of
3 it. I wouldn't change but, that you that's up to you
4 guys.
5 SPEAKER: May I ask a question. As Steve and
6 Linda are representatives of the Board, and we as home
7 owners want to discuss anything or open any dialogue,
8 are they allowed to have dialogue with us, or does the
9 whole Board need to be present?
10 MR. COCKREL: No, they can have a dialogue
11 with you. But there's a stupid restriction under the
12 law that says, if you have three members present and you
13 start talking about District business, they it's an open
14 meeting. Now, that means everybody gets to come in and
15 participate in that discussion.
16 They still can't take action unless they are
17 conducting a formal meeting with advance notice and
18 stuff like that, but of course, they can talk about
19 that. You can talk to them together as neighbors. I
20 mean, it would be silly not to.
21 SPEAKER: Having trouble now.
22 MR. COCKREL: There's another --
23 SPEAKER: Just can't be all together in the
24 same place.
25 MR. BURKE: There's a restraining order
104
1 that's the problem I think she's referring to.
2 MR. COCKREL: I'm going to fly right over the
3 additional districts. I told you REI would like the
4 ability to create different districts in the green area.
5 Don't know why. Frankly, I don't think it matters. The
6 one thing we want is a protection so that they can't --
7 is that District 2 or REI -- basically, we're talking
8 about District 2 -- can't create an overlapping district
9 in Filing 1 unless the District Number 1 Board consents.
10 I can't imagine why that would ever happen, but we've
11 got the protection in here.
12 SPEAKER: Can I ask something?
13 MR. COOPER: Pardon me?
14 SPEAKER: Within the IGA, as you're talking
15 about maybe selling different districts, could we also
16 have in there that we would have access to the lake area
17 and Milton reservoir and things like that?
18 MR. COCKREL: Yes. One of the things we need
19 to do, we need to switch the titles around, because the
20 title conditions doesn't reflect the terms of the IGA.
21 For example, the buffer zone, in Outlet A and Outlet 1,
22 2, and 3, are not in -- are titled in District 1,
23 although the IGA specifies that District 2 owns,
24 operates, and maintains. Our insurance policies are
25 kind of screwed up, so we want to switch some title
105
1 around.
2 The agreement itself makes it very -- will
3 make it abundantly clear that there is equal access to
4 the use of these facilities by all residents, all
5 property owners, whether they're in 1 or 2, and there
6 can't being discrimination because of where you're
7 located. Your tax dollars are going to pay for those.
8 Oil tax dollars are going to pay for those. It's for
9 the common good, and that's what the agreement is
10 saying.
11 SPEAKER: Thank you.
12 MR. COCKREL: We also want to put some
13 standards in there so District Number -- since District
14 Number 2 is really in control -- you know, make no bones
15 about that. It could be viewed from your standpoint as
16 actually a benefit, because it's not your liability.
17 Maintaining a record is not a particular advantage to
18 anyone, if you look at it from a financial standpoint.
19 You've got to pay for it. District 2 is going to be
20 responsible for maintaining, okay.
21 We want to have some standards to make sure
22 that District 2 adheres to -- commercially reasonable
23 standards? Is that the term? Finally, after hours of
24 disagreement, it's arrived at Commercially reasonable
25 standards, I think, which all of us understand the --
106
1 and that applies to not only existing facilities but to
2 future facilities.
3 For the roads, we're going to maintain to
4 County standards. That seems like a relevant standard.
5 I'm not sure what "commercially reasonable" means with
6 respect to roads. County roads, that may not satisfy
7 you.
8 SPEAKER: Weld County roads?
9 MR. COCKREL: Right. We're continuing to
10 work with them. Again, I think -- those real issues get
11 decided by that executive committee. I mean, if you're
12 complaining about the potholes in the road, Steve knows
13 it and will take to the committee. If the fish aren't
14 jumping down at the lake.
15 SPEAKER: It's Steve's fault.
16 MR. COCKREL: Okay. On the transfer and
17 title, we're going to max the title up in the conditions
18 in the present IGA. The 2 will have title. Again, it's
19 not going to affect it's not going to affect the use
20 of the tax dollars, okay. It's going to -- from a
21 business standpoint, it's going to line these things up
22 so that District Number 2, as the owner on of the
23 insurance policies, among other things, is recognized as
24 the owner.
25 So while we're making some title transfers, I
107
1 don't believe we're changing any of the fundamental
2 rights or any of those things that, Susan, you were
3 concerned about.
4 SPEAKER: Thank you.
5 MR. COCKREL: The ultimate goal under the
6 Service Plan doesn't change. Someone asked a question,
7 and MaryAnn answered it directly, as Filing 2 develops
8 in the future and lots are built and homes are sold,
9 that property gets transferred into District Number 1,
10 just like it's anticipated today, okay. It gets
11 transferred to 1, goes into the common tax base, and
12 ultimately, you end up with one district.
13 I hope I'm here to break the champagne bottle
14 when that happens, but you end up with one district, a
15 common board, and -- and you -- and then you're fully in
16 control for better or worse, all right. So you see what
17 happens then.
18 I think we've gone --
19 SPEAKER: You said there would be title
20 changes, right? Say that again.
21 MR. COCKREL: Right now, basically, title on
22 the public facilities is in 1. Okay. We're going to
23 transfer title to 2. The IGA recognizes --
24 SPEAKER: Just for District 2.
25 MR. COCKREL: That's right.
108
1 SPEAKER: And District 1 is going to be in
2 District 1 title.
3 MR. COCKREL: There is no -- okay. What I'm
4 talking about are the public facilities, for example,
5 Outlets 1, 2, and 3. I can't tell you where they are.
6 It's better for me to tell you the buffer zones. The
7 buffer zones around the lake were acquired, basically,
8 with conservation easements on them to prevent any
9 development adjacent to the lake.
10 That was actually a requirement of the
11 Environmental Protection Agency when we negotiated that
12 deal. And the title is held -- even though it's up here
13 in this green area, title is held by 1, because when all
14 these titles were transferred, there weren't two
15 districts, so the effects of that was they were run
16 into -- into Beebe Draw Farms Metro District.
17 From a strict legal title matter, 1 is the
18 owner of those facilities. We're going to transfer
19 those to 2. But your rights to use don't change. It
20 doesn't matter who holds the title. We need to ensure
21 those and take other steps. We feel it's better to
22 actually implement what the agreement is currently
23 recognizing by transferring those titles.
24 SPEAKER: So was that the liability -- you
25 said District 2 then becomes responsible, if they're not
109
1 already, for the insurance. That goes into liability.
2 MR. COCKREL: It's also a liability issue.
3 SPEAKER: I'm sorry. Who was it that owned
4 the base here in District 17
5 MR. COCKREL: 1.
6 SPEAKER: 1. That won't change.
7 MR. COCKREL: No, we are going to change
8 that. We're going to transfer all the title to the
9 property -- whether it's open space, Outlet A, buffer
10 zones, will be transferred to 2 so that we can line our
11 insurance policies up, we can take all the other action.
12 Rights of control are consistent with the Service Plan.
13 Does not affect usage.
14 SPEAKER: Okay.
15 MR. COCKREL: We go through the same process
16 with exclusion. There's overlapping. We've got to
17 clean up the overlaps again. Outlet A is in both
18 districts.
19 One of the things that I will -- we are
20 recommending to the District Number 1 Board is that that
21 property be excluded from 1. Otherwise, there's
22 potential double taxation to that property. And quite
23 frankly, there's oil production on the property, so you
24 can't have double taxes. It would be inconsistent.
25 So what we want to do -- again, you're going
110
1 to end up with a boundary line. If Filing 1 was in this
2 section, all in that section, spelled out, you get
3 developed property around developed property, and that's
4 how it lines up. And as this section gets developed and
5 filled out and put into the District, the boundaries
6 keep expanding for District Number 1, and the boundaries
7 keep getting reduced for District 2, and at the end of
8 the day, you've got a single district owning all
9 facilities.
10 SPEAKER: I thought that the yellow area was
11 owned by the State or is deeded to the State.
12 MR. COCKREL: You're correct. This is Filing
13 16 land. When the District was first created, the
14 developer at that time had an option on that land, and
15 so it got included in District Number 1. It's still in
16 District 1, and it will remain in District 1 until the
17 State Land Board or somebody else asks to exclude it.
18 So other than -- other than the -- all the --
19 none of the REI undeveloped property will be in 1. Now,
20 the REI platted property, they still own lots. That
21 will still be in 1. This remains in 1 until we get it
22 excluded. But we wouldn't exclude it until they include
23 it in 2, because, frankly, we want the tax revenue off
24 that property.
25 SPEAKER: And when the exclusion goes through
111
1 as far as the title, does it go through, as far as the
2 legal descriptions, like, the southeast corner of the
3 northwest block?
4 MR. COCKREL: It does. And if you look at
5 the exclusion, the only effect 2 really has on anyone is
6 on the County Assessor when they draw the taxing areas
7 and they switch the taxing boundaries around. What we
8 are doing with the IGA is to control the flow of revenue
9 with this contract between the two districts.
10 Otherwise, things could get screwed up.
11 SPEAKER: Has somebody with Counsel looked at
12 all the legal descriptions and be sure this has the
13 property that needs to be recovered?
14 MR. COCKREL: I will defer to REI. I'll tell
15 that you legal description was taken from the legal in
16 the Service Plan, the Consolidated Service Plan, when
17 District 2 was created Is that correct?
18 MS. McGEADY: I'm sorry. I'm not tracking
19 the question.
20 MR. COCKREL: The question is, have they
21 excluded the boundaries? Susan asked if I checked the
22 legal for the exclusion. The answer is, no, I did not.
23 But I know it is the same as the District 2 property in
24 the Service Plan, correct? Yeah.
25 MS. HETHCOCK: Yes, and it has been checked
112
1 by legal counsel.
2 MR. COOPER: Yeah.
3 MR. TOENJES: A surveyor also.
4 MR. COCKREL: I'll show you the legal. It
5 says everything is in 1. Everything in this area, out
6 of Filing 1 and Section 16.
7 SPEAKER: Got it. Thank you.
8 MS. McGEADY: And I think we also have a
9 title commitment prepared, Paul.
10 MR. COCKREL: Pardon?
11 SPEAKER: Will that become recorded.
12 MS. McGEADY: We have a title prepared for
13 that description to make sure that the property was all
14 REI owned.
15 SPEAKER: Thank you.
16 SPEAKER: I just want to clarify something.
17 I'm keeping up with the whole flow here, but the
18 undeveloped and developed lots that are unsold, that REI
19 owns that are part of Filing 1, does that get
20 transferred also?
21 MS. McGEADY: No
22 MR. COCKREL: No.
23 SPEAKER: Is that going to stay in 1?
24 MR. COCKREL: They're going to stay in 1
25 SPEAKER: Okay.
113
1 MR. COCKREL: -- because those can sell any
2 day. So we don't want to --
3 SPEAKER: Right.
4 MR. COCKREL: -- exclude them to re -include
5 them. Just leave --
6 SPEAKER: That's right.
7 MR. COCKREL: So all of the REI platted lots
8 in 1 will remain under the control of the District
9 Number 1 Board.
10 SPEAKER: Okay.
11 MR. COCKREL: Because it is effectively
12 developed, and that was the concept in the Service Plan.
13 Once it's been platted and developed and included in 1.
14 It's all this undeveloped stuff that stays in.
15 SPEAKER: Okay. Got it.
16 MR. COCKREL: Okay. Down to the final one
17 action. Default. So what happens if this doesn't work?
18 (Unreportable general conversation.)
19 MR. COCKREL: I mean, yeah. Attorneys always
20 look at it from the worse. Nobody wants to be
21 embarrassed. So we are going to put in some new default
22 provisions in the agreement, the first of which --
23 because I -- you know, I kind of spoke with REI, and
24 I've been through this, where you get a developer who
25 defaults and goes into bankruptcy, and then homeowners
114
1 get screwed.
2 So what we're going to do is we're going to
3 put District Number 1 Board temporarily in control of
4 all facilities until that situation is remedied. So
5 District 1 takes over.
6 We've got an alternative for what we call
7 conservatorship. The only difference there is, once
8 again, District 2, if it does not do its job, we go to
9 the Court and ask the Court to appoint an independent
10 third party to be the conservator for this property so
11 we know that you guys aren't being detrimentally
12 effected.
13 SPEAKER: Paul, who is that, usually? Who is
14 likely to be, like, a conservator.
15 MR. COCKREL: It really depends on the
16 lender. Generally, what happens -- in this case, I'm
17 not too concerned, because the developer, in a typical
18 developer bankruptcy situation, is also funding the
19 operating expenses of the District. He's making
20 advances while he begins his development. If something
21 happens, then there's no money to pay for them. You
22 know, the weeds grow, the roads go into disrepair, the
23 sewer plan doesn't work. Whatever it is, it doesn't
24 work. It's stopped working.
25 Here, don't forget, over 90 -- 93 percent of
115
1 your revenue is coming from oil and gas production.
2 This is the most secure district around. Believe me. I
3 mean, as long as the Wattenburg field keeps producing.
4 The only thing you need to be able to do as a practical
5 manner is to be able to get your hands on the money, and
6 that's why we have this IGA in place.
7 One board will step in control that. Again,
8 once they bring in the new developer and he's got
9 everything funded and operating appropriately again, let
10 him take back over. But during any period when they're
11 in default, when 2 is in default of agreement, it falls
12 back to 1 or an independent conservator.
13 Who is that? We find a district management
14 company, probably, someone like that, to come in and do
15 it. But I don't imagine that happening, frankly. I
16 don't imagine any of this happening.
17 SPEAKER: Has it ever happened in the State
18 of Colorado?
19 MR. COCKREL: Pardon?
20 SPEAKER: Has a metro district gone into
21 conservatorship?
22 MR. COOPER: Yes. I'm dealing with problems
23 in one of my districts now.
24 SPEAKER: Wasn't it one in Castle Pines
25 North?
116
1 MR. COCKREL: Yes. That was one of
2 MaryAnn's.
3 MS. McGEADY: No, it wasn't.
4 SPEAKER: It was someone independent, that
5 the district would pay to manage the fiscal side, when 1
6 is going to be responsible for all the day-to-day stuff.
7 MR. COCKREL: Yes, and typically, what
8 happens, Linda, in those situations, you get -- again,
9 the developer, frankly, files for bankruptcy. The
10 bankruptcy court prevents anything from happening. You
11 can't get any funds out, and you don't have any source
12 of revenue for running the District.
13 That's what traditionally happens. That
14 won't happen here because of the revenue flows. During
15 that period, you're not going to go out and spend all of
16 this money on new roads and stuff. You're going to cool
17 it. Hunker down.
18 MR. BURKE: That's the reason why there was
19 only $2 million of bonds sold for this project, because
20 of Castle Pines North. It couldn't have been done with
21 any more.
22 MR. COCKREL: Those are my recommendations.
23 If you decide to approve this, then I would definitely
24 suggest that you make the approval subject to changes to
25 the IGA, the conditions which we've outlined here for
117
1 you. I will work over the next several weeks, if that's
2 the case, with REI to come up with language that we all
3 feel comfortable with, and then we'll present that
4 document for your approval and subsequent approval.
5 SPEAKER: So can the IGA be reviewed before
6 we go to final vote?
7 MR. COCKREL: Yes. Yeah, we don't have the
8 IGA amendments today.
9 SPEAKER: So it would be subject to.
10 MR. COCKREL: I could have drafted it in
11 advance, but I didn't want to be presumptuous, and I
12 also didn't know if additional information would come
13 out of this meeting. So these are the things that I
14 feel are necessary. I haven't heard anything different,
15 frankly, what we need to address. Linda, do you have
16 questions?
17 MS. COX: I do not
18 MR. COCKREL: Steve?
19 MR. COOPER: Have you concluded your
20 presentation?
21 MR. COCKREL: Yes. As long as you accept my
22 recommendations, I have no further comments.
23 MR. COOPER: Yes. Thank you very much, Paul.
24 MR. COCKREL: Sure.
25 MR. COOPER: While Paul has been making his
118
1 presentation -- all of us on the Board are well aware of
2 what he's saying. Steve decided as to make a motion,
3 and I will move the motion as follows:
4 Inasmuch as revenue debt service, bond
5 redemption, and mill levies will remained unchanged, I
6 move that the petition for exclusion by REI be
7 tentatively approved on the specific proviso that the
8 interagency governmental agreement is revised and
9 amended to reflect the revisions proposed by District
10 Number 1; upon satisfactory revision, the proposal for
11 exclusion will be examined by District Number 1 on
12 November 3rd, at this location, at 6:00 p.m., for final
13 decision by the Board of District Number 1.
14 End of motion. Do we have a second?
15 MS. COX: I second the motion.
16 MR. COOPER: Seconded by Cox. All those in
17 favor, say aye.
18 MR. BURKE: Aye.
19 MS. COX: Aye.
20 MR. COOPER: Aye.
21 Unanimous by District 1. So the motion has
22 passed for tentative approval under specific criteria,
23 which will be decided on November 3rd at 6:00 o'clock.
24 Now --
25 MR. COCKREL: Steve, may I make one comment?
119
1 At that time, we also -- the statute will require that
2 the Board enter its final order of inclusion,
3 effectively -- what I think is you've just done is
4 conditionally approve this, but you must enter a final
5 order, the form of which is kind of specified by
6 statute, and we will have that order prepared at that
7 time, and you will also have the documents in advance of
B that. We'll get those out to you as soon as possible,
9 so that they're available for public review, and we'll
10 have all that stuff available for you at your next board
11 meeting.
12 MR. COOPER: And making that available is
13 somewhat difficult at times, because we have a placard
14 there with a locked door, and we have a mail room, and
15 we have other areas prior to review of November 3rd.
16 MR. COCKREL: Once I finalize the document, I
17 will forward it to you; and if anyone has any interest
18 in seeing the document, they can contact me. You'll
19 have it by -- electronically, so you'll be able to
20 forward it.
21 MR. COOPER: Okay.
22 MR. COCKREL: Does that work?
23 MR. COOPER: Yes.
24 MR. COCKREL: Okay.
25 MR. COOPER: You'll have to some days prior
120
1 to November 3rd? Couple of days?
2 MR. COCKREL: It'll are next weeks, I think.
3 SPEAKER: The IGA amendments and that? Okay.
4 MR. COOPER: Okay.
5 MS. McGEADY: Mr. President? Since we have a
6 stenographer keeping track of what's going on in the
7 meeting, could you clarify that Christine Hethcock did
8 not participate in the vote? I think you referenced a
9 unanimous vote, and I don't think she voted.
10 MS. HETHCOCK: Hethcock abstained from the
11 vote.
12 MS. McGEADY: Thank you.
13 MR. COCKREL: And from overall participation.
14 Strangely silent.
15 MS. HETHCOCK: And from overall
16 participation.
17 MR. COOPER: Yes. I understand why you
18 raised the question.
19 Public comment, which we've had a lot, but I
20 guess we're open for more. Any public comment? We're
21 getting close to adjournment. Any comments to the Board
22 from the public?
23 Mr. Cox.
24 SPEAKER: I would just comment that I think
25 this proceeding has been extraordinarily well -run, the
121
1 presentations have been easy to follow, and I will go
2 away, A, much better informed, and B, feeling like this
3 is a win -win for everybody, period.
4 MR. COOPER: Thank you, John. We take all
5 compliments very seriously.
6 Without any other public comments, I will
7 close that. Thank you very much.
8 There's other matters to come before the
9 Board. And one is a copy of this transcript. What is
10 the procedure if one would want to purchase portions or
11 the entire transcript? Where do they go? We are
12 required to have minutes of the meeting. I know that.
13 But that's one copy.
14 MR. COCKREL: The petitioner is going to
15 provide a copy to the District, and if anyone else wants
16 a copy, MaryAnn could, once again -- maybe if you would
17 just advise Steve how much that costs for additional
18 copies, and then anyone who's interested in having their
19 own copy of this hearing can secure it through Steve and
20 MaryAnn.
21 MR. COOPER: Secure it through -- ask for me
22 to assist you in paying for them.
23 MR. COCKREL: I will tell you -- okay.
24 MR. COOPER: Other matters -- thank you,
25 Paul.
122
1 MR. COCKREL: And Steve, I should have asked.
2 I would like the direction of the Board to also prepare
3 some of these other kind of tangential things we've
4 talked about, like, we do the exclusion, do the title
5 work, speed those up, so you can make the decision at
6 the meeting on November at 6:00 so we have all this
7 behind us, and we can move into the new year without
8 having to repeat ourselves. So unless you tell me
9 otherwise, we'll start on that. We do have those
10 petitions for exclusion for you guys to sign so we can
11 take this next step.
12 SPEAKER: Did I understand that the REI
13 presentation will be available for review?
14 MR. COCKREL: You said you had hard copies of
15 that?
16 MS. McGEADY: Sure.
17 SPEAKER: Where do we find that?
18 MS. McGEADY: We have, what, six or seven
19 copies tonight. We'll leave -- we'll leave them with
20 Sharon, I guess.
21 MR. COCKREL: Just pass them out. Who wants
22 a copy?
23 MS. McGEADY: We need to make sure that the
24 District keeps one copy.
25 MR. COCKREL: You three hang around, and
123
1 we'll get them copied, and MaryAnn can dispense the
2 rest.
3 MR. COOPER: Those who want copies please see
4 MaryAnn after.
5 SPEAKER: And who's getting transcripts?
6 MR. COOPER: John, did you hear me? If you
7 want copies, stop and --
8 SPEAKER: No, transcripts. Stacy and
9 somebody? I didn't know who --
10 MR. COCKREL: No. If you would like a copy
11 of the transcript, just let Steve know, and he'll get
12 the information when they're available and how much that
13 will be.
14 MR. COOPER: Okay? Unfinished business.
15 It's a possibility that director vacancies may or will
16 occur in the future on the Board. And the Board has
17 prepared applications for potential new Board members
18 which will be appointed by the remaining District 1
19 directors to fulfill the terms of the vacancies.
20 Those interested shall complete the forms
21 properly and mail or otherwise provide the applications
22 prior to the deadline of November 16th -- November 16th,
23 2008, to Chairman Steve Cooper at 16500 Beebe Draw Farms
24 Parkway, Platteville, Colorado, 80615. Now, I have
25 the -- 51. 51. Excuse me. First mistake I've made
124
1 tonight.
2 I have 20 applications here. If you're
3 interested in possible vacancies on District 1, you will
4 fill out the application, and I hope you do it a lot
5 better than you filled out the member questions. But
6 here they are. So please only take one.
7 SPEAKER: So, Coop, how are you going to let
8 people in the community who aren't here know about that?
9 MR. COOPER: Excuse me?
10 SPEAKER: How are you going to let people in
11 the community know that they're applications out there
12 to be filled out?
13 MR. COOPER: First of all, I've never said
14 anything in the community that didn't go around within
15 five minutes. But we will post that in the mail room.
16 SPEAKER: In the glass case.
17 MR. COOPER: What?
18 SPEAKER: In the glass case.
19 MR. COOPER: We'll post it in the mail room
20 only. Period. We don't have statutory requirements.
21 Trust me, trust me. We'll post it in the mail room, and
22 it's here. And that's the only place it will be placed.
23 It won't .
24 MS. COX: Actually, you can call, if there
25 isn't one, call. We'll get one.
125
1 MR. COCKREL: And maybe explain one other
2 thing on that, to preempt any questions. When a vacancy
3 occurs on the Board, the Board has to -- can take all
4 the information it wants and makes the appointments, and
5 that's what Steve is doing. And then if -- an
6 appointment itself is made in public session, so that
7 will all be posted. It won't be done secretively.
8 MR. COOPER: Yes, Roy.
9 SPEAKER: Is it official that there are two
10 vacancies --
11 MR. COOPER: No, there are no vacancies at
12 this time.
13 SPEAKER: Huh?
14 MR. COOPER: There's no vacancies at this
15 time.
16 SPEAKER: But it has to be done by November
17 16th?
18 MR. COOPER: Yes.
19 SPEAKER: So what --
20 (Unreportable general conversation.)
21 SPEAKER: Hypothetically.
22 SPEAKER: I understand. But -- how do we
23 know when there are vacancies?
24 SPEAKER: November 3rd.
25 MR. COOPER: We don't know.
126
1 SPEAKER: Do all our paperwork ahead of time
2 and be ready just in case.
3 MR. BURKE: I wouldn't count on there being
4 any vacancies if there's nobody that wants to serve.
5 Not a chicken and egg deal. You know, if somebody wants
6 to serve, we can pick one.
7 MR. COOPER: I have 20 applications for
8 vacancies. You're all welcome to get them. They'll be
9 posted in the mail room.
10 I ask for a motion to adjourn.
11 MS. COX: So moved.
12 MR. COOPER: So moved by --
13 MR. BURKE: Before we do, did you talk about
14 us, you wanted us to sign that resolution which had the
15 subject --
16 MR. COCKREL: We'll do -- we'll do the formal
17 resolution for final approval or disapproval at the
18 November meeting.
19 MR. BURKE: Okay.
20 MR. COCKREL: Because we need to prepare it•
21 based upon -- we will prepare a proposed order. I mean,
22 if you deny it, you deny it. But if you approve it, we
23 need to prepare an order to that effect.
24 MR. BURKE: Okay.
25 SPEAKER: Halftime is winding down.
127
1
2
3
4
5
6
7
8
9 very much.
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
MS. COX: Second.
MR. COOPER: We have a second.
MR. BURKE: Second.
MR. COOPER: All those in favor say aye.
MR. BURKE: Aye.
MS. COX: Aye.
MR. COOPER: All those opposed, say nay.
Unanimous. Meeting adjourned. Thank you
(Hearing concluded at 8:05 p.m.)
* * *
128
1 STATE OF COLORADO )
) REPORTER'S CERTIFICATE
2 COUNTY OF LARIMER )
3 I, Jason T. Meadors, RPR, CRR, and Notary
4 Public, State of Colorado, hereby certify that the
5 foregoing hearing, taken in the matter of Beebe Draw
6 Farms, Request for Exclusion, was taken on Monday,
7 October 20, 2008, at 16502 Beebe Draw Farms Parkway,
8 Platteville, Colorado; that said proceedings were taken
9 down by me in stenotype notes and reduced under my
10 supervision to the foregoing 127 pages; that said
11 transcript is an accurate and complete record of the
12 proceedings so taken.
13 I further certify that I am not related to,
14 employed by, nor of counsel to any of the parties or
15 attorneys herein nor otherwise interested in the outcome
16 of the case.
17 Attested to by me this 28th day of October,
18 2008.
19
20
Jason T. Meadors
21 Meadors Court Reporting, LLC
315 West Oak Street, Suite 710
22 Fort Collins, Colorado 80521
(970) 482-1506
23 My commission expires January 26, 2009.
24
25
Hello