Sewer services to Rooney Valley. Who. How. Will you have anything to say about it. Now is the time.
Here is a summary of the issue, public involvement, and timeline of events including the key documents with links to all the prior blogs on the matter.
We have come a long way.
On May 8, 2018, the night that the previous board of Green Mountain Water and Sanitation District (Green Mountain) was being voted out of office, the Rooney Valley developers had the outgoing board approve an Intergovernmental Agreement.
That IGA established Big Sky Metro District as the new “master meter” sanitation district for all of Rooney Valley. Big Sky – undeveloped and run by one developer formerly a Vice President with Brookfield.
[The same person who served on the Solterra board during a time when it was run by Brookfield and, for 11 years, all the public elections were “cancelled” by the Brookfield board.]
There was no public hearing. No effort to find out what the residents of Green Mountain thought about that proposal. It was rushed through election night.
Neither Big Sky or Green Mountain had authority to enter into that IGA on May 8, 2018.
Since May 9, 2018, the newly elected directors of Green Mountain have worked hard to provide the residents with a seat at the table along with the developers to decide whether or not Green Mountain should provide sewer service to Rooney Valley and, if they do, how.
After more than 8 months of wrestling with the issue in the face of bullying threats of litigation from the Rooney Valley developers and after 18 months of litigation, the directors who started work on the issue on May 9, 2018 (Jeff Baker, Alex Plotkin and Adrienne Hanagan) and the two who were elected last year (Karen Morgan and Rhonda Peters) are still working hard to include the residents in answering these questions as to Green Mountain.
Will Green Mountain or someone else provide sewer. If Green Mountain, how will they do it.
Public Involvement
As with any organization, there are different approaches and points of view. All the board members insist on public involvement. However, we see there are at least two approaches so far.
On March 16, 2021, the board discussed how to include the public in considering settlement options. A majority of the board stated that they wanted to obtain more information about the options from counsel, prepare a presentation for the public, and think about how best to obtain public input.
One member, Ms. Hanagan stated she was going to go ahead and hold a public meeting on her own even if no other board members attended.
Here is a tape of the March 16 meeting:
Ms Hanagan had her meeting without the board on March 30, 3021. There was a recording but it is not yet public. There is a discussion of that event (March 30, 2021) below.
Friday, the board issued a notice of a meeting April 6, 2021 for:
“a. Discussion and adoption of the Survey to facilitate the Public Input on the current litigation against the District.
b. Discussion and adoption of other Public Input options in regards to the proposed Settlement options if any are considered by the Board.
c. Discussion and adoption of presentation materials for the Public to consider in regards to the litigation.”
Here is the proposed survey:
“Dear GMWSD Constituents. We, the Board of GMWSD, want to reach to you in order to provide some foundational information in regards to the ongoing litigation with Big Sky and other Plaintiffs and to ask some initial questions to help us understand where our constituents stand.
Here are some facts:
1. You are a resident/constituent of the GMWSD District.
2. GMWSD exists to provide sewer (and water) to you and other residents inside the District boundary.
3. GMWSD is a Master Meter for the water provided by Denver Water and sewer collected by Metro Waste. This means that GMWSD is legally bound by certain provisions from those entities.
4. GMWSD has no obligation to provide sewer to entities outside the District boundary.
5. All of the plaintiffs (Big Sky, CDN, Cardel, Green Tree, Three Dinos) are outside the GMWSD District boundary.
6. All the plaintiffs have alternative ways to obtain sewer service without GMWSD.
Questions:
1. Do you support GMWSD providing sewer service to the plaintiffs who are now outside the District boundary?
If yes, there are two ways for GMWSD to provide sewer service: Inclusion or an Intergovernmental Agreement.
2. Do you support inclusion?
(With inclusion, the new Service Areas are made part of GMWSD by expanding the District boundary to include the plaintiffs’ territory, which, for geographic reference, encompasses a large portion of the Rooney Valley. All the new residents of the expanded District would get to vote and be taxed. With inclusion, the District controls providing sewer service within the new, expanded, District.)
3. Do you support using an Intergovernmental Agreement?
(With an Intergovernmental Agreement, the new Service Areas stay outside the District boundary. The GMWSD District boundary and number of residents stays the same. All the residents of the plaintiffs’ future potential developments become customers of the District, but not the residents (constituents) of the District. For example, Solterra gets sewer from GMWSD through an IGA. They are customers, but not residents (constituents) of the District. Hence, they can’t vote or be taxed. Their contract for sewer expires in 2023. With the IGA the Developer’s Metro District would control the provision of the sewer service within their Metro District.)
There are additional pros and cons for each option. There are no preferred choices at this time. We would love to hear from you on this in order to help us better understand where does the Public stand on these issues.”
(Emphasis added).
Here is the full board agenda and packet posted on the Green Mountain website yesterday:
Brief Timeline and Key Documents:
Prior to May 8, 2018
1. Rooney Valley property will obtain sewer through the Mt. Carbon Sanitation District.
2. Rooney Valley developers decide to opt out or “exclude” themselves from Mt. Carbon and obtain sewer from another source. The future residents will still have to pay a tax to pay off Mt. Carbon’s debts.
3. Rooney Valley developers consistently push Green Mountain to provide sewer.
4. Green Mountain has no obligation to provide service outside of the District boundaries. Green Mountain’s power is limited by its Service Plan. The Service Plan states that Green Mountain’s authority is limited to “provid[ing] a complete waterworks distribution system for the District and the inhabitants thereof“. (Emphasis added)
Here is the Service Plan: Green Mountain Service Plan 1
5. Despite the developer’s constant pushing, Green Mountain continues to maintain that it has no legal obligation to provide service to Big Sky or any other Rooney Valley developers.
See for example paragraph 2 in: Mem of Understanding 4-18-2017 Pre IGA No Committment
May 8, 2018
6. The three members being voted out of office on May 8 vote to approve the Big Sky IGA. The IGA was prepared for the board by Big Sky Metro District (undeveloped and run by one developer).
7. Big Sky only has two directors. Title 32 references either 5 or 7 and the Department of Local Government Affairs states there must be at least 5 directors.
8. The Big Sky IGA violates the Big Sky Service Plan. The IGA expands the Service Area of the Big Sky Metro District beyond the boundaries expressly approved in the Big Sky Service Plan and limited by the City of Lakewood in 2014.
9. Green Mountain violates its Service Plan by agreeing to provide service to inhabitants outside of its district boundary.
10. The Big Sky IGA establishes Big Sky as the new “master meter” sanitation district for Rooney Valley. Big Sky will decide who gets service and how much it will cost. The only limit to the fees Big Sky can charge is what they think is “reasonable”. Staff raised concerns about the unstable soils in the area. There were unanswered questions about capacity. Big Sky will initially pay the costs of building the “Big Sky Sanitation System”. Green Mountain will pay “kickbacks” to Big Sky for certain costs. The Big Sky IGA says at one point that Big Sky will own the system and at another point Green Mountain will own the system.
11. The Big Sky IGA is entirely different from the Solterra IGA. Solterra is not a new master meter for residents outside of Solterra. Big Sky is. Solterra is not deciding who gets sewer and how much it will cost for districts and development outside Solterra. Big Sky is. Solterra’s IGA for sewer expires in 2023. The Big Sky IGA has no expiration date.
(Note Green Mountain also did not have authority to enter into the Solterra IGA. If Green Mountain is to follow the Service Plan, it can only provide service outside its boundary if it obtains permission from the City of Lakewood to amend its Service Plan to expressly state that it is authorized to provide service outside its District boundary).
Here is the Big Sky IGA:
Here is a map of the Big Sky Service Area approved by Lakewood in 2014 when the Big Sky Metro District was created:
Here is a map of the “new” Service Area created by Big Sky in the Big Sky IGA without approval from Lakewood. The area with the black border is the area that was approved in 2014 by Lakewood:
May 8, 2018 – August, 2018
12. The new board majority slowly learned about the Big Sky IGA. The Green Mountain attorney (formerly associated with Big Sky’s attorney) and Green Mountain manager obstructed the new majority’s efforts to obtain information about the Big Sky IGA. The attorney was replaced in the Fall, 2018. The Manager was replaced in the Spring, 2019.
September 4, 2018
13. The board issued a declaration to the Rooney Valley developers that the District was conducting an evaluation of the validity of the Big Sky IGA and engaged separate counsel to assist with that effort.
Here is that document:
Green Mountain Declaration 9-4-2018
November 2, 2018
14. The board issued a declaration regarding deficiencies in the Big Sky IGA.
Here is that document:
Green Mountain Declaration November 2, 2018
October 8, 2018 – February 12, 2019
15. Big Sky counsel threatens litigation in two letters. Green Mountain counsel outlines defects in Big Sky IGA, questions the authority of Big Sky and Green Mountain to enter into the Big Sky IGA and recommends that Big Sky apply to the City of Lakewood to modify Big Sky’s service plan and obtain permission to create the Big Sky sanitation district.
Big Sky refuses.
January 8, 2019
16. There is a debate before the Green Mountain board on whether or not the Big Sky IGA should be terminated. 40 – 50 residents attended. Given the limited capacity in the Green Mountain meeting room many were turned away.
Here is the motion that was orally made and passed unanimously by the board on January 8:
“Direct the counsel to issue a letter stating that the District [Green Mountain] will take no further action or perform any work related to the Big Sky IGA until the Big Sky Metro District is brought into compliance by the City of Lakewood City Council as related to the expansion of said District’s boundaries and purposes as provided by the IGA. This letter is to be issued to the Lakewood City Council and to be published on the district website.”
Here is a report on that debate:
January 8, 2019 – April 8, 2019
17. Green Mountain obtains new district counsel.
18. Big Sky refuses to obtain permission from the City of Lakewood to establish the Big Sky sanitation district.
April 9, 2019
19. Green Mountain votes to terminate the Big Sky IGA. The resolution outlined the reasons for the termination. The litigation seeks to overturn this Green Mountain resolution.
Here is the Resolution Terminating the Big Sky IGA:
Green Mountain Adopted Resolution Terminating Big Sky IGA April 9, 2019
June 20, 2019
20. The Rooney Valley developers sue Green Mountain.
21. The Rooney Valley developers’ first theory of their case is that the Resolution terminating the IGA should be overturned by the Court because it was arbitrary and capricious.
It was arbitrary and capricious because the reasons stated in the resolution weren’t the real reasons.
The real reasons were because the directors are anti – development and they listened to residents who are anti – development.
The Big Sky IGA should be restored and damages paid.
The Rooney Valley developers’ second theory of their case is that even if the Resolution is not overturned, terminating the Big Sky IGA breached the contract and Green Mountain owes damages. Big Sky IGA is still terminated but Green Mountain pays the cost of breaking the contract.
[Since the contract was May 8, 2018 and the notice that Green Mountain was evaluating the validity of the IGA was September 4, 2018, the damages are arguably limited to what was spent between May 8 and September 4.]
Here is a sample of one of the complaints:
Green Mountain Lawsuit CDN – Complaint
22. Green Mountain’s position is
1. As to the plaintiffs’ first theory,
The reasons for termination are stated in the Resolution passed by the Board April 9. 2019 terminating the Big Sky IGA. The reasons are not arbitrary or capricious.
The directors are not anti – development. Their reasons for terminating the IGA stated in the Resolution do not include “being anti-development”.
The District listened to everyone, including the Rooney Valley developers, residents and customers. Big Sky participated in an open debate on the issue January 8, 2019.
The District tried to work with Big Sky but Big Sky refused and simply said “do it our way or we will sue”.
2. As to the plaintiffs’ second theory, The Big Sky IGA was invalid to begin with for several reasons, including neither Big Sky or Green Mountain had authority on May 8, 2018, to enter into the Big Sky IGA.
Here is a sample of one of Green Mountain’s Answer:
Green Mountain lawsuit Answer to Big Sky
June 20, 2019 – Current
23. There have been motions and the exchange of discovery. There have been several hearings. Trial is set for August 16, 2021.
24. The Rooney Valley developers and Green Mountain attended a mediation session and are working to see if there is a way to resolve the case without going to trial.
25. The Rooney Valley developers have stated in their pleadings that they would like to restore the Big Sky IGA.
March 30, 2021
26. Director Hanagan decided to hold a public event without the other board members present.
27. She stated she has decided the case should be settled by entering into an IGA with the Rooney Valley developers.
[It appears she would like to generate public support for her position to persuade the other board members to make the same decision]
28. Green Mountain counsel also promoted settling by entering into an IGA with the Rooney Valley developers.
29. Director Hanagan stated in her opinion the other directors are “anti – development”. She explained that the District cannot promote or inhibit development.
[This position seems to overlook the fact that no matter what Green Mountain does, it will either promote or inhibit development of Rooney Valley.
Not providing service inhibits development. The Rooney Valley developers will have to go back to Mt. Carbon or pursue one of about four other alternative ways to get sewer.
Providing service promotes development.
The only real questions are:
1.). are there valid reasons for agreeing to provide service;
2.) are there valid reasons not to provide service and
3.) if the decision is to provide service, what is the right way to accomplish that objective.
Note that the way the Rooney Valley developers have framed the issue, if you oppose what they want to do, you are “anti – development”.
Questioning whether or not Big Sky and Green Mountain had authority to enter into the IGA is “anti-development”.
Questioning capacity is “anti-development”.
Questioning the stability of the soils is “anti-development”.
Questioning whether or not it is in the best interest of the public to have a single person employed by a developer running a new for profit sanitation system for Rooney Valley is “anti-development”.
Insisting on public involvement in the decision making process is “anti-development”.
The simple fact is that the Rooney Valley developers do not have a right to sewer from Green Mountain. They are not in Green Mountain’s district. Green Mountain, with an amendment to their Service Plan, can provide sewer if they want to. But they don’t have to.]
30. Director Hanagan and Green Mountain Counsel acknowledged the other directors were absent and said Director Hanagan held this event without the other directors to obtain public input.
31. Director Hanagan explained there is a fracture in the board over “petty” issues and a “power struggle”.
32. In response to a resident concern about the fact that the Big Sky IGA was voted on by the previous board the same night they were being voted out of office, Director Hanagan and Green Mountain counsel stated that the May 8, 2018, Big Sky IGA was a legal contract. Earlier, Green Mountain counsel also stated that there were reasons why it was not valid.
[The fact that Big Sky had the IGA signed the night of the election for fear that the new board would not sign the IGA is important for at least two reasons. First, it illustrates that until May 8, there was no legal obligation to provide service. If a legal obligation already existed, then why was the May 8 IGA necessary. Second, it appears the “clean hands” doctrine may be a relevant defense to a claim by Big Sky to force specific performance of the IGA. ]
33. Green Mountain counsel stated the district might have to pay damages even if termination of the IGA by the District was upheld. One resident noted that if the Big Sky IGA was invalid to begin with, that there should be no damages.
[It is also important to note that the Big Sky IGA is the first time Green Mountain entered into an agreement to provide sewer service to the Rooney Valley developers. That was May 8, 2018. By September 4, 2018, the District put everyone on notice that the validity of the agreement was under review. There is an argument that even if the agreement was valid, any damages will be limited to expenses incurred between May 8, 2018 and September 4, 2018. Termination would still be valid but the damages would be limited to that period of time.]
34. Members of the public asked questions and shared positions. In response to statements or questions about other alternatives, Director Hanagan and Green Mountain Counsel defended their preference to settle with an IGA and explained why an IGA was the best alternative.
35. Director Hanagan stated she would schedule another public event on her own for April 10.
36. Director Hanagan invited the plaintiffs to speak. Of the 78 folks on the zoom line, presumably a number of them were representatives of the plaintiffs. No one spoke in response.
What’s Next
1. On April 6, 2021, the board will consider sending out a survey with additional information about the issues and settlement options.
2. After the survey results are returned it appears there may be a public hearing to present the results of the survey and have further public discussion about the options.
3. At some point the board will vote on the options and respond to the plaintiffs’ settlement proposal.
4. It is likely there will some negotiation. If there is agreement the case will be resolved without trial. If not, there will be a trial.
Hopefully the board will heal its fracture.
I doubt that Director Hanagan really intended to agree with the plaintiffs’ claim that the IGA was terminated because her co-directors were “anti – development”. I hope that she would not make that false accusation against her co-directors in order to punish them for some slight. Unfortunately, the plaintiffs will likely use that public statement as an admission during the trial.
I also doubt that Director Hanagan intended to support the plaintiffs’ argument that the Big Sky IGA was a valid agreement.
It does not appear that the rest of the board has committed to a particular settlement option before hearing from the public.
It appears that the rest of the board is committed to including the public in considering all the alternatives, not just an IGA. It appears that a majority of the board wants to hear from the public before making a decision.
IGA may be the right decision. But it appears that the rest of the board is still learning the details about the options and considering the choices.
The District only speaks through a majority of the elected board. And it is counsel’s job to represent the majority decisions of the board, not the interests of one board member against others.
The best course is to provide all the information available, listen to the client, help the client analyze all the pros and cons of all the options and once the client makes a decision, then work as hard as possible to follow, enforce and defend the majority’s decision.
More to come.
Here are references to prior postings with additional information since August, 2018:
http://solterracommunity.org/index.php/2019/01/19/land-of-oz-a-trip-to-see-the-wizard-big-sky-metro-special-meeting-on-rooney-valley-sewer-iga/
http://solterracommunity.org/index.php/2019/02/17/dinosaur-ridge-big-sky-sanitation-grab-c-470-loan-repayment-updates-plus-mayor-paul-attacks-the-new-members-of-the-green-mountain-board/
http://solterracommunity.org/index.php/2019/02/23/big-sky-dinorsoar-ridge-update-doozy-of-a-green-mountain-meeting-thursday-night/
http://solterracommunity.org/index.php/2019/02/23/ka-ching-why-the-two-green-mountain-water-and-sanitation-district-board-members-really-like-the-big-sky-iga/
http://solterracommunity.org/index.php/2019/03/09/ward-4-meeting-dino-ridge-taxpayer-loand-and-big-sky-iga/
http://solterracommunity.org/index.php/2019/04/14/ward-4-meeting-mayor-adam-paul-responds-to-the-emails-disclosing-collaboration-between-him-city-attorney-cox-and-the-big-sky-attorneys/
http://solterracommunity.org/index.php/2019/04/25/big-sky-green-tree-special-district-abuse-notices-to-bypass-public-hearings-and-change-their-territory-and-purpose-by-default/
http://solterracommunity.org/index.php/2019/05/11/solterra-residents-now-paying-attorney-to-force-green-mountain-water-and-sanitation-district-to-un-terminate-the-election-night-iga-establishing-big-sky-as-the-new-sanitation-district-for-rooney-valle/
http://solterracommunity.org/index.php/2019/05/18/solterra-board-representing-big-sky-brookfield-and-not-the-residents-attacks-green-mountain-water-and-sanitation-board-demands-reinstatement-of-the-big-sky-iga/
http://solterracommunity.org/index.php/2019/06/09/special-district-relationship-green-mountain-water-and-sanitation-district-and-solterra/
Follow the Money – Financial Agreements Adam Paul Will Enforce
Green Mountain Water and Sanitation District Election – Candidate Biographies- Excellent Choices
Big Sky Sues Green Mountain Water and Sanitation to Force the IGA
Report on Court Hearing – Big Sky Case Management Conference August 28, 2019
Big Sky Litigation – Hearing Tuesday 10:00 AM Jefferson County Courthouse
Big Sky Hearing Rescheduled To December 9, 2019 at 3:00 pm and Recent Briefs
Big Sky, Cardel, Three Dinos v. Green Mountain Water and Sanitation District – Latest Update
Big Sky Litigation Update (Cardel, CDN, Three Dinos v. Green Mountain Water and Sanitation District)
John Henderson
(Disclaimer – This blog is solely my work and does not attempt to represent the position of the Green Mountain Water and Sanitation District or any individual member of the District. The Board was not aware of and did not have an opportunity to review this blog. I have been asked on occasion to provide advice and counsel to the board on a pro/bono basis but this blog, again, is independent of any consulting role I may have provided in the past. All of the information contained in the blog is based upon public information or analysis independent of any consulting role I may have provided to the Board in the past. No information was obtained from the board or obtained in the context of providing service to the board.)