The Colorado Court of Appeals reviewed the District Court’s dismissal of the Big Sky case, said everyone was wrong and the case needs more facts before it can be decided.
Briefly the legal posture. Green Mountain made a motion for summary judgment. Summary judgment says here are the undisputed facts and based on the undisputed facts the case should be dismissed.
If there is disagreement about the facts, then there can’t be summary judgment.
Big Sky also said the facts were undisputed but that they should win.
The Court of Appeals said they were both wrong. The Court of Appeals said the facts were unclear and confusing.
What facts are we talking about. Green Mountain and Big Sky both said the IGA was clear and unambiguous.
The Court of Appeals said, no, the IGA is very ambiguous, not clear at all. And since it’s (my words) a pool of muddy water, the Court needs to figure out the facts, clear it up and then decide the motion again.
What are the muddy facts about. Whether or not the IGA required that Green Mountain spend money. If it did, the IGA violated the legal requirement that Green Mountain appropriate money in the budget to pay the costs and if the costs go for more than a year, get voter approval under TABOR.
The decision (with highlighted portions) is below. Here are several highlights:
- The Court of Appeals called attention to the fact that Green Mountain’s motion for summary judgment arguing that the IGA was void did not use any of the reasons the Board used when it terminated the IGA April 9, 2019.
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- This suggests that a new motion for summary judgment should include the reasons the Board relied upon to terminate the IGA
- For example, that the IGA was void because neither Big Sky or Green Mountain had legal authority under its Service Plan to create the “Big Sky Sanitation System” for all of Rooney Valley. Doing so was a material modification of the Service Plan and required an amendment to the Service Plan (with public hearings)
- Big Sky sugar coated the unilateral change as its “Expanded Service Area”.
- It can’t just decide to expand its service area without permission from the City (and a public hearing).
- The Court of Appeals went on about how incomplete the IGA was. This is part of the story that has yet to be told in Court.
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- That the IGA was a last minute “cram down” by the Big Sky developers the very night of the election where a majority of the board members were being voted out of office.
- That the new Board, led by Jeff Baker, started asking questions about this IGA
- That the former Green Mountain manager and attorney obstructed the new board’s access to information about the IGA and then opposed the new Board’s critical evaluation of the IGA
- That one of the new Board’s concerns was that the IGA was incomplete, there really was no agreement on key terms, and there was no authority to enter into the IGA.
It suggests another argument on a new motion for summary judgment is that the IGA was so full of holes there was no “meeting of the minds” about the terms of the agreement which meant there was no agreement to begin with.
- The Court of Appeals decided that Big Sky’s alternative claim of “promissory estoppel” was no good. This was their claim that even if the IGA is void, they still win because Green Mountain “promised” for years to provide sewer.
- That argument was false for two reasons. First, Green Mountain didn’t make that promise. In every document where Big Sky said so, Green Mountain said they were not making that promise.
- Second, as held by the Court of Appeals, the “will serve” letter was contingent upon an IGA.
- The Court of Appeals did make one mistake. They later said Cardel might have a claim of promissory estoppel because its “will serve” letter was not contingent on an IGA.
- To be clear, the Cardel “will serve” letter was different than the Big Sky “will serve” letter.
- But the Cardel letter actually stated it was contingent on two IGA’s, one with Cardel and one with Big Sky.
- The Court of Appeals noted that Big Sky pulled an argument out of the air (not briefed) at the hearing that TABOR did not apply to Big Sky.
- Which is strange because the statute he cited is a statute and TABOR is the constitution. A statute can’t override the constitution.
- And Big Sky’s Service Plan which sets forth the LIMITS of this metro district government expressly states that it will follow TABOR. (See page 11 paragraph H of Big Sky Service Plan).
- So this is another reason it sent it back to the District Court, to sort out this “Hail Mary” argument by Big Sky
- The Court of Appeals noted that a big issue was HOW Green Mountain would get paid by Big Sky. Big Sky argued at length that it would “pay for everything” according to the Big Sky IGA and that Green Mountain would pay nothing.
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- But the Court of Appeals said they weren’t so sure about that.
- There was a lot of confusion in the IGA about HOW Green Mountain would get paid
- The Court of Appeals held that even if Green Mountain got paid back eventually, since it had to pay something up front, that would violate the law unless there were budget appropriations or a vote of the Green Mountain residents.
Big Sky and Green Mountain talked about various provisions but no one seems to focus on and since they didn’t, neither did the Court of Appeals, this section in 6.1 B of the Big Sky IGA:
“6.1 B Green Mountain shall rebate 50% of SDFs paid by Big Sky on a monthly basis, not later than the 15th of each month for all amounts paid in the previous month, until the earlier of (1) the amount rebated to Big Sky totals the Actual Costs of the GM Improvements paid by Big Sky pursuant to Section 4.1, without interest, as of the date of the rebate, or (2) the expiration of ten (10) years from the date the first SDF is paid by Big Sky to Green Mountain.”
- This is a kick-back of income paid to Green Mountain.
- Where Green Mountain is actually paying Big Sky
- For the costs advanced by Big Sky
- For Green Mountain’s improvements.
So, one undisputed fact is that, in fact, when you follow the money, Big Sky isn’t paying for the GM Improvements. GM is. And over time, up to ten years. This violates the statute and TABOR and reveals a significant misrepresentation by Big Sky.
And newcomers to this issue might ask, who cares. What’s the big deal.
One response is its all about who decides public policy about significant basic utilities like sanitation. And providing service outside the territory limited by the Service Plan.
The developer who seeks to make un-checked profit off of a new sewer system it creates on its own.
Or elected citizens who live in the Green Mountain district and pay taxes and who are accountable to the residents who elected them.
Big Sky is working hard to control public policy. Green Mountain is working hard to represent the residents.
But at the end of the day its up to you, the residents.
Here’s the decision. This is obviously one person’s evaluation. See what you think.
Final decision 2 on Big Sky appeal