For the first time since 1976, there will be a public hearing on how to provide water and sanitation services to Rooney Valley.
The issue, unfortunately completely clouded by an almost administrative resolution, is simple:
Will the sanitation services be provided by:
- developers for profit and accountable only to the developers, or
- public utility accountable to the public
That is essentially what will be voted on Monday, July 11, 2022, by the Lakewood City Council led by Adam Paul. Since at least 2007, then Adam Paul as the VP of Green Mountain Water and Sanitation District, and now as mayor, has long championed the first choice. Developer run – and profiting by – sanitation service to Rooney Valley.
With no public hearings.
Notably, the newly elected (in 2018) board of Green Mountain taught Paul and his developer supporters that you have to have a public hearing. The developer’s May 8, 2018 election night Big Sky IGA “cram down” without a public hearing was found to be illegal.
Now, for the first time since 1976, there will be a public hearing.
The issue, again, is whether or not providing sewer should be
- a profit making developer controlled enterprise or
- a non-profit making publicly controlled utility service.
Here’s why it matters.
Cost
Quality
COST. You know where the money comes from to pay for the service. Bond debt and fees paid by future residents.
And you know the math. If it pays developer profits its going to cost more.
QUALITY. What’s in the best interests of the public has no real value and is not seriously considered in a profit driven enterprise.
Once the developers cash out, they’re gone and never accountable to the public. They are in it only as long as it takes to make their maximum profits. Then they leave it all to the future residents to deal with.
Consider your own developments. All too often the developer only does what he needs to do to make it pretty and sell the homes. If it doesn’t work or needs constant repairs after he leaves – not his problem.
Is that the “business model” you want to apply to building and running a sanitation utility district.
The detailed history below, with links to the original documents and minutes of meetings, tells a story of
- bullying (there is no other word for it)
- by well financed developers (with your metro district tax dollars)
- to dominate either through strong arm political tactics, or
- enticements of sharing in the profits, or ultimately
- litigation
It tells a story of trying to force developer controlled sanitation service without public hearings, buying Mt. Carbon Sanitation District, trying to force Green Mountain to violate its Service Plan by providing service outside its district boundaries and now entering into an agreement to have the Town of Morrison provide sanitation through Mt. Carbon or another developer controlled district.
Here is the essence of the IGA on the table for Monday:
“D. Service Through or With a District
All properties [in all of Rooney Valley – see map] served by the Town [Morrison] may, at the Town’s election, be served directly by the Town, or with, through, or in coordination with the Mount Carbon Metropolitan District or any other special district organized for the purpose of providing water or sewer services.”
Proposed 2022 IGA Lakewood and Morrison.
Here is the full proposed IGA between Lakewood and Morrison:
Here is the map:
Lakewood City Council Public Hearing on Rooney Valley IGA is Monday, July 11, 2022 at 7:00 pm.
https://lakewoodspeaks.org/items/2151
But first, what does this mean for the Big Sky litigation.
Green Mountain won in the trial court. Big Sky and Cardel have appealed.
Big Sky/CDN and the developers have consistently argued (and falsely claimed to the District Court and now the Appellate Court) that they could not develop without sewer from Green Mountain. That was never true, because Big Sky and the developers left Mt. Carbon – their sewer district – and could always go back or make other arrangements.
This proposed IGA says both. Mt. Carbon is proposed to, again, provide sewer to all of Rooney Valley (as it was back in 1976 and again in 2004). Or service can be provided directly from the Town of Morrison or the Town of Morrison through Mt. Carbon or another district.
If this new IGA is approved, it could result in dismissal of the appeal and an end to the litigation. They can get sewer through the Town of Morrison directly, or working through Mt. Carbon or working through another district.
CURRENT STATUS 2022 Mt. Carbon, Big Sky, RRC (Red Rocks Centre)
Town of Morrison is publicly controlled and accountable to the public.
All the metro development districts, including the two leading districts Big Sky (CDN) and RRC (Red Rocks Centre – Lennar – Ventana Capital -Theraldson) are run by the developers.
Big Sky ( No.s 2 – 7 legally inactive; No. 1 factually inactive) has only two directors (must have at least 5) with Tom Morton (referenced below) as the lead director employed by CDN.
Here are the Red Rocks Centre (residential section and currently building homes) RRC directors (RRC No. 1 and 2 – see map)
John Cheney VP Lennar
Jonathan Beckwitt Lennar
Jennifer (Walton) Thornbloom Lennar (professional board member serving on multiple metro district boards for Lennar)
Debra Hessler Lennar (professional board member serving on multiple metro district boards for Lennar)
Here are the Red Rocks Centre (commercial section) RRC directors (RRC No. 3 – see map)
Andrew Trietley (Ventana Capital)
Tom Clark (Ventana Capital)
Bryan Horan (Ventana Capital)
Note, Lennar owns the residential development districts RRC No. 1 and 2, previously owned and now financed by Tharaldson and developed by Ventana. Tharaldson and Ventana apparently still own RRC No. 3 the commercial district.
See 2021 45 million bond prospectus:
Here are the directors of Mt. Carbon – all private developers and all on the boards for RRC:
Jonathan Beckwitt (RRC 1 and 2; Lennar)
John Cheney (RRC 1 and 2; Lennar)
Tom Clark (RRC 3; Ventana)
Bryan Horan (RRC 3; Ventana)
Andrew Trietley (RRC 3; Ventana)
Tharaldson / Lennar owns Mt. Carbon:
From the most recent audit:
“Note 7: Economic Dependency
The District [Mt. Carbon] has not yet established a revenue base sufficient to pay the District’s capital improvement requirements and operational expenditures. Until an independent revenue base is established, continuation of operations in the District and the payment of capital improvement obligations will be dependent upon funding by the developer and or additional revenues from current taxpayers.
“Note 4 Long Term Debt . . . Reimbursement Agreements
. . . The District has also entered into a Tap Purchase Agreement with Tharaldson Ethanol Plant II wherein the District has sold the rights to acquire water and sewer taps to the company. . . .
. . . On May 1, 2012, the District entered into a Reimbursement Agreement with Company, whereby Company agreed to advance funds to the District based upon a schedule of anticipated funding needs through December 31, 2013 for the costs associated with the Morrison Wastewater Reclamation Facility [and in separate paragraphs the developer agreed to and has advanced funds for building, maintaining and operating Mt. Carbon] . . .
. . . The Reimbursement Agreements described in this Note 4 have been renewed to provide for the reimbursement of additional developer advances after May 1, 2012 and December 31, 2013 respectively. . . ”
[End quoted material]
As you can see from the budget excerpts of the audit below, Mt. Carbon already owes the developer $21 million in just interest on the advances and it continues to grow daily. Mt. Carbon has also exhausted its debt authority by issuing over $17 million in its own bonds. Of course it has no money to pay the interest and principal on those bonds so the developer is also paying those costs. And those costs of course also become additional developer advances which will be paid back by future residents – with yet additional interest. Interest on interest on interest.
The 2017 audit is the most recent and the district created budgets (unfortunately) do not disclose the debts to Tharaldson/Lennar.
Currently, providing service through
- Big Sky, as proposed
-
- under the Big Sky IGA, challenged by the new (2018) Green Mountain board and held illegal by the District Court (now on appeal) and
-
- as now possible through the 2022 proposed Lakewood – Morrison IGA or
- Mount Carbon, as proposed by the 2022 Lakewood – Morrison IGA
both lead to private developer control and operation of the sanitation services for Rooney Valley.
And here are the costs, so far:
- RRC bond 2021 $45,000,000.
- 58 mills
- Mt. Carbon debt $39,000,000 including over $21 million in just interest to pay developer debt
- 28 mills (maximum 50 mills)
- Mt. Carbon Bankruptcy debt pay off 20 mills
Total current resident debt and (taxes) mills just for developer debt to future residents of RRC (and profit)
- $84,ooo,ooo
- 106 mills
With much more debt to come in order to build out and pay developer profits.
Here is the current map of Mt. Carbon (after Solterra (Fossil Ridge District), Bandimere and Big Sky/CDN left Mt. Carbon district) showing completed lines and former but now abandoned lines. Undeveloped Big Sky and Bandimere can be served either through this proposed IGA or by returning to Mt. Carbon.
HISTORY: Description of significant events and links to significant documents:
1951
A group of citizens petitioned the court to create a water and sanitation district which, after a merger, becomes the Green Mountain Water and Sanitation District.
- The service plan approved by the Court defined the boundary and the purpose:
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- ” 2. The present purpose of the District is to provide a complete waterworks distribution system for the district and the inhabitants thereof.“
- The Green Mountain Service Plan has never been amended to allow the district to provide waterworks outside the district boundary.
- The Green Mountain Service Plan has never been amended to provide waterworks for anyone other than inhabitants of the district.
- The process to amend a Service Plan includes public hearings.
November 16, 1976
A separate district, The Mount Carbon Water and Sanitation District was created to provide water and sanitation service to Rooney Valley. (2004 Bond page 22).
Mt. Carbon boundary (Exhibit B to Bond)
- The 2002 Rooney Valley “Joint Master Plan” relied upon Mt. Carbon to provide water and sanitation services to Rooney Valley. (Plan p. 20-21).
- Following bankruptcy proceedings that began in 1997 a final order and reorganization plan was approved in 2003, re-establishing the Mount Carbon Water and Sanitation District as the sanitation district for Rooney Valley. (Bond p. 25).
- Lakewood, Morrison and Jefferson County entered into a new IGA with Mt. Carbon on November 4, 2003, establishing Mt. Carbon’s purpose to provide water and sanitation services to residents in Rooney Valley. (Bond p. 22)
2007
Solterra – the very first residential development in Rooney Valley and the first residential district to ask Green Mountain for extraterritorial sewer service.
(screen shots of documents are Green Mountain Board minutes)
- The developer was Carma – later bought by Brookfield.
- The lead developer was Tom Morton.
- Tom Morton presided over Solterra during the years he cancelled public elections for the board of directors and issued bond debt without resident approval.
- Tom Morton is the now the lead developer for Big Sky.
- Solterra took itself out of the Mt. Carbon Sanitation District and then asked the Green Mountain District to provide sanitation service instead.
- Solterra residents must still pay the Mt. Carbon 20 mill tax rate. (See Mt. Carbon 1976 Court docket)
- February 13, 2007 Charles Norton’s law firm is retained to provide advice to the board on extraterritorial service to Solterra. (Board minutes 2-13-2007)
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- Adam Paul is VP of Green Mountain and Charles Norton is his college teacher and mentor.
- The firm continues as general counsel 11 years until September, 2018.
- Charles Norton splits from the firm and later represents Big Sky
- Mr. Norton and his ex-partners work out the May 8, 2018 election night Big Sky IGA on behalf of Big Sky and Green Mountain.
- July 10, 2007 the Green Mountain manager, staff, Norton’s firm and Terry Kenyon negotiate a proposed agreement to provide extraterritorial service for Solterra – first extraterritorial service to a residential development outside the district boundary.
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- No public hearing.
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- No discussion about the Service Plan limits on the boundary and purpose “to provide a complete waterworks distribution system for the district and the inhabitants thereof.”
-
- No amendment of the Service Plan to provide service to non-inhabitants outside the district.
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- The Board decides inclusion is better than an IGA – making the Solterra residents part of the district.
- August 28, 2007. After an executive session with Mr. Morton’s firm, and without a public hearing, the board abandoned their initial decision for inclusion and entered into an IGA with Solterra which expires in 2023.
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- Solterra residents have no vote and pay a 25% higher fee for less service.
- Green Mountain provides provisional water and sewage services to Solterra so they can begin construction and host the “Parade of Homes” marketing and sales event.
- Jay Hutchinson of City of Lakewood talks to Green Mountain about
- its role in promoting the development of Rooney Valley and
- Rooney Valley developer plans to include Green Mountain in the development of Rooney Valley.
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- Adam Paul is now on the Lakewood City Council
- November 2007 Discussions are initiated with potential new Rooney Valley residential developments to follow in Solterra’s footsteps – Green Tree and others.
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- No public hearings
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- No amendment to the Green Mountain Service Plan
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- No discussion regarding limits on service and purpose “to provide waterworks to the district and inhabitants thereof.”
- November, 2007 Lew Short, former board member and now consultant to water and sanitation companies explains his philosophy about extraterritorial service to newly elected board members:
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- “Green Mountain does not solicit additional customers, but will consider additional service areas when no other cost effective options are available for future development”
(Interpretation – its up to the developer to decide. If he believes its cheaper for him to build a future development in Rooney Valley using Green Mountain than Mt. Carbon, then its ok to provide extraterritorial service.)
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- No discussion of limits to Service Plan boundary and service to “provide waterworks to the district and the inhabitants thereof”.
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- No discussion about amending Service Plan
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- No discussion about public hearings
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- No discussion that any policy is subject to change by future boards
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- No discussion about who came up with this approach, that it violates the service plan, when this approach was discussed by the board and whether the public was involved in coming up with this policy.
2008 – 2018
- Tom Morton, having moved from lead developer for Solterra to lead developer for Big Sky and Rooney Valley
- continues to assume Green Mountain will provide extraterritorial service
- under his direction:
- Big Sky makes a presentation to provide sewage through Green Mountain to all of Rooney Valley
- Mr. Morton asks the District to prepare cost estimates for improvements to the Districts system to accommodate new development in Rooney Valley
- Mr. Morton explains there are at least three developments that want sewage through Green Mountain (instead of Mt. Carbon) and run by Big Sky – Green Tree (Dinosaur Ridge development area), CDN (Big Sky) and Lightner property (Cardell Homes).
- Each development has left or will leave the Mt. Carbon Sanitation district they are already part of in order to be able to ask Green Mountain to provide sewer. (See Mt. Carbon 1976 Court docket for motions to exclude)
- One of Big Sky’s attorneys explains in October, 2018 that
-
- setting up Big Sky as a new sanitation district
- for all of Rooney Valley
- without a public hearing
- using Green Mountain’s resources
- is good “public policy”
- because its cheaper for the developers
” [Big Sky] will essentially act as a master meter for the properties” . . . “without such service [Big Sky Sewer System in the IGA] development of the Project could not take place.” . . . [except “such service” is in fact available from Mt. Carbon and there are other alternatives]
“[e]nabling development within the Rooney Valley has the potential to increase property values of the future residents of the Districts“. . . . [particularly the value of the land for the developers ]
“The [Big Sky] IGA provides a streamlined approach to sewer service in the Rooney Valley which has the added benefit of avoiding duplication of facilities and services, and makes sewer facility construction and transmission of wastewater to Green Mountain the most efficient and economical solution, which is all intended to benefit the Districts, the properties service and Green Mountain. ”
Here is the complete memo from Big Sky’s attorney
Here is a response
Green Mountain Big Sky Lakewood Memo 1-21-19 2
- Mr. Morton complains to the Green Mountain board that Solterra (which he formally ran) is taking too long in working up their part of the sewer line sharing agreement.
- Mr. Morton directs Green Mountain’s attorney to draft an extraterritorial agreement between Big Sky and Green Mountain
- Mr. Morton (lead developer for Big Sky) requests a will serve letter from Green Mountain for the Bandimere property.
- Appears that Mr. Morton (Big Sky) assumes that Green Mountain is working for them to develop Rooney Valley by providing sewer to all the new developments in Rooney Valley through Big Sky
May 8, 2018 –
- The Big Sky IGA is presented to the board for the first time and
- voted on election night with
- virtually no discussion
- as the old board majority is being voted out of office.
- This is the second decision to provide extraterritorial service to a development in Rooney Valley that took itself out of the Mt. Carbon district, still has to pay the Mt. Carbon tax and knocks on Green Mountain’s door to provide sanitation service instead of Mt. Carbon. (Solterra was the first)
- Norton’s prior firm retained in 2007 is still counsel to the board. Norton is now representing Big Sky and his prior firm is representing Green Mountain.
- The IGA establishes Big Sky as the new sanitation district for all of Rooney Valley using Green Mountain’s resources.
- No public hearings
- No approval from the City of Lakewood to amend the Big Sky Service Plan
- No proposal to amend Green Mountain’s Service Plan
- There are numerous defects in the agreement and process
- Green Mountain incurs financial and managerial obligations short term and long term
- Former Board counsel and former manager actively obstruct the new board’s efforts to obtain information about the Big Sky IGA
- September, 2018 the new (current) Board issues a resolution announcing that it is evaluating the IGA and may cancel the agreement
Green Mountain Declaration 9-4-2018
- November, 2018 the new (current) Board issues a notice of preliminary defects associated with the Big Sky IGA
Green Mountain Declaration November 2, 2018
- December 2018 Big Sky repeatedly threatens to sue the new Green Mountain Board in response to the new board’s efforts to address the problems with the Big Sky IGA.
- January, 2019 there is a public hearing and debate about terminating the Big Sky IGA
- April 9, 2019 the new (current) Board passes a detailed resolution terminating the Big Sky IGA with a list of reasons for saying “no” to this second attempt at extraterritorial service for Rooney Valley.
Green Mountain Adopted Resolution Terminating Big Sky IGA April 9, 2019
- June, 2019 Big Sky sues the new Green Mountain board followed by four additional lawsuits by Rooney Valley developers – CDN (Big Sky’s developer), Green Tree, Stream Realty (Green Tree’s developer) and Cardell Homes.
Green Mountain Lawsuit CDN – Complaint
- August 19, 2021 the District Court dismisses all the cases essentially holding that the Big Sky IGA was illegal and void.
Order_ Cross Motion for Summary Judgment
Order_ Responses to Order of May 6 2021
Order_ Motion for Leave to File Amended Answers
An appeal by the developers is pending.
Conclusion:
The only way to ensure public accountability is to provide sanitation service through the Town of Morrison directly or by including all of Rooney Valley into a currently publicly controlled and accountable (not owned by the developers) sanitation district. Allowing the Town of Morrison to provide the service through Mt. Carbon or another district will not serve the public interest.
It also appears there may be a contest between Big Sky/CDN and Lennar/Tharaldson/Ventana over who controls sewer in Rooney Valley. Unlikely that either wants to be beholden to the other. That contest will not benefit current or future residents.
All the more reason to have a truly public institution accountable to the public in charge of sewer. Not “short vision” profit driven (as opposed to public interest driven) private developers not accountable to the public.
The public hearing on providing sanitation service to Rooney Valley is Monday, July 11, 2022 at 7:00 pm.
https://lakewoodspeaks.org/items/2151
John Henderson