Here is yet another example of why private developer control over essential public services like water and sewer is a really bad idea.
1. The special district supplying water and sewer to the proposed development (Red Rocks Centre aka RRC) in Rooney Valley immediately south of Solterra . . . is Mt. Carbon Water and Sanitation District . . . rising like the phoenix out of the depths of the Mt. Carbon bankruptcy.
The members of the board of directors of Mt. Carbon, elected by two voters:
Thomas Clark, Bryan Horan, Dan Boten, John Cheney
2. The second special district covering the same area is RRC Metro District. (RRC = Red Rocks Centre)
The members of the RRC board of directors, elected by three voters:
Thomas Clark, Bryan Horan, Andrew Trietley
3. The principals of Ventana Capital, the private developer of Red Rocks Centre and the applicant for the subdivision approval:
Thomas Clark, Bryan Horan, Dan Boten, Andrew Trietley
https://www.ventanacap.com/#our-team
John Cheney, the only Mt.Carbon director who does not work for the developer is the VP of Land Acquisition for Lennar – a national homebuilder.
See a pattern
4. So, the developer runs Mt. Carbon Water and Sanitation District as well as RRC Metro District.
5. The developer made a presentation to the Jeffco Planning Commission on November 6 and proudly stated that he had a will serve letter from Mt. Carbon promising to provide water and sanitation services to the development.
That was not hard to do. Mr. Clark, Mr. Horan and Mr. Boten – Mt Carbon directors – told – Mr. Clark, Mr. Horan and Mr. Boten – the developer – that yes, after giving it careful consideration and thoughtfully evaluating what was in the best interest of the public . . . they decided to give themselves a will serve letter.
This is what they call a conflict of interest. This is what they call a self-dealing sham relationship. This is what they call a private company owning a government. Literally.
6. It was pointed out to the Planning Commission that based upon the most recent published financial audit report for Mt. Carbon – Mt. Carbon’s total expenditures (2017) were: $305,907.00.
Mt. Carbon’s total income for the same period of time was: $18,996.
Mt. Carbon, who declared bankruptcy (residents are currently paying 20 mills every year to pay off Mt. Carbon’s debt) and now run by another bunch of developers, is . . . in debt again. Up to their eyeballs. The deficit for just one year (2017) was: $286,911.00.
And the developer directors running Mt. Carbon are going to stick the residents with yet more Mt. Carbon debt.
Who is carrying Mt. Carbon. Who owns Mt. Carbon. Answer: the developer. A developer advance of $291,234.00 in 2017 balanced the books. For 2017.
For now.
Until the developer stops carrying Mt. Carbon.
Until the developer cashes out.
And guess how the developer is going to get paid back.
Here is the audit report that provides the details:
https://dola.colorado.gov/dlg_portal/filings.jsf?jfwid=iktKgly8-mrIodJTLI3o2bVsGS2PsP6fgKR0LG8U:0
In 2013 Mt. Carbon built a new sewage treatment facility to provide sewer service to the new development. Who paid for the cost of construction. The developer.
It costs at least $165,000 per year for Mt. Carbon to run the sewage treatment facility. Who pays for it. The developer.
And, how will the developer be paid back these advances for building the new sewage treatment plant, running the plant and keeping Mt. Carbon afloat every year . . . since Mt. Carbon is broke.
Easy. Especially when the people making the decision for Mt. Carbon, RRC Metro District and the developer Ventana Capital are all the same people. Real easy.
They decided to pay themselves back, with interest of course, by issuing bond debt which the new residents will have to pay. With no disclosures to the new residents when they buy their homes. With no opportunity to vote on all this debt. With no opportunity to hold the developer accountable for how the money was spent.
And keep in mind, these new residents will be saddled with twice the debt – not just one but two – special districts. Both with maximum limits of 50 mills plus 20 mills for the Mt. Carbon bankruptcy. They will have 120 mills in debt limit before they even get started mowing their lawns.
To pay for the new sewage treatment plan, to pay for the loans from the developer to RRC and Mt Carbon, to pay for the operation of the new sewage treatment plant and of course to pay interest on all those loans.
There is a reason why the special district statutes prohibit two special districts for the same group of residents. Twice the debt. And a significant risk of bankruptcy for that community since over 100% of the value of their homes will be the collateral for the bond debt. Upside down.
But of course, under the statutes, if the residents agree to take on two districts, that is ok. And in this case, the directors of RRC and Mt. Carbon and employees of the developer are all the same people so they agreed with themselves that this was a really good idea.
See a pattern.
Now, back to the Planning Commission.
They are responsible for protecting the health and safety of the residents in deciding whether or not to approve a subdivision. Two of the critical elements are water and sewer.
Does the developer have a reliable source of water and sanitation for the future residents of the development. They get this assurance in the form of a “will serve letter” from the public entity that will provide these essential public services.
The integrity of the organization is very important. The financial stability of the organization is very important.
https://www.jeffco.us/DocumentCenter/View/2513/Section-22-Wastewater-PDF
In the three minutes available to speak to the commission, a resident provided the financial information demonstrating, according to Mt. Carbon’s own financial audit, that they were not financially stable and that they were owned by the developer.
See starting at 27:00 on the meeting videotape: jeffersonco
Andrew Trietley, the principal of Ventana and director of the RRC Metro District responded at 42:20 on the same videotape: jeffersonco
Mr. Trietley stated:
1. Mt. Carbon was financially stable – he attends all their meetings (along with his Ventana co-workers on the board). Mt. Carbon paid $4 million to build the sewage treatment plant. Mt. Carbon has $90,000 as of a week before the hearing.
The resident quoting from the Mt. Carbon financial audit rose after Mr. Trietley’s remarks to correct Mr. Trietley’s information based upon the actual financial documents. But the Planning Commission refused to take that additional information. See 1:32:16 on the videotape. jeffersonco
Contrary to Mr. Trietley’s representation, the financial audit states that the developer, not Mt. Carbon, paid for the construction of the sewage treatment plant. The budget shows that the developer also pays to operate the plant.
There can be no doubt that the $90,000.00 Mr. Trietley referred to came from him – the developer – Ventana Capital. And he knew that when he provided his responsive testimony under oath.
2. Mr. Trietley went on to say that Mt. Carbon has not sold a single water or sewage tap – which is a potential source of revenue.
Yet, according to the financial audit, in fact Mt. Carbon has sold water and sewage taps. Mt. Carbon actually didn’t just sell one tap. According to the financial audit, Mt. Carbon sold all its water and sewage taps – sold them all – to Ventana Capital, the developer. Apparently to help pay for the many developer advances.
Ventana literally bought Mt. Carbon Water and Sanitation District. Mr. Trietley knew this when he provided his responsive testimony under oath.
3. Finally, Mr. Trietley laughed off the idea that a principal from Ventana Capital was on the board of directors for Mt. Carbon stating that he, for example, Mr. Trietley, was not on the board.
He is correct, there isn’t just one principal from Ventana running Mt. Carbon. There are three. And while he is not a director of Mt. Carbon, he is a director of the RRC Metro District.
Conflict of interest. Self dealing. And a less than candid disclosure by the person making an application for a subdivision approval before a public body . . . under and oath to tell the truth.
It is clear that there are significant questions about the integrity and financial stability of Mt. Carbon as well as the obvious conflicts of interest between Ventana Capital, Mt. Carbon and RRC Metro District.
At the very least, the Commissioners need to fully understand whether or not there is in fact a reliable, financially sound and capable public utility to provide water and sewer service to this development before approving the subdivision application. The public health and safety of the residents in this and adjoining communities will be impacted by the Jeffco Commissioners’ decision.
Right now there are significant questions and not enough information from an independent source to support the applicant’s self-serving and conflict-ridden statements.
The application will now be heard by the Jeffco Board of Commissioners at 8:00 am on Tuesday morning 11-19 at the Jefferson County Courthouse building.
You have an opportunity to be heard. Let the Commissioners know whether or not you care about the public health and safety of our community.
John Henderson
John, I have pasted below an article about a Golden resident who has been supporting statewide growth limits. Think he may be very interested in your RVN articles. He is currently reviving his quest to get a 1% growth limit initiative on the ballot next year for voters to weigh in. I could not find contact info for him on line, but he is probably well known in Golden. Seem this common issue might be served by a merger of information from both of you.
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DENVER — One day after voters in Lakewood decided to slow down residential growth and cap it at 1% per year, a ballot language hearing on Wednesday discussed the possibility of asking voters in 11 counties across Colorado whether they want to do the same thing.
Initiative 109 was created by Daniel Hayes, the Golden resident who proposed a similar growth cap in Golden back in the 1990’s.
“Denver traffic is starting to look like L.A. It’s not quite there yet but it’s getting there,” Hayes said.
This proposal would limit growth in Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, Elbert, El Paso, Jefferson, Larimer and Weld counties for two years. After that, individual counties could choose to amend or repeal the initiative.
“It’s kind of a pause or a break to let people see what they think,” Hayes said.
This is not the first time Hayes has tried to get the idea on the ballot; he tried to get the idea on the statewide ballot last November. However, the idea faced a legal battle that made it all the way up to the Colorado Supreme Court.
Hayes and then-Initiative 66 supporters won the right to add the question to the ballot from the state’s highest court. However, by the time the legal battle was over, Hayes said he didn’t have enough time to gather the necessary signatures to add it to the November ballot, so the initiative was withdrawn.