| LovelandPolitics.com |
| Council To Vote April 21 to Sack I-25/U.S. 34 Upgrade McWhinney Target - More Public Money, Not Jobs |
Loveland - April 13, 2009 (updated April 14, 2009)
Last February the Denver Post reported on efforts by banks to renegotiate loans with developers behind on their payments to
avoid owning the development. The story reported, "Developer Chad McWhinney is renegotiating the terms of a loan
for construction of one of the two office buildings under construction at his Centerra development in Loveland."
Concerned that the building was only 40% pre-leased, the lender was seeking more equity and assurances that McWhinney
had the resources necessary to finish the project.
Like so many distressed homeowners, McWhinney was seeking to renegotiate the terms of their loan while the project wasn't
turning-out as they had hoped. Unlike so many distressed homeowners, McWhinney operates a taxpayer funded Metro
District where $12 million has been put aside to make required improvements to the I-25 and US 34 interchange per an
agreement with the City of Loveland.
This website broke the story on March 25 that a cash strapped McWhinney organization would attempt a raid on the $12
million dollars set aside by McWhinney's Centerra Metro District to make interim safety improvements to the I-25 and U.S.
34 interchange. McWhinney was required to fund the project as part of its Master Financing Agreement (MFA) signed with
Loveland in 2004. By late March the developer had already met with most of Loveland's City Council in secret and was
confident they could get the votes necessary to amend their agreement with the city thus accessing the $12 million.
McWhinney had the City of Loveland prepare the necessary amendments to their agreement and post the agenda item on its
April 7 agenda. Now their only issue was how to sell the idea to the local media and the public.
The Spin
After considerable internal discussions with friendly members of Loveland's City Council and management, it was decided
that jobs would need to be the theme of their public relations campaign to explain why McWhinney is going to renege on its
now 5 year-old promise to use the public debt they were given to repair the I-25 and U.S. 34 interchange.
In order to draw attention away from the obvious fact that McWhinney's new commercial properties compete with other
local commercial properties, a mystery outside "big employer" is said to be interested in coming to Loveland only if
McWhinney gets the highway improvement money to improve its own properties. McWhinney claimed to be on the verge of
bringing a Fortune 500 agricultural research company to the area but the reality is something different.
Propagating Propaganda
The Loveland Reporter-Herald ran a story propagating the news spin that allowing McWhinney to abandon their obligations
to improve the dangerous I-25/U.S. 34 interchange somehow will translate into more jobs for Loveland. The newspaper's
story appeared the day after the council postponed its decision and was titled "Developer Touts New Jobs" that began,
"Developer Chad McWhinney revealed what he would like to see from the money freed from restriction..." The
article also paraphrased McWhinney's comments to the council as, "it could help land a 'Fortune 500' company that is
looking to move its headquarters to one of two sites, with Loveland being one of those in competition."
What McWhinney failed to disclose is that the competing site is located on the Southeast corner of I-25 and U.S. 34
interchange - just a stone's throw from where McWhinney would like them to locate. In other words, Loveland should
give-up its long awaited improvements to the I-25 and U.S. 34 interchange so that McWhinney can be subsidized to locate
the company on their property versus a competitor who is just around the corner. Because the two properties are on either
side of the boundary between Loveland and Johnstown, McWhinney coins the disingenuous argument that if their
development is not further subsidized the jobs will not come to Loveland.
While technically accurate, the argument is clearly deceptive since both locations are in Larimer County and will provide
identical economic impacts to the region including jobs for qualified Loveland residents. The company is not being lured to
the area by McWhinney as implied but instead has been in discussions with the Northern Colorado Economic Development
Council (NCEDC) regarding various options in Larimer County. In addition, the company already employs a large number
of Larimer County residents who would simply be consolidated into the new location thus many of the jobs are already here.
Who Is McWhinney's "Fortune 500" Mystery Employer?
The mystery employer McWhinney is claiming they can bring to Loveland only after the I-25/U.S. 34 safety improvements
are de funded was described as a "Fortune 500 agricultural research firm." In fact, it is a consolidation of two companies
already located in Greeley and Loveland that is the subsidiary of a much larger Canadian firm.
LovelandPolitics has learned the mystery employer is really UAP (United Agricultural Products) which changed its name to
Crop Production Services (CPS) on January 1, 2009. According to a 2007 article in the Northern Colorado Business
Report "UAP, which has about 250 employees in Greeley and Loveland and about 3,400 worldwide, is the largest
independent distributor of agricultural and non-crop inputs in the United States and Canada."
In May of 2008, Agrium Inc. of Alberta Canada (NYSE stock symbol AGU) acquired 98.5% of UAP's stock that was
previously traded on the NASDAQ. Agrium Inc. also acquired a number of ADM (Archer Daniels Midland Company) sites
throughout the Midwest. This may have led to confusion by some on Loveland City Manager Don William's staff regarding
which company McWhinney was eluding to in their private conversations with city officials.
UAP considered three sites in Northern Colorado in late 2008 while working with the NCEDC but narrowed their search
down the two sites near I-25 just inside and outside Loveland's city boundary last January. UAP's name was changed from
UAP to CPS when the former company merged several smaller entities which were consolidated into CPS. The only
subsidiary CPS didn't rename is Loveland Products Inc. Below is an excerpt from UAP's website information that likely
provides an important clue as to why Loveland is their intended destination already;
"In addition to consolidating under one name, the CPS logo is also changing. In the coming months, our
websites will reflect the one company name, logo and website under Crop Production Services. There will be no
change to the Loveland Products Inc. (LPI) name."
Does McWhinney Really Put Loveland First?
What makes the story so intriguing is that McWhinney has also promoted a similar story involving mystery tenants and
employers to the Broomfield, Colorado City Council. Attracting business that can bring jobs to their 915 acres commercial
development in Broomfield Colorado (located on I-25 next to E470 interchange) called Anthem is apparently a top priority.
McWhinney is developing 17.2 million square feet of new commercial and retail space in Broomfield and is being equally coy
with the local media about jobs they will be bringing to the area. According to a Broomfield Enterprise story that was
published last September, Troy McWhinney (Chad's brother and business partner) is negotiating with an employer to bring
jobs into Broomfield. Troy was quoted as saying, "I really am serious when I say this is the best property in the western U.S.
for what we want to do."
The same publication also reported, "When [Broomfield] Councilman Brian Kenyon asked if McWhinney had tenants lined
up for the site, McWhinney said the company is in confidential negotiations with potential clients. He offered to brief council
on the parties involved, but wants to keep the information out of the media."
Ultimate Leverage
McWhinney has attempted to link the money they want to take from the I-25 and U.S. 34 as being necessary to sign-up a
new tenant who will bring jobs to the city but are unwilling to disclose the details. Loveland's City Council has postponed the
vote for amending the MFA from their April 7 to April 21 meeting.
By keeping all the details secret the McWhinneys can maintain ultimate leverage over the city in negotiations. If they sign the
agreement for a new tenant before April 21 (CPS is scheduled to decide by April 16) then their argument that a Council vote
transferring $12 million in public monies to McWhinney will entice CPS to come to Loveland has no merit.
Councilwoman Carol Johnson lectured Loveland residents at the April 7 council meeting that in an economic crisis jobs take
precedence over transportation projects. What she failed to disclose were her previous attempts to obtain a job with
McWhinney while also serving on the city council. Besides Johnson's obvious pandering to a potential employer, there are a
number of reasons why the jobs vs. transportation safety argument is disingenuous.
1. McWhinney is claiming to have "reimbursable expenses" for the Metro District. This means they want money from the
$12 million set aside put into their own pocket to use as they see fit and not transferred to any "jobs" fund.
2. While the public argument proposes transferring much of the $ 12 million for the I-25 / U.S. 34 interchange towards
developing light industrial areas in Loveland, the proposed amendment does not. The amendment proposed by McWhinney
to be voted on by Loveland's City Council simply removes the requirement in the near-term that McWhinney fund the interim
safety improvements to the interchange. It adds nothing to the agreement.
3. McWhinney has made similar commitments and promises to their Anthem project in Broomfield, Colorado not to mention
their development of the Garden Grove side of Harbour Blvd. in Orange County, California. While the NCEDC works for
one region exclusively, McWhinney's motives and loyalties are spread across the multiple states and regions where they own
commercial properties. Unfortunately, the NCEDC cannot easily prevent McWhinney, an active participant in NCEDC
confidential activities, from steering leads McWhinney obtains through the NCEDC towards their projects in Broomfield,
Colorado or Garden Grove, California.
According to sources inside the NCEDC, CPS will make their decision on where to re-locate by April 16, 2009. Five days
later on April 21, the Loveland City Council is scheduled to vote on de funding the I-25 / U.S. 34 interchange safety
improvements with the excuse McWhinney needs the funds to incentivize the decision by CPS on where to locate.
Last February the Denver Post reported on efforts by banks to renegotiate loans with developers behind on their payments to
avoid owning the development. The story reported, "Developer Chad McWhinney is renegotiating the terms of a loan
for construction of one of the two office buildings under construction at his Centerra development in Loveland."
Concerned that the building was only 40% pre-leased, the lender was seeking more equity and assurances that McWhinney
had the resources necessary to finish the project.
Like so many distressed homeowners, McWhinney was seeking to renegotiate the terms of their loan while the project wasn't
turning-out as they had hoped. Unlike so many distressed homeowners, McWhinney operates a taxpayer funded Metro
District where $12 million has been put aside to make required improvements to the I-25 and US 34 interchange per an
agreement with the City of Loveland.
This website broke the story on March 25 that a cash strapped McWhinney organization would attempt a raid on the $12
million dollars set aside by McWhinney's Centerra Metro District to make interim safety improvements to the I-25 and U.S.
34 interchange. McWhinney was required to fund the project as part of its Master Financing Agreement (MFA) signed with
Loveland in 2004. By late March the developer had already met with most of Loveland's City Council in secret and was
confident they could get the votes necessary to amend their agreement with the city thus accessing the $12 million.
McWhinney had the City of Loveland prepare the necessary amendments to their agreement and post the agenda item on its
April 7 agenda. Now their only issue was how to sell the idea to the local media and the public.
The Spin
After considerable internal discussions with friendly members of Loveland's City Council and management, it was decided
that jobs would need to be the theme of their public relations campaign to explain why McWhinney is going to renege on its
now 5 year-old promise to use the public debt they were given to repair the I-25 and U.S. 34 interchange.
In order to draw attention away from the obvious fact that McWhinney's new commercial properties compete with other
local commercial properties, a mystery outside "big employer" is said to be interested in coming to Loveland only if
McWhinney gets the highway improvement money to improve its own properties. McWhinney claimed to be on the verge of
bringing a Fortune 500 agricultural research company to the area but the reality is something different.
Propagating Propaganda
The Loveland Reporter-Herald ran a story propagating the news spin that allowing McWhinney to abandon their obligations
to improve the dangerous I-25/U.S. 34 interchange somehow will translate into more jobs for Loveland. The newspaper's
story appeared the day after the council postponed its decision and was titled "Developer Touts New Jobs" that began,
"Developer Chad McWhinney revealed what he would like to see from the money freed from restriction..." The
article also paraphrased McWhinney's comments to the council as, "it could help land a 'Fortune 500' company that is
looking to move its headquarters to one of two sites, with Loveland being one of those in competition."
What McWhinney failed to disclose is that the competing site is located on the Southeast corner of I-25 and U.S. 34
interchange - just a stone's throw from where McWhinney would like them to locate. In other words, Loveland should
give-up its long awaited improvements to the I-25 and U.S. 34 interchange so that McWhinney can be subsidized to locate
the company on their property versus a competitor who is just around the corner. Because the two properties are on either
side of the boundary between Loveland and Johnstown, McWhinney coins the disingenuous argument that if their
development is not further subsidized the jobs will not come to Loveland.
While technically accurate, the argument is clearly deceptive since both locations are in Larimer County and will provide
identical economic impacts to the region including jobs for qualified Loveland residents. The company is not being lured to
the area by McWhinney as implied but instead has been in discussions with the Northern Colorado Economic Development
Council (NCEDC) regarding various options in Larimer County. In addition, the company already employs a large number
of Larimer County residents who would simply be consolidated into the new location thus many of the jobs are already here.
Who Is McWhinney's "Fortune 500" Mystery Employer?
The mystery employer McWhinney is claiming they can bring to Loveland only after the I-25/U.S. 34 safety improvements
are de funded was described as a "Fortune 500 agricultural research firm." In fact, it is a consolidation of two companies
already located in Greeley and Loveland that is the subsidiary of a much larger Canadian firm.
LovelandPolitics has learned the mystery employer is really UAP (United Agricultural Products) which changed its name to
Crop Production Services (CPS) on January 1, 2009. According to a 2007 article in the Northern Colorado Business
Report "UAP, which has about 250 employees in Greeley and Loveland and about 3,400 worldwide, is the largest
independent distributor of agricultural and non-crop inputs in the United States and Canada."
In May of 2008, Agrium Inc. of Alberta Canada (NYSE stock symbol AGU) acquired 98.5% of UAP's stock that was
previously traded on the NASDAQ. Agrium Inc. also acquired a number of ADM (Archer Daniels Midland Company) sites
throughout the Midwest. This may have led to confusion by some on Loveland City Manager Don William's staff regarding
which company McWhinney was eluding to in their private conversations with city officials.
UAP considered three sites in Northern Colorado in late 2008 while working with the NCEDC but narrowed their search
down the two sites near I-25 just inside and outside Loveland's city boundary last January. UAP's name was changed from
UAP to CPS when the former company merged several smaller entities which were consolidated into CPS. The only
subsidiary CPS didn't rename is Loveland Products Inc. Below is an excerpt from UAP's website information that likely
provides an important clue as to why Loveland is their intended destination already;
"In addition to consolidating under one name, the CPS logo is also changing. In the coming months, our
websites will reflect the one company name, logo and website under Crop Production Services. There will be no
change to the Loveland Products Inc. (LPI) name."
Does McWhinney Really Put Loveland First?
What makes the story so intriguing is that McWhinney has also promoted a similar story involving mystery tenants and
employers to the Broomfield, Colorado City Council. Attracting business that can bring jobs to their 915 acres commercial
development in Broomfield Colorado (located on I-25 next to E470 interchange) called Anthem is apparently a top priority.
McWhinney is developing 17.2 million square feet of new commercial and retail space in Broomfield and is being equally coy
with the local media about jobs they will be bringing to the area. According to a Broomfield Enterprise story that was
published last September, Troy McWhinney (Chad's brother and business partner) is negotiating with an employer to bring
jobs into Broomfield. Troy was quoted as saying, "I really am serious when I say this is the best property in the western U.S.
for what we want to do."
The same publication also reported, "When [Broomfield] Councilman Brian Kenyon asked if McWhinney had tenants lined
up for the site, McWhinney said the company is in confidential negotiations with potential clients. He offered to brief council
on the parties involved, but wants to keep the information out of the media."
Ultimate Leverage
McWhinney has attempted to link the money they want to take from the I-25 and U.S. 34 as being necessary to sign-up a
new tenant who will bring jobs to the city but are unwilling to disclose the details. Loveland's City Council has postponed the
vote for amending the MFA from their April 7 to April 21 meeting.
By keeping all the details secret the McWhinneys can maintain ultimate leverage over the city in negotiations. If they sign the
agreement for a new tenant before April 21 (CPS is scheduled to decide by April 16) then their argument that a Council vote
transferring $12 million in public monies to McWhinney will entice CPS to come to Loveland has no merit.
Councilwoman Carol Johnson lectured Loveland residents at the April 7 council meeting that in an economic crisis jobs take
precedence over transportation projects. What she failed to disclose were her previous attempts to obtain a job with
McWhinney while also serving on the city council. Besides Johnson's obvious pandering to a potential employer, there are a
number of reasons why the jobs vs. transportation safety argument is disingenuous.
1. McWhinney is claiming to have "reimbursable expenses" for the Metro District. This means they want money from the
$12 million set aside put into their own pocket to use as they see fit and not transferred to any "jobs" fund.
2. While the public argument proposes transferring much of the $ 12 million for the I-25 / U.S. 34 interchange towards
developing light industrial areas in Loveland, the proposed amendment does not. The amendment proposed by McWhinney
to be voted on by Loveland's City Council simply removes the requirement in the near-term that McWhinney fund the interim
safety improvements to the interchange. It adds nothing to the agreement.
3. McWhinney has made similar commitments and promises to their Anthem project in Broomfield, Colorado not to mention
their development of the Garden Grove side of Harbour Blvd. in Orange County, California. While the NCEDC works for
one region exclusively, McWhinney's motives and loyalties are spread across the multiple states and regions where they own
commercial properties. Unfortunately, the NCEDC cannot easily prevent McWhinney, an active participant in NCEDC
confidential activities, from steering leads McWhinney obtains through the NCEDC towards their projects in Broomfield,
Colorado or Garden Grove, California.
According to sources inside the NCEDC, CPS will make their decision on where to re-locate by April 16, 2009. Five days
later on April 21, the Loveland City Council is scheduled to vote on de funding the I-25 / U.S. 34 interchange safety
improvements with the excuse McWhinney needs the funds to incentivize the decision by CPS on where to locate.
| "I really am serious when I say this is the best property in the western U.S. for what we want to do." Troy McWhinney - Sept. 2008 Describing McWhinney's promise to fill over 900 acres they acquired for commercial development in Broomfield's Anthem project. Does this make Centerra's unoccupied retail and industrial spaces second best? Will the money they save by not funding improvements to the I-25/US 34 go towards projects in Broomfield? |
| The "International West" Resort area of Garden Grove California where McWhinney proposes bring new jobs through their developments in exchange for city incentives and financing |
