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|Fire Safety Funds Raided To Complete Last Minute Property
Purchase By Lame-Duck Council
Councilman Skowron is personally attacked by Heckel for asking too many questions
Loveland, November 8, 2007
On November 6, 2007 as many in Loveland gathered for the final election returns that already showed at
least two incumbents for city council were going to lose the election, the lame-duck council met to rush
through last minute massive property acquisitions using reserve funds never intended for land
Loveland City Manager Don Williams placed the controversial purchase of 98 acres by the City of
Loveland at 1452 South County Road on the council's consent agenda (a consent agenda is normally
used by cities to pass in groups perfunctory ordinances like an updating of codes where there is unlikely
to be any dissenting views or discussion).
Apparently, concerned about potentially losing the majority he needed on Council to rush through these
massive land acquisitions, Williams negotiated purchase contracts that not coincidentally terminated on
election day if not acted upon thus cementing any speculation that his haste was due to politics. The 98
acres sits at the northwest corner of the I-25 and highway 402 south of Loveland. The city intends on
annexing the property once it is purchased. In addition, the city intends to sub-divide the property and
to allow Don Williams to privately negotiate agreements with various local developers to buy the
annexed, subdivided and possible utility improved properties. Some developers, like Williams' friend
and fellow motorcycle riding companion, Don Marostica, will likely have an advantage if a non-public
process is followed by Williams again in negotiating the subdividing and selling of the property.
The actual decision to purchase the property was made over a phone call weeks prior to the meeting
between a majority of the City Council and Don Williams. Councilman Heckel promised some of his
doubtful colleagues during that call the city can "flip-it" and make a bundle of money. Because secret
meetings to decide how to appropriate funds are illegal in Colorado, Heckel carefully reminded his
colleague Walt Skowron of their previous decision before the vote without being too specific. As
Skowron pushed for details about past discussions Heckel couldn't disclose, Heckel became even more
The purchase price of $4,850,000 will be funded from capital expansion funds and monies collected from
new development to expand emergency services and provide park services for a growing population.
$3,200,000 was raided from funds intended for emergency fire services and $2,000,000 from funds
intended for recreational improvements like new city parks. The scheme is to borrow from the fire and
recreation internal funds and pay it back over ten years (using internal IOU's) thus bringing the real cost
of the property acquisition to city taxpayers to $6,795,486 when interest is included. The "Rob Peter to
Pay Paul" concept is a technique employed by Williams to avoid having to comply with the TABOR
requirement that new indebtedness by the city in these amounts must be approved by voters unless
borrowed from internal reserves.
Councilman Walt Skowron became the skunk at the garden party when he asked to pull the item from
the consent agenda and began asking due diligence questions. Skowron appeared to be poking at the
political motivations by asking questions like, why do we need to rush to buy property that has been on
the market for two years if we are paying the full asking price?
Williams and his supporters on council refused to engage Skowron in any meaningful discussion.
Instead, Councilman Larry Heckel responded with outrages personal attacks upon Skowron by
questioning his integrity and later accusing Skowron of not being smart enough to understand the deal.
In fact, Heckel was angry over Skowron poking at the fact the real decision had already been made in
private contrary to Colorado's Open Meetings Laws.
Skowron tried to emphasize the point that he wasn't questioning the purchase itself but instead the
process by which it was being approved and financed. He commented,
"I think the time lines and the information given to me..ah..was inadequate."
Heckel angrily shot back, "Walt that is a false statement by you!" Heckel claimed Skowron was also
fully briefed (presumably in closed session since the financing was never fully briefed by staff to council
in a public session).
Skowron also commented, "The financing methodology that we are using -- I look at this as an
off-balance sheet debt. Its an off-balance sheet [debt] with 10 years of IOU's and paying interest with
public money is a method of financing that I just don't agree with..so¦I know we did not spend more
than a minute or two about the financing methods to purchase this property."
Williams was either unwilling or unable to respond to Skowron regarding which specific funds were
being raided to pay for the unplanned property purchase and looked to the assistant city manager for
help in answering where the money was coming from to purchase the property.
Councilman Larry Heckel's comments were nasty and appeared more like personal attacks on a Jerry
Springer Show instead of meeting of public officials. This came after Skowron offered to go through the
document "line-by-line" when Heckel questioned the sincerity of his interest in wanting to know more
about the deal. Heckel interrupted, "I don't think it would do any good. I don't think you would
understand it." SEE VIDEOS TO THE RIGHT OF THIS STORY.
In the end, City Manager Don Williams prevailed by pushing through the lame-duck council on a nearly
unanimous vote (Skowron was the only member to vote no) the hasty purchase of 98 acres by the
City of Loveland.
At least two of the three newly elected council members (Cecil Gutierrez and Kent Solt) who promised a
change in priorities away from subsidizing further sprawl along I-25 and back towards downtown will
have a tough time. The payments on the debt will likely tie-up discretionary money from the general
fund and limit their choices. Selling the property after annexation may also be difficult since the city paid
a price for the land the private sector was unwilling to pay for the two years it sat dormant on the
market. The haste to make a decision that night was clearly political and not market driven.
|See video clips below of the Nov. 6, 2007 meeting
where Councilman Heckel attempt to shut-up
Councilman Skowron and City Manager pretends
not to remember he is raiding $3 million of fire safety
funds for property acquisition.