| LovelandPolitics.com |
Loveland Oct. 3, 2007
The Loveland City Council narrowly approved an additional 50 mills property tax for 451 new
homes to be built on the far west end of 22nd Street in Loveland west of Hunter’s Run.
Metro Districts are special taxing authorities that can be created by the City Council. They may be
used by a developer to pay for infrastructure or other amenities by creating public debt in the form
of bonds to be repaid by the future home owners through their property taxes normally over 20-30
years.
The proposal to subsidize the new development named Cascade Ridge, at first, appeared to be
headed for defeat when a majority of the Council announced they would not support the new
development as proposed with public debt due to philosophical beliefs or other financial concerns.
Councilman Daryl Klassen expressed his doubt about the "absorption rate" in the financial plan
which projects selling all 451 new homes in Loveland while Jan Brown added, "things are getting
too tight and the market [new homes] is just saturated." Dave Clark and Gene Pielin expressed
concerns about the fairness of saddling new homebuyers with extra taxes to pay for infrastructure
the developer normally pays. Finally, Walt Skowron announced his opposition due to the fact local
Metro Districts "usurps the authority of local governments."
The tide turned, however, when Mayor Larry Walsh, who supported the new Metro District all
along, reminded his colleagues that they just approved a similar all residential Metro District tax for
McWhinney's Lakes at Centerra Project last August. Click here to see a video clip of his
comments. As LovelandPolitics.com reported in the past, another home builder, KB Homes, was
turned away with a similar proposal before the Council approved McWhinney's Lakes at Centerra
Metro District in August.
"This isn't any different than what you were dealing with in the past and quite frankly what you
approved in the past [for McWhinney]." The Mayor followed these comments by saying in a lower
voice, "Chad [McWhinney] shared with you the reason these are needed." see video
clip
Christopher Fellows, the developer, spoke at length to the City Council regarding Metro Districts in
general and provided details of the financial plan for Cascade Ridge in an effort to relieve concerns
that the project carries too much risk in this poor housing market. Fellows stated he and his
partners would invest $25 to $30 million in the project before the $8 million in debt would be taken
out by the Metro District.
Fellows also told the council several times that he had personally invested thousands of hours
helping people who lost their life savings through the failure of these types of bonds. Therefore, he
argued, his project was conservative since the assumptions made for paying back the bonds were
very conservative.
Fellows argued that residential properties in the front range are expected to continue increasing in
value of at least 3%. He told the Council the two most important factors in paying back the debt
(bonds) will be the increasing value of residential properties (since the tax collected depends on
assessed values) and the stability of interest rates.
How Cascade Ridge Differs From the Recently Approved McWhinney Project
Cascade Ridge Metro District will include 5 mills of property taxes (on top of the 45 requested)
destined for exclusively for City of Loveland's recreation department and Thompson School District
(approximately $1 million each over 30 years). Fellows explained this was a gesture on his part to
ensure the development "pays its way" by having the future homeowners contribute some portion of
their extra property taxes towards general city services and public schools on top of what they will
already be paying.
The McWhinney Project, Lakes At Centerra, recently approved by council had no such
contributions to general city or school services. Instead, the Metro District will fund only amenities
for the use of the new home buyers. The Lakes at Centerra HOA will determine access to the
amenities being provided through the increased property taxes.
Curiously, one Councilmember asked if the amenities of Cascade Ridge would be available for the
public to use or reserved exclusively for homeowners. Fellows responded in the following way.
He stated there are two advantages of raising the money through a metro district. 1. Property taxes
will be deductible for homeowners while HOA fess are not and 2. All the amenities funded through
the Metro District will be available to the public. Fellows stated, "If a district builds an amenity,
according to our attorneys, they must be available to the public."
This directly contradicts information provided to the council by McWhinney when they approved
Lakes at Centerra Metro District. According to the McWhinney spokesperson, the Lakes at
Centerra home owners association will decide access to the amenities paid through the increased
property taxes.
Councilman Dave Clark attempted to remove the 5 mills for the schools and city by proposing an
amendment to the plan. Councilman Steve Dozier than made the motion but stated it was 5% (he
was corrected) and the vote to amend failed. Glenn Rousey and Dave Clark were the only two to
vote for removing the extra 5 mills.
Ironically, the Metro District passed Council on a 5-4 vote with Walt Skowron, the Council's only
regular opponent of Metro Districts, supporting Cascade Ridge and thus serving as the swing vote
to approve the new Metro District.
After stating he was voting in the affirmative, Skowron was scolded by Rousey who stated, "I am
just surprised Walt voted one way a few weeks ago and now is voting another way." To which the
Mayor replied in jest, "Well, just buckle-up down there."
Skowron and Dozier voted against the Lakes at Centerra Metro District (see story) but the City
Clerk recorded the vote for McWhinney's development as "unanimous" in the minutes of the
meeting which were later approved by the entire city council.
Most cities provide developers guidelines for a minimum standard for residential Metro Districts.
This prevents overly ambitious developers from placing too high a burden on homeowners with
exceptionally high Mill Levies.
The Loveland City Council narrowly approved an additional 50 mills property tax for 451 new
homes to be built on the far west end of 22nd Street in Loveland west of Hunter’s Run.
Metro Districts are special taxing authorities that can be created by the City Council. They may be
used by a developer to pay for infrastructure or other amenities by creating public debt in the form
of bonds to be repaid by the future home owners through their property taxes normally over 20-30
years.
The proposal to subsidize the new development named Cascade Ridge, at first, appeared to be
headed for defeat when a majority of the Council announced they would not support the new
development as proposed with public debt due to philosophical beliefs or other financial concerns.
Councilman Daryl Klassen expressed his doubt about the "absorption rate" in the financial plan
which projects selling all 451 new homes in Loveland while Jan Brown added, "things are getting
too tight and the market [new homes] is just saturated." Dave Clark and Gene Pielin expressed
concerns about the fairness of saddling new homebuyers with extra taxes to pay for infrastructure
the developer normally pays. Finally, Walt Skowron announced his opposition due to the fact local
Metro Districts "usurps the authority of local governments."
The tide turned, however, when Mayor Larry Walsh, who supported the new Metro District all
along, reminded his colleagues that they just approved a similar all residential Metro District tax for
McWhinney's Lakes at Centerra Project last August. Click here to see a video clip of his
comments. As LovelandPolitics.com reported in the past, another home builder, KB Homes, was
turned away with a similar proposal before the Council approved McWhinney's Lakes at Centerra
Metro District in August.
"This isn't any different than what you were dealing with in the past and quite frankly what you
approved in the past [for McWhinney]." The Mayor followed these comments by saying in a lower
voice, "Chad [McWhinney] shared with you the reason these are needed." see video
clip
Christopher Fellows, the developer, spoke at length to the City Council regarding Metro Districts in
general and provided details of the financial plan for Cascade Ridge in an effort to relieve concerns
that the project carries too much risk in this poor housing market. Fellows stated he and his
partners would invest $25 to $30 million in the project before the $8 million in debt would be taken
out by the Metro District.
Fellows also told the council several times that he had personally invested thousands of hours
helping people who lost their life savings through the failure of these types of bonds. Therefore, he
argued, his project was conservative since the assumptions made for paying back the bonds were
very conservative.
Fellows argued that residential properties in the front range are expected to continue increasing in
value of at least 3%. He told the Council the two most important factors in paying back the debt
(bonds) will be the increasing value of residential properties (since the tax collected depends on
assessed values) and the stability of interest rates.
How Cascade Ridge Differs From the Recently Approved McWhinney Project
Cascade Ridge Metro District will include 5 mills of property taxes (on top of the 45 requested)
destined for exclusively for City of Loveland's recreation department and Thompson School District
(approximately $1 million each over 30 years). Fellows explained this was a gesture on his part to
ensure the development "pays its way" by having the future homeowners contribute some portion of
their extra property taxes towards general city services and public schools on top of what they will
already be paying.
The McWhinney Project, Lakes At Centerra, recently approved by council had no such
contributions to general city or school services. Instead, the Metro District will fund only amenities
for the use of the new home buyers. The Lakes at Centerra HOA will determine access to the
amenities being provided through the increased property taxes.
Curiously, one Councilmember asked if the amenities of Cascade Ridge would be available for the
public to use or reserved exclusively for homeowners. Fellows responded in the following way.
He stated there are two advantages of raising the money through a metro district. 1. Property taxes
will be deductible for homeowners while HOA fess are not and 2. All the amenities funded through
the Metro District will be available to the public. Fellows stated, "If a district builds an amenity,
according to our attorneys, they must be available to the public."
This directly contradicts information provided to the council by McWhinney when they approved
Lakes at Centerra Metro District. According to the McWhinney spokesperson, the Lakes at
Centerra home owners association will decide access to the amenities paid through the increased
property taxes.
Councilman Dave Clark attempted to remove the 5 mills for the schools and city by proposing an
amendment to the plan. Councilman Steve Dozier than made the motion but stated it was 5% (he
was corrected) and the vote to amend failed. Glenn Rousey and Dave Clark were the only two to
vote for removing the extra 5 mills.
Ironically, the Metro District passed Council on a 5-4 vote with Walt Skowron, the Council's only
regular opponent of Metro Districts, supporting Cascade Ridge and thus serving as the swing vote
to approve the new Metro District.
After stating he was voting in the affirmative, Skowron was scolded by Rousey who stated, "I am
just surprised Walt voted one way a few weeks ago and now is voting another way." To which the
Mayor replied in jest, "Well, just buckle-up down there."
Skowron and Dozier voted against the Lakes at Centerra Metro District (see story) but the City
Clerk recorded the vote for McWhinney's development as "unanimous" in the minutes of the
meeting which were later approved by the entire city council.
Most cities provide developers guidelines for a minimum standard for residential Metro Districts.
This prevents overly ambitious developers from placing too high a burden on homeowners with
exceptionally high Mill Levies.
| 451 New Homes - New Metro Dictrict Narrowly Passes City Council |
| "As a matter of personal integrity, I will not remove the contribution to the school district" Chris Fellows, Cascade Ridge Developer |
| "Philosophically we disagree on where that money (school funding) should come from." Councilman Glenn Rousey |
| "I have a little bit of a fairness issue since we have just approved one" Councilman Clark |
| All over the map - City Council Supports Metro Tax Concept for McWhinney but divided on other Metro Tax Proposals Below - Support Given To Metro Districts |
