I assume that most people in Archuleta County have no idea that the Town of Pagosa Springs is planning to involve itself in a multi-million-dollar development project adjacent to, and perhaps in collaboration with, the proposed-but-still-dormant Mountain Crossing subdivision near the intersection of Highways 160 and 84.
I also assume that most people wouldn’t have an opinion, one way or the other, if they did know something about the Town’s plans. Nor would they be likely to have concerns about the project.
That’s one of the curses of working in the news business. You hear about this stuff, and you can’t help but have opinions about it. You can’t help but feel concerned about potential problems… because you’ve watched other boards and councils make similar mistakes, before.
Ten years ago, I escaped from Pagosa Springs, and from the daily editorials I’d been writing for eight years, believing I’d had enough of Pagosa politics. When I arrived, however, in my new home in Salida, Colorado — another smallish tourist-oriented town closer to Denver, Boulder and the Front Range — I found similar controversies unfolding, in terms of (what appeared to me to be) government overreach. In particular, the City had become embroiled in a questionable development project at the east end of town, on what was once the Vandaveer Ranch. A group of government agencies — U.S. Forest Service, Colorado Parks & Wildlife, U.S. Fish & Wildlife — were acting supportive of a new “natural resource center” that could accommodate a joint “one-stop shop” for tourists and recreationalists.
For reasons I cannot recall, the City of Salida decided to get itself into the development business, and build the new facility on the Vandaveer Ranch.
In 2009, the Salida City Council — with the help of Karl Hanlon, a City attorney with a unique sense of legality — created a Council-controlled non-profit corporation called the Natural Resource Center Development Corporation (NRCDC) with one sole purpose: to establish some type of “natural resource center” on City-owned property near the east edge of town, without needing to get voter approval.
The NRCDC was declared to be a “63-20 corporation” which was nominally “independent” of the City — a move that supposedly would expressly allow the “corporation” to sell tax-exempt bonds. For some reason, however, the new corporation never took advantage of their ability to finance debt with tax-exempt bonds. Instead, the “private corporation” obtained conventional loans from local banks, saddling itself with balloon payments and higher interest rates. (But making the local banks happy.)
When the NRCDC experienced problems trying to finance the new office building on the former Vandaveer Ranch, the City Council voted to transfer the entire 191-acre Vandaveer Ranch to the NRCDC. This allowed the NRCDC to use the collateral to negotiate a bank loan — without a vote of the people, something that could not have happened under City ownership. This created a $4.7 million debt, with a $3.5 million balloon due in nine years. Between the City and the NRCDC, close to $7 million had been expended on the Vandaveer property, which included $2.2 million to purchase the land.
One big problem for the taxpayers and voters: the City was dealing with the U.S. Forest Service, and the USFS had issued a a “certificate of non-disclosure” which prevented the City Council from discussing the $4.7 million taxpayer-contingent project. Subsequently, all of the negotiations were handled in secret. Even though the NRCDC was completely funded by the City and the taxpayers, they held all of their board meetings behind closed doors.
Ultimately, the local press and the taxpayers demanded that the NRCDC meetings be held in open public session. Meanwhile, Colorado Parks & Wildlife rejected the City’s invitation to be part of the “natural resource center” project.
To deal with the pending financial disaster, the NRCDC had brought forward big plans, blessed by the City Council, to develop — not just the Natural Resource Center but the entire 191-acre Vandaveer property. “Workforce housing” was discussed as part of that development, to be build among hundreds of future residential units at the Vandaveer Ranch property. Here’s a quote from a 2014 news article written by Salida journalist Cynda Green:
[NRCDC] Board member Walt Harder asserted that, “63-20 is untenable from a development stance. … If we’re in the business of developing this property, there will be a lot of inconveniences and ultimately a big impediment to doing business.”
To continue acquiring debt without voter approval required the NRCDC to maintain its 63-20 status. But to try and sell parcels for development, while remaining a 63-20, was untenable.
NRCDC Board alternate Ron Mazzeo thought a bond issue should go to a public vote. “There’s a lot of people in this community who think the 63-20 was used to get around [a vote] in the first place.”
Tom Yerkey responded, “That’s exactly right”. Harder chimed, “It was.”
Mazzeo continued, “That’s a negative view in this town… To get rid of the 63-20 and take it to a vote of the people, is a good thing. They’re the ones paying a lot of it, so….”
Yerkey replied that the problem likely could be solved if the bank would release the land.
“So, are you saying, don’t get rid of the 63-20?” Mazzeo asked. “We just said we could sell bonds through the City.”
Yerkey: “But we can’t without going to a vote of the people….”
Mazzeo: “Which is a good thing.”
Yerkey: “Which is NOT a good thing at this point, if you want to sell pieces of property….”
Mazzeo: “The 63-20 hinders development and we’d be better off without it. If the bond has to go to a vote, so be it.”
Harder: “Is this [63-20] a club we can get out of — and get back into?”
We can see, from the above discussion, that the NRCDC Board was split between those who admitted the corporation was beholden to the taxpayers, and those who wanted to insure that the taxpayers would play no part in deciding the future of the Vandaveer Ranch development, and the community’s future debt burdens. Meanwhile, the federal government, with its “non-disclosure agreement”, had helped the elected and appointed leadership keep the entire financial mess hidden from the public.
In 2018 — four years later — the NRCDC finally handed all of its remaining assets (and presumably, all its debts?) off the the City government. To say the whole situation had been a decade-long embarrassment for the City government would be an accurate statement.
That said, I wonder how many people in Salida — how many taxpayers — were following the unpleasant situation closely enough to have an informed opinion about the controversy? I suppose the answer to that question depends, to some degree, on how well the controversy was covered in the local media.
And I wonder how well the Mountain Crossing project, here in Pagosa, will be covered in the local media?