Photo: Village Pointe condominiums.
Looked at from a certain perspective, I am currently debt-free. The house is paid off; bought the car with cash; no student loans; got rid of all my credit cards ten years ago.
Looked at from another perspective, I am massively in debt, thanks to my federal, state and local governments.
As a U.S. citizen, my portion of the federal debt — $39 trillion — is about $118,000. (Assuming we each owe an identical share?)
Apparently, Colorado state and county governments, municipalities and school districts have borrowed a significant amount of money . A report by Reason.org found that, in total, Colorado governments owe $104 billion. That makes the state the 15th highest nationally and works out to $17,969 per person.
Perhaps $35,000 per household, on average?
Of that total, school districts in Colorado owe about $28 billion. The total owed by school districts could increase slightly next year, courtesy of Archuleta County taxpayers, if the Archuleta School District (ASD) puts a bond issue on the November ballot and the voters approve it.
The potential ASD bond issue will be discussed this week at the Wednesday, August 5, School Board meeting at the Middle School Library at 6pm. The agenda states that the conversation will be “Discussion Only” indicating that no final decision will be made. But also on the agenda is possible approval of a special board meeting later this month (to approve the ballot measure?)
Also on the agenda is possible approval of an agreement with Archuleta County to participate in the November election.
The school district might be asking the voters to create a new property-tax-funded debt in excess of $120 million. More about that possibility later.
We already know that Pagosa Springs Medical Center will have a tax measure on the November ballot, which — if approved — will allow PSMC to keep all the property tax money they collect each year, rather than needing to distribute Taxpayer Bill of Rights (TABOR) refunds when they collect more than what TABOR allows. Property taxes make up only a very small part of the PSMC budget, but it’s useful for helping pay off the debt held by the medical center, which amounts to about $13 million, or about $1,800 per district household.
We don’t yet know if the Archuleta County government will place a Lodgers Tax increase on the November ballot. That increased tax, if approved, would be paid by visitors saying in motels and short-term rentals outside the town limits. How the revenues will be used would be defined in the ballot language, but indications from the County staff are that the lion’s share would be dedicated to road maintenance. I suppose this revenue stream could potentially be used a collateral for acquiring additional County debt.
Currently, the County’s debt amounts to about $17 million (as of the 2024 audit) which equals about $2,400 per household.
Over the past few years, Pagosa Area Water and Sanitation District (PAWSD) has created about $55 million in new customer debt, which financed a new $44 million water treatment plant on Snowball Road, and $10 million in sewer plant upgrades required by the state of Colorado. Those debts did not require voter approval because PAWSD operates its water and wastewater operations as rate-funded ‘government enterprises’ which are exempt from TABOR limitations. The total PAWSD debt are, however, still subject to lender-imposed limitations.
Total PAWSD debt amounts to about $7,600 per household within the district.
As of 2024, the Town of Pagosa Springs had liabilities of around $7.8 million, or about $9,700 per town household. (I live in the town.) I believe the debt burden has increased since 2024?
The Town recently participated in an auction for three bankrupt condominium complexes near Village Lake, and was the successful bidder on the 32-unit Village Pointe condos, with an offer of $4.9 million. Presumably, this purchase will entail some level of additional municipal debt. But the total debt necessary for this purchase is undefined at the moment.
According to Town Council member Gary Williams:
The funding approach will be a bond for the purchase price plus a million or so for repairs. We have been working on the bond in parallel with the due diligence and bidding. We are hoping that state money will be available for such an interesting acquisition. We figure the price per square foot for the purchase is about on third of what it would cost to build them.
I have toured the property and am really excited about the possibilities. The plan is to rent all the units as affordable housing.
So a new debt of up to $6 million? To be funded, most likely, through Certificates of Participation, which are not considered “TABOR debt” by Colorado courts. But still… debt by another name, to be owed by the 1,880 residents within the municipal limits. (I’m one of those residents.)
The Town’s current plan is to remodel the 32 two-bedroom condo units into 64 one-bedroom units, to help meet the community’s shortage of smaller apartments.
Ideally, the monthly rents will cover the debt payments.
According to Town Housing Coordinator Jeff Sams, it’s possible that the Town can get financial help through a state of Colorado Housing Development Grant which can be used for acquisitions and renovations.
From Mr. Sams:
Working with the Town’s Financial Advisor, we looked for options to finance the properties. A bond utilizing Certificates of Participation, has proved to provide the lowest interest rate so far for financing the project. Other options for financing continue to be reviewed, with the property as collateral for any financing options.
The interiors of the units all appear to be in good condition with some being remodeled in the last 2 to 3 years. There are some exterior issues identified and some items in the attics and crawl spaces that need to be addressed. This was added to the budget to ensure this work could be completed within budget and still have the units at affordable rent amounts.
Then we have a possible Archuleta School District ballot question, still under consideration.
Will the School Board put a $120 million bond issue before the voters in November, to build a proposed new PreK-8 school facility on Vista Boulevard?
Read Part Two… tomorrow…