New Metro Districts on the mountain

Council approves new service plan for 860 acres near ski area

The 860-acre development project in Mt. Crested Butte comprised of Prospect, Promontory and North Village hasn’t quite developed as planned, due to the economic downturn affecting the community and the nation. For that reason, the developers are requesting a restructuring of the development plan, and the formation of additional metropolitan districts.
Metropolitan districts, simply put, are created for the purpose of issuing debt for the construction of roads and other infrastructure required for a given development. The existing Reserve Metropolitan Districts, No. 1 and No. 2, were approved by the town of Mt. Crested Butte in 2000 to provide public infrastructure improvements and services for approximately 860 acres surrounding the Crested Butte ski area. The initial plan was that those two districts would be able to meet the infrastructure needs of the entire development, but a lackluster economy and real estate market has made that unfeasible. Thus far, Reserve Metropolitan District 2 has issued $18,400,000 in mil levy-funded debt for infrastructure construction in a portion of its service area.

So as not to burden current and future residents with debt for infrastructure they don’t use, CBMR brought a proposal before the public and Town Council, which would add six more metro districts. That way each individual development, like Promontory and the North Village for example, will have its own metro district and be able to issue debt for its own infrastructure. Meanwhile, existing and future property owners in say, Prospect, won’t have to pay the infrastructure cost for the other developments.
The incentive for the creation of these new districts is political as well. As Mt. Crested Butte town manager Joe Fitzpatrick said, “The major thing that’s going on right now is trying to beat the November election.” There are three controversial fiscal issues on the ballot, including Amendments 60 and 61, which would have an impact by limiting state and local debt.
For example, Amendment 61 ballot language poses: “Shall there be an amendment to the Colorado constitution concerning limitations on government borrowing, and, in connection therewith, prohibiting future borrowing in any form by state government; requiring voter approval of future borrowing by local governmental entities; limiting the form, term, and amount of total borrowing by each local governmental entity; directing all current borrowing to be paid; and reducing tax rates after certain borrowing is fully repaid?”
So if these new districts aren’t formed, and Amendment 61 then passes, issuing new debt for infrastructure and improvements would become very difficult.
As CBMR’s vice president of planning and development Michael Kraatz explained, “One of the reasons to do it now is so these metro districts are set up prior to those amendments being voted on in November. If they do pass, the districts can function as they’re intended to function, and be able to issue debt.”
During its September 21 meeting, the Town Council held a public hearing on the proposed Consolidated Service Plan for Reserve Metropolitan District Nos. 3-8. No one from the public spoke during the hearing, though Fitzpatrick and attorney Kim J. Seter spoke to the purpose of the plan.
Fitzpatrick provided an overview of the process. “The town will have to approve an Intergovernmental Agreement [IGA] each time one of these districts is formed,” he said. “Adding Districts 3-8 would allow the developer to develop more districts in smaller pieces, and just those districts would be responsible for the added debt.” Currently, “If you were to add infrastructure for the North Village, everyone that is currently a member of District 2 would be subject to additional bonds for something in the North Village.”
Seter explained, “The job we were tasked with was [coming up with] a means of protecting District 2 homeowners from future debt.” He said the purpose was to “also provide a mechanism to avoid some of the impacts of Amendments 60 and 61 if they pass. And protect the town from the costs of infrastructure.
“These [new] districts are being conceived, but they are not born until this IGA is created,” Seter said.
The public hearing closed, and the item was revisited later in the meeting and ultimately approved by the council without further deliberation.