Town to propose settlement to Mt. CB Water and San

A sit-down before the sit-down if resolution not reached?

By Mark Reaman

The Crested Butte town council will send two proposals to the Mt. Crested Butte Water and Sanitation District to hopefully settle a financing dispute over an expansion at the Wastewater Treatment Plant that included improvements to the Solids Processing Facility used by both town and the district. If the district doesn’t accept either proposal the council would like to sit down for a “pre-mediation meeting” to listen to the district and try to gain an understanding of their position.

The issue arose in 2022 when under an Intergovernmental Agreement (IGA) the estimate for the plant improvements raised the expected portion for Mt. CB Water and San from $1.5 million to $3.3 million. The district has made three payments on the bill, including one for $1.5 million. 

The town estimates it is still owed $1.9 million while the district claims it is closer to $1.78 million. The Crested Butte town council agrees with its attorney and staff that it is more cost effective to settle on the $1.78 million figure, but the dispute continues to boil over financing terms. The district proposed paying the $1.78 million over five years at a very low interest rate. Councilmembers said that would result in Crested Butte taxpayers subsidizing those in the district which they didn’t feel was fair.

The town will counter that proposal with two of its own. Both would conclude with a payoff by December 1, 2028. Under option A, town would charge an interest rate of 2% on the balance from January of 2023 through November 30, 2025. From December 1 through payoff, the interest rate would be set at 4.5%. Option B would charge 0% interest from January of 2023 through November 30, 2025, but then start a 5.5% interest rate on December 1, 2025 through the payoff. That actually would result in about $91,000 less in total payments than option A.

The council discussed the issue after a 20-minute closed-door executive session at the November 3 council meeting.

Town attorney Karl Hanlon said he had been in touch with the district’s attorney, Marcus Lock, as recently as that afternoon but no official proposals were discussed. 

“I would prefer to start with this and go to mediation if we have to and avoid litigation,” said mayor Ian Billick.

Hanlon again emphasized the staff’s concern was the interest rate and timing given the lost opportunity of what town could do if it held the cash.

“It doesn’t seem right that our taxpayers would subsidize the Mt. Crested Butte Water and San district,” said councilmember Gabi Prochaska.

“I’d be comfortable offering these proposals,” said Billick. “If needed we could have a pre-mediation meeting where we would just listen to them, no pressure, no arguing, but try to understand their position. If we then need to, we could go to nonbinding mediation.”

“It would be good to hear where they are coming from,” said Prochaska.

Hanlon will communicate the proposals to Lock and hope for a resolution. If not, the council would push for a mediation session with representatives from both entities.