This page is a blending of questions asked by Lee Phelan and answers provided by Jim Davis on June 19, 2003.
Jim;
Why do we have to wait for a POA Meeting, the POA signed over its interest in the water system to the SFTR METRO District, which is a Title 32 municipality.
Lee:
Thank you for your e-mail of June 19, 2003. I would like to address each of your questions and comments by paragraph.
The reason we have to "wait for a POA meeting" is that, in fact, the POA and Metro District are interrelated by virtue of the Association Agreement between the two, executed March 15, 1999. This Agreement, subsequently filed with the Las Animas County Clerk and Recorder, is defined and explained on page 24 of the Official Statement of the Metro District's 1999 financing recently provided to you by Bill Quigley's office.
The Metro District needs to assume its proper role and responsibilities under Colorado law engage in an appropriation for the completion of the water system or return the assets back to the POA – so we can do it ourselves.
The Metro District is diligently pursuing the appropriate financing mechanism for the completion of the water system, consistent with the concept and structure of the original financing, which gave consideration to those who prefer "time payments" as well as those capable of and desiring to avoid interest expense. in reality, all of us, as property owners, are and have been "doing it ourselves" through the Metro District's tax exempt financing.
All this double dealing, shifting and negotiation is ridiculous. The reason the Metro District was created was to limit liability to the POA. What reduction of liability is there, if a municipality has to seek approval of a property association to conduct business.
The reason the Metro District was formed was for a financing tool, capable of borrowing at tax exempt interest rates, to acquire telephone service, water delivery from the City, and any other major capital expenditure that may be required in the future to benefit the Santa Fe Trail Ranch (like rebuilding our roads). That is why the Metro District Service Plan, which is one of the exhibits in the Metro District Organizational Documents recently provided to you by Bill Quigley's office, was written so broadly. That service plans allows us to participate in State Programs, like the Conservation Trust Fund, which pays us a quarterly participation of state gambling revenues, based on our permanent population, which Metro turns over to the POA to go towards costs of noxious weed abatement and the Gallinas Nature Conservancy. The limitation of any "liability" was never a consideration in forming the District, although there is an inherent benefit, by virtue of its existence.
I don’t agree how this “municipality” was created, or how the funding was tracked or disbursed. However, we are where we are – its time to crap or get off the pot!
The Metro District was created in accordance with Colorado State Statutes and was guided by our District legal counsel, Grimshaw and Harring in Denver. They represent over 100 special districts in the state of Colorado. Our tax exempt debt offering was done in accordance with federal and state securities laws and was guided by our investment bankers, Miller & Schroeder Financial, Inc., our legal council, Grimshaw & Harring and our special counsel, Becker, Stowe and Bieber, also of Denver. As I do not know what the elements of your "disagreement with the creation, funding and disbursement" are, I can't address them. However, our legal counsels have agreed to address them if you wish, as I stated in my recent letter to you.
The Metro District needs to act. Either you have funding from the bonding agent, or you enact legislation to assess properties under the municipality. The POA is absorbing too much cost of the Metro District operation, which it should not have too. Property owners are paying assessments to the POA; they should be paying to the Metro District.
I agree with you that the "Metro District needs to act", and we are. We work on this dilemna daily. I cannot express to you the anxiety and frustration I have and share with my colleagues who have volunteered their time and efforts. The bonding company will have to be dragged into court to get anything out of them. In the meantime, we have to move forward. We are about to assess the cost of completion, but wanted to do it in conjunction with a tax exempt loan from a conventional lender so we can "cash flow" the money needed while allowing for both up front and time payments from property owners, giving consideration to varying financial capabilities. The property owners pay the POA dues to the POA. The property owners pay the debt service on the bond financing to the Metro District through its collection agent, Colorado Community First Bank. The Association Agreement referenced in paragraph 1 utilizes the POA's lien powers to deal with delinquent payments. The alternative is to have the delinquency placed on the Las Animas County Tax bill by the County Treasurer, which we have not wanted to do, up to now. I would like to again point out that the property owners are the POA and the property owners are the Metro District, as a body.
The Metro District is not another committee under the POA; people need to realize that – especially the Metro District Board. It’s been two years since I have moved to the ranch; same crap – different day. I would like to see an action plan, some project plan with cost projection posted on the website. Additionally, what reasonable accounting method will be utilized to eliminate cost overruns?
The action plan, project plan and cost projection were posted on the website as of January 27, 2003 and further discussed in a posting on March 27, 2003. The Water Committee and the Metro District Board are comprised of property owners who have volunteered their time and efforts to take on the projects, complete the projects and maintain the availibility of the District as a beneficial tool for the Santa Fe Trail Ranch in the future. People need to realize that also. It was the vote of the property owners in 1997 that mandated that. We all, I am sure, welcome any and all volunteer assistance to help prevent "cost overruns". Our current predicament is not a matter of cost overruns, but rather the failure and refusal or our original contractor to complete their work under the contract.
I am tiring of meetings, which accomplish nothing other than to set another follow-up date – somewhere in the not so near future. If the Metro Board doesn’t have a concrete plan in place today; it will never be able to accomplish that simple task. In five years the Metro District has been able to assume control of the original assessment established by the POA for the Power, Water and Telephone. I’m leery how the Metro District can control an additional assessment; unless the POA assets are utilized (again).
The Metro District does have a concrete plan in place. No viable alternative has come forth. Until the property owner's vote in 1997 to form the District and do the financing, nothing had happened for at least four years towards water and phone service. We, the property owners, decided as a body, to complete the task. Everything that has been done by those who chose to volunteer has been done towards those goals. It is our personal assets that have financed and will continue to finance our community's existence. Those personal assets and those we share as a collective body are "represented" by the terms "POA" and "Metro District". Both are legitimate entities, but both are really us, the property owners.
While I enjoy any updates at the POA Board meetings, do not let the bi-monthly POA meetings inhibit the necessary action of the Metro District in completing the water system. All inhabitants affected by the Metro District should have easy access to the web site; others you will have to mail.
The Metro District needs to breathe life into itself, under Title 32 or die. If it dies, we need to evaluate having additional POA meetings to pick up the pieces.
I have a great deal of pride in and respect for our POA Board, as I do for anyone who has volunteered for any Ranch activity that results in mutual benefit for us all as property owners. At the same time, I respect and understand that not everyone can or will be an active participant in the administration of our community. The POA Board and its meeting schedule has not inhibited the actions of the Metro District. We are all a group of property owners trying to accomplish things to preserve the integrity of our community and protect the value of our respective investments and that of our neighbors. We live in an imperfect world (an overused phrase, I know), but if we excuse the frequent failures and concentrate our collective talent and efforts on achievement, we might just get it done.
Sorry, I don’t have more than 4 postings to put this on the website
D. Lee Phelan, SR.
As I have not used my four postings, I will by copy, request that Pat Roehl post this to the website. Thank you for your thoughts and questions.
Jim Davis