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Home My WebLink AboutCOUNCIL - AGENDA ITEM - 09/21/2021 - RESOLUTION 2021-086 CONSENTING TO THE DISSOLUTION Agenda Item 16 Item # 16 Page 1 AGENDA ITEM SUMMARY September 21, 2021 City Council STAFF Clay Frickey, Redevelopment Program Manager John Duval, Legal SUBJECT Resolution 2021-086 Consenting to the Dissolution of Waterfield Metropolitan District Nos. 1 – 3. EXECUTIVE SUMMARY The purpose of this item is to consider dissolving the Waterfield Metropolitan District Nos. 1 -3 (Districts). Council approved a Metropolitan District Service Plan for these Districts on September 18, 2018 (Service Plan). The Service Plan contemplates a development containing 498 residential units with 50 of those units being deed restricted and affordable to families earning less than 80% of Area Median Income. Council then approved on April 16, 2019, a development agreement to secure cert ain public benefits related to the Service Plan (Public Benefits Agreement). The property’s original developer never signed the Public Benefits Agreement and that developer has since sold the property to a new developer. The new developer wants to develop the property without using the Districts and is seeking dissolution of them. The Districts have no indebtedness and staff have reviewed the materials and support the request for dissolution. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BACKGROUND / DISCUSSION On September 18, 2018, the Council adopted Resolution 2018-082 approving the Service Plan for the Districts. The Service Plan authorizes the Districts to finance and provide certain public improvements and services in support of a proposed development containing 498 residential units with 50 of those units being deed restricted and affordable to families earning less than 80% of Area Median Income. The Service Plan also provides that either the Districts or the developer of the property must provide or secure to the City’s satisfaction certain public benefits before the Districts would be permitted to impose property taxes or issue debt. The public benefits proposed in the Service Plan were in accordance with the City’s Metro politan District policy at the time. These public benefits included: • Zero Energy Ready - The applicant agreed to construct all 498 homes in the proposed project in compliance with the Department of Energy’s Zero Energy Ready and Environmental Protection Ag ency’s Indoor airPlus standards - the estimated cost of delivering homes at these standards is $14 million. • Net Zero Energy/Distributed Storage - The applicant agreed to construct either 10 percent of the homes as Net Zero Energy (with Rooftop Solar) or distributed power storage equivalent to the consumption by 10 percent of homes at an estimated cost of $2.8 million. • Multimodal Transportation Improvements - The applicant agreed to deliver buffered bike lanes, wider than required sidewalks, and enhanced pedestrian crossings as part of the construction of the 4-lane arterial Suniga at an estimated cost of $212,000. • Smart Growth Management - The applicant agreed to design and construct the project at the upper -end of the zoned density by following new urbanist principles, such as alley loading, smaller lot size, and increasing multi-family density at an estimated cost of $6.1 million. Agenda Item 16 Item # 16 Page 2 • Walkability/Pedestrian Friendliness - The applicant agreed to make trail enhancements along the wetlands and other portions of the project to facilitate connections to the regional trail system at an estimated cost of $2.1 million. • Public Spaces - The applicant agreed to construct several pocket parks, as well as mixed use open spaces throughout the project at an estimated cost of $1.7 million. • Affordable Housing - The applicant agreed to make 10 percent of the homes (approximately 50 lots) available for the construction of affordable homes targeted at 80 percent of area median income; affordability will be maintained for a minimum of 20 years - the anticipated sales price is approximately $280,000 - these homes will likely be constructed in partnership with either a land trust or similar entity - at an estimated cost of $3.3 million. Council subsequently passed Resolution 2019-051 on April 16, 2019, approving the Public Benefits Agreement to secure the provision of public benefits described above. Following approval of the Public Benefits Agreement, the developer completed the entitlement process for the proposed projec t on the property and the final subdivision plat was recorded on February 26, 2021. While the developer completed many of the required steps to begin imposing property taxes and issuing debt and building per the Service Plan, the developer did not execute the Public Benefits Agreement. Again, without executing that Agreement, the Districts cannot impose property tax or issue debt. The original developer of Waterfield has since sold the property to a new developer. The new property owner does not wish to ut ilize the Districts to develop the property. By law, a district court may dissolve a metropolitan district without an election if: (1) the district lies wholly within the corporate limits of a municipality, (2) the district has no financial obligations or outstanding bonds, and (3) the district’s board and the governing body of the municipality both consent to dissolution . On September 7, 2021, staff received the attached letter from attorney Audrey Johnson with White Bear Ankele Tanaka & Waldron, general counsel for the Districts, requesting Council’s consent to the Districts’ dissolution. Attached to that letter is the joint resolution of the Districts’ Boards of Directors approving the dissolution of the Districts. To avoid unnecessary administrative costs, the Districts aim is to dissolve by the end of 2021. As a result, the Districts request that Council consider the request for consent to dissolution as soon as possible. As of submittal for Council consideration of this consent to dissolution, the Districts have no outstanding indebtedness or other financial obligations. Additionally, the Districts have not constructed any public improvement nor provided any services pursuant to its Service Plan. Finally, the Districts have no assets. Staff has received and reviewed documentation provided by the Dissolution Districts requesting City Council consider supporting their dissolution. Staff has reviewed the materials and supports the request for dissolution. ATTACHMENTS 1. Letter of Request (PDF) WILLIAM P. ANKELE, JR. JENNIFER GRUBER TANAKA CLINT C. WALDRON KRISTIN BOWERS TOMPKINS ROBERT G. ROGERS BLAIR M. DICKHONER GEORGE M. ROWLEY OF COUNSEL: KRISTEN D. BEAR K.SEAN ALLEN TRISHA K. HARRIS ZACHARY P. WHITE HEATHER L. HARTUNG MEGAN J. MURPHY EVE M. G. VELASCO LAURA S. HEINRICH AUDREY G. JOHNSON CAREY S. SMITH V ERIN K. STUTZ 1 1988.1900, 1128466 September 7, 2021 VIA ELECTRONIC MAIL City Hall West 300 LaPorte Ave., Fort Collins, CO 80521 Attn: John Duval, Deputy City Attorney RE: Request for the Fort Collins City Council’s Consent of the Dissolution of Waterfield Metropolitan District Nos.1-3 Dear Mr. Duval: Our firm serves as general counsel to the Waterfield Metropolitan District Nos.1-3 (each a “District” and collectively, the “Districts”), which is an existing Title 32 metropolitan district located wholly within the City of Fort Collins (the “City”). The purpose of this letter is to provide additional information for the City Council’s consideration in connection with the Districts’ previously submitted request for City consent to the Districts’ dissolution pursuant to § 32-1-704(3)(b), C.R.S. Enclosed with this letter is a copy of the joint resolution approving the dissolution of the Districts and a proposed resolution for adoption by the City Council evidencing the City’s consent to the dissolution. The Districts were organized pursuant to orders and decrees of the Larimer County District Court on February 11, 2019, and operate pursuant to a consolidated service plan which was approved by the City Council of the City on September 18, 2018 (the “Service Plan”). The Service Plan authorizes the Districts to finance and construct certain public improvements for the Waterfield development, as further contemplated therein (the “Project”). However, the Districts were operating under inactive status pursuant to § 32-1-103(9.3), C.R.S. from May 27, 2020 until May 11, 2021, and they have not imposed a mill levy, charged fees, or expended any District funds since organization. At the time the Service Plan was approved, it was anticipated that prior any District taxation, financing, or other revenue raising activities, the developer for the Project would be entering into a public benefits agreement with the City, pursuant to which the Developer would ATTACHMENT 1 Mr. John Duval RE: Request for the Fort Collins City Council’s Consent of the Dissolution of Waterfield Metropolitan District Nos.1-3 September 7, 2021 2 1443.1900; 1078144 commit to providing various public benefits in exchange for metro district financing to help support the Project. While the form of the agreement was approved conceptually by the City, the document was not executed by the City or the developer, and accordingly it has not taken effect. More recently, the property has changed hands, and the current property owner does not plan to utilize metro district financing to support the Project. Accordingly, at this juncture, it is the view of the Districts’ governing bodies that the most cost-effective course of action moving forward is to administratively dissolve the Districts. For the reasons set forth above, and in accordance with Section XVI of the Service Plan, the Boards of Directors have determined that it is in the best interest of the Districts to file a petition for dissolution with the Larimer County District Court pursuant to §§ 32-1-701 et seq., C.R.S. Section 32-1-704(3)(b), C.R.S., provides that an order dissolving a special district may be entered without an election if: (i) the special district lies wholly within the corporate limits of the municipality, (ii) the special district has no financial obligations or outstanding bonds, and (iii) the special district board and the governing body of the municipality consent to the dissolution. The Districts’ boundaries are located wholly within the City, the only eligible electors of Districts are the current directors, and the Districts have no outstanding indebtedness or other financial obligations. On May 21, 2021, the Boards of Directors of the Districts adopted the Joint Resolution Approving the Dissolution of the Districts deeming it in the Districts’ best interest to dissolve. A copy of this resolution is enclosed herewith. Upon receipt of the consent of the City, the Districts intend to dissolve. It is important to note that the City’s consent is required only to avoid the time and costs associated with an election for dissolution. Because there are no eligible electors within the Districts other than the current directors, all of whom are affiliated with the developer of the community, conducting such an election would be unnecessary, and would result in an inefficient use of administrative resources and avoidable costs. In order to avoid unnecessary administrative costs, the Districts’ aim to dissolve by October 15, 2021. To allow for the appropriate amount of time to proceed with the dissolution process with the District Court and meet the statutory requirements, we respectfully request that the City Council consider the Districts’ request in September of 2021. We look forward to working with you on this dissolution process. Please let us know if you have any questions regarding this matter. Very Truly Yours , WHITE BEAR ANKELE TANAKA & WALDRON Robert G. Rogers Shareholder Mr. John Duval RE: Request for the Fort Collins City Council’s Consent of the Dissolution of Waterfield Metropolitan District Nos.1-3 September 7, 2021 3 1443.1900; 1078144 cc: Boards of Directors, Waterfield Metropolitan District Nos.1-3 Enclosures: A Resolution of the Boards of Directors Approving the Dissolution. B Proposed Resolution of the City Council of the City Consenting to Dissolution of the Districts. -1- RESOLUTION 2021-086 OF THE COUNCIL OF THE CITY OF FORT COLLINS CONSENTING TO THE DISSOLUTION OF WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 WHEREAS, Waterfield Metropolitan District Nos. 1-3 (the “Districts”) were created by Orders and Decrees entered by the Larimer County District Court on February 11, 2019; and WHEREAS, the Districts operate pursuant to a service plan approved by the City Council on September 18, 2018, in Resolution 2018-082 (the “Service Plan”); and WHEREAS, the Districts have operated under an inactive status as that term is defined in Section 32-1-103(9.3) of the Colorado Revised Statutes (“C.R.S.”) from May 27, 2020, until May 11, 2021, and were reactivated on May 11, 2021, solely for the purpose of initiating dissolution; and WHEREAS, the Districts are not currently authorized to impose a property tax mill levy, charge fees or issue debt to finance the public improvements to support the project outlined in the Service Plan, so the purposes for which the Districts were created have not been commenced since their organization; and WHEREAS, the Boards of Directors of the Districts (the “Boards”) have determined it is in the best interest of the Districts to file a Petition for Dissolution with the Larimer County District Court pursuant to C.R.S. Section 32-1-701, et seq., as set forth in the attached “Joint Resolution of the Boards of Directors of Waterfield Metropolitan District Nos. 1-3 Approving the Dissolution of the Waterfield Metropolitan District Nos. 1-3” dated May 21, 2021, attached hereto as Exhibit “A” and incorporated herein by reference (the “Boards’ Dissolution Resolution”); and WHEREAS, as represented in the Boards’ Dissolution Resolution, the Districts do not have any outstanding bonds, indebtedness or other financial obligations and they have not constructed any public improvements nor provided any services pursuant to the Service Plan, and the Districts have no assets; and WHEREAS, C.R.S. Section 32-1-704(3)(b) provides that a district court may enter an order dissolving a metropolitan district without an election if: (i) the district lies wholly within the corporate limits of a municipality, (ii) the district has no financial obligations or outstanding bonds, and (iii) the metropolitan district’s board and the governing body of the municipality both consent to the dissolution; and WHEREAS, the City Council is in receipt of and has reviewed such documentation as it deems necessary, is supportive of the dissolution of the Districts, and consents to the dissolut ion of the Districts in this Resolution. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT COLLINS, COLORADO as follows: -2- Section 1. That the City Council hereby adopts as findings and determinations the recitals state above. Section 2. That pursuant to and in accordance with C.R.S. Section 32-1-704(3)(b), the City Council hereby consents to the dissolution of the Districts. Section 3. That the Interim City Manager and City Attorney are authorized and directed to take any and all actions necessary or appropriate to effectuate the provisions of this Resolution for the dissolution of the Districts. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 21st day of September, A.D. 2021. ____________________________________ Mayor ATTEST: ________________________________ Interim City Clerk 1 1988.1900; 1115158 JOINT RESOLUTION OF THE BOARDS OF DIRECTORS OF THE WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 APPROVING THE DISSOLUTION OF THE WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 ___________________________________ WHEREAS, pursuant to orders and decrees of the District Court in and for Larimer County, Colorado, the Waterfield Metropolitan District Nos.1-3 (the “Districts”) were duly and validly organized as metropolitan districts in accordance with all applicable law; and WHEREAS, the Districts operate pursuant to a service plan approved by the City of Fort Collins, Colorado on September 18, 2018 (the “Service Plan”); and WHEREAS, pursuant to Section 32-1-1001(1)(h), C.R.S., the Boards of Directors of the Districts (the “Boards”) shall have management, control, and supervision of all business affairs of the Districts; and WHEREAS, pursuant to Section 32-1-701(1), C.R.S., whenever the majority of all the members of the Boards deem it to be in the best interest of the Districts that they be dissolved, the Boards shall file a petition for dissolution with the court; and WHEREAS, the Districts encompass territory located wholly within the City of Fort Collins, Colorado (the “City”) as described and set forth on Exhibit A (the “Property”); and WHEREAS, the Boards have determined that since no debt is intended to be issued by the Districts, the purpose for which the Districts were created will not be accomplished; and WHEREAS, the Districts do not have any outstanding indebtedness or other financial obligations; and WHEREAS, the Districts have never provided any services pursuant to their Service Plan and the Districts have no assets; and WHEREAS, a majority of all of the members of the Boards deem it to be in the best interests of the Districts that they be dissolved. NOW, THEREFORE, BE IT RESOLVED BY THE BOARDS OF DIRECTORS OF THE DISTRICTS AS FOLLOWS: 1.Declaration to Dissolve. The Boards hereby find and determine it to be in the best interests of the Districts that they be dissolved. The foregoing statement is being given in compliance with § 32-1-701(1), C.R.S. EXHIBIT A 2 1988.1900; 1115158 2. Petition for Dissolution. The Districts’ general counsel, WHITE BEAR ANKELE TANAKA & WALDRON (the “Legal Counsel”), is hereby directed to prepare such Petition for Dissolution pursuant to § 32-1-702(1), C.R.S. (the “Petition”), and to file such Petition with the District Court in and for Larimer County, Colorado, as may be necessary to effectuate the dissolution of the Districts, and to prepare any and all other documentation and undertake any and all actions necessary to effectuate the dissolution of the Districts pursuant to Colorado law. 3. Plan for Continuation of Services. The Boards hereby find and determine that the Districts provide no services within their boundaries and all services authorized to be provided by the Districts are provided by the City, or other jurisdiction, and as a result, no plan for the continuation of the Districts’ services is necessary. 4. Financial Certificate. The Boards hereby find and determine that due to all financial obligations of the Districts having been paid by the Developer since organization, and having never opened a bank account on behalf of the Districts, the Districts do not have any financial obligations or outstanding bonds, and the financial certificate given in accordance with § 32-1-702(3)(a), C.R.S. is attached hereto and incorporated herein as Exhibit B. 5. Authority of Legal Counsel. The Districts’ Legal Counsel shall have the power and authority to execute any and all documents necessary to effectuate the Districts’ dissolution, and to take any and all actions necessary to effectuate the Districts’ dissolution. Legal Counsel shall act in the same capacity and with the same authority as the Districts’ Boards of Directors in order to effectuate the Districts’ dissolution. [Remainder of Page Intentionally Left Blank. Signature Page Follows.] EXHIBIT A EXHIBIT A EXHIBIT A (The Property) EXHIBIT A A REPLAT OF A PORTION OF WATERFIELD THIRD FILING, TRACT A, WATERFIELD P.U.D. FIRST FILING AND PORTIONS OF VACATED TIMBERLINE ROADS, LOCATED IN THE WEST HALF OF SECTION 5, TOWNSHIP 7 NORTH, RANGE 68, WEST OF THE 6TH PRINCIPAL MERIDIAN, CITY OF FORT COLLINS, COUNTY OF LARIMER, STATE OF COLORADO. Recorded with Larimer County, CO at Reception No. 20210020155 EXHIBIT A OVERALL DISTRICT BOUNDARY E VINE DR SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W N TIMBERLINE RDDISTRICT 1 44,969 sq.ft. 1.03 ac DISTRICT 1 BOUNDARY THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E N G I N E E R N GI EHTRON RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 EXHIBITSCALEDRAWN BY C. Snowdon DATE August 27, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com DISTRICT 1 AREA BOUNDARY MAP 1" = 400' B-1 ( US SURVEY FEET ) 1 inch = ft. Feet0 NOTE: THIS EXHIBIT IS NOT INTENDED TO BE A MONUMENTED LAND SURVEY. ITS SOLE PURPOSE IS AS A GRAPHIC REPRESENTATION TO AID IN THE VISUALIZATION OF THE WRITTEN PROPERTY DESCRIPTION WHICH IT ACCOMPANIES. THE WRITTEN PROPERTY DESCRIPTION SUPERCEDES THE EXHIBIT DRAWING. 400 400400 EXHIBIT A N TIMBERLINE RDOVERALL DISTRICT BOUNDARY E VINE DR SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W DISTRICT 2 3,960,783 sq.ft. 90.93 ac THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E N G I N E E R N GI EHTRON RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 EXHIBITSCALEDRAWN BY L. Smith DATE December 2019 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com DISTRICT 2 AREA BOUNDARY MAP 1" = 400' B-2 ( US SURVEY FEET ) 1 inch = ft. Feet0 NOTE: THIS EXHIBIT IS NOT INTENDED TO BE A MONUMENTED LAND SURVEY. ITS SOLE PURPOSE IS AS A GRAPHIC REPRESENTATION TO AID IN THE VISUALIZATION OF THE WRITTEN PROPERTY DESCRIPTION WHICH IT ACCOMPANIES. THE WRITTEN PROPERTY DESCRIPTION SUPERCEDES THE EXHIBIT DRAWING. 400 400400 EXHIBIT A OVERALL DISTRICT BOUNDARY E VINE DR SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W N TIMBERLINE RDDISTRICT 3 44,969 sq.ft. 1.03 ac DISTRICT 3 BOUNDARY THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E N G I N E E R N GI EHTRON RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 EXHIBITSCALEDRAWN BY L. Smith DATE December 2019 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com DISTRICT 1 AREA BOUNDARY MAP 1" = 400' B-3 ( US SURVEY FEET ) 1 inch = ft. Feet0 NOTE: THIS EXHIBIT IS NOT INTENDED TO BE A MONUMENTED LAND SURVEY. ITS SOLE PURPOSE IS AS A GRAPHIC REPRESENTATION TO AID IN THE VISUALIZATION OF THE WRITTEN PROPERTY DESCRIPTION WHICH IT ACCOMPANIES. THE WRITTEN PROPERTY DESCRIPTION SUPERCEDES THE EXHIBIT DRAWING. 400 400400 EXHIBIT A 5 EXHIBIT B (Certificate – No Financial Obligations or Outstanding Bonds) EXHIBIT A 1988.1900; 1151814 FINANCIAL CERTIFICATE REGARDING THE DISSOLUTION OF WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 1. We, the undersigned officers of the Boards of Directors of Waterfield Metropolitan District Nos. 1-3, hereby certify and affirm that we have been closely involved in the financial affairs of Waterfield Metropolitan District Nos. 1-3. 2. We hereby further certify that, as of the date of execution of this Financial Certificate, Waterfield Metropolitan District Nos. 1-3 have no assets of any form, no outstanding financial obligations that require repayment, and no outstanding bonds or other form of outstanding indebtedness. Dated this 10th day of September, 2021. WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 By: President Attest: By: Matt Childers (Sep 10, 2021 11:46 MDT) Matt Childers JD Padilla Pres. (Sep 10, 2021 12:25 MDT) JD Padilla Pres. EXHIBIT A