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COUNCIL - AGENDA ITEM - 01/15/2019 - (ITEM MOVED TO DISCUSSION) FIRST READING OF ORDINA
Agenda Item 5 Item # 5 Page 1 AGENDA ITEM SUMMARY January 15, 2019 City Council STAFF Tawnya Ernst, Real Estate Specialist III John Stokes, Natural Resources Director Jason Graham, Water Reclamation/Biosolids Manager Ingrid Decker, Legal SUBJECT First Reading of Ordinance No. 004, 2019, Authorizing the Conveyance of a Transmission Line Easement on City Property at Meadow Springs Ranch to Roundhouse Renewable Energy, LLC. EXECUTIVE SUMMARY The purpose of this item is to authorize conveyance of a transmission line easement to Roundhouse Renewable Energy, LLC on the City of Fort Collins’ Wastewater Utility owned Meadow Springs Ranch and the right of access to the transmission line from County Roads 5 and 92 and private drives. The Roundhouse Renewable Energy Project will include an above ground 230 kilovolt transmission line from a wind energy facility in Wyoming to Platte River Power Authority’s Rawhide Energy Station. Platte River Power Authority plans to deliver 150 megawatts (MW) of new wind power to its owner cities of Fort Collins, Loveland, Longmont and Estes Park. The 150-foot wide easement will run across 9.7 miles of Meadow Springs Ranch totaling an approximate 176.4 acres. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BACKGROUND / DISCUSSION Roundhouse Renewable Energy, LLC, a subsidiary of Nextera Energy Resources, is proposing a 230-kilovolt (kV) transmission line to deliver energy from a wind energy facility in Wyoming to Platte River Power Authority’s (PRPA) Rawhide Energy Station (Rawhide). PRPA and the four communities it serves are committed to delivering a diversified energy portfolio to their ratepayers. This project will add 150 megawatts (MW) of wind energy to the portfolio. Over the course of a year, the project will generate an amount of electricity equivalent to the yearly energy needs of approximately 70,500 homes. This dovetails with the City of Fort Collins’ Climate Action Plan goals to reduce the community’s carbon emissions by 20% by 2020 and 80% by 2030. The project has the potential to reduce the community’s carbon emissions by 10% and to boost non- fossil electricity resources to nearly 50%. One key component to successfully delivering this wind energy to Rawhide is approval of 9.7 miles of transmission line on Meadow Springs Ranch (MSR). The 26,600-acre ranch, owned by the Wastewater Utility, serves as the primary location for regulatory compliant land application of biosolids generated from the City’s wastewater facilities. MSR is also rich in cultural and environmental resources including a reintroduced population of black-footed ferrets, archeological artifacts, and water rights. MSR also serves as a working cattle ranch (Attachment 1). Agenda Item 5 Item # 5 Page 2 The transmission line will consist of a corten-steel monopole design ranging in height from 80 feet to 100 feet, depending on the length of span. The typical span length between transmission structures is 700 feet, with longer spans of 1,200 feet to help avoid sensitive environmental resources. Alternative Alignments Analysis The project team evaluated six possible routes and their potential impacts to MSR. The team engaged many city boards (Water, Energy, Land Conservation and Stewardship, Natural Resources) as well as the public and potentially impacted land owners. The project team utilized a systems approach (Energy by Design, Criteria Ranking, Siting Study, and Appraisal Study) to evaluate and determine a preferred route and mitigation strategy to present to council for consideration of approval. The Project Siting Study was completed by Logan Simpson for the Roundhouse Renewable Energy project in August 2018. The Siting Study provided an analysis of possible transmission line routes on MSR. The analysis used the City’s Energy by Design methodology focused on a triple bottom line approach to select a preferred transmission line route. Six potential routes were identified for consideration. Criteria included in the evaluation to select the preferred route include the following: vegetation and surface water; wildlife, including grassland birds and raptors; visual resources; land uses; cultural resources; engineering factors; existing linear infrastructure; and public input. The preferred route was identified as Route 2B because it has the lowest or equal conflicts with vegetation and surface water, wildlife, birds - raptor, visual resources, land uses, cultural resources, and engineering criteria. It is the shortest route with the fewest angle structures and parallels existing linear infrastructure for most of its length. The preferred alternative route will be carried forward into the Weld County 1041 permit and Use by Special Review applications and the Larimer County 1041 permit application. Route 2B parallels the existing rail road for the first six miles from Wyoming to MSR prior to heading south and west to the Rawhide Substation. The alignment of the preferred route is generally depicted on Attachment 2. Roundhouse has proposed a three hundred (300) to five hundred (500) foot wide corridor (the Permitting Corridor) within which the transmission line may be constructed. The alignment may shift slightly east or west within the Permitting Corridor depending upon conditions on the ground as final design and/or construction proceeds. Roundhouse will submit a legal description of the easement area (no greater than one hundred fifty (150) feet wide) upon completion of construction of the transmission line. (Attachments 3 and 4). CITY FINANCIAL IMPACTS Nextera Energy Resources will pay the City of Fort Collins Wastewater Fund $105,850 for the value of the easement. As additional consideration, Nextera will provide compensation to mitigate for impacts connected to construction and operation of the transmission line. Based on recent published studies in Colorado placing economic or monetary value on ecosystem goods and services, Nextera and the City have agreed upon a formula to calculate the mitigation compensation. The parties are in the process of determining a final mitigation compensation amount which is anticipated to be in the realm of $330,000. Compensation Mitigation Package Context Mitigation hierarchy uses the concept to first avoid impacts, minimize the impacts that occur and finally to mitigate unavoidable impacts associated with a project. There is both a surface area and lost goods and services impact to MSR that requires the city to receive adequate monetary value associated with these impacts as project mitigation for the City and wastewater rate payer. An appraisal was completed by CBRE (Attachment 10) as part of this project to determine a fair compensatory estimate for the surface area easement impact on Meadow Springs Ranch. The value per acre was determined to be $1200. A 50% value factor was applied to the easement area based on City Real Estate Services guidance which aligns with International Right of Way Association Easement Valuation Matrix. This valuation matrix is strictly related to surface area impacts. The easement value of $105,850 will be paid to the City of Fort Collins Wastewater Fund as part of the final mitigation package. Agenda Item 5 Item # 5 Page 3 Market Value Conclusion Appraisal Premise Acreage Appraisal Date Value Conclusion Easement Land 176.4 September 27, 2018 $105,850 Ecosystem goods and services are provided by ecosystem processes that either directly sustain or enhance human life or maintain the quality of ecosystem goods (Brown et al, 2007). Ecoservices maintain biodiversity or improve the condition or location of valued natural items (carbon storage, water filtration, etc.). Ecosystem goods are generally defined products that have tangible value (forage, timber, biomass fuels, pharmaceuticals, etc.). Others have categorized ecosystem services into provisioning services, regulatory services, supporting services and cultural services (Holzman 2012). Provisioning services provide natural products: food, fiber, fuels etc. Regulatory services include things such as water and air filtration, carbon sequestration and storage and organic cycling. Supporting services maintain provisioning and regulatory services and include things like soil formation, photosynthesis and maintenance of healthy habitats. Finally, cultural services describe the intangible benefits that result from contact with nature; hiking, bird watching, fishing, hunting etc. Given the broad definition of ecological goods and services, it can be assumed that some portion of the value will remain following the transmission line construction. While valid estimates of ecosystem services have been developed, the loss of values associated with the transmission line can only be estimated at this time. The cost of long-term studies needed to quantify the change are likely to exceed the value lost. Also, the lost value will change over time. For example, areas directly disturbed by construction activities will have a relatively high loss of ecosystem services until restored. Areas converted to roads will have a permanent loss of some ecosystem values and minor effects on others. Last, some areas within the easement that remain undisturbed during the project will have little if any reduction in value. Recent studies in Colorado have worked to place monetary value on ecosystem goods and services and are used for this analysis (Sargent-Michaud 2009, Seidl et al. 2017.) The equation and agreed upon variables below were used to establish the monetary value associated with the loss of goods and services as a result of the project. Using values from Sargent-Michaud (2009) and Seidl et al. (2017) the total annual value of ecological goods and services within the 176.4-acre easement area total is $16,729.01. Impact Calculation Ecosystem Values2 ($130.50) Annual payment (21.5 years)3 New Roads1 (5.7 x 5280 x 30)/43560 = 21 acres 21 x 10 yrs. x $130.50 = $27,405 $1274.65 New Fragmentation (0.7 X 5280 x 100)/43560 = 8.5 8.7 x .1 = 0.84 acres 0.84 x $130.50 x 21.5 yrs. = $2380.63 $110.72 Transmission Line (9.7 miles X 100 x5280)/43560 = 117.6 acres (117.6 x 130.50) x 21.5 = $329,888.18 $15,343.64 BOARD / COMMISSION RECOMMENDATION Feedback from four boards (Water, Energy, Natural Resources, and Land Conservation/Stewardship) has overall been in support of granting the easement. The Water Board has an official role with providing a recommendation in support or against this project to council. At its December 20, 2018 meeting, the Water Board unanimously supporting this project as recommended by City staff December 20, 2018. (Attachment 6) The Energy Board and Natural Resources Advisory Board unanimously provided recommendations to Council in support of the project as well at their respective meetings on November 8, 2018 and October 17, 2018 (Attachments 7 and 8.) Agenda Item 5 Item # 5 Page 4 The project was also presented to the Land Conservation and Stewardship Board, November 7, 2018 Board meeting (Attachment 9). The Board was generally supportive of the process staff has followed for environmental analysis and recommended that any funds that are made available from the Roundhouse project for environmental compensation be used for two purposes and in the following order: 1. Ameliorate local environmental damage from Roundhouse facilities, with transmission lines across Meadow Springs Ranch being a special concern to the City and to this Board, owing to ecological and visual impacts on Soapstone Natural Area and on Meadow Springs, which should be conserved in the future. 2. Protect land in and around Meadow Springs, primarily through conservation easements, with the aim of maintaining regional habitat connectivity. The project was discussed at a Council Work Session November 27, 2018. Council requested additional information related to wildlife (particularly burrowing owls’ ability and likelihood to return to the area after construction) and the analysis of the preferred route versus alternative routes to the east. Staff have provided the following responses: • Staff is not aware of any studies that address impacts to either burrowing owls’ presence or avoidance of areas due to transmission lines. Staff has identified the use of perch deterrents as a mitigation measure to minimize the potential increase in predation of burrowing owls. • All alternative routes along I-25 or further east, would have considerably greater impacts (in part to wildlife) than the preferred route. Approximately 98% of the preferred route parallels existing infrastructure. The easterly routes would necessitate longer distances for the line to cross and would subsequently impact a larger area and increase the project cost. Please see additional information regarding staff’s follow-up responses (Attachment 5.) PUBLIC OUTREACH The project team has attended several board meetings, workshops, and open houses to provide updates and gather feedback from all identified stakeholders. Outreach included presentations to the Water, Energy, Natural Resources, and Land Conservation and Stewardship board including two open houses (August 15 and September 26, 2018) and a joint board meeting August 20, 2018. Overall comments have been supportive of the City granting the easement on MSR for the Roundhouse Renewable Energy Transmission Lines. At the August 20 open house, the project team requested feedback on the following two questions: 1. Would you support City Council granting an easement across Meadow Springs Ranch for the above- ground transmission lines? 2. Would you support City Council issuing a cooperation agency letter of support to Larimer and Weld County’s 1041 permit process? Agenda Item 5 Item # 5 Page 5 Question Yes Somewhat support / neutral No Total Respondents % in Support Would you support an easement? 31 3 0 34 91% Would you support a letter of support from Council to Larimer and Weld County? 32 2 0 34 94% ATTACHMENTS 1. Laramie Foothills Wind Energy Vicinity Map (PDF) 2. Preferred Route Map (PDF) 3. Easement Permit Corridor North (PDF) 4. Permitting Corridor South (PDF) 5. Council Work Session Follow Up (PDF) 6. Water Board Meeting Minutes, December 20, 2018 (Draft) (PDF) 7. Energy Board Minutes November 8, 2018 (Draft) (PDF) 8. Natural Resources Advisory Board Minutes, October 17, 2018 (PDF) 9. Land Conservation Stewardship Board Minutes, July 11, 2018 (PDF) 10. CBRE Land Appraisal (PDF) 012 0.5 Miles Data Sources: Fort Collins, Larimer County & COMap Fort Collins Natural Area Fort Collins Utilities Larimer County Open Space State Land Board Bureau of Land Management US Forest Service Conservation Easement The Nature Conservancy State Wildlife Area Other Public Lands Wind Energy Facility Laramie Foothills Mountains to Plains Landscape ATTACHMENT 1 !( !( !( ( ! ( ! ( ! !( ( ! !( ( ! ( !( ! ( ! ( ! ! ( ( ! ( ! !( !( !( !( !( ( ! ( ! ( !( ! !( !( !( ( ! !( !( ( !( ! !( ! ( !( !( ( !( !( ! ( ! ( !( ! ( !( !( ! !( !( !( ( !( !( ! ( ! !( !( ! ( !( !( ( !( ! !( !( !( !( !( !( !( !( !( ! ( Hamilton Reservoir WELD COUNTY LARIMER COUNTY ¦¨§25 SOPARPASIRTOIENE NATURAL AREA C o ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! WELD COUNTY LARAMIE COUNTY WELD COUNTY LARIMER COUNTY LARAMIE COUNTY LARIMER COUNTY ¦¨§25 S p ring Cr e ek S po t wood C re e k Co Rd 126 1/2 Co Rd 92 05 06 07 08 17 18 19 20 02 01 11 12 14 13 23 24 19 20 29 30 31 32 23 24 26 25 35 36 ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ¦¨§25 I nd i an C r e ek S p ring Creek C o al Cree k Spottlew ood Creek Co Rd 82 N Co Rd 7 E Co Rd 92 Co Rd 92 E Co Rd 82 Romar Ranch Rd N Co Rd 9 Co Rd 5 04 03 02 01 05 08 09 10 11 12 17 16 15 14 13 08 09 10 11 12 13 17 16 15 14 Utilities electric · stormwater · wastewater · water 700 Wood Street PO Box 580 Fort Collins, CO 80522 970.221.6700 970.221.6619 – fax 970.224.6003 – TDD utilities@fcgov.com fcgov.com/utilities M E M O R A N D U M DATE: 11/29/2018 TO: Mayor Troxell and Councilmembers THRU: Darin Atteberry, City Manager Jeff Mihelich, Deputy City Manager Kevin Gertig, Utilities Executive Director Carol Webb, Utilities Deputy Director FROM: Jason Graham, Director of Plant Operations, Utilities Daylan Figgs, Planning Program Manager, Natural Areas RE: November 27, 2018 Work Session Summary: Roundhouse Renewable Energy Project, Transmission Line Easement on Meadow Springs Ranch The purpose of the memo is to summarize the Council Work Session on November 27, 2018 and next steps. All Council members were present except Overbeck and Summers. Staff provided an overview of the Roundhouse Renewable Energy Project including the need for a transmission line easement on Meadow Springs Ranch. The focus of the presentation was on the transmission line preferred alignment and to seek input from Council on their level of support for approving an easement at the January 15, 2019 City Council meeting. Key points or requests made by Councilmembers were: Council was appreciative of the analysis and work completed by City staff and project team. Council expressed gratitude for the provided feedback from the boards and commissions. Council requested more information related to wildlife, particularly burrowing owl’s ability and likelihood, to return to the area after construction. Council requested more information regarding the analysis completed between the preferred route and alternative routes to the east, including wildlife impacts. In general, Council members were supportive of the transmission line easement request on Meadow Springs Ranch to move forward for approval at the January 15, 2019 City Council meeting. DocuSign Envelope ID: 6A8FE62F-472A-4415-95FA-54D32F8DB7FD Attachment 5 Follow Up Items City staff will provide requested additional information to City Council prior to the scheduled January 15, 2019 City Council meeting. DocuSign Envelope ID: 6A8FE62F-472A-4415-95FA-54D32F8DB7FD We are not aware of any studies that address the impacts to burrowing owls from the presence of transmission lines. Also, we are not aware of any studies that look to determine if burrowing owls avoid previously occupied areas following construction of features like transmission lines. A concern to burrowing owls is the creation of perch locations for avian predators and the impacts of increased predation on the owls. Utility poles may offer hunting sites in areas where tall perches are scarce (Dwyer and Doloughan 2014). Perch deterrents will be used as a mitigation measure to help minimize impacts, but it is likely impacts will still occur. The City is working with Dr. James Dwyer to assist in the placement of transmission poles and the design and placement of perch deterrents. Further, staff will monitor burrowing owl activities to determine if previously occupied sites are avoided. Breeding bird surveys conducted on Soapstone and Meadow Springs have found burrowing owls to be widely distributed within suitable habitat across this landscape (See Map). Efforts to minimize and hopefully avoid impacts to burrowing owls from the transmission line are in place. However, burrowing owls are located in areas away from any potential impact. Also, current prairie dog management efforts to expand the prairie dog complex and minimize impacts from sylvatic plague will continue to provide and expand suitable habitat for burrowing owls. Dwyer, J. F. and K.W. Doloughan. 2014. Testing systems of avian perch deterrents on electrical power distribution lines in sage‐brush habitat. Human‐Wildlife Interactions 8(1): 39‐55. RHRE City Council Study Session, 11/27/18 Follow Up: Council requested more information regarding the analysis completed between the preferred route and alternative routes to the east, including wildlife impacts. Through the Siting Study (Agenda Item Summary Attachment 5), a number of potential segments were considered on both sides of Interstate 25 (I-25). These segments were connected end-to-end to form route alternatives. Of the six alternatives carried forward for comparative analysis, five were east of the preferred route: Routes 2C, 3B, 4, 5A, 5B. Alternative routes 4, 5A, and 5B paralleled or were east of I-25. All alternative routes, including routes along I-25 or further east, would have had considerably greater impacts than the preferred route 2B as shown in Table 4-2 and corresponding maps found in the Siting Study. The comparative impacts to natural resources are summarized in the table below. Route 2B (Preferred, west of Railroad) Route 2C (East of Railroad) Route 3B (Old State Highway 87) Route 4 (East Of Railroad) Route 5A (East of I-25) Route 5B (East of I-25) Vegetation And Surface Water Criteria Route 2B avoids siting within a 100- foot buffer of perennial and ephemeral surface water features, wetlands, and riparian vegetation communities. It requires one crossing of a riparian area, the lowest of any alternative route except Route 2C, which also has one crossing. Route 2C avoids siting within a 100- foot buffer of perennial and ephemeral surface water features, wetlands, and riparian vegetation communities. Route 2C would involve one crossing over or through an identified riparian/wetland vegetation Wildlife Criteria Route 2B has the shortest distance through the following wildlife habitats than any of the other routes: • Mapped black- tailed prairie dog colonies, including those that were active in 2017 and areas designated for active conservation; and • Mule deer winter concentration areas and severe winter range. Route 2C has lower impacts on the following wildlife habitats: • Mapped black- tailed prairie dog colonies (slightly more than Route 2B); • Pronghorn winter concentration areas; and • A substantially greater distance through mule deer severe winter range. Route 3B avoids any effect on mule deer winter concentration areas. Although slightly higher than Alternative 2B, this route would cross a lower amount of black-tailed prairie dog colonies than most of the other alternative routes. In addition, it has a mid-range rating for the following wildlife habitats: • Pronghorn winter concentration areas; and • Mule deer severe winter range. Route 4 has a greater distance McCown’s longspur mapped core areas. McCown’s longspur mapped core areas. However, Route 2C has the greatest distance of any route through lark bunting core areas. through lark bunting core areas and one of the highest distances through McCown’s longspur core areas. McCown’s longspur mapped core areas. miles) through McCown’s longspur mapped core areas. Linear Infrastructure Criteria in Colorado 98% of its distance in Colorado is adjacent to existing linear infrastructure. Approximately 96% of its length is adjacent to existing linear infrastructure, however, it has the least distance that can be accessed by a local use road system and would require road- building. Approximately 96% of its length is adjacent to existing linear infrastructure. Despite its proximity to I-25, Route 4 has limited access via existing surface roads – a frontage road does not exist along the west side of I-25 infrastructure (railroad tracks, existing pipeline ROW/corridor, or County Road 5) for 98% of its length. A WAPA alternative route would require 5 miles of new corridor; 72% would follow existing linear infrastructure. 2. Overall length is an indicator of overall natural resource, land use, cultural resource, and visual impact. As distance increases, the likelihood of resource impacts increase. An alternative that follows the existing WAPA line would be approximately 18 miles long compared to 13-14.5 miles in Colorado for the alternatives. Excerpt from Unapproved DRAFT MINUTES - WATER BOARD REGULAR MEETING December 20, 2018, 5:30 p.m. 222 Laporte Avenue, Colorado River Community Room 12/20/2018 – Excerpt from Unapproved DRAFT MINUTES Page 1 o Roundhouse Renewable Energy Project – Transmission Line Easement Request on Meadow Springs Ranch (Attachments available upon request) Presentation Summary: Water Reclamation and Biosolids Manager Jason Graham summarized the transmission line easement request, which was presented to the Water Board in the past and to the Energy Board, Natural Resources Advisory Board, and Land Conservation & Stewardship Board. The item was presented at the November 27, 2018 City Council Work Session. Staff asks for the Water Board to support granting an easement on Meadow Springs Ranch (MSR) for a transmission line as part of the Roundhouse Renewable Energy Project. After attending a Council Work Session, general support and appreciation for they work they have done was received. Council asked for additional information of analysis between the preferred route and alternative routes and more analysis regarding burrowing owls’ ability and likelihood, to return to the area after construction. All alternative routes are further east and would have a significantly higher impact on wildlife, and the preferred route lines up with 98% of existing infrastructure. Discussion Summary: Board members inquired and commented on various related topics including if more information had been found out about the owls (After doing a literature review and speaking to multiple resources, staff is not aware of any studies that impact burrowing owls’ presence or avoidance of areas due to transmission lines), if there were any federal permits needed (confirmed no federal permits were required, only a state industrial siting permit from Wyoming), how the permit process is going for the wind turbines (Ryan Fitzpatrick, with NexTerra, replied that the permitting in Wyoming is submitted and currently working on the industrial siting permit to be submitted in March of 2019), and if all finances are ready (confirmed they are). Board Member Kuiken moved that The Water Board recommends City Attachment 6 WATER BOARD REGULAR MEETING 11/15/2018 – Excerpt from Unapproved DRAFT MINUTES Page 2 Council approve the transmission line easement on Meadow Springs Ranch for the Roundhouse Renewable Energy Project as recommended by City Staff Board Member Malers seconded the motion. Vote on the motion: It passed unanimously, 11-0 Energy Board Minutes – ABRIDGED November 8, 2018 Energy Board Minutes – ABRIDGED November 8, 2018 Fort Collins Utilities Energy Board Minutes – ABRIDGED Thursday, November 8, 2018 Energy Board Chairperson Nick Michell, 970-215-9235 City Council Liaison Ross Cunniff, 970-420-7398 Energy Board Vice Chairperson Amanda Shores, 408-391-0062 Staff Liaison Tim McCollough, 970-305-1069 Roll Call Board Present: Chairperson Nick Michell, Vice Chairperson Amanda Shores, Alan Braslau, Bill Becker, Jeremy Giovando, Greg Behm, John Fassler Late Arrivals: Stacey Baumgarn, Krishna Karnamadakala Board Absent: Others Present Staff: Tim McCollough, Christie Fredrickson, John Phelan, Adam Bromley, Kirk Longstein, Pablo Bauleo, Jason Graham, Rhonda Gatzke, Cyril Vidergar, Daylan Figgs Platte River Power Authority: Paul Davis, Brad Decker, Joel Danforth, Alyssa Clemson Roberts Members of the Public: Rich Maroncelli, Rick Coen Roundhouse Renewable Energy Project Update Jason Graham, Director, Plant Operations Daylan Figgs, Planning and Special Projects Program Manager, Natural Areas (attachments available upon request) The Energy Board is familiar with this project, but Mr. Graham said he would provide an update and make time for the Board to ask any questions they may have. Mr. Graham said staff is not asking the board for any action or recommendation, but if the board would like to act, the City Council work session deadline is Wednesday, November 14. The Roundhouse Renewable Energy Project is a wind farm in Wyoming to generate power, and the power will be delivered by transmission line to Platte River Power Authority’s Rawhide Facility. The planned project includes 75 wind turbines with 150 MW of energy capacity. The transmission line will be self-supporting steel monopole structures with a height in range of 80 feet to 130 feet. The transmission line will go across 9.7 miles of Meadow Springs Ranch (MSR), a City-owned property. City Staff partnered with NextEra Energy, Logan Simpson, and Platte River to determine the “preferred” route on MSR using Energy by Design criteria and a Siting Study. Staff has received feedback from various stakeholders such as City Boards and Commissions, workshops, and public open houses. There were three total proposed routes, and the Siting Study ranked each route by criteria in the following categories: vegetation and surface water, wildlife, raptor (birds), non-raptor, visual resources, land use, cultural resources, engineering, and linear infrastructure. The highest score route on the Siting Study was selected as the preferred route, because it had the least environmental impact. Attachment 7 Energy Board Minutes – ABRIDGED November 8, 2018 Energy Board Minutes – ABRIDGED November 8, 2018 Vice Chairperson Shores said there is one area on the map (colored in dark purple) that goes through a densely populated area for birds, and regardless of the route it does not seem to be mitigated well. Mr. Figgs said the problem there is mostly related to the timing of construction; staff is addressing the issue by a seasonal construction closure, so construction is only allowed to happen outside the time when the birds are present on the property. Chairperson Michell asked which of the three routes are most cost effective, or if there is a significant difference in construction cost. Mr. Graham said the preferred route does have the least amount of infrastructure impact and a lower construction cost because of that. Vice Chairperson Shores asked what feedback Staff has received from other boards, and Mr. Graham said the feedback staff has received so far has generally been supportive. Mr. Figgs added that most boards are concerned with the environmental impact and are pleased with the mitigation plans so far. Mr. Graham said over the course of a year, this project will generate the equivalent energy needs for 70,500 homes annually and completion of the project will be a significant step in achieving Platte River’s and community energy goals, including the City’s CAP goals. The project is also estimated to decrease Fort Collins emissions by about 10%. City Council has a request to approve the easement on MSR in January 2019, and construction is slated to complete in 2020. Board member Baumgarn moved the Energy Board Chair to write a memo in support of the Roundhouse Renewable Energy proposed transmission line route and required easement by November 14, 2018. Board member Braslau seconded the motion. Vote on the motion: It passed unanimously, 9-0 !"#$ % / 6$&.$("9*'#'2)7 26$-4,'(6$""4.).3',* . : ,5"(.8 *" " '.'*$$2'/$/7$ +..8 2 3'*2 :(2)4;5$,0'@.8 -0/. ,8 4('.'.$#",/2.0"2"* 260$0) " 26$1 3'* " (**5,.4"// 0',$11'22$'4# " (*)* #*.$** ""/'.0 5:'-.3 7/* "*.$ :$$ 1/4, 2/." 3"0 , /- 0$$ 1:0$7 =$,.:- / 20" '4.$/@:*02'4#/'A$:'*2051$:./6 3'26/1$ '4 26$0254'2).8 6$8 9*42 /42""52 : ( 2/7 $. (* 2/.'2)/ # ",$. 26$ 3'*5("2.,26$"". "** $ 6$.2'/'4#2 <0 "'.77/4 1$2.* "=:,028 9/ 26$ 26$,4,>'2'/" '4( 0', 2$.4" '4(50$1:*"$5,* '47/1 $0 5:*.5,/$ /4$.$4 '2$-01" " 2/ 1""42. 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"-#$/$& & "+*" 7*2*&&$,/$./2*&*+*(28 7./+:2"$0 A$*#+$+ 3(2**6- ,+..*/..5 *./ "-+C"/55" "// ,#+:,,/'.0 A$(".2**$)5 */5::$ )( '$+$$"+ ( '$$ 3.&2* 4*$$.,$3 "+/.21 21$5*+/3. 4*$&2-2 *:/$/($/21 >"$ &++ 21$58+0 >* # *:./$$.*.( "+ 2. +$/"' 4. . $$ 3((. 21$)(6 21$,66$"+*.$5 + "-C"2", >5)/2*$ ,,5 ):./ 5*2** $28y+2*":9$ *&($)/ 2.$+ 4" / " "2 /2$)))( *(z-6.A$ 5*D"/&+$$ /(*##4 4.B""-y+/".12 (5*&* :($28 *2 "'$) 2.55$$*$/)21 A-((/ >z-#8 * 2"9 35") v * 21$(-/$$9$229$2$++)+2 # "/ ()$$0 / +$)(+/ *. *2B 6$2$,"/-!/5-*C)))3+ 21$ 3() * 21$$$*/ 2./.321 5.5+ 1$ {#3. 21" w. & 21$ *+#""12$2 ".9$( &5+0 w*9 !9 "0 > 3(*$/( z-"$2 21$5"21 21$"$+)/(+- "(" v *$8 &(5*/$ 4"/28;&"2" )58+$ 3.$2*2$"//.2"*2*(+2 2./+55- *. # . "++/0 5*2"+$6 ).:$-/"5+)/$$*" 21"2+5"0 A$B"+(2"" "0 '5$'$5 $ '-2 +/ *);/21 A-+ 4$2 ,/ ). ).-(*.4 3"*+# +:/"10 $)1.,33.()$+$-,) 21$1$2B /9 )5)$*/+ '$ 4.2$ 21"(".$)2"2$6. " "- 6.2 21*+('5$5)'.$ 21"( ) 5* 21$-+ 2.9$$ &2 21$2 "+ $ 2.$ *#)(/:.12 / 9/: 5":$.-*+ ",21$,*.."9 ..22$4 */2$2 '$( 21$//+6 2(6 21$ <2* 1" 21$.$ 6-.//:, * <)$9*2-/ '$ ) 21$$($"+=+0 2"2 > Land Conservation & Stewardship Board Regular Meeting 07/11/2018 – MINUTES Page 2 5. NEW BUSINESS DISCUSSION ITEM Meadow Springs Ranch above ground transmission line easement request. Daylan Figgs, Planning Program provided an update on the mitigation strategy to offset the impacts from the project, describing the alignment, pole design and perch deterrents. Another large piece of the project is Compensatory Mitigation. Daylan explained the value of ecological goods and services are represented in the scientific literature, but less understood is how to calculate a reduction in value associated with a project impact. . This loss of value can be used to determine compensatory mitigation. Joe noted that Board members have been working a memorandum to City Council regarding the Board’s position on the project and asked what the next steps would be. Daylan summarized a timeline: The proposed MSR transmission line has gone before the NRAB and the Energy Board. Both boards have unanimously approved the process used for the alignment. November 27th is a Work Session with City Council to go through the information for the alignment. December 20th is the date the Water Board will consider the easement. January 15th is the first reading at City Council for the approval of the easement Discussion: Board members discussed several issues including prairie dog and black footed ferret management, protection of wildlife species and resource management and transmission line maintenance. Surface impacts and historical resources that might be found on the sight were of concern. Daylan assured the Board that all those resources have been well thought out and he feels confident that continued efforts will ensure proper mitigation takes place for all impacts. MEADOW SPRINGS TRANSMISSION LINE MEMORANDUM TO CITY COUNCIL Board members overall were opposed to any type of resource disturbance but agreed a memo could be sent to City Council, if some changes were made. Joe led discussion on the memorandum. Board members agreed on the following memorandum changes: Replacing the term “renewable” with “clean energy”, in paragraph 5. Replacing “Utilities and Natural Areas” with the term “city organization” in paragraph 4. Include “Fort Collins” in the second to the last sentence in the last paragraph…….`export environmental damage to Wyoming and Fort Collins’. There was discussion that the memo’s language was too strong in terms of how NAD Attachment 9 Land Conservation & Stewardship Board Regular Meeting 07/11/2018 – MINUTES Page 3 might acquire Meadow Springs in the future. John recommended instead highlighting the interest in maintaining a relationship with the Utilities Department to protect the property. John agreed to review the memo and make changes. Kelly is in opposition to the Meadow Springs Transmission Line. He does, however support the memorandum and its general content. Joe reiterated the memo just expresses the Board’s concerns and doesn’t necessarily say the Board is in support of the transmission line. David Tweedale made a motion to approve the Memorandum to City Council supporting the conservation of Meadow Springs Ranch with the above four amendments. Mike Weber seconded the motion. The motion was approved 5-0 The Board agrees that Utilities and Natural Areas have done a good job of environmental analysis for the transmission alignment and are in support of and future land acquisition of Meadow Springs. 6. OTHER BUSINESS . . 7. ADJOURNMENT The Board adjourned at 8:25 p.m. MEADOW SPRINGS RANCH PROPERTY LARIMER COUNTY ROAD 92 LARIMER AND WELD COUNTIES, COLORADO 80549 CBRE GROUP, INC. FILE NO. 18-271PH-2524-1 PARCEL NOS.: ELECTRIC TRANSMISSION EASEMENT OWNER: CITY OF FORT COLLINS APPRAISER: JON VAUGHAN DATE OF VALUE: SEPTEMBER 27, 2018 DATE OF REPORT: OCTOBER 15, 2018 APPRAISAL REPORT CBRE VALUATION & ADVISORY SERVICES ATTACHMENT 10 i VALUATION & ADVISORY SERVICES 2850 McClelland Drive, Suite 3500 Fort Collins, CO 80525 T 970-223-4347 F 970-223-4393 www.cbre.com October 15, 2018 Mr. Ryan Fitzpatrick Project Director NEXTERA ENERGY RESOURCES 700 Universe Blvd Juno Beach, Florida 33408 RE: Project: 230kV Overhead Electric Transmission Line Location: Larimer County Road 92 Larimer and Weld Counties, Colorado Owner: City of Fort Collins CBRE, Inc. File No.: 18-271PH-2524-1 Dear Mr. Fitzpatrick: At your request and authorization, CBRE, Inc. has prepared an appraisal report of the referenced property. The purpose of this appraisal is to provide a compensation estimate for the reasonable market value of the property actually taken; compensable damages, if any, to the residue; and special benefits, if any, to the residue. Only the underlying land/site value and affected improvements acquired in the acquisition area have been valued in this appraisal. My analysis is presented in the following Appraisal Report. I understand that this appraisal report may be used in connection with the acquisition of an easement for the referenced project to be constructed by NextEra Energy Resources. The subject is a 26,600-acre parcel of dry agricultural land located north of the Town of Wellington in unincorporated Larimer and Weld Counties, Colorado. Although the property is improved with a biosolids processing facility, the improvements are not being impacted by the easement acquisition. Therefore, no building improvements will be valued. The reasonable market value and compensation estimate are subject to certain definitions, assumptions and limiting conditions, and certification of appraiser set forth in the attached appraisal report. Based upon my independent appraisal and exercise of my professional judgment, my compensation estimate for the acquisition is concluded as follows: MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion Land Value - As Is Fee Simple Estate September 27, 2018 $31,920,000 Compensation Estimate September 27, 2018 $105,850 Compiled by CBRE ii The report, in its entirety, including all assumptions and limiting conditions, is an integral part of, and inseparable from, this letter. The following appraisal sets forth the most pertinent data gathered, the techniques employed, and the reasoning leading to the opinion of value. The analyses, opinions and conclusions were developed based on, and this report has been prepared in conformance with, the guidelines and recommendations set forth in the Uniform Standards of Professional Appraisal Practice (USPAP) and the Uniform Relocation Assistance and Real Property Acquisition Act. It also conforms to the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. The purpose of this appraisal is to estimate the appropriate compensation for a partial acquisition of the subject property. As a result, it is being analyzed before and after the acquisition. For the analysis after the acquisition, the property is being analyzed as though the project has been completed on the date of value, which is a hypothetical condition. This hypothetical condition is common to all partial acquisition appraisals because it is necessary to develop a compensation estimate. The intended use and user of my report are specifically identified in my report as agreed upon in my contract for services and/or reliance language found in the report. As a condition to being granted the status of an intended user, any intended user who has not entered into a written agreement with CBRE in connection with its use of my report agrees to be bound by the terms and conditions of the agreement between CBRE and the client who ordered the report. No other use or user of the report is permitted by any other party for any other purpose. Dissemination of this report by any party to any non-intended users does not extend reliance to any such party, and CBRE will not be responsible for any unauthorized use of or reliance upon the report, its conclusions or contents (or any portion thereof). iii It has been a pleasure to assist you in this assignment. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us. Respectfully submitted, CBRE - VALUATION & ADVISORY SERVICES Jon Vaughan, MAI, SR/WA Director CG# 100000631 www.cbre.com/jon.vaughan Phone: 970 223 4378 Mobile: 970 310 1339 Email: jon.vaughan@cbre.com Table of Contents iv TABLE OF CONTENTS Introduction Part 1 - Scope of Work ........................................................................................................ 1 Part 2 - Factual Data – Larger Parcel Before Take ................................................................ 8 Part 3 – Analysis and Valuation – Larger Parcel Before Take ............................................... 22 Part 4 – Factual Data – Part Acquired ................................................................................. 35 Part 5 – Analysis and Valuation – Part Acquired ................................................................. 37 Part 6 – Residue Value Before Take .................................................................................... 39 Part 7 – Factual Data – Residue After Take ......................................................................... 40 Part 8 – Analysis and Valuation – Residue After Take ......................................................... 41 Part 9 – Analysis of Damages or Benefits ........................................................................... 42 Part 10 – Temporary Easement Rental Value ...................................................................... 43 Part 11 – Compensation Summary .................................................................................... 44 Part 12 – Exhibits and Addenda ......................................................................................... 46 A Colorado 7-Step Partial Acquisition Appraisal Process B Acronyms and Definitions C Qualifications Executive Summary v EXECUTIVE SUMMARY Parcel Number Property Name Name of Owner Property Address or Location Project Location Owner Present at Inspection Client Property Rights Appraised Date of Report Date of Inspection Larger Parcel Land Area 26,600 AC Zoning Owner and/or Tenant Occupancy Affected Owner Improvements Subject 5-year Sales History External Market Influences Highest and Best Use Before Take After Take Purpose of Easement Purpose of Temporary Easement Affect of Take on Residue Parcel Damage Considerations Cost to Cure Special Benefits Considerations None None 230 kV Electric Transmission Line None being acquired No significant affect None Agriculture Agriculture The subject property has been held by the current owner for more than 5 years Ranch land extending for miles between the Cities of Fort Collins and Cheyenne NextEra Energy Resources City of Fort Collins Electric transmission line extending from a wind farm near Cheyenne, Wyoming to the Rawhide Power Plant Substation in Larimer County Tawnya Ernst, Mark Sears, and several other officials with the City of Fort Collins Meadow Springs Ranch Larimer County Road 92, Larimer & Weld Counties, CO 80549 Electric Transmission Easement Fee Simple Estate October 15, 2018 September 27, 2018 O (Open) by Larimer County None Owner-occupied VALUE AND COMPENSATION CONCLUSIONS Larger Parcel Value Before Acquisition Total Value Before Acquisition Total Value Executive Summary vi Value of the Part Acquired Land/Site Acquisitions Parcel Area $/Unit Value Value Total Value None $0 $0 Easement Acquisitions Parcel Area $/Unit Value % of Fee Value Total Value Electric Transmission Easement 176.364 AC $1,200 50% $105,818 $105,818 Owner Affected Improvements Acquired (Contributory Value) Contributory Value Total Value $0 $0 Tenant Affected Improvements Acquired (Contributory Value) Contributory Value Total Value $0 $105,818 Description None Total Tenant Affected Improvements Contributory Value of Part Acquired Total Value of Part Acquired (land + affected improvements) Total Owner Affected Improvements Contributory Value of Part Acquired Total Land/Site Value of Part Acquired Total Land/Site Value of Part Acquired None Description Parcel Area $/Unit Value Rate (%) Term (Mos.) Value Total Value None $0 Total Rental Value of Temporary Easements $0 Value of Part Acquired Land/Site Value $0 Easement Value $105,818 Contributory Value of Improvements $0 Total Value of Part Acquired $105,818 Compensible Damages and/or Offsetting Benefits Compensible Damages - Curable (Net Cost to Cure) $0 Compensible Damages - Incurable (No Cost to Cure) $0.00 <Less> Special Benefits (Offset Up To 100% of Incurable Damages) $0.00 =Remaining Special Benefits (Offset Up To 50% of Value of Part Acquired) $0.00 Total Rental Value of Temporary Easements $0 Compensation Estimate $105,818 Rounded $105,850 Compiled by CBRE Executive Summary vii SUBJECT PROPERTY Aerial View (Boundary lines are approximate) Part 1: Scope of Work 1 Part 1 - Scope of Work This Appraisal Report is intended to comply with the reporting requirements set forth under Standards Rule 2 of USPAP. The scope of the assignment relates to the extent and manner in which research is conducted, data is gathered and analysis is applied. EXTRAORDINARY ASSUMPTIONS An extraordinary assumption is defined as “an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.” 1 1. No draft of the proposed permanent easement was available for review. Therefore, the analysis of the value of the part taken is based on conversations with the acquisition agent regarding the terms of the easement. Specifically, the acquisition agent indicated that this will be a non-exclusive easement for an overhead electric transmission line. Any site improvements and landscaping impacted by the project will be repaired or replaced by the condemnor. The appraiser reserves the right to revise the report and value conclusions if the final terms of the easement are significantly different than the terms disclosed during the appraisal process. 2. No legal description of the larger parcel or title policy was available for review. Furthermore, no legal description of the easement area being acquired was available. Therefore, the precise land area of the larger parcel and the easement area, as well as all descriptions and sketches of the larger parcel are approximate, based on information provided by the property owner and the client. The appraiser reserves the right to revise the report if the land area of the larger parcel or the easement area are significantly different than what was estimated. HYPOTHETICAL CONDITIONS A hypothetical condition is defined as “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purposes of analysis.” 2 1. The purpose of this appraisal is to estimate the appropriate compensation for a partial acquisition of the subject property. As a result, it is being analyzed before and after the acquisition. For the analysis after the acquisition, the property is being analyzed as though the project has been completed on the date of value, which is a hypothetical condition. This hypothetical condition is common to all partial acquisition appraisals because it is necessary to develop a compensation estimate. ASSUMPTIONS AND LIMITING CONDITIONS 1. CBRE, Inc. through its appraiser (collectively, “CBRE”) has inspected through reasonable observation the subject property. However, it is not possible or reasonably practicable to personally inspect conditions beneath the soil and the entire interior and exterior of the improvements on the subject property. Therefore, no representation is made as to such matters. 1 The Appraisal Foundation, USPAP, 2018-2019 2 The Appraisal Foundation, USPAP, 2018-2019 Part 1: Scope of Work 2 2. The report, including its conclusions and any portion of such report (the “Report”), is as of the date set forth in the letter of transmittal and based upon the information, market, economic, and property conditions and projected levels of operation existing as of such date. The dollar amount of any conclusion as to value in the Report is based upon the purchasing power of the U.S. Dollar on such date. The Report is subject to change as a result of fluctuations in any of the foregoing. CBRE has no obligation to revise the Report to reflect any such fluctuations or other events or conditions which occur subsequent to such date. 3. Unless otherwise expressly noted in the Report, CBRE has assumed that: (i) Title to the subject property is clear and marketable and that there are no recorded or unrecorded matters or exceptions to title that would adversely affect marketability or value. CBRE has not examined title records (including without limitation liens, encumbrances, easements, deed restrictions, and other conditions that may affect the title or use of the subject property) and makes no representations regarding title or its limitations on the use of the subject property. Insurance against financial loss that may arise out of defects in title should be sought from a qualified title insurance company. (ii) Existing improvements on the subject property conform to applicable local, state, and federal building codes and ordinances, are structurally sound and seismically safe, and have been built and repaired in a workmanlike manner according to standard practices; all building systems (mechanical/electrical, HVAC, elevator, plumbing, etc.) are in good working order with no major deferred maintenance or repair required; and the roof and exterior are in good condition and free from intrusion by the elements. CBRE has not retained independent structural, mechanical, electrical, or civil engineers in connection with this appraisal and, therefore, makes no representations relative to the condition of improvements. CBRE appraisers are not engineers and are not qualified to judge matters of an engineering nature, and furthermore structural problems or building system problems may not be visible. It is expressly assumed that any purchaser would, as a precondition to closing a sale, obtain a satisfactory engineering report relative to the structural integrity of the property and the integrity of building systems. (iii) Any proposed improvements, on or off-site, as well as any alterations or repairs considered will be completed in a workmanlike manner according to standard practices. (iv) Hazardous materials are not present on the subject property. CBRE is not qualified to detect such substances. The presence of substances such as asbestos, urea formaldehyde foam insulation, contaminated groundwater, mold, or other potentially hazardous materials may affect the value of the property. (v) No mineral deposit or subsurface rights of value exist with respect to the subject property, whether gas, liquid, or solid, and no air or development rights of value may be transferred. CBRE has not considered any rights associated with extraction or exploration of any resources, unless otherwise expressly noted in the Report. (vi) There are no contemplated public initiatives, governmental development controls, rent controls, or changes in the present zoning ordinances or regulations governing use, density, or shape that would significantly affect the value of the subject property. (vii) All required licenses, certificates of occupancy, consents, or other legislative or administrative authority from any local, state, nor national government or private entity or organization have been or can be readily obtained or renewed for any use on which the Report is based. (viii) The subject property is managed and operated in a prudent and competent manner, neither inefficiently or super-efficiently. (ix) The subject property and its use, management, and operation are in full compliance with all applicable federal, state, and local regulations, laws, and restrictions, including without limitation environmental laws, seismic hazards, flight patterns, decibel levels/noise envelopes, fire hazards, hillside ordinances, density, allowable uses, building codes, permits, and licenses. (x) The subject property is in full compliance with the Americans with Disabilities Act (ADA). CBRE is not qualified to assess the subject property’s compliance with the ADA, notwithstanding any discussion of possible readily achievable barrier removal construction items in the Report. (xi) All information regarding the areas and dimensions of the subject property furnished to CBRE are correct, and no encroachments exist. CBRE has neither undertaken any survey of the boundaries of the subject property nor reviewed or confirmed the accuracy of any legal description of the subject property. Unless otherwise expressly noted in the Report, no issues regarding the foregoing were brought to CBRE’s attention, and CBRE has no knowledge of any such facts affecting the subject property. If any information inconsistent with any of the foregoing assumptions is discovered, such information could have a substantial negative impact on the Report. Accordingly, if any such information is subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. CBRE assumes no Part 1: Scope of Work 3 responsibility for any conditions regarding the foregoing, or for any expertise or knowledge required to discover them. Any user of the Report is urged to retain an expert in the applicable field(s) for information regarding such conditions. 4. CBRE has assumed that all documents, data and information furnished by or behalf of the client, property owner, or owner’s representative are accurate and correct, unless otherwise expressly noted in the Report. Such data and information include, without limitation, numerical street addresses, lot and block numbers, Assessor’s Parcel Numbers, land dimensions, square footage area of the land, dimensions of the improvements, gross building areas, net rentable areas, usable areas, unit count, room count, rent schedules, income data, historical operating expenses, budgets, and related data. Any error in any of the above could have a substantial impact on the Report. Accordingly, if any such errors are subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. The client and intended user should carefully review all assumptions, data, relevant calculations, and conclusions of the Report and should immediately notify CBRE of any questions or errors within 30 days after the date of delivery of the Report. 5. CBRE assumes no responsibility (including any obligation to procure the same) for any documents, data or information not provided to CBRE, including without limitation any termite inspection, survey or occupancy permit. 6. All furnishings, equipment and business operations have been disregarded with only real property being considered in the Report, except as otherwise expressly stated and typically considered part of real property. 7. Any cash flows included in the analysis are forecasts of estimated future operating characteristics based upon the information and assumptions contained within the Report. Any projections of income, expenses and economic conditions utilized in the Report, including such cash flows, should be considered as only estimates of the expectations of future income and expenses as of the date of the Report and not predictions of the future. Actual results are affected by a number of factors outside the control of CBRE, including without limitation fluctuating economic, market, and property conditions. Actual results may ultimately differ from these projections, and CBRE does not warrant any such projections. 8. The Report contains professional opinions and is expressly not intended to serve as any warranty, assurance or guarantee of any particular value of the subject property. Other appraisers may reach different conclusions as to the value of the subject property. Furthermore, market value is highly related to exposure time, promotion effort, terms, motivation, and conclusions surrounding the offering of the subject property. The Report is for the sole purpose of providing the intended user with CBRE’s independent professional opinion of the value of the subject property as of the date of the Report. Accordingly, CBRE shall not be liable for any losses that arise from any investment or lending decisions based upon the Report that the client, intended user, or any buyer, seller, investor, or lending institution may undertake related to the subject property, and CBRE has not been compensated to assume any of these risks. Nothing contained in the Report shall be construed as any direct or indirect recommendation of CBRE to buy, sell, hold, or finance the subject property. 9. No opinion is expressed on matters which may require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers. Any user of the Report is advised to retain experts in areas that fall outside the scope of the real estate appraisal profession for such matters. 10. CBRE assumes no responsibility for any costs or consequences arising due to the need, or the lack of need, for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for Flood Hazard Insurance. 11. Acceptance or use of the Report constitutes full acceptance of these Assumptions and Limiting Conditions and any special assumptions set forth in the Report. It is the responsibility of the user of the Report to read in full, comprehend and thus become aware of all such assumptions and limiting conditions. CBRE assumes no responsibility for any situation arising out of the user’s failure to become familiar with and understand the same. 12. The allocations of the total value estimate in the Report between land and improvements apply only to the existing use of the subject property. The allocations of values for each of the land and improvements are not intended to be used with any other property or appraisal and are not valid for any such use. 13. The maps, plats, sketches, graphs, photographs, and exhibits included in this Report are for illustration purposes only and shall be utilized only to assist in visualizing matters discussed in the Report. No such items shall be removed, reproduced, or used apart from the Report. 14. The Report shall not be duplicated or provided to any unintended users in whole or in part without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Exempt from this restriction is duplication for the internal use of the intended user and its attorneys, accountants, or advisors for the sole benefit of the intended user. Also exempt from this restriction is transmission of the Report pursuant to any requirement of any court, governmental authority, or regulatory agency having jurisdiction over the intended user, provided that the Report and its contents shall not be published, in whole or in part, in any public document without the written Part 1: Scope of Work 4 consent of CBRE, which consent CBRE may withhold in its sole discretion. Finally, the Report shall not be made available to the public or otherwise used in any offering of the property or any security, as defined by applicable law. Any unintended user who may possess the Report is advised that it shall not rely upon the Report or its conclusions and that it should rely on its own appraisers, advisors and other consultants for any decision in connection with the subject property. CBRE shall have no liability or responsibility to any such unintended user. 15. Property utilities will be protected and/or restored by the project. 16. This report is as of the date set out and is not intended to reflect subsequent fluctuations in market conditions, up or down. As an assignment condition, no specific exposure time is linked to the value and compensation conclusions in this appraisal report, however, reasonable exposure time is presumed. This is in accordance with the Uniform Appraisal Standards for Federal Land Acquisitions, which is a guiding document in many partial acquisition appraisal procedures and policies followed by agencies, organizations and appraisal professionals. 17. It is assumed there are no hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for such conditions or arranging for engineering studies that may be required to discover them. 18. The property is appraised assuming responsible ownership and competent property management. PURPOSE OF THE APPRAISAL This appraisal is subject to the Code of Federal Regulations (CFR) and the federal Uniform Act appraisal requirements, Colorado Revised Statutes (C.R.S.), and Colorado Jury Instructions (CJI). Real property appraisal development and reporting is subject to the Uniform Standards of Professional Appraisal Practice (USPAP). The purpose of this appraisal is to develop a compensation estimate for the reasonable market value of the property actually acquired; compensable damages, if any, to the residue after acquisition; and specific benefits, if any, to the residue after acquisition. Referred to as the modified state before-and-after rule, steps to develop a compensation estimate for the acquisition of real property are: 1. Larger Parcel Value Before Acquisition 2. Value of Part Acquired (including easements acquired) 3. Residue Value Before Acquisition (= Value of Larger Parcel Before Acquisition <Less> Value of Part Acquired) 4. Residue Value After Acquisition (including encumbered easement areas acquired) 5. Analysis of Damages and/or Benefits 6. Rental Value of Temporary Easements 7. Compensation Estimate Summary Further details about the steps outlined above are included in the Addenda. CLIENT The client is NextEra Energy Resources. INTENDED USER OF REPORT Intended users of this appraisal report include but are not limited to the property owner or the owner’s personal representative, property owner’s attorney, NextEra Energy Resources officials, and attorneys for NextEra Energy Resources. No other user may rely on my report unless as specifically indicated in the report. Part 1: Scope of Work 5 Intended Users - the intended user is the person (or entity) who the appraiser intends will use the results of the appraisal. The client may provide the appraiser with information about other potential users of the appraisal, but the appraiser ultimately determines who the appropriate users are given the appraisal problem to be solved. Identifying the intended users is necessary so that the appraiser can report the opinions and conclusions developed in the appraisal in a manner that is clear and understandable to the intended users. Parties who receive or might receive a copy of the appraisal are not necessarily intended users. The appraiser’s responsibility is to the intended users identified in the report, not to all readers of the appraisal report. 3 INTENDED USE OF REPORT The intended use of the appraisal is in connection with the acquisition of an easement for the referenced project to be constructed by NextEra Energy Resources. INTEREST APPRAISED The value estimated represents Fee Simple Estate as defined below: Fee Simple Estate - Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat. 4 The property is appraised “as if free and clear” of all liens, bond assessments, and indebtedness, but subject to existing easements, covenants, deed restrictions, rights-of-way of record, and excepting therefrom all rights to oil, natural gas, or other mineral resources beneath such real property. This mineral interest exception is an assignment condition. DEFINITION OF REASONABLE MARKET VALUE Colorado eminent domain proceedings use the following jurisdictional definition of reasonable market value: “The value you are to determine for the property actually acquired is the reasonable market value for such property on September 27, 2018. ‘Reasonable market value’ means the fair, actual, cash market value of the property. It is the price the property could have been sold for on the open market under the usual and ordinary circumstances, that is, under those circumstances where the owner was willing to sell and the purchaser was willing to buy, but neither was under an obligation to do so.” In determining the market value of the property actually acquired, you are not to take into account any increase or decrease in value caused by the proposed public improvement.” (CJI-Civil 4th, 36:3) Colorado Revised Statutes also address Project Influence: “Any decrease or increase in the fair market value of real property prior to the date of valuation caused by the public improvement for which such property is acquired, or by the 3 Appraisal Institute, The Appraisal of Real Estate, 14th ed. (Chicago: Appraisal Institute, 2013), 50. 4 Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015), 90. Part 1: Scope of Work 6 likelihood that the property would be acquired for such improvement, other than that due to physical deterioration within the reasonable control of the owner, shall be disregarded in determining the compensation for the property.” (§24-56-117(1)(c), C.R.S.) The Jurisdictional Exception Rule of USPAP applies to Standards Rule 1-4(f). In Standards Rule 1-4(f), anticipated public or private improvements must be analyzed for their affect on value as reflected in market actions. This is contrary to law for eminent domain appraisal. Jurisdictional exception authorities are Uniform Act, Title III, § 301(3); 49 CFR § 24.103(b); § 24-56-117(1)(c), C.R.S.; and CJI – Civ. 4th, 36:3. Please refer to definitions of other terms and pertinent acronyms listed in the Addenda. EFFECTIVE DATE OF APPRAISAL The effective date of appraisal, reasonable market value opinions, and compensation estimate for the proposed acquisition is as of September 27, 2018. DATE OF APPRAISAL REPORT The date of the appraisal report is October 15, 2018. DATE OF PROPERTY INSPECTION AND OWNER ACCOMPANIMENT Tawnya Ernst, Mark Sears, and several other officials with the City of Fort Collins inspected the subject property with the appraiser, on September 27, 2018. PROJECT IDENTIFICATION AND DESCRIPTION The project will install a 230kV Overhead Electric Transmission Line extending from a wind farm in Wyoming to the Rawhide substation. PROJECT PLANS RELIED ON FOR VALUATION PURPOSES This appraisal was made under the assumption the acquisition for the proposed project will occur as shown on the plans included in the addenda to this report. If any modifications are made to the plans, the appraiser reserves the right to revise the appraisal and appraisal report to reflect the change. SCOPE OF RESEARCH AND ANALYSES Extent to Which the Property is Identified The property is identified through the following sources: property owner’s records Type and Extent of the Data Researched CBRE reviewed the following: applicable tax data Part 1: Scope of Work 7 zoning requirements flood zone status demographics comparable data Type and Extent of Analysis Applied CBRE, Inc. analyzed the data gathered through the use of appropriate and accepted appraisal methodology to arrive at a probable value indication via each applicable approach to value. For vacant land, the sales comparison approach has been employed for this assignment. Data Resources Utilized in the Analysis DATA SOURCES Item: Source(s): Site Data Size City of Fort Collins Other Right of Way Plans NextEra Energy Compiled by CBRE SUMMARY OF APPRAISAL PROBLEMS No legal description of the larger parcel or title policy was available for review. Furthermore, no legal description of the easement area being acquired was available. Therefore, the precise land area of the larger parcel and the easement area, as well as all descriptions and sketches of the larger parcel are approximate, based on information provided by the property owner and the client. The appraiser reserves the right to revise the report if the land area of the larger parcel or the easement area are significantly different than what was estimated. Part 2: Factual Data – Larger Parcel Before Take 8 Part 2 - Factual Data – Larger Parcel Before Take IDENTIFICATION OF THE LARGER PARCEL BEFORE TAKE Appraisal for partial acquisitions is unique in that it requires consideration of damages and/or benefits to the residue property after the acquisition when a partial acquisition occurs, thus the larger parcel from which an acquisition will be made must be determined. Three conditions establish the larger parcel for the consideration of compensable damages and/or special benefits. The three conditions include the portion of a property that has: Unity of Ownership Contiguity Unity of Use The larger parcel identified in this assignment is the 26,600 -acre property located at Larimer County Road 92, in unincorporated Larimer and Weld Counties, Colorado, that is owned by the City of Fort Collins. EXTERNAL MARKET AND LOCATION INFLUENCES US and Colorado Market Conditions U.S. Gross Domestic Product (GDP) grew at an annualized rate of 4.1% in Q2 2018, which was its strongest pace since the third quarter of 2014. Underlying domestic fundamentals are stong, despite a flattening yield curve. On an annual basis, the economy grew 2.8%. Employment The labor market continues to offer a mixed picture of the economy, and the ongoing trade tensions could potentially dampen hiring activity in the coming quarters. On the other, a shortage of workers suggests that the labor market is reaching its limit, thus making an acceleration in wages imminent. Wage growth itself continues to puzzle, however, growing only slightly faster than inflation despite a shrinking labor pool. A key metric to watch for in the coming months is the underemployment rate, which declined in July to 7.5% from 7.8% in June. The still-high underemployment rate is often viewed as a sign that the labor market hasn’t yet reached capacity, and may be the reason wages haven’t increased significantly. Part 2: Factual Data – Larger Parcel Before Take 9 Forecast Our baseline forecasts remain largely unchanged from last quarter. We expect the government’s fiscal stimulus to boost growth, though gains are modest given that the economy is operating at near-capacity. Inflation in 2018 is stronger than 2017’s 2.1%. The 10- year Treasury hovers around 3% for the rest of the year, with the possibility of rising higher, due in part to the Fed’s balance sheet reduction and the increasing government debt issuance. We expect a relatively mild slowdown to begin in late 2019—5 quarters with GDP growth between slightly negative and 0.8%. The slowing causes the Fed to lower interest rates, and the 10-year drops from 3.0% in 2018 to 2.2% in 2019. Inflation also declines with the slowing economy. We see a quick rebound only toward the beginning of 2021 as the economy recovers. Part 2: Factual Data – Larger Parcel Before Take 10 Regional Economy and Market Conditions POPULATION The subject is located in the northeastern portion of Larimer County and the northwestern portion of Weld County, in proximity to Carr, Colorado. Key information about the area is provided in the following tables. Theareahasapopulationof504anda median age of 45, with the largest population group in the 50-59 age range and the smallest population in 80+ age range. Population has increased by 88 since 2010, reflecting an annual increase of 2.4%. Population is projected to increase by 37 by an additional 2023, reflecting 1.4% annual population growth. 416 504 541 0 100 200 300 400 500 600 201020182023 POPULATION BY YEAR 0 20 40 60 80 100 0‐9 10‐19 20‐29 30‐39 40‐49 50‐59 60‐69 70‐79 80+ AREA POPULATION BY AGE Source: Esri Source: Esri Subject Part 2: Factual Data – Larger Parcel Before Take 11 INCOME EDUCATION EMPLOYMENT The area includes a total of 280 employees and has a 4.4% unemployment rate. The top three industries within the area are Health Care/Social Assistance, Construction and Retail Trade, which represent a combined total of 43% of the population. The area features an average household income of $86,084 and a median household income of $71,849. Over the next five years, median household income is expected to increase by 10.4%, or $1,499 per annum. A total of 31.9% of individuals over the age of 24 have a college degree, with 22.1% holding a bachelor's degree and 9.8% holding a graduate degree. $71,849 $79,345 $68,000 $70,000 $72,000 $74,000 $76,000 $78,000 $80,000 2018 2023 MEDIAN INCOME BY YEAR 22.1% 9.8% 68.1% POPULATION BY DEGREE Bachelor's Degree Graduate Degree Other 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% Transportation/Warehousing Public Administration Accommodation/Food Services #N/A Agric/Forestry/Fishing/Hunting Prof/Scientific/Tech Services Educational Services Retail Trade Construction Health Care/Social Assistance Source: Esri Source: Esri Source: Esri CONCLUSION The subject property is situated on the northern edge of the Northern Colorado Front Range, extending from the plains to the continental divide. Although Larimer and Weld Counties feature a growing populations and expanding employment bases, the area surrounding Carr is relatively remote, and its growth is on a much smaller scale. Nevertheless, the long term prospects for this area are for continued growth. Part 2: Factual Data – Larger Parcel Before Take 12 Neighborhood Analysis – Local Market Influences Location The subject is situated on the northeastern edge of Larimer County and the northwestern corner of Weld County, between the Cities of Fort Collins and Cheyenne. This area is primarily comprised of dry grazing land due to a lack of irrigation water, undulating topography, and frequent wind. Boundaries The neighborhood boundaries are detailed as follows: Subject Part 2: Factual Data – Larger Parcel Before Take 13 North: Colorado – Wyoming State Line South: Owl Canyon Road East: US Highway 85 West: US Highway 287 Land Use Land uses within the subject neighborhood consist of agricultural properties and some rural residential estates. In addition to private lands, this neighborhood includes thousands of acres of publicly-owned open space, including the Soapstone Prairie Natural Area, Red Mountain Open Space, and Meadow Springs Ranch. One of the most prominent landmarks in the area is the Rawhide Energy Station, which is just north of Buckeye Road. The power plant, which is visible from miles away, includes coal-fired generators, natural gas turbines, and a 185-acre, 30 megawatt solar array. Unlike many other parts of Larimer County, this neighborhood has not experienced significant residential development because it is further removed from urban amenities. Growth Patterns Nearly all of the population growth in Larimer County has taken place to the south of the subject neighborhood. Properties within the neighborhood are generally sought for ranching and outdoor recreation. Access Primary access to the subject neighborhood is provided by Interstate 25 and US Highway 287. Interstate 25 is the primary north-south route through the Colorado front range, as well as the surrounding region. US Highway 287 is a secondary north-south route through the region. Owl Canyon Road is one of the only east-west roads that connects Interstate 25 to U.S. Highway 287. Demographics Selected demographics from the neighborhood surrounding the subject are shown in the following table: Part 2: Factual Data – Larger Parcel Before Take 14 Larimer County Road 92 Larimer, CO 80549 Population 2023 Total Population 165 937 20,040 386,432 2018 Total Population 154 877 18,769 351,860 2010 Total Population 122 780 16,624 299,630 2000 Total Population 85 631 13,344 251,494 Annual Growth 2018 - 2023 1.39% 1.33% 1.32% 1.89% Annual Growth 2010 - 2018 2.95% 1.48% 1.53% 2.03% Annual Growth 2000 - 2010 3.68% 2.14% 2.22% 1.77% Households 2023 Total Households 73 364 7,795 153,124 2018 Total Households 68 342 7,303 139,765 2010 Total Households 55 306 6,552 120,295 2000 Total Households 36 233 5,015 97,164 Annual Growth 2018 - 2023 1.43% 1.25% 1.31% 1.84% Annual Growth 2010 - 2018 2.69% 1.40% 1.37% 1.89% Annual Growth 2000 - 2010 4.33% 2.76% 2.71% 2.16% Income 2018 Median Household Income $72,616 $74,539 $53,136 $66,513 2018 Average Household Income $85,943 $94,233 $65,862 $90,291 2018 Per Capita Income $32,870 $36,375 $25,660 $36,406 2018 Pop 25+ College Graduates 25 157 1,569 67,080 Age 25+ Percent College Graduates - 2018 16.2% 17.9% 8.4% 19.1% Source: ESRI SELECTED NEIGHBORHOOD DEMOGRAPHICS Larimer County 5 Mile Radius 10 Mile Radius 15 Mile Radius Conclusions – External Market and Location Influences The neighborhood is primarily sought for agriculture and outdoor recreation uses. Growth in the surrounding region has fueled demand for recreational properties in this area. This exerts a positive influence on the subject property. Part 2: Factual Data – Larger Parcel Before Take 15 PROPERTY DESCRIPTION – LARGER PARCEL BEFORE TAKE The following chart summarizes the salient characteristics of the subject site. SITE SUMMARY AND ANALYSIS Physical Description Gross Site Area 26,600 Acres 1,158,696,000 Sq. Ft. Shape Topography Zoning District Flood Map Panel No. & Date 08069C 0275F & 08069C 0250F 19-Dec-06 Flood Zone Zone X (Unshaded) Adjacent Land Uses Comparative Analysis Visibility Functional Utility Traffic Volume Adequacy of Utilities Landscaping Drainage Utilities Availability Water Yes Sewer Yes Natural Gas Yes Electricity Yes Telephone Yes Other Yes No Unknown Detrimental Easements x Encroachments x Deed Restrictions x Reciprocal Parking Rights x Source: Various sources compiled by CBRE Septic Propoane Poudre Valley REA CenturyLink Assumed adequate Average Provider Well Assumed adequate Rating Average Average Average Irregular Varies O (Open) by Larimer County & A (Agriculture) by Weld County Agriculture, Residential, and River Recreation Part 2: Factual Data – Larger Parcel Before Take 16 PROPERTY MAP Part 2: Factual Data – Larger Parcel Before Take 17 FLOOD PLAIN The subject not situated in a floodplain. The map panels that encompass this area are non- printed. LOCATION The subject straddles Interstate 25 just south of the Wyoming border in the north edges of Larimer and Weld Counties. LEGAL DESCRIPTION The larger parcel comprises numerous sections and aliquot parts in Township 12 North, Range 68 West, Township 12 North, Range 67 West, Township 11 North, Range 68 West, Township 11 North, Range 67 West of the 6th P.M., Township 10 North, Range 68 West, and Township 10 North, Range 67 West of the 6th P.M. in Larimer and Weld Counties, Colorado. SHAPE AND FRONTAGE The site features an irregular shape with more than eleven miles of frontage on Interstate 25. ACCESS Ingress and egress is available from Larimer County Road 92/Weld County Road 126. This road is asphalt-paved in Weld County, but gravel-surfaced in Larimer County. TOPOGRAPHY AND DRAINAGE The larger parcel features varied topography, ranging from relatively level meadows to rugged hills. Overall, the topography is appropriate for livestock grazing and recreational uses. During my inspection of the site, I observed no drainage problems and assume that none exist. SOILS A soils analysis for the site has not been provided for the preparation of this appraisal. In the absence of a soils report, the USDA web soil survey indicates that the subject property is comprised of a wide variety of soils, including Altvan and Fort Collins loams, Larim gravelly sandy loam, Otero-nelson sandy loam, as well as Bainville-Keith and Larimer Stoneham complex, among others. These soils are typical in this area, and are appropriate for ranching. Part 2: Factual Data – Larger Parcel Before Take 18 SOIL MAP Part 2: Factual Data – Larger Parcel Before Take 19 EASEMENTS, ENCROACHMENTS, AND RESTRICTIVE COVENANTS No title policy or recorded plat was available for review. Interstate 25, the Burlington Northern Railroad, and some county roads transect the property. However, this does not affect the marketability or highest and best use. It is recommended that the client/reader obtain a current title policy outlining all easements and encroachments on the property, if any, prior to making a business decision. UTILITIES AND SERVICES Municipal utilities are limited in this area. Poudre Valley REA provides electricity in the area. Individual well and septic systems are used in lieu of municipal water and sewer services. Propane is used in lieu of natural gas. The utilities available to the site are in adequate quality and quantity to service the highest and best use. SITE IMPROVEMENTS No site improvements are being impacted by the easement acquisition. FUNCTIONAL ADEQUACY OF THE SITE The site is large enough to accommodate a variety of potential uses with terrain that does not prohibit efficient land utilization. Overall, the site is functionally adequate to accommodate numerous uses. ADJACENT AND SURROUNDING LAND USES AND DEVELOPMENT The larger parcel is surrounded by dry agricultural parcels an rural residential acreages. ENVIRONMENTAL ISSUES The appraiser is not qualified to detect the existence of potentially hazardous material or underground storage tanks which may be present on or near the site. The existence of hazardous materials or underground storage tanks may affect the value of the property. For this appraisal, CBRE, Inc. has specifically assumed that the property is not affected by any hazardous materials that may be present on or near the property. OWNER IMPROVEMENTS DATA The building improvements on the larger parcel are not being affected by the easement acquisition. Part 2: Factual Data – Larger Parcel Before Take 20 ZONING MAP ZONING Larimer County has zoned the property O (Open), while Weld County has zoned the property A (Agricultural) district. Both of these districts support continued livestock grazing and rural density residential acreages. USE HISTORY The property has been used for land application of biosolids and livestock grazing for many years. SALES HISTORY Title to the property is currently vested in the name of the City of Fort Collins. The parcels have been assembled through multiple transactions over a few decades. One of the most recent transfers of ownership interest involved the purchase of the East Half of the East Half of Section 6, T11N, R67W of the 6th P.M. in Weld County. This parcel includes 134.910 acres that were purchased on January 12, 2015 at a price of $202,000, or $1,497 per acre. The warranty deed conveying title from the Warner and Pamela Rogers Living Trust was recorded in Weld County Records at Reception No. 4075743. To the best of my knowledge, there has been no ownership transfer that has a bearing on the market value of the subject property during the previous five years. Part 2: Factual Data – Larger Parcel Before Take 21 LISTING/CONTRACT HISTORY The property is not currently offered for sale. TAX AND ASSESSMENT DATA The property is held by the City of Fort Collins, and is not assessed by the Larimer or Weld county assessors. SUBJECT PHOTOGRAPHS Photos taken in August of 2018 by Jon Vaughan Easterly view of the Lost Creek basin Northeasterly view in the northern portion of the property Southeasterly view from the northern portion of the property Southwesterly view of a creekbed in the central portion of the property Part 3 – Analysis and Valuation - Larger Parcel Before Take 22 Part 3 – Analysis and Valuation – Larger Parcel Before Take HIGHEST AND BEST USE Highest and best use is the most profitable and competitive use of a property. Colorado Jury Instructions - Civil 4th, 36:6 views highest and best use as follows: "In determining the market value of the property actually taken (and the damages, if any, and benefits, if any, to the residue) you should consider the use, conditions and surroundings of the property as of the date of valuation. In addition, you should consider the most advantageous use or uses to which the property might reasonably and lawfully be put in the future by persons of ordinary prudence and judgment. Such evidence may be considered, however, only insofar as it assists you in determining the reasonable market value of the property as of the date of valuation (or the damages, if any, or the benefits, if any, to the residue). It may not be considered for the purposes of allowing any speculative damages or values." The Appraisal Institute in The Dictionary of Real Estate Appraisal, Sixth Edition, Chicago, © 2015, p. 109, defines highest and best use as: "The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity." First, in this analysis, the subject site is considered as if the subject ownership is vacant land or a vacant site. Then, if the site is improved, the property is analyzed considering the existing improvements. The building improvements on the subject larger parcel contribute a relatively small amount to the value of the whole, and do not occupy a large portion of the site. Therefore, it is only necessary to analyze the highest and best use as though vacant. AS VACANT Legal Permissibility The legally permissible uses of the site currently include agricultural production and rural residential estates, as detailed in the Zoning section of this report. Physical Possibility The site has an adequate shape and size to allow efficient land utilization. The terrain features include gently sloping meadows and some rugged hills and ravines. The Lost Creek flows through the eastern portion of the ranch, and several seasonal streams transect the ranch. There are also some livestock wells and springs, though the distance between water features appears to be further than ideal for livestock production. The property features good regional accessibility. Overall, numerous uses would be physically possible for the larger parcel. Part 3 – Analysis and Valuation - Larger Parcel Before Take 23 Financial Feasibility The property is primarily used for land application of the City of Fort Collins biosolids, which fertilizes the soils to enhance livestock grazing on the property. With respect to financial feasibility, the site appears to function well for biosolid land application and ranching operations. However, the primary difference between the subject property and other ranches in the region are the building improvements and processes used to safely apply biosolids to fertilize the ranch. Since the project will not affect the building improvements or the biosolid applications, only the land is being analyzed. Continued agricultural production is financially feasible for the property. Maximum Productivity - Conclusion The final test of highest and best use of the site as if vacant is that the use be maximally productive, yielding the highest return to the land. Based on the information presented above and upon information contained in the market and neighborhood analysis, the highest and best use of the subject is for continued ranching. APPRAISAL VALUATION METHODOLOGY In appraisal practice, an approach to value is included or omitted based on its applicability to the property type being valued and the quality and quantity of information available. Depending on a specific appraisal assignment, any of the following four methods may be used to determine the market value of the fee simple interest of land: Sales Comparison Approach Income Capitalization Procedures Allocation Extraction The following summaries of each method are paraphrased from the text. The first is the sales comparison approach. This is a process of analyzing sales of similar, recently sold parcels in order to derive an indication of the most probable sales price (or value) of the property being appraised. The reliability of this approach is dependent upon (a) the availability of comparable sales data, (b) the verification of the sales data regarding size, price, terms of sale, etc., (c) the degree of comparability or extent of adjustment necessary for differences between the subject and the comparables, and (d) the absence of nontypical conditions affecting the sales price. This is the primary and most reliable method used to value land (if adequate data exists). The income capitalization procedures include three methods: land residual technique, ground rent capitalization, and Subdivision Development Analysis. A discussion of each of these three techniques is presented in the following paragraphs. The land residual method may be used to estimate land value when sales data on similar parcels of vacant land are lacking. This technique is based on the principle of balance and the related concept of contribution, which are concerned with equilibrium Part 3 – Analysis and Valuation - Larger Parcel Before Take 24 among the agents of production--i.e. labor, capital, coordination, and land. The land residual technique can be used to estimate land value when: 1) building value is known or can be accurately estimated, 2) stabilized, annual net operating income to the property is known or estimable, and 3) both building and land capitalization rates can be extracted from the market. Building value can be estimated for new or proposed buildings that represent the highest and best use of the property and have not yet incurred physical deterioration or functional obsolescence. The subdivision development method is used to value land when subdivision and development represent the highest and best use of the appraised parcel. In this method, an appraiser determines the number and size of lots that can be created from the appraised land physically, legally, and economically. The value of the underlying land is then estimated through a discounted cash flow analysis with revenues based on the achievable sale price of the finished product and expenses based on all costs required to complete and sell the finished product. The ground rent capitalization procedure is predicated upon the assumption that ground rents can be capitalized at an appropriate rate to indicate the market value of a site. Ground rent is paid for the right to use and occupy the land according to the terms of the ground lease; it corresponds to the value of the landowner's interest in the land. Market-derived capitalization rates are used to convert ground rent into market value. This procedure is useful when an analysis of comparable sales of leased land indicates a range of rents and reasonable support for capitalization rates can be obtained. The allocation method is typically used when sales are so rare that the value cannot be estimated by direct comparison. This method is based on the principle of balance and the related concept of contribution, which affirm that there is a normal or typical ratio of land value to property value for specific categories of real estate in specific locations. This ratio is generally more reliable when the subject property includes relatively new improvements. The allocation method does not produce conclusive value indications, but it can be used to establish land value when the number of vacant land sales is inadequate. The extraction method is a variant of the allocation method in which land value is extracted from the sale price of an improved property by deducting the contribution of the improvements, which is estimated from their depreciated costs. The remaining value represents the value of the land. Value indications derived in this way are generally unpersuasive because the assessment ratios may be unreliable and the extraction method does not reflect market considerations. The sales comparison approach is the only method being applied to estimate the land value. LAND VALUE The following map and table summarize the comparable data used in the valuation of the subject site. A detailed description of each transaction follows the table. Part 3 – Analysis and Valuation - Larger Parcel Before Take 25 Land Sales Location Map Part 3 – Analysis and Valuation - Larger Parcel Before Take 26 Land Sales Summary Table SUMMARY OF COMPARABLE LAND SALES Actual Sale Adjusted Sale Size Price Per No. Property Location Type Date Proposed Use Price Price 1 (Acres) Acre 1 US Highway 287 Part of Sections 24, 34, 35 T11N R71W et al Sale Apr-16 Agriculture and Recreation $3,950,000 $3,950,000 3,973.00 $994 2 2298 Diamond Peak Rd Livermore, CO 80534 Sale Mar-17 Agriculture and Recreation $1,220,000 $920,000 640.00 $1,438 3 237 Shimmerhorn Road Laramie, WY 82052 Sale Apr-17 Agriculture and Recreation $12,000,000 $11,900,000 11,845.00 $1,005 4 29781 Larimer County Road 103 Jelm, CO 82063 Sale Jul-18 Agriculture and Recreation $4,900,000 $4,900,000 2,640.00 $1,856 5 22950 Larimer County Road 23 Wellington, CO 80549 Sale Aug-18 Agriculture and Recreation $2,225,000 $2,225,000 800.00 $2,781 Subject Larimer County Road 92, Larimer, Colorado --- --- Agriculture --- --- 26,600.00 --- 1 Adjusted sale price for cash equivalency and/or development costs (where applicable) Compiled by CBRE Transaction Part 3 – Analysis and Valuation - Larger Parcel Before Take 27 Land Sale Detail Sheets Land Sale 1 View: Date Inspected/Photo by: Location/Address Tax Schedule No.: Legal Description: Grantor: Grantee: Sale Confirmed with/Date: Appraiser Confirming: Recordation/Sale Deed: Property Rights Conveyed: Conditions of Sale: Financing and Terms: Cash to Seller Date of Sale: April 27, 2016 Post Sale Expense: None Selling Price: $3,950,000 Project Influence: None Unit Price: $994 per AC Land Area: 3,973 AC Access: Paved street Shape: Irregular Utilities: Electricity nearby, Well and Septic Required Topography: Hilly Zoning: O (Open) by Larimer County Drainage/Flood Plain: Zone X Platted: No Surrounding Properties: Agricultural and Rural Residential Stage of Development: Raw Use at Time of Sale: Highest and Best Use: Remarks: Jon Vaughan Reception #20160025999, Larimer County / Special Warranty Deed Physical Characteristics - Legal Aspects This property is situated west of U.S. Highway 287, adjacent to the Phantom Canyon Preserve near Livermore. This parcel is subject to a conservation easement held by The Nature Conservancy (Reception # 19960091081), which limits construction of residential improvements on the property to six homes in designated building envelopes with the remainder of the property restricted to livestock grazing and non-motorized recreational uses. The purchaser indicated that the easement didn't impact them since they only intended to graze cattle on the property and use it for limited outdoor recreation. However, they also noted that the price they paid for this property was significantly less than nearby land values. Agriculture and Recreation Agriculture and Recreation Southwesterly view from US Highway 287 along the northeast edge of the property September 27, 2018/Jon Vaughan 0006000015 (one of numerous parcel numbers) US Highway 287, Livermore, Larimer County, CO Fee Simple Estate Arms-Length Sections 6, 7, and 35; and parts of Sections 1, 2, 12, 25, and 34, T11N, R71W of the 6th P.M. T.J. Mac Ltd. Liability Co. Geo. A. Henderson Co. Inc. and Chris Vandemoer Buyer, 9/25/18 Part 3 – Analysis and Valuation - Larger Parcel Before Take 28 Land Sale 2 View: Date Inspected/Photo by: Location/Address Tax Schedule No.: Legal Description: Grantor: Grantee: Sale Confirmed with/Date: Appraiser Confirming: Recordation/Sale Deed: Property Rights Conveyed: Conditions of Sale: Financing and Terms: Cash to Seller Date of Sale: March 29, 2017 Post Sale Expense: None Selling Price: $1,220,000; $920,000 (Land Only) Project Influence: None Unit Price: $1,438 per AC Land Area: 640 AC Access: Paved street Shape: Irregular Utilities: Electricity, well and septic Topography: Hilly Zoning: O (Open) by Larimer County Drainage/Flood Plain: Zone X Platted: No Surrounding Properties: Agricultural and Rural Residential Stage of Development: Raw Use at Time of Sale: Highest and Best Use: Remarks: Arms-Length Physical Characteristics - Legal Aspects Agriculture and Recreation Southwesterly view toward the subject property (which could not be reached due to private road restrictions) September 27, 2018/Jon Vaughan 3235000014 Agriculture and Recreation This parcel is situated along Trail Creek, north of Livermore, in an area surrounded by national forest on three sides. It features roughly one mile of creek frontage, which provides good fishing. The property is improved with a cabin and some outbuildings that were in reasonably good condition on the date of sale. In addition to the improvements, the sale included two adjudicated springs, which could be used for irrigating the meadows or to develop a reservoir on the property. The contributory value of the building improvements and water rights is estimated to be $300,000. The property was on the market for roughly 8 months, at a final asking price of $1,472,000, which calculates to a list-to-sale discount of 17%. Portions of Section 6, T6N, R67W and Section 31, T7N, R67W of the 6th P.M., Weld County, CO Diamond Peak Properties, LLC A&H Ranch LLC Listing Broker, 9/20/18 Jon Vaughan Reception #20170020973, Larimer County / Special Warranty Deed 2298 Diamond Peak Rd, Livermore, Larimer County, CO Fee Simple Estate Part 3 – Analysis and Valuation - Larger Parcel Before Take 29 Land Sale 3 View: Date Inspected/Photo by: Location/Address Tax Schedule No.: Legal Description: Grantor: Grantee: Sale Confirmed with/Date: Appraiser Confirming: Recordation/Sale Deed: Property Rights Conveyed: Conditions of Sale: Financing and Terms: Cash to Seller Date of Sale: April 7, 2017 Post Sale Expense: None Selling Price: $12,000,000; $11,900,000 (Land Only) Project Influence: None Unit Price: $1,005 per AC cal Characteristics - Legal Aspects Land Area: 11,845 AC Access: Paved street Shape: Irregular Utilities: Electricity in service, Well and Septic Required Topography: Hilly Zoning: Agriculture Drainage/Flood Plain: Zone X Platted: No Surrounding Properties: Agricultural and Rural Residential Stage of Development: Raw Use at Time of Sale: Agriculture and Recreation Highest and Best Use: Agriculture and Recreation Remarks: This transaction was the first in an assemblage of several parcels in the southern portion of Albany County, Wyoming. The purchasing entity is held by Curt Richardson, the founder of Otterbox, who is an avid hunter. Wyoming is a non-disclosure state, which means that sale prices are not public information, and are only available through voluntary disclosure from a party to the transaction. The seller reported a sale price of $12,000,000. The property was improved with a 2,800-square-foot, 3-bed, 2.5-bath house, as well as a 1,000-square foot guest home. Additionally, the property features good outbuildings to support the ranching operation. As a result, the contributory value of the improvements is estimated to be $500,000. The ranch includes territorial water rights along the Dale Creek and Texas Creek to irrigate hay meadows that produce 200 tons of hay. In addition to the irrigation water, the ranch features several ponds and springs that provide livestock water, as well as wildlife habitat. September 27, 2018/Jon Vaughan Looking southwesterly from Monument Road in the central portion of the property The Hansen Spring Gulch Limited Partnership Old Elk Ranch Ax, LLC Seller, 9/26/18 Jon Vaughan Reception #2017,1556, Albany County / Special Warranty Deed Fee Simple Estate Arms-Length 237 Shimmerhorn Road, City of Laramie, Albany County, WY 13711430003000 (one of numerous parcel numbers) NW¼ of Section 3, SW¼NE¼ and E ½NE¼ of Section 4, T4N, R67W of the 6th P.M., Weld County, CO Part 3 – Analysis and Valuation - Larger Parcel Before Take 30 Land Sale 4 View: Date Inspected/Photo by: Location/Address Tax Schedule No.: Legal Description: Grantor: Grantee: Sale Confirmed with/Date: Appraiser Confirming: Recordation/Sale Deed: Property Rights Conveyed: Conditions of Sale: Financing and Terms: Cash to Seller Date of Sale: July 18, 2018 Post Sale Expense: None Selling Price: $4,900,000 Project Influence: None Unit Price: $1,856 per AC cal Characteristics - Legal Aspects Land Area: 2,640 AC Access: Paved street Shape: Irregular Utilities: Electricity nearby, Well and Septic Required Topography: Hilly Zoning: O (Open) by Larimer County Drainage/Flood Plain: Zone X Platted: Yes Surrounding Properties: Agricultural and Rural Residential Stage of Development: Recorded Exemption lot Use at Time of Sale: Agriculture and Recreation Highest and Best Use: Agriculture and Recreation Remarks: This property straddles the Laramie River, just south of the Wyoming border. The property had been designated a centennial ranch in 2017 after being held by the Hohnholz family for 100 years. The ranch included some water rights in the Mansfield and Mansfield No. 2 Ditches and the Hance Ditch, which were used to irrigate a 400-acre hay meadow. The 40-acre parcel that contains the building improvements and a 40-acre tract was conveyed in a separate transaction to the same buyer at a price of $360,000. The improvements included three houses that were built between 1890 and 1978, as well as several agricultural outbuildings. The transaction had to be structured this way to continue a national forest grazing lease as well as permit the remainder to be used in a reverse 1031 exchange. September 27, 2018/Jon Vaughan Arms-Length Jon Vaughan Reception #20180044130, Larimer County / Warranty Deed Fee Simple Estate Looking westerly from Laramie River Road 29781 Larimer County Road 103, Jelm, Larimer County, CO 7102000002 (one of numerous parcel numbers) Lot B, Recorded Exemption No. 0963-09-3 RECX-0033, Weld County, Colorado Hohnholz Ranch, Inc. H Ranch 1031, LLC Seller, 9/26/18 Part 3 – Analysis and Valuation - Larger Parcel Before Take 31 Land Sale 5 View: Date Inspected/Photo by: Location/Address Tax Schedule No.: Legal Description: Grantor: Grantee: Sale Confirmed with/Date: Appraiser Confirming: Recordation/Sale Deed: Property Rights Conveyed: Conditions of Sale: Financing and Terms: Cash to Seller Date of Sale: August 1, 2018 Post Sale Expense: None Selling Price: $2,225,000 Project Influence: No influence on sale price Unit Price: $2,781 per AC Land Area: 800 AC Access: Paved street Shape: Irregular Utilities: Electricity nearby, Well and Septic Required Topography: Hilly Zoning: O (Open) by Larimer County Drainage/Flood Plain: Zone X Platted: No Surrounding Properties: Agricultural and Open Space Stage of Development: Raw Use at Time of Sale: Highest and Best Use: Remarks: 9118000916, 9107000931, 0112000918 22950 Larimer County Road 23, Wellington, Larimer County, CO Southwesterly view from Larimer County Road 23 September 27, 2018/Jon Vaughan This parcel represents one of the only in-holdings surrounded by thousands of acres of open space owned by Larimer County and the City of Fort Collins. Larimer County had been trying to acquire the property for many years, and an assemblage premium is evident. Although there was a residence and agricultural outbuildings on the property, the structures were in poor condition on the date of sale, and will be razed. No usable water rights were included in the transaction. Part of Sections 18 and 19, T4N, R66W of the 6th P.M., Weld County, CO Mike Gallegos and Rick Gallegos Board of County Commissioners of Larimer County Buyer, 9/25/18 Jon Vaughan Reception #20180047568, Larimer County / Special Warranty Deed Fee Simple Estate Arms-Length Physical Characteristics - Legal Aspects Agriculture and Recreation Agriculture and Recreation Part 3 – Analysis and Valuation - Larger Parcel Before Take 32 Land Sales Adjustment Table LAND SALES ADJUSTMENT GRID Comparable Number12345Subject Transaction Type Sale Sale Sale Sale Sale --- Transaction Date Apr-16 Mar-17 Apr-17 Jul-18 Aug-18 --- Proposed Use Agriculture and Recreation Agriculture and Recreation Agriculture and Recreation Agriculture and Recreation Agriculture and Recreation Agriculture Actual Sale Price $3,950,000 $1,220,000 $12,500,000 $4,900,000 $2,225,000 --- Adjusted Sale Price 1 $3,950,000 $920,000 $11,900,000 $4,900,000 $2,225,000 --- Size (Acres) 3,973 640 11,845 2,640 800 26,600 Price Per Acre $994 $1,438 $1,005 $1,856 $2,781 --- Price ($ Per AC) $994 $1,438 $1,005 $1,856 $2,781 Property Rights Conveyed 20% 0% 0% 0% 0% Financing Terms 1 0% 0% 0% 0% 0% Conditions of Sale 0% 0% 0% 0% -20% Market Conditions (Time) 7% 4% 4% 1% 0% Subtotal $1,277 $1,495 $1,045 $1,875 $2,225 Size -10% -20% 0% -10% -20% Shape 0% 0% 0% 0% 0% Access 0% 0% 0% 0% 0% Frontage 0% 0% 0% 0% 0% Topography 0% 0% 0% 0% 0% Location 0% 0% 20% -25% 0% Zoning/Density 0% 0% 0% 0% 0% Utilities 0% 0% 0% 0% 0% Functional Utility 0% 0% 0% 0% 0% Total Other Adjustments -10% -20% 20% -35% -20% Value Indication for Subject $1,149 $1,196 $1,254 $1,219 $1,780 Absolute Adjustment 37% 24% 24% 36% 40% 1 Adjusted sale price for cash equivalency and/or development costs (where applicable) Compiled by CBRE Discussion/Analysis of Land Sales The sales have been compared to the subject and, where necessary, have been adjusted for differences between the sale properties and the subject larger parcel. Characteristics that are similar between the comparable property and the subject do not require adjustment. Therefore, the following discussion focuses exclusively on the elements that require adjustment. PROPERTY RIGHTS CONVEYED This adjustment accounts for various legal characteristics of a property, such as the inclusion of mineral rights, or other interests. Comparable One is subject to a conservation easement that restricts the use of the property to agricultural production and six homes. This is inferior to the subject property and a positive adjustment is appropriate. CONDITIONS OF SALE This adjustment accounts for disproportionate negotiating power between the buyer and the seller. Part 3 – Analysis and Valuation - Larger Parcel Before Take 33 Comparable Five was an assemblage of an infill parcel within the purchaser’s Red Mountain Open Space. The purchaser had reportedly been trying to buy this property for several years while the seller held out with excessive asking prices. Overall, this transaction exhibits a premium related to the assemblage, and a negative adjustment is being applied. MARKET CONDITIONS Economic conditions may change between the sale date of the comparables and the effective date of value provided. These changes in supply and demand characteristics tend to exert some impact on real estate prices. The adjustment for this factor is not a function of time, but of differences in economic conditions, if any, between time periods. Thus, it is possible a period of time could elapse with no material change in market conditions having occurred. There is limited transaction data available, which required the use of sales from 2016 to 2018. Market participants report a scarcity of land offered for sale, and relatively high listing prices. Beef prices have been gradually rising from their multi-year low in early 2016. Overall, a positive adjustment of 3% per year is being applied for market conditions. SIZE An adjustment for size typically recognizes the concept of economies of scale, in that all other things being equal, a larger property will sell for less per measurable unit than a smaller property, and vice versa. Comparables One, Two, Four, and Five are considerably smaller than the subject property. Therefore, negative adjustments are being applied, in varying degrees. Although Comparable Three is also less than half the size of the subject, it is large enough to be attract a similar category of investor. Therefore, no adjustment is being applied. LOCATION An analysis of location takes into account differences in the comparables relative to their surrounding environs. Linkages to complementary land uses exert positive influences on value, while proximity to undesirable land uses exert negative influences. Comparable Three is situated in the southern portion of Wyoming, which typically features lower land values than properties in Colorado due to its low population density and the distance from urban amenities. This location is inferior and a positive adjustment is warranted. Comparable Four extends along the Laramie River, which enhances the recreational and aesthetic appeal of the ranch. This is superior to the subject property, and a negative adjustment is necessary. Part 3 – Analysis and Valuation - Larger Parcel Before Take 34 LAND VALUE CONCLUSION Based on the preceding analysis, Comparables Four and Five are the most representative of the subject larger parcel, and warrant greatest consideration because they required the least amounts of overall adjustment. The following table presents the valuation conclusion: CONCLUDED LAND VALUE $ Per AC Subject Acs. Total $1,200 x 26,600.00 = $31,920,000 Indicated Value: $31,920,000 (Rounded $ Per AC) $1,200 Compiled by CBRE LARGER PARCEL VALUE BEFORE TAKE Larger Parcel Value Before Acquisition Total Value Before Acquisition Total Value Land/Site Value $31,920,000 Affected Improvement Contributory Value $0 Total Larger Parcel Value Before Acquisition (land + affected improvements) $31,920,000 Part 4 – Factual Data – Part Taken 35 Part 4 – Factual Data – Part Acquired IDENTIFICATION OF PART ACQUIRED R.O.W. MAP Part 4 – Factual Data – Part Taken 36 PROPERTY DATA – PART ACQUIRED Land/Site Data No land area is being acquired in fee simple estate. Easement Data The permanent easement is situated just west of the Burlington Northern Railroad. The 150-foot- wide, non-exclusive 230 kV electric transmission line easement extends a total distance of 9.7 miles across the larger parcel. The easement parcel contains a land area of 176.364 AC. Owner Affected Improvements Data No owner improvements will be impacted by the easement acquisition. Partial Acquisition Photographs Northerly view along the proposed easement route on west side of the Burlington Northern Railroad Southerly view along the proposed easement route on west side of the Burlington Northern Railroad Part 5 – Analysis and Valuation – Part Taken 37 Part 5 – Analysis and Valuation – Part Acquired VALUE OF PART ACQUIRED AS PART OF LARGER PARCEL Land/Site Value of Part Acquired No land area is being acquired in fee simple estate. Easement Value of Part Acquired The permanent non-exclusive easement being acquired is for a 230 kV overhead electric transmission line that will be supported by rust-colored monopoles to minimize the visual impact. Although the easement document was not available for review, the primary terms of the easement were discussed with the acquisition agent. If the final terms of the easement are different than what was disclosed, the appraiser reserves the right to revise the report. The easement entitles NextEra Energy Resources to construct, reconstruct, inspect, upgrade, operate, repair, and maintain the overhead electric transmission. It will also permit the easement holder to control trees, bushes, and shrubs within the encumbered area. The easement also will require the property owner to keep this area clear of buildings, structures, and other materials. However, the owner can use the easement area for continued livestock grazing and land application of biosolids, as long as it does not interfere with the function of the powerline. As a result, the functional utility of the encumbered area is estimated to be diminished by 50 percent. Therefore, the compensation due the property owner for the permanent easement being acquired is estimated to be as follows: Parcel Area $/Unit Value % of Fee Value Total Value Electric Transmission Easement 176.364 AC $1,200 50% $105,818 $105,818 Owner Affected Improvements Acquired (Contributory Value) Total Land/Site Value of Part Acquired Owner Improvements Contributory Value of Part Acquired No owner improvements are being affected by the project. Part 5 – Analysis and Valuation – Part Taken 38 SUMMARY OF VALUE OF PART ACQUIRED Value of the Part Acquired Land/Site Acquisitions Parcel Area $/Unit Value Value Total Value None $0 $0 Easement Acquisitions Parcel Area $/Unit Value % of Fee Value Total Value Electric Transmission Easement 176.364 AC $1,200 50% $105,818 $105,818 Owner Affected Improvements Acquired (Contributory Value) Contributory Value Total Value $0 $0 Tenant Affected Improvements Acquired (Contributory Value) Contributory Value Total Value $0 $105,818 Description None Total Tenant Affected Improvements Contributory Value of Part Acquired Total Value of Part Acquired (land + affected improvements) Total Owner Affected Improvements Contributory Value of Part Acquired Total Land/Site Value of Part Acquired Total Land/Site Value of Part Acquired None Description Part 6 – Residue Value Before Take 39 Part 6 – Residue Value Before Take Calculating the residue value before acquisition is a mathematical step that is simply the value of the larger parcel (land + affected improvements) minus the value of the part acquired, including fee acquisitions, easements and affected improvements, but excluding any temporary construction easements. The calculation is shown below: Larger Parcel Value Before Take (Land + Affected Improvements) $31,920,000 <Less> Value of Part Acquired (Land + Easements + Affected Improvements) $105,818 Residue Value Before Take $31,814,182 This is the value that should be reflected in the remainder parcel, if there are no damages or benefits resulting from the acquisition. If the remainder value is less than this sum, the remainder has been damaged to that extent. If the remainder value is greater than this amount, the remainder has benefited. The value of the remainder property after the acquisition is addressed in a following section. Part 7 – Factual Data – Residue After Take 40 Part 7 – Factual Data – Residue After Take NEIGHBORHOOD DESCRIPTION – PROJECT INFLUENCES The neighborhood information is unchanged after the acquisition. PROPERTY DESCRIPTION – RESIDUE AFTER TAKE Land/Site Data After the take, the land area of the larger parcel remains 26,600 AC, though 176.364 AC will be encumbered by a permanent easement. This does not impact the utility of the unencumbered portions of the property significantly. Overall, it appears that the remainder parcel can continue to function in a similar manner in the "after" condition. Owner Affected Improvements Data Any fencing or other site improvements impacted by the project will be repaired or replaced by the NextEra Energy Resources construction crew as part of the project. Assessed Value – Real Estate Taxes – Special Taxing Districts The property will remain under the ownership of a municipal entity, which is not assessed by the local counties. Zoning and Other Land Use Regulations Zoning is the same as before. Part 8 – Analysis and Valuation – Residue After Take 41 Part 8 – Analysis and Valuation – Residue After Take HIGHEST AND BEST USE – RESIDUE AFTER TAKE It was determined that the maximally productive use of the property before the acquisition is for agricultural and recreation uses. Please refer to Part 3. The highest and best use has not been affected by the easement acquisition. LAND/SITE VALUATION – RESIDUE AFTER TAKE Land Sale Transaction Data The land sales utilized before the acquisition remain applicable after the acquisition. Land/Site Value The residue parcel after the acquisition will contain a total land area of 26,600.000 AC, of which 176.364 AC will be encumbered by a permanent easement. As a result, after the easement acquisition, the unencumbered land area of the larger parcel will be reduced to 26,423.636 AC (26,600.000 AC - 176.364 AC). Therefore, the market value of the remainder parcel after the acquisition is estimated to be as follows: Parcel Area $/Unit Value % of Fee Value Total Value Unencumbered Land Value 26,423.636 AC $1,200.00 $31,708,363 Plus: Residue Value of Easement Encumbered Land 176 SF $1,200.00 50% $105,818 Residue Value After Take $31,814,182 Part 9 – Analysis of Damages or Benefits 42 Part 9 – Analysis of Damages or Benefits Damages are a loss in value to the remainder property as a result of a partial acquisition. Conversely, benefits to the remainder property represent the increase in value to the remainder property as a result of a partial acquisition, as defined by the International Right of Way Association. RESIDUE LAND VALUE – BEFORE VS. AFTER After the acquisition, the functional utility of the remainder parcel is not significantly changed, nor is its highest and best use. The residue property after the project can still be put to similar use as before the easement acquisition, and the residue land value after the acquisition as compared to the residue land value before the acquisition has not changed. Additionally, any damage to vegetation will be negotiated separately, based on the specific impact. COMPENSIBLE DAMAGES – RESIDUE VALUE AFTER TAKE There are no compensable damages to the remainder after the acquisition. RESTORATION COST (COST TO CURE) There is no restoration necessary. SPECIFIC BENEFITS – RESIDUE VALUE AFTER TAKE There are no specific benefits to the residue as a result of the project. Part 10 – Temporary Easement Rental Value 43 Part 10 – Temporary Easement Rental Value TEMPORARY EASEMENT DATA NextEra Energy Resources currently intends to complete all construction from within the easement area being acquired. There are no temporary construction easements planned at this time. Part 11 – Compensation Summary 44 Part 11 – Compensation Summary EXPLANATION OF COMPENSATION Compensation applies to the right of way, easements, and owner improvements being acquired. There are no incurable damages to the remainder parcel. COMPENSATION ESTIMATE SUMMARY Value of Part Acquired Land/Site Value $0 Easement Value $105,818 Contributory Value of Improvements $0 Total Value of Part Acquired $105,818 Compensible Damages and/or Offsetting Benefits Compensible Damages - Curable (Net Cost to Cure) $0 Compensible Damages - Incurable (No Cost to Cure) $0.00 <Less> Special Benefits (Offset Up To 100% of Incurable Damages) $0.00 =Remaining Special Benefits (Offset Up To 50% of Value of Part Acquired) $0.00 Total Rental Value of Temporary Easements $0 Compensation Estimate $105,818 Rounded $105,850 Compiled by CBRE Part 11 – Compensation Summary 45 CERTIFICATION I certify to the best of my knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial and unbiased professional analyses, opinions, and conclusions. 3. I have no present or prospective interest in or bias with respect to the property that is the subject of this report and have no personal interest in or bias with respect to the parties involved with this assignment. 4. My engagement in this assignment was not contingent upon developing or reporting predetermined results. 5. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 6. This appraisal assignment was not based upon a requested minimum valuation, a specific valuation, or the approval of a loan. 7. My analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice, as well as the requirements of the State of Colorado. 8. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. 9. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 10. As of the date of this report, Jon Vaughan has completed the continuing education program for Designated Members of the Appraisal Institute. 11. Jon Vaughan has made a personal inspection of the property that is the subject of this report. 12. No one provided significant real property appraisal assistance to the persons signing this report. 13. Valuation & Advisory Services operates as an independent economic entity within CBRE, Inc. Although employees of other CBRE, Inc. divisions may be contacted as a part of my routine market research investigations, absolute client confidentiality and privacy were maintained at all times with regard to this assignment without conflict of interest. 14. Jon Vaughan has not provided any services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment. Jon Vaughan CO Certification #CG 100000631 Part 12 – Exhibits and Addenda 46 Part 12 – Exhibits and Addenda Part 12 – Exhibits and Addenda 47 Addendum A COLORADO 7-STEP PARTIAL ACQUISITION APPRAISAL PROCESS Part 12 – Exhibits and Addenda 48 The purpose of this appraisal is to develop a compensation estimate for the reasonable market value of the property actually acquired; compensable damages, if any, to the residue after take; and special benefits, if any, to the residue after the acquisition. Referred to as the modified state before-and-after rule, steps to develop a compensation estimate for the acquisition of real property are: STEP 1: LARGER PARCEL VALUE BEFORE TAKE The first step in the appraisal process is to develop the reasonable market value of the subject larger parcel had there been no acquisition or any effect on value due to the proposed transportation project. The Jurisdictional Exception Rule of USPAP applies to Standards Rule 1-4(f) in this step. In Standards Rule 1-4(f), anticipated public or private improvements must be analyzed for their effect on value as reflected in market actions. This is contrary to law for eminent domain appraisal. Jurisdictional exception authorities are Uniform Act, Title III, § 301(3); 49 CFR § 24.103(b); § 24-56- 117(1)(c), C.R.S.; and CJI – Civ. 4th, 36:3. “Any decrease or increase in the fair market value of real property prior to the date of valuation caused by the public improvement for which such property is acquired, or by the likelihood that the property would be acquired for such improvement, other than that due to physical deterioration within the reasonable control of the owner, shall be disregarded in determining the compensation for the property.” (§24-56-117(1)(c), C.R.S.) STEP 2: VALUE OF PART ACQUIRED (INCLUDING EASEMENTS ACQUIRED) The second step involves the same USPAP Jurisdictional Exception Rule as in step 1. In this step, the reasonable market value of the land or property actually acquired is developed. The value of land acquired is based on its value as part of the whole or the larger parcel. Value of improvements acquired is based on their contributory value to the larger parcel. (49 CFR § 24.103(a)(2)(iv), §§ 38- 1-114(2) and 115(b), C.R.S., and CJI-Civil 4th, 36:3) STEP 3: RESIDUE VALUE BEFORE TAKE The third step is the reasonable market value of the residue before the property actually acquired has been acquired. This step sets the initial basis for the ascertainment of damages and/or special benefits to the residue. The reasonable market value of the residue before the acquisition is the mathematical difference of step 1 (larger parcel value before take) minus step 2 (value of part acquired). STEP 4: RESIDUE VALUE AFTER ACQUISITION (INCLUDING ENCUMBERED EASEMENT AREAS ACQUIRED) The fourth step is to develop the reasonable market value of the residue after the real property actually acquired has been acquired and proposed project improvements have been constructed. In this step, the reasonable market value of the residue after the acquisition is no longer subject to the Jurisdictional Exception Rule to USPAP Standards Rule 1-4(f). Any decrease or increase in the reasonable market value, if any, of the residue after the acquisition due to the proposed public project needs analyses. The influence of the proposed public improvement is considered except for any damages or benefits shared in common with the community at large. The market value of the residue after the acquisition is predicated on the “as is” or “uncured” condition of the residue after the acquisition. Any decrease or increase in value of the residue after the acquisition is based on market evidence. Damage to the residue must be established before a Part 12 – Exhibits and Addenda 49 cost to cure can be considered to mitigate some or all damage. Special benefits may accrue to the residue after the acquisition as a result of the project. STEP 5: ANALYSIS OF DAMAGES AND/OR BENEFITS Fifth step in the process involves analysis of damages and benefits to the residue after the acquisition. Depending upon the extent of damages and cost to cure, performance of another appraisal of the “cured” residue after the acquisition may be required (see Feasibility of Cost to Cure below). The damages and benefits analyses might include the following elements: Indicated Damages and/or Benefits Compensable Damages and/or Offsetting Special Benefits Compensable Damages – Incurable Compensable Damages – Curable (Net Cost to Cure) including: Cost to Cure Feasibility of Cost to Cure Damages (Possible Re-appraisal of Residue After Cure*) Net Cost to Cure Indicated Offsetting Special Benefits – Residue Value As Cured *If damage to the residue is substantial and the cost to cure is not minor, an appraisal of the residue as cured might be necessary to analyze the feasibility of the cure. If the cost to cure is minor, an analysis of the feasibility of the cost to cure damages might not be required. STEP 6: RENTAL VALUE OF TEMPORARY EASEMENTS Sixth step in the process is the estimate of reasonable rental value for the time the temporary easement is used. A temporary (construction) easement is used for a limited time period and is terminated after the construction of the highway improvements. The unencumbered fee interest in the land reverts to the owner at the time of termination. STEP 7: ESTIMATE OF COMPENSATION SUMMARY The final step is a compensation summary. The compensation summary includes the following: • Reasonable Market Value – Land and/or Real Property Acquired • Compensable Damages – Curable – Net Cost to Cure (residue after take/as is) • Compensable Damages – Incurable (residue after take/as is) • Offsetting Special Benefits (residue after take/“as is” or “as cured”) • Temporary Easements Rental Value • Total Compensation Estimate As stated in § 38-1-114(2)(d), C.R.S., “In determining the amount of compensation to be paid for such a partial acquisition, the compensation for the property acquired and damages to the residue of said property shall be reduced by the amount of any special benefits which result from the improvement or project, but not to exceed fifty percent of the total amount of compensation to be paid for the property actually acquired.” Part 12 – Exhibits and Addenda 50 Addendum B ACRONYMS AND DEFINITIONS Part 12 – Exhibits and Addenda 51 Following are certain acronyms and definitions of significant terms used in this appraisal report. Sources and authorities for the following definitions are shown as text-notes. AC – acre CDOT – Colorado Department of Transportation PSF or SF – per square foot; square foot ROW or R.O.W. – Right of Way Benefits (Specific Benefits) – “...any benefits to the residue are to be measured by the increase, if any, in the reasonable market value of the residue due to the (construction) (improvement) of the (...proposed improvement). For anything to constitute a specific benefit, however, it must result directly in a benefit to the residue and be peculiar to it. Any benefits which may result to the residue but which are shared in common with the community at large are not to be considered.” (CJI-Civ. 4th, 36:4) Compensation – “...ascertain the reasonable market value of the property actually taken and the amount of compensable damages, if any, and amount and value of any specific benefit, if any, to the residue of any land not taken.” (CJI-Civ. 4th, 36:1) “(a) For highway acquisition, the right to compensation and the amount thereof, including damages and benefits, if any, shall be determined as of the date the petitioner is authorized by agreement, stipulation, or court order to take possession or the date of trial or hearing to assess compensation, whichever is earlier, but any amount of compensation determined initially shall remain subject to adjustment for one year after the date of the initial determination to provide for additional damages or benefits not reasonably foreseeable at the time of the initial determination. (b) If an entire tract or parcel of property is condemned, the amount of compensation to be awarded is the reasonable market value of the said property on the date of valuation. (c) If only a portion of a tract or parcel of land is taken, the damages and special benefits, if any, to the residue of said property shall be determined. When determining damages and special benefits, the appraiser shall take into account a proper discount when the damages and special benefits are forecast beyond one year from the date of appraisal. (d) In determining the amount of compensation to be paid for such a partial acquisition, the compensation for the property taken and damages to the residue of said property shall be reduced by the amount of any special benefits which result from the improvement or project, but not to exceed fifty percent of the total amount of compensation to be paid for the property actually taken.” (§ 38-1-114(2), C.R.S.) Damages – “…Any damages are to be measured by the decrease, if any, in the reasonable market value of the residue, that is, the difference between the reasonable market value of the residue before the property actually taken is acquired and the reasonable market value of the residue after the property actually taken has been acquired. Any damages which may result to the residue from what is expected to be done on land other than the land actually taken from the respondent and any damages to the residue which are shared in common with the community at large are not to be considered.” (CJI-Civ. 4th, 36:4) Easement – “An easement is a limited right to use or control land owned by another for specified purposes. An easement is a property interest less than the fee estate, with the owner of the underlying fee retaining full dominion over the realty, subject only to the easement; the fee owner may make any use of the realty that does not interfere with the easement holder’s reasonable use of the easement and is not specifically excluded by the terms of the easement.” (Interagency Land Acquisition Part 12 – Exhibits and Addenda 52 Conference, Uniform Appraisal Standards for Federal Land Acquisitions, Washington, D.C., 2016, p.168) Fee Simple Estate (Title) – “Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat.” (Appraisal Institute, The Dictionary of Real Estate Appraisal, Sixth Edition, Chicago, 2015, p. 78) Note: as an assignment condition all mineral rights are excepted from any fee simple property interest appraised in this report. Larger Parcel – “That tract, or tracts, of land that possess a unity of ownership and have the same, or an integrated, highest and best use." The larger parcel may or may not have the same boundaries as the parcel being acquired. As a result, the appraiser must determine the larger parcel based on the unity of use, unity of ownership and proximity or contiguity. (Interagency Land Acquisition Conference, Uniform Appraisal Standards for Federal Land Acquisitions, Washington, D.C., 2016, p. 110) Part Taken (Partial Taking) – “The taking of part of any real property interest for public use under the power of eminent domain; requires the payment of compensation.” (Appraisal Institute, The Dictionary of Real Estate Appraisal, Sixth Edition, Chicago, 2015, p. 143) Residue (Remainder) – “‘Residue’ means that portion of any property which is not taken but which belongs to the respondent, ..., and which has been used by, or is capable of being used by, the respondent, together with the property actually taken, as one economic unit.” (CJI-Civ. 4th, 36:4) Restoration Cost to Cure (Cost to Cure) – “In certain circumstances, damage to the remainder may be cured by remedial action. The cost to cure is a proper measure of damage only when it is no greater in amount than the decrease in the market value of the remainder if left as it stood. When the cost to cure is less than the compensable damages if the cure were undertaken, the cost to cure is the proper measure of damage, and the government is not obligated to pay in excess of that amount.” (Interagency Land Acquisition Conference, Uniform Appraisal Standards for Federal Land Acquisitions, Washington, D.C., 2016, p. 38) Slope Easement – “A ‘slope easement’ is an easement reserved to the condemnor to use whatever portion of the property is needed to provide lateral support for a roadbed, and those surface rights to property which are not required for lateral support are retained by landowner for any usage which does not interfere with condemnor’s slope easement.” (State Dept. of Highways v. Woolley, 696 P.2d 828, Colo. App. 1984) Temporary Easement – “An easement granted for a specific purpose and applicable for a specific time period. A construction easement, for example, is terminated after the construction of the improvement and the unencumbered fee interest in the land reverts to the owner.” (Appraisal Institute, The Dictionary of Real Estate Appraisal, Sixth Edition, Chicago, 2015, p. 195) Compensation due for a temporary easement is the reasonable rental value for the time the easement is used. (State Dept. of Highways v. Woolley, 696 P.2d 828, Colo. App. 1984) Part 12 – Exhibits and Addenda 53 Addendum C QUALIFICATIONS Jon Vaughan Director, Fort Collins, CO ̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶ Experience ̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶ Jon brings 15 years of experience preparing real estate appraisals, feasibility studies and consulting. His expertise covers a broad spectrum of property types, including commercial and residential development land, mixed-use projects, as well as farm and ranch properties. His background in improved properties includes office, retail and industrial facilities, as well as special purpose facilities, such as automobile dealerships, breweries, churches and schools. Prior to joining CBRE, Mr. Vaughan worked as an appraiser with Foster Valuation in Greeley, where he honed his focus on eminent domain. He has worked on property valuations related to some of Colorado’s most-notable infrastructure projects including the I-25 widening and the addition of express lanes from north Denver to Northern Colorado. ̶̶̶̶̶̶ Professional Affiliations / Accreditations ̶̶̶̶̶̶ • Appraisal Institute: Designated Member (MAI) – 2017 Colorado Chapter President – 2015-2016 Colorado Chapter Officer – 2013-2014 Colorado Chapter Board of Directors • International Right of Way Association: Senior Right of Way Professional (SR/WA) – 2018-Present Colorado Chapter Professional Development Committee Chair – 2014-Present IR/WA Instructor – Appraisal Courses – 2015-2018 Colorado Chapter Education Chair • Certified General Real Estate Appraiser: State of Colorado, #CG100000631 • Accepted Expert Witness, District Courts in Larimer and Weld Counties ̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶ Education ̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶̶ • Colorado State University, Bachelor of Science; Business Administration • Appraisal Institute – General Courses Covering Highest and Best Use, Market Analysis, Quantitative Analysis, Income Capitalization, Sales Comparison, and Cost Approach, Business Practices and Ethics – Valuation of Conservation Easements – Uniform Appraisal Standards for Federal Land Acquisitions • International Right of Way Association – General: Principles, Uniform Relocation Act, Ethics and the Right of Way Profession – Negotiations: Principles, Bargaining Negotiations, and Conflict Management – Appraisal: Principles, Easement Valuation, Appraisal Review, and Valuation of Environmentally Contaminated Real Estate – Environmental: Understanding Environmental Contamination in Real Estate – Property Management: Leasing – Real Estate Law: Principles, Legal Aspects of Easements, Eminent Domain Law Basics – Engineering: Engineering Plan Development, Property Descriptions • American Society of Farm Managers and Rural Appraisers – Appraising Conservation Easements and Case Studies • Colorado Division of Real Estate: Conservation Easement Appraiser Update Course T + 970 223 4378 M +970 310 1339 Jon.Vaughan@cbre.com 2850 McClelland Drive Suite 3500 Fort Collins, CO 80525 • City of Fort Collins • City of Greeley • City of Loveland • City of Aurora • City of Thornton • Weld County • Town of Milliken • University of Northern Colorado • Xcel Energy • Western States Land Services Part 12 – Exhibits and Addenda 54 JON VAUGHAN Valuation & Advisory Services +1 9702234378 Jon.Vaughan@cbre.com www.cbre.com CBRE VALUATION & ADVISORY SERVICES -1- ORDINANCE NO. 004, 2019 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CONVEYANCE OF A TRANSMISSION LINE EASEMENT ON CITY PROPERTY AT MEADOW SPRINGS RANCH TO ROUNDHOUSE RENEWABLE ENERGY, LLC WHEREAS, the City is the owner of real property located north of Fort Collins in Larimer County and Weld County known as Meadow Springs Ranch, as described on Exhibit “A”, attached and incorporated herein by reference (the “Property”); and WHEREAS, the Property is managed by the City’s Wastewater Utility as a site for land application of biosolids, is a working cattle ranch, and is the site of numerous cultural and environmental resources; and WHEREAS, Roundhouse Renewable Energy, LLC, a subsidiary of Nextera Energy Resources (“Roundhouse”), is proposing to build a 230-kilovolt transmission line (the “Project”) to deliver energy from a wind energy facility in Wyoming to Platte River Power Authority’s (the “Authority”) Rawhide Energy Station; and WHEREAS, as part of the Project, Roundhouse is requesting from the City an easement 150 feet wide to install and maintain 9.7 miles of the transmission line and related infrastructure on the Property (the “Easement”); and WHEREAS, the Easement would also include the right to access the Easement Area using certain existing roads on the Property; and WHEREAS, the proposed location of the Easement is shown on Exhibit “B”, attached and incorporated herein by reference (the “Easement Area”); and WHEREAS, the Easement Area is within a 300- to 500-foot-wide corridor designated by Roundhouse as part of its 1041 permitting process with Larimer and Weld Counties (the “Permitting Corridor”); and WHEREAS, issuance of 1041 permits by Larimer and Weld Counties is a prerequisite to construction of the Project; and WHEREAS, the Easement Area may shift east or west within the Permitting Corridor during final design and construction of the Project, if unforeseen conditions require; and WHEREAS, upon completion of the Project, Roundhouse would provide a surveyed legal description of the ultimate location of the Easement Area, no greater than 150 feet wide, to be recorded as the final description of the Easement; and WHEREAS, Roundhouse would pay the City $105,850 as compensation for the fair market value of the Easement, which would be used for the benefit of the Property; and -2- WHEREAS, Roundhouse would also pay the City compensation based on a formula to mitigate impacts to the Property from construction of the Project, which the parties estimate will total approximately $330,000; and WHEREAS, as a founding member of the Authority, the City would benefit from the Project as it supports the City’s Climate Action Plan goals to reduce the community’s carbon emissions; and WHEREAS, the Water Board, at its regular meeting on December 20, 2018, voted to recommend that the City Council support the Project; and WHEREAS, the Energy Board, at its regular meeting on November 8, 2018, voted to recommend that the City Council support the proposed transmission line route and Easement; and WHEREAS, the Natural Resources Advisory Board, at its regular meeting on October 17, 2018, voted in support of the recommended location of the Easement; and WHEREAS, the Land Conservation and Stewardship Board at its regular meeting on November 7, 2018, was supportive of the process City staff has followed for environmental analysis and made recommendations to staff about how funds received from Roundhouse as compensation for Project impacts should be spent; and WHEREAS, Section 23-111 of the City Code authorizes the City Council to sell, convey or otherwise dispose of any interest in real property owned by the City, provided that the City Council first finds, by ordinance, that such sale or other disposition is in the best interests of the City and, for real property that is part of the City’s water or utility systems, that the disposition will not materially impair the viability of that utility system as a whole, and will be for the benefit of the citizens of the City. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That the City Council hereby finds that conveyance of the Easement to Roundhouse as described herein is in the best interests of the City; will not impair the viability of the City’s wastewater utility system; and will be for the benefit of the citizens of the City. Section 3. That the Mayor is hereby authorized to execute such documents as are necessary to convey the Easement to Roundhouse on terms and conditions consistent with this Ordinance, together with such additional terms and conditions as the City Manager, in -3- consultation with the City Attorney, determines are necessary or appropriate to protect the interests of the City or effectuate the purposes of this Ordinance. Section 4. That execution of the Easement documents is contingent upon the issuance of 1041 permits for construction of the Project by both Larimer County and Weld County no later than six months after the effective date of this Ordinance. Section 5. That during construction of the Project the City Manager, in consultation with the City Attorney, is authorized to approve modifications to the alignment of the Easement within the Permitting Corridor provided the Easement Area remains not more than 150 feet wide, and the impacts of the Easement are not significantly greater that the original alignment or will be mitigated appropriately. Section 6. That upon completion of the Project the Mayor is authorized to execute such documents as are determined by the City Manager, in consultation with the City Attorney, to be necessary to approve and document the final legal description of the Easement Area. Introduced, considered favorably on first reading, and ordered published this 15th day of January, A.D. 2019, and to be presented for final passage on the 5th day of February, A.D. 2019. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 5th day of February, A.D. 2019. __________________________________ Mayor ATTEST: _______________________________ City Clerk EXHIBIT A Legal Description of City Property Meadow Springs Ranch The real property described in the following six (6) documents: 1. Patent No. 7993 recorded December 7, 1993 at Reception No. 02362991 of the records of the Clerk and Recorder of Weld County, Colorado; 2. Correction Warranty Deed recorded February 13, 1991 at Reception No. 91006161 of the records of the Clerk and Recorder of Larimer County, Colorado; 3. Patent No. 7992 recorded December 3, 1993 at Reception No. 93091867 of the records of the Clerk and Recorder of Larimer County, Colorado; 4. Warranty Deed recorded May 12, 2003 at Reception No. 2003-0057523 of the records of the Clerk and Recorder of Larimer County, Colorado; 5. General Warranty Deed recorded July 18, 2006 at Reception No. 2006- 0053666 of the records of the Clerk and Recorder of Larimer County, Colorado; 6. Special Warranty Deed recorded May 9, 2007 at Reception No. 2007-0034998 of the records of the Clerk and Recorder of Larimer County, Colorado. EXHIBIT A ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! WELD COUNTY LARAMIE COUNTY WELD COUNTY LARIMER COUNTY LARAMIE COUNTY LARIMER COUNTY ¦¨§25 S p ring Cr e ek S po t wood C re e k Co Rd 126 1/2 Co Rd 92 05 06 07 08 17 18 19 20 02 01 11 12 14 13 23 24 19 20 29 30 31 32 23 24 26 25 35 36 ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ¦¨§25 I nd i an C r e ek S p ring Creek C o al Cree k Spottlew ood Creek Co Rd 82 N Co Rd 7 E Co Rd 92 Co Rd 92 E Co Rd 82 Romar Ranch Rd N Co Rd 9 Co Rd 5 04 03 02 01 05 08 09 10 11 12 17 16 15 14 13 08 09 10 11 12 13 17 16 15 14 20 21 22 23 24 29 28 27 26 25 32 33 34 35 36 TWN 010N RNG 068W TWN 011N RNG 068W MSPERAIDNOGWS RANCH RHeasmerilvtooinr !. !. !. !. !] !] LPORCOAJTEIOCNT L A R I M E R ¦¨§25 W E L D ¦¨§80 Fort Collins Greeley Loveland Wellington Cheyenne 0 0.15 0.3 0.6 Mile 0 0.15 0.3 0.6 Kilometer ROUNDHOUSE ENERGYRENEWABLE PROJECT SOUTH Easement Area and Easement Access 1:24,000 º O:\Projects\2018\185095 Enyo Renewable Energy\06GIS\6.3Layout\Easement_Maps\Easement_and_Access_SOUTH_11x17.mxd Exported On: 11/29/18 RenewRoaubnledhouse Energy LLC. Project Components Easement Area ! ! ! Transmission Centerline Proposed Access Northern Map Extent (Match Line) Existing Features Interstate State Highway Existing Roads BNSF Railroad Township and Range Boundary Section Boundary County Boundary Meadow Springs Ranch Existing Substation Water Body Stream Existing Transmission !( !( Existing 230kV Transmission !( !( Existing 345kV Transmission ¦¨§25 12 TWN RNG 65 08 W N ABpipolsicoalitdiosn Facility TWN 012N RNG 067W TWN 012N RNG 068W TWN 012N RNG 067W TWN 011N RNG 067W TWN 012N RNG 068W TWN 011N RNG 068W TWN 011N RNG 067W TWN 011N RNG 068W MSPERAIDNOGWS RANCH !. !. !. !. !] !] LPORCOAJTEIOCNT L A R I M E R ¦¨§25 W E L D ¦¨§80 Cheyenne Fort Collins Greeley Loveland Wellington 0 0.15 0.3 0.6 Mile 0 0.15 0.3 0.6 Kilometer ROUNDHOUSE ENERGYRENEWABLE PROJECT NORTH Easement Area and Easement Access 1:24,000 º O:\Projects\2018\185095 Enyo Renewable Energy\06GIS\6.3Layout\Easement_Maps\Easement_and_Access_NORTH_11x17.mxd Exported On: 11/29/18 RenewRoaubnledhouse Energy LLC. Project Components Easement Area ! ! ! Transmission Centerline Proposed Access Southern Map Extent (Match Line) Existing Features Interstate State Highway Existing Roads BNSF Railroad Township and Range Boundary Section Boundary County Boundary Meadow Springs Ranch Existing Substation Water Body Stream Existing Transmission !( !( Existing 230kV Transmission !( !( Existing 345kV Transmission ¦¨§25 12 TWN RNG 65 08 W N EXHIBIT B • Tri-State Generation and Transmission • Atkins Global • CDOT • TRS Corp. • HC Peck and Associates • Otis, Bedingfield, & Peters, Attorneys at Law • First National Bank • Farmers and Merchants Bank • Numerous Private Property Owners Clients Served Land/Site Value $31,920,000 Affected Improvement Contributory Value $0 Total Larger Parcel Value Before Acquisition (land + affected improvements) $31,920,000 for most of the distance south of the state line. Route 5A has nearly the lowest distance adjacent to an existing linear disturbance. Although parallel to I-25 for most of its distance, Route 5A is separated from the highway by approximately 0.25 mile in order to avoid conflicts with existing residential and commercial uses. Similar to Route 5A, Route 5B has the lowest distance adjacent to an existing linear disturbance. Overall Length Route 2B is the shortest route (19 miles) Route 2C (20.3 miles) is slightly longer than 2B. Route 3BC (20.3 miles) is slightly longer than 2B. 21.1 miles 21.4 miles The longest route at 21.7 miles. Councilmembers also asked about the feasibility of an alternative route further east along the existing Western Area Power Administration (WAPA) 345kV transmission line in Weld County. Wildlife and plant data is not nearly as available for the private lands crossed in Weld County as in the City’s Energy By Design study area (Meadow Springs Ranch and Larimer County), making it difficult to offer a straight comparison for a route parallel to the WAPA line. In their place, two quantitative datasets offer a useful comparison: 1. Length parallel to existing linear infrastructure is an indicator of habitat fragmentation. As distance parallel to existing infrastructure increases, the amount of habitat disturbance decreases. The preferred route parallels existing linear through pronghorn winter concentration area and a substantially greater distance through mule deer winter concentration area. Route 5A has the greatest distance through mapped black-tailed prairie dog colonies (2.4 miles), a substantially higher distance than Route 2B and the other routes. In addition, the route is located in proximity to the National Black- Footed Ferret Conservation Center and has greater distances through pronghorn and mule deer winter habitat. Similar to Route 5A, Route 5B has the greatest distance through mapped black- tailed prairie dog colonies (2.4 miles). In addition, the route is located in proximity to the National Black- Footed Ferret Conservation Center and had has the highest distances through pronghorn and mule deer winter habitat. Birds – Raptor Criteria Route 2B has a lower distance (0.47 mile) through a 0.25 mile buffer around known raptor nests, similar to Route 2C and higher than Route 5B. Similar to Route 2B, Route 2C has a lower distance (0.47 mile) through a 0.25 mile buffer around known raptor nests. Route 3B would have a greater distance through a 0.25 mile buffer around known raptor nests than Alternatives 2B and 2C. Route 4 has the greatest distance within 0.25 mile of known raptor nest sites, approximately three times the distance of Route 2B. Compared to the other alternative routes, Route 5A has one of the higher distances (nearly one mile) through a 0.25 mile buffer around known raptor nests. Route 5B has the lowest distance through a 0.25 mile buffer around known raptor nests. Birds – Non- Raptor Criteria Route 2B does not cross chestnut- collared longspur or mountain plover mapped habitats. Route 2B also has one of the lowest distances through Route 2C does not cross chestnut- collared longspur or mountain plover mapped habitats. Route 2C also has the lowest distances through Route 3B does not cross chestnut- collared longspur or mountain plover mapped habitats. Route 3B has a mid-range rating for distances Route 4 has one of the lower distances through lark bunting core area but the highest distance through McCown’s longspur core area. Route 5A crosses chestnut-collared longspur breeding area (0.5 miles) and has a substantial distance (over 2.5 miles) through As with Route 5A, Route 5B crosses chestnut-collared longspur breeding area (0.5 miles) and has a substantial distance (over 2.5 community. Route 3B avoids siting within a 100- foot buffer of perennial and ephemeral surface water features, wetlands, and riparian vegetation communities. However, this route would cross more identified riparian/wetland vegetation communities (five) than most of the other routes. Route 4 avoids siting within the 100-foot buffer of perennial and ephemeral surface water features but would result in one structure located in the 100-foot buffer of a riparian area. It would also require five crossings over an identified riparian/wetland vegetation community, more than any other alternative route except Route 3B. Route 5A has a higher level of effect on these criteria, including one structure within the 100-foot buffer of a drainage and four structures within a riparian area. In addition, Route 5A requires four crossings of riparian areas. Similar to Route 5A, Route 5B has a higher level of effect on these criteria, including one structure within the 100-foot buffer of one drainage and four structures within a riparian area. In addition, Route 5A requires four crossings of riparian areas. 20 21 22 23 24 29 28 27 26 25 32 33 34 35 36 TWN 010N RNG 068W TWN 011N RNG 068W MSPERAIDNOGWS RANCH RHeasmerilvtooinr !. !. !. !. !] !] LPORCOAJTEIOCNT L A R I M E R ¦¨§25 W E L D ¦¨§80 Cheyenne Fort Collins Greeley Loveland Wellington 0 0.15 0.3 0.6 Mile 0 0.2 0.4 0.8 Kilometer ROUNDHOUSE ENERGYRENEWABLE PROJECT SOUTH Easement Area and Permitting Corridor 1:24,000 º O:\Projects\2018\185095 Enyo Renewable Energy\06GIS\6.3Layout\Easement_Maps\Easement_and_Permitting_Corridor_SOUTH_11x17.mxd Exported On: 11/29/18 RenewRoaubnledhouse Energy LLC. Project Components Easement Area ! ! ! Transmission Centerline 1041 Permit Corridor Northern Map Extent (Match Line) Existing Features Interstate State Highway Existing Roads BNSF Railroad Township and Range Boundary Section Boundary County Boundary Meadow Springs Ranch Existing Substation Water Body Stream Existing Transmission !( !( Existing 230kV Transmission !( !( Existing 345kV Transmission ¦¨§25 12 TWN RNG 65 08 W N Attachment 4 T WN 012N RNG 067W TWN 012N RNG 068W TWN 012N RNG 067W TWN 011N RNG 067W TWN 012N RNG 068W TWN 011N RNG 068W TWN 011N RNG 067W TWN 011N RNG 068W ABpipolsicoalitdiosn Facility MSPERAIDNOGWS RANCH !. !. !. !. !] !] LPORCOAJTEIOCNT L A R I M E R ¦¨§25 W E L D ¦¨§80 Fort Collins Greeley Loveland Wellington Cheyenne 0 0.15 0.3 0.6 Mile 0 0.2 0.4 0.8 Kilometer ROUNDHOUSE ENERGYRENEWABLE PROJECT NORTH Easement Area and Permitting Corridor 1:24,000 º O:\Projects\2018\185095 Enyo Renewable Energy\06GIS\6.3Layout\Easement_Maps\Easement_and_Permitting_Corridor_NORTH_11x17.mxd Exported On: 11/29/18 RenewRoaubnledhouse Energy LLC. Project Components Easement Area ! ! ! Transmission Centerline 1041 Permit Corridor Southern Map Extent (Match Line) Existing Features Interstate State Highway Existing Roads BNSF Railroad Township and Range Boundary Section Boundary County Boundary Meadow Springs Ranch Existing Substation Water Body Stream Existing Transmission !( !( Existing 230kV Transmission !( !( Existing 345kV Transmission ¦¨§25 12 TWN RNG 65 08 W N Attachment 3 a l Cr e ek I n dian Cre e k S pri n g C r eek S pottlewo o d Cr e ek G r a ve s C r e e k Linton Ln Aldridge Rd Ranchland Ln E Co Rd 92 N Co Rd 7 Co Rd 92 E Co Rd 82 Buckeye Rd Romar Ranch Rd Mars Hill Ln N Co Rd 9 Co Rd 5 L o n e T r e e Cre e k S p o t w o o d C r e e k 12N 67W 12N 68W 12N 67W 11N 67W 12N 68W 11N 68W 10N 67W 10N 68W 10N 67W 11N 67W 10N 68W 11N 68W 1 1 N 6 7 W 11N 68W 36 21 Rawhide 20 21 22 23 24 19 06 05 04 07 08 09 18 17 16 19 20 21 05 04 03 02 01 08 09 10 11 12 17 16 15 14 13 20 21 22 23 24 06 05 04 07 08 09 18 17 16 19 20 21 30 29 28 31 32 33 05 04 03 02 01 08 09 10 11 12 17 16 15 14 13 20 21 22 23 24 29 28 27 26 25 32 33 34 35 19 20 30 29 28 31 32 33 20 21 22 23 24 29 28 27 26 25 32 33 34 35 36 !. !. !. !. !. !] !] CO WY NE LPORCOAJTEIOCNT L A R I M E R A D A M S M O R G A N G R A N D W E L D A R A P A H O E ¦¨§25 ¦¨§80 ¦¨§76 ¦¨§70 Denver Cheyenne Fort Collins Greeley Loveland Wellington 0 0.225 0.45 0.9 Mile 0 0.225 0.45 0.9 Kilometer ROUNDHOUSE ENERGYRENEWABLE PROJECT Project Overview 1:75,000 º O:\Projects\2018\185095 Enyo Renewable Energy\06GIS\6.3Layout\Miscellaneous_Maps\ProjectOverview_8_5x11_with_Preferred.mxd Exported On: 11/14/18 RenReowuanbdlheouse Energy Transmission Centerline Siting Area !( Existing 230kV Transmission !( Existing 345kV Transmission Old US Highway 87 Local Roads Railroad Stream Water Body Meadow Springs Ranch City of Fort Collins Natural Area Roundhouse Lease Area PRPA Owned Property Existing Substation pg. 2 Attachment 2