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Woodmen Hills amendment denied

On Dec. 15, the El Paso County Board of County Commissioners denied Woodmen Hills Metropolitan District’s request to amend and restate the district’s service plan.WHMD board president Jan Pizzi said the most important provision of the plan was the new wastewater treatment plant the district will likely need in the next few years, followed by water (including storage and filtration), parks and recreation, drainage, a voter-approved covenant enforcement authority and permission to have a voter-approved mill levy.After hearing almost five hours of testimony from WHMD representatives and four Woodmen Hills residents in favor, as well as 11 residents opposed; commissioners Amy Lathen, Sallie Clark and Peggy Littleton voted to deny approval of the new service plan.As they did at the BOCC’s first hearing on the new service plan in October, many people spoke against the plan because it would allow the district to enforce covenants.Lathen said she had reviewed a stack of Woodmen Hillsí covenants and concluded the problem is not so much an enforcement issue but the covenants themselves.ìThese are not common-sense covenants. These would make anyone frustrated,î she said.County attorney William Louis said covenants are a matter of private contract and the BOCC has no authority to change them.Louis said he disagreed with the district’s attorneys that covenants for filings 1 through 10 name the district as the filings’ covenant enforcement authority.ìThere’s got to be a provision that expressly names the district as having the authority. I don’t see it in the covenants,î he said.In support of his argument, Louis said when WHMD was formed in the 1990s Colorado statute did not give metropolitan districts authority to enforce covenants. At that time, they were enforced neighbor-to-neighbor or via homeowners associations.It was not until the 2000s that Colorado law was changed to allow metropolitan districts to enforce covenants, he said.Louis said if a Woodmen Hills homeowner wants to form an HOA to enforce covenants, he or she needs to write an amended covenant and ask neighbors in that filing to sign it.If a super-majority of homeowners (66 or 75 percent depending on the filing) agree, an HOA can be formed. The HOA can then contract with the district and establish a fee to finance the association, he said.WHMD attorney Evan Ela said he disagreed with Louis’ interpretation of the covenants, but he also said the WHMD board would be willing to remove covenant enforcement from the plan to get the BOCC’s approval.The concession did not sway the three commissioners, who were also concerned about opposition to the plan’s provision to allow the district to have a voter-approved mill levy capped at 60 mills.WHMD treasurer Al Kreps said a mill levy would allow the district to lower its interest payments by refinancing its privately-placed 8 percent bonds on the public bond market at 3 or 4 percent.Paying for district services by a property tax payment instead of user fees would benefit homeowners because the payments would be tax-deductible on their income tax returns ñ a savings of as much as $700 a year.ìWhen we pay fees, we do not get tax deductions,î Kreps said.Woodmen Hills resident Pat Reedy said there is no need to raise debt that high. ìTimes are bad, and I don’t think someone should have control to put us that far in debt,î Reedy said. ìI don’t trust any of them.îThe issue of trust came up throughout the opponents’ testimony. Littleton addressed the issue and said the district needs to spend time building trust with its residents.Given that residents were not happy with the increase for district employee salaries, one way to build trust would be to freeze salaries, she said.Trust could also be enhanced by developing an online bill payment system to put an end to disputes over late postings and late payment fees, Littleton said.Lathen said there is nothing in the service plan specifying that user fees would go away if voters approved a mill levy. There are too many questions that need to be answered, she said.Clark said the plan had too many moving parts, and the financial components werenít appropriately presented.The BOCC’s denial allows the district to present a revised service plan amendment within a year, without having to pay county fees again.The district will, however, have to pay for expenses the county incurred to notify Woodmen Hills residents of another hearing.The county will also prepare a written denial letter outlining the BOCC’s objections.Kreps said the district had already spent from $40,000 to $50,000 updating the service plan.ìThe more time we take, the more cost to the district, to the community,î he said.Commissioner Dennis Hisey disagreed with the decision to deny. His motion to approve a version of the plan that excluded covenant enforcement failed.ìThis board has a history of allowing people to vote on how they want to live in their neighborhoods,î Hisey said, adding that he thought removing covenants mitigated major objections.Saga of wastewater treatment plantAt the BOCC hearing on the amended service plan, WHMD’s manager Larry Bishop summarized the history of the district’s wastewater treatment plant.Bishop said in 1988 Falcon Properties (developer of Woodmen Hills) entered into an agreement with Paint Brush Hills Metropolitan District to equally share the $900,000 cost of building an 800,000-gallon-a-day wastewater treatment plant. Paintbrush Hills would bear costs in excess of $900,000.By the 2000s, Woodmen Hills had grown faster than Paint Brush Hills, and on its own WHMD paid for a 500,000-gallon-a-day expansion of the treatment plant, which was completed in 2005.When the plant continued to receive notices of violation from the Colorado Department of Public Health and Environment, WHMD hired a third-party engineer to evaluate the treatment plant, Bishop said.ìWe were very surprised to find a capacity of 610,000 gallons a day, when it was thought the plant was supposed to handle over one million,î he said.WHMD sued and settled with Paint Brush Hills Metropolitan District last year. The settlement made WHMD the treatment plant’s sole owner.The plant is currently at 90 percent capacity ñ the level at which the Colorado Department of Public Health and Environment requires districts to start planning for additional capacity, he said.An alternative to building a new plant is sending wastewater to Cherokee Metropolitan District’s new treatment plant, which will also use filtration to recharge the alluvial aquifer.The drawback is that WHMD would lose 400-acre-feet of water a year valued at as much as $5,000 per-acre feet because the Colorado Supreme Court has ruled that every drop of water from Cherokee’s new plant belongs to the Upper Black Squirrel Groundwater Management District, Bishop said.An offer to join the Cherokee project was withdrawn in March 2008 but negotiations have resumed.ìWe got a price of $7.1 million for hooking up,î Bishop said.If WHMD builds a new treatment plant, it will have a capacity of 900,000 gallons a day because that’s what’s needed for build-out, he said.

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