The bottom line… Elbert County Commissioners Danny Willcox, Chris Richardson, and Grant Thayer approved a $900,000.00 interest free loan in April to the Sun Country Meadows PID (Public Improvement District) for road paving.

At the July 11 commissioner board meeting, the three commissioners refused to answer my questions regarding this loan, which I only discovered by reading the 2017 county financial audit report. The 2017 audit report, produced by the firm Rubin Brown, was on the meeting agenda for presentation and then formal acceptance by vote of the commissioners. I asked the commissioners to please explain the loan as it was my understanding that all debt associated with the Sun Country road improvements were to be funded by a third party (a bank) via certified bonds. The commissioners were silent to my inquiries. When the time came for the vote to accept the audit report, I asked the commissioners to address my questions before voting. Nope. More silence. There was some murmuring among the commissioners but no explanation of the loan for public consumption.

Following the meeting, I was approached by Commissioners Willcox and Richardson. It seems the paving bids and the bank/bond loan interest rates were higher than anticipated and the commissioners felt badly for Sun Country residents and guilty for their own bad financial estimates. And so, they decided to chip in a county interest free loan of $900K and to reduce the amount of bank loan debt by $1 million.

County Commissioners, acting as the ex officio District board, presumably because of their expertise, put the cart before the horse. They rushed to a public election with a ballot initiative wherein voters approved a specific amount of financial debt (for a specific amount of road paving), without the benefit of firm labor and banking estimates.

Indeed, the county solicitation for paving proposals only closed a few days ago on July 12, 2018! See the solicitation here: https://www.bidnetdirect.com/colorado/elbert-county-government/solicitations/2018-Sun-Country-Meadows-Road-Improvement-Project/0000193441?purchasingGroupId=8409951&origin=2

So, fellow county citizens, those property tax hikes and the windfarm windfall that should provide increased services to all of us? Nearly $1 million of that is going to fund road improvements to Sun Country Meadows. Shouldn’t we all now expect the same type of interest free loan from the county coffers? What financial geniuses would ever provide an interest free $1 million loan to anyone, ever?

If you’re interested in the gory details, please read on. And keep in mind the fact that the commissioners continue offering excuses about why the county does not have enough revenues to: improve county roads, pave county roads, open county offices five days a week, reopen the compactor site, operate an annual hazardous waste/recycle event, provide for county sheriff dispatch, etc.

HISTORY
In the late summer of 2017, resident(s) of the Sun Country Meadows subdivision began discussions with Elbert County officials about their desire to improve road conditions in their neighborhood. Ultimately, the parties agreed to establish a Public Improvement District (PID), with the Elbert County Commissioners assuming the role Board of Directors for said PID and placing a question on the ballot for the November 2017 election asking Sun Country Meadows residents (registered voters) to approve acceptance of a total debt of $3.185 million for road improvements ($2.8 million for road improvements plus $385K interest). An increased mill levy totaling 16.85 mills was to be assessed on all Sun Country Meadows residences in order to collect $189,252 annually for debt payment over 30 years. Read the approved county resolutions and ballot language here: http://www.elbertcounty-co.gov/Res%202017-24A.pdf and here: http://www.elbertcounty-co.gov/Res%202017-025.pdf

So far, so good. The resident voters of Sun Country Meadows accepted $3.185 million in debt to pave 3.9 miles of roads in their development and the county agreed to pass the extra money from increased property tax assessments of the development’s residences on to the bond holder. The bank issuing the bonds reaps a profit of $385K in interest. American capitalism and free enterprise at work, Yay!

Then, last week, presentation of the annual county financial audit report appeared on the agenda for the county commissioners’ board meeting. The auditor’s report was posted to the county website barely 24 hours before the meeting. During my late night speed read of the 2017 audit report, I noticed in the “Notes to Financial Statements” section, an accounting of this long-term debt attributed to the Sun Country Meadows PID. A few pages later in the report, it is noted that the county agreed in April 2018 to loan $900K to the Sun Country Meadows PID. From that report:

NOTE 5 - LONG-TERM OBLIGATIONS (CONTINUED)
Unissued Debt
Sun Country Meadows Public Improvement District - As part of the formation of the Sun Country Meadows Public Improvement District (District), the voters approved the issuance of $2,800,000 in debt with the total repayment to be $3,185,000. The County anticipates issuing this debt during 2018. (Page 27)

NOTE 14 - SUBSEQUENT EVENTS
During April, 2018, Sun Country Meadows, a blended component unit of the County, issued $1,800,000 in general obligation bonds to finance improvements within the District. Payments are due on a semiannual basis with the last payment due December 1, 2037. The bond carries an interest rate of 4.2%. The sources of repayment are property and specific ownership taxes. In order to complete these improvements the County agreed to loan the District an additional $900,000. (Page 32)

The 2017 Audit report is here:
http://www.elbertcounty-co.gov/Elbert%20County%202017%20Annual%20Financial%20Report.pdf