Palmer Lake Board of Trustees, July 12, 13, and 27 – Water rates to rise 5% annually

Water rates to increase 5% annually
Elephant Rock property future debated
RV policy takes shape
Audit of 2022 budget shows good financial health
Public hearings
Other votes
Focus on the Forest honored

By James Howald and Jackie Burhans

The Palmer Lake Board of Trustees (PLBOT) met three times in July: regular board meetings were held on July 13 and 27 and a workshop was held on July 12. The board continued its work on water rates, the future of the Elephant Rock property, and how to regulate recreational vehicle (RV) use and storage on private and public property. The board heard an audit report on its 2022 budget. It held two public hearings, both of which led to votes.

The board voted on a resolution facilitating cooperation between the Palmer Lake Police Department and surrounding police departments. It revised the priorities for maintaining the water and sewer system documented in its Preliminary Engineering Report and renewed the intergovernmental agreement that regulates the town’s ambulance service. The board considered a special event permit and recognized Focus on the Forest volunteers for their work to eliminate graffiti.

The July 12 meeting was preceded by an executive session to develop negotiation strategies regarding the lease agreements for the EcoSpa and the Star View Ranch, and regarding the intergovernmental agreement (IGA) between the town and the Monument Fire Department. The July 27 meeting was preceded by an executive session to discuss a letter of intent concerning the Norris Hay Ranch.

Water rates to increase 5% annually

At the water rate workshop on July 12, water rate consultant Chris Brandewie presented several scenarios to the board which were designed to fully fund the town’s water service and allow for the accumulation of reserve funds earmarked for future capital improvement projects. The different scenarios also addressed questions and concerns the board members had expressed in previous discussions. The board asked Brandewie to modify the rate structure one last time for final consideration at the board meeting scheduled for July 27, at which time a final vote would be taken.

At the regular board meeting the next day, the board returned to the issue. Director Dennis Stern and Town Administrator Dawn Collins summarized the rates changes they had directed Brandewie to work out as a 5% increase in the water base rate and water usage charges, changes to the tier structure, and a 5% increase in future tap fees.

Resident Roger Mosely opposed the changes, arguing the increased base rate treated low-income families unfairly and that water funds needed to go into their own bank account. Collins explained that different accounting codes were used to track water funds, that a separate bank account was not needed, and in fact separate bank accounts had proved convoluted in the past.

Mayor Glant Havenar said she wanted most of the increased revenue to come from increasing the base rate, not from increases in the tiered usage charges. She added the rates could be adjusted annually if necessary.

At the July 27 meeting, the board considered Resolution 54-2023, which documents all rate changes and projects them over a five-year period. The resolution specifies:

Beginning in 2024, water tap fees will increase 5% annually.
The water tiers will be redesigned, and usage rates will increase 5% annually beginning in January 2025.
The monthly base fee, which contributes to capital improvement projects and debt service, will increase to $85 per month for residential customers starting with the September 2023 billing. Commercial customers, out-of-town customers, and irrigation customers will pay higher base fees.
The rate increases will continue annually until the board directs otherwise.

The resolution, which contains tables listing all the water rate changes, can be found online at page < 90 > of the board meeting packet, available here: https://bit.ly/plbot-packet-230727.

In the discussion of the resolution, Director Samantha Padgett asked that the resolution be amended to add a sunset clause that would end the annual increases after five years unless the board took action to continue them. Havenar pointed out the board could alter the annual increases at any time. Padgett insisted that a sunset clause ending annual increases on Jan. 1, 2029 be added to it.

The amended resolution passed, with Directors Shana Ball, Kevin Dreher, Sam Padgett, and Dennis Stern, as well as Havenar, voting yes. Director Jessica Farr voted no, and Director Nick Ehrhardt was excused from the meeting and did not vote.

Elephant Rock property future debated

At the July 13 meeting, Collins told the board the Palmer Lake Planning Commission had met on July 19 and had recommended development at the Elephant Rock property stop, except for trail construction, until the master plan was complete. Havenar said she was not comfortable stopping the process.

At the July 27 meeting, the board continued this discussion. Havenar said the board was considering three concepts for the property: the spa proposed by Richard and Lindsay Willan, the wedding venue proposed by Franco Pisani and Lindsey Truitt, and the perimeter trail proposed by the Parks Commission. She also mentioned that the police and fire departments requested land to be reserved for a public safety building. Havenar said many ideas for the property were being informally proposed and the town did not have the staff or the insurance coverage to address them. The future of the cabins on the property was uncertain, as the draft master plan calls for them to be demolished, the town does not have staff to manage them, and the town’s insurer wants them boarded up and fenced before allowing residents to visit the Elephant Rock property.

Farr said she was grateful for the many suggestions about uses for the cabins. She said the board had decided to lease 2.8 acres to the Willans, proceed with the wedding venue proposal and reserve three acres for the police and fire departments, who will use the longhouse for training before it is demolished.

Havenar and Farr asked for comments from the audience. Gina Brenneman said moving forward without a complete master plan “appears to defy logic.” She asked for the neighbors’ request for peace and quiet to be considered and requested noise, safety, lights, the beauty of the site, quality of life and home values all be studied. She also suggested some of the land should be put into a conservation trust.

Havenar responded that the town owns the land so there is no need for a trust, adding that the cabins were uninsurable and this was preventing the town from opening the property to residents. She agreed to revisit the issue of a trust.

Richard Willan told the board he was willing to lease the cabins from the town, board up the windows and fence them off at his expense and then begin repairing them one by one. He offered to insure them at his expense and said he would form an LLC to manage them. He believed they could be rented to weekenders. Dreher, Farr, Stern and Havenar did not support Willan’s offer. Other residents spoke in favor of and against leaving the cabins in place.

Ball ended the discussion by saying the board would continue to look into the suggestions for the property.

RV policy takes shape

At the July 13 meeting, Havenar said a policy on RVs was needed because they currently were not addressed in the municipal code and the board wanted to prevent people living in RVs within the town limits. Town Attorney Matt Krob said the policy should make it clear RVs could not be used as Additional Dwelling Units, which are subordinate dwellings sharing a lot with a primary dwelling, whether attached or separate.

Ball questioned whether the town had the constitutional right to decide how people can use their property. Krob answered RVs could be regulated by towns just as towns specify setbacks and other regulations that affect private property. Boards are charged with administering affairs to ensure health and safety. Zoning and fire codes are examples of this, he said.

Collins said that at one time the municipal code did regulate RVs. Now the town frequently fields questions about residents residing long term in RVs on private property. She said the town’s regulations on short-term rentals prevent RVs from being used as short-term rentals.

Fire Chief John Vincent pointed out that RVs present fire and safety issues, arguing the single door and gray water disposal were concerns.

The discussion at this meeting ended with a consensus that RV use on public land needed regulation, and Krob said he would begin drafting a policy.

The RV discussion continued at the July 27 meeting. Krob put together questions for the board to answer to guide the policy development.

The board generally supported:

Storing RVs on private property.
Honoring setbacks when an RV is on private property.
RVs on private property can’t be permanently occupied.
RVs can have temporary electrical connections, but not water or wastewater connections.
Using Code Enforcement to address violations of policy.

The board generally did not support:

Specifying where an RV must be stored on private property.
Requiring RVs on private property be covered or screened.
Using RVs to camp on public property.
Using private property to store RVs as a commercial enterprise.

The board did not take a position on use of generators with RVs on private property.

Audit of 2022 budget shows good financial health

David Green, of Green and Associates, the town’s independent auditing company, presented the results of his audit of the town’s 2022 financial statements. His report gave the town an unmodified “clean” opinion, indicating the statements are in line with generally accepted accounting principles and provide an accurate picture of the town’s finances for 2022. He performed a risk-based audit designed to identify and address risks.

He reported some checks that were erroneously duplicated, but noted they were only paid once. He complimented the town staff for their cooperation with his work.

He said the town’s net position, a statement of what the town owns and owes, was $4 million, with $2.6 million in the General Fund and the rest in the Enterprise Water Fund. The town’s assets are mainly property tax receivables, Green said. He noted funds from the American Recovery Plan Act (ARPA) that have been received but not yet spent. Those funds are tracked, and the remainder is known, he said.

Green pointed out the Water Fund is its own enterprise, has its own financial statements and has its own opinion in his report.

Mosely asked Green to comment on the fact that $800,000 was budgeted for Capital and Operations and Maintenance but only $194,000 was spent. Mosely asked if that was reasonable. Green replied every budget should be as accurate as possible, but revenues and expenditures have to be estimated and it’s “easy enough” for some funds to be unspent. State law requires towns not to exceed their published budget, but spending less than what is budgeted doesn’t mean the budget should be adjusted down.

In response to a question from Havenar about why amounts don’t always match the budget on a month-to-month basis, Green pointed out that there can be a lag when invoices are presented. Accounting uses hindsight, he explained, and sometimes things are not reconciled until an audit is performed and charges made to incorrect accounts are adjusted. It was common to adjust accounting entries throughout the year, he said. Collins pointed out the accounting codes the town uses have changed over time and it wasn’t until 2021 that the town began to budget for capital items. Havenar said uncertainty about expenses and revenues sometimes required the town to budget high.

Green said he has seen constant improvement in the town’s financial processes in the eight years he has served as the town’s auditor. “It seems to get smoother every year,” he said.

Padgett asked if the Water Fund was under budget and Green answered expenses were $889,699 under budget and revenues were $245,435 less than expected.

Later in the meeting, the board voted in favor of Resolution 48-2023, which authorizes staff to file the 2022 audit report with the state.

At the July 27 meeting, in her administrative report, in response to comments that the town had misused ARPA funds, Collins affirmed with the board that the 2022 audit included a review of the town’s use of ARPA funds, with a positive result. She mentioned that when the town received the ARPA funds a call was held with the state, who agreed that water lines and a well were appropriate uses of the funds. There was no misuse of ARPA funds, Collins said.

Public hearings

At the July 27 meeting, the board held two public hearings, both of which led to votes later in the meeting.

The first public hearing concerned a minor subdivision request from Scott Phillips, who requested to subdivide his five-acre lot on Rockridge Road into three lots: a 2.5-acre lot for his home, a 1.4-acre lot and a 1.3-acre lot. The second and third lot would be developed later, he said. Phillips told the board the Planning Commission had unanimously supported his request.

There were no comments from the public on Phillips’ request, and the board voted unanimously in favor of Resolution 49-2203 approving his request.

The second public hearing was more contentious. Sylvia Amons requested a conditional use permit allowing her to develop her property at 56 Highway 105 as a mixed-use commercial and residential project. Amons said she had begun planning the project in 2018, but the town’s moratorium on water and sewer taps stalled it. She was also delayed by issues of the proposed building’s height and the number of floors. Amons said she wanted to develop the property as a three-story building within the town’s current height limitation, with commercial space on the bottom floor and two floors of residential units.

Collins said the Planning Commission decided the project complied with the master plan and would add needed housing to the town. Havenar pointed out that Amons’ plan was approved in 2018, with a height of 32 feet and two stories. Havenar also said the question before the board was not the design of the building but only the question of whether the property could be developed for mixed use. The property was currently zoned for commercial use, Havenar said. The plan would be considered later in the process.

Several residents spoke against the project, citing concerns with access to the lot, impact on traffic, the density, the proximity to other homes, the impact on neighbors’ views of Ben Lomond, location of trash receptacles, inadequate parking, lowering of property values, and turnover in the residential units.

Havenar and Krob pointed out, again, that the issue before the board was only whether to allow mixed residential and commercial use, and not the design of the building.

Ball pointed out that citizens wanted to see a mix of commercial and residential on the town’s main street. The state Legislature is pushing for more affordable housing, she said, adding Amon’s project addressed those concerns.

Havenar said a 30-foot-tall commercial building might be less to the neighbors liking than Amons’ project. The Planning Commission and the Board of Adjustment would work through all the design details later, she said.

The hearing was closed, and the board voted to approve Resolution 50-2023, granting Amons her conditional use permit for a mixed-use project, with Dreher voting no, Ball, Farr, Padgett, Stern and Havenar voting yes. Ehrhardt was excused from the meeting and did not vote.

Other votes

The board voted unanimously in favor of Resolution 47-2023, which renews a cooperative agreement between the Palmer Lake Police Department and El Paso County allowing the town to rely on the county when doing investigations involving child abuse and neglect.
The board voted unanimously to approve Resolution 51-2023, which updates the high priority task list in the Preliminary Engineering Report that addresses the town’s water system maintenance needs.
The board voted unanimously in favor of Resolution 53-2023, which revises an intergovernmental agreement between the town and the Monument Fire Department regarding ambulance service and medical transport to allow an annual fee rather than per-call fees, making it easier for the town to budget for the service.
A special permit was granted to Verity’s Village to hold a fundraiser in the form of a running event at the lake on Sept. 16.

Focus on the Forest honored

Jimmy Zelones, Tyson Reese, and Shawn Nielson of Focus on the Forest were presented with certificates of appreciation for their work removing graffiti from the reservoir trail. For more information, see https://focusontheforest.org.

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The next board meetings are scheduled for Aug. 10 and 24. See the town’s website at www.townofpalmerlake.com to confirm times and dates of board meetings and workshops. Meetings are typically held on the second and fourth Thursdays of the month at the Town Hall. Information: 719-481-2953.

James Howald can be reached at jameshowald@ocn.me. Jackie Burhans can be reached at jackieburhans@ocn.me.