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PAWSD suspends controversial fee

Toward the end of another lengthy Pagosa Area Water and Sanitation District (PAWSD) Board of Directors meeting Tuesday night, some convincing community members moved what seemed an immovable object. As a result, the board suspended its construction-related Water Resource Fee (WRF) for six months.

A sometimes heated, sometimes contentious, debate quickly ensued as newly-elected director Roy Vega presented a self-conceived draft resolution designed to, among other things, impose an immediate moratorium on Dry Gulch spending, halt the imposition and collection of the district’s WRF and refund all relevant monies collected, to date.

Following Vega’s motion to adopt his resolution, which he promptly read aloud in its entirety, another newly-elected board member, Allan Bunch, quickly seconded the move. At that point, board chair Steve Hartvigsen asked for discussion and director Bob Huff started in. However, prior to Huff completing his first sentence, Vega reminded him that the maker of the motion gets the floor first.

Vega then continued by describing the district’s WRF as an “exaction” that either fits the description of an impact fee or tax. He suggested that impact fees are not provided for in Title 32, Governmental Entities; while imposing such a tax would be in violation of Tabor and Article 10, Section 20 of the Colorado Constitution.

Vega further insisted the board, by imposing its exaction on constituents, is exposing itself and individual board members to potential litigation and liability for a wrongful act.

He then turned to the current estimated cost of building Dry Gulch and related systems ($216.6 million), questioned anticipated long-term growth rates, and cast doubt on the district’s ability to pay for the project, as well as the legal counsel it received in crafting the WRF.

To that, Huff responded by first proclaiming, “There’s a whole lot on the table. First of all, I wouldn’t touch this thing without our counsel review of it as it sits here, thoroughly, point by point.”

He added that Vega’s reference to the WRF as an impact fee was inaccurate, and that it is not legally an impact fee. He further suggested that district engineers and other advisors be consulted, before acting on Vega’s proposed resolution.

Huff also expressed concern with taking action on such a resolution as the district and Archuleta County Board of County Commissioners (BoCC) continue work on an important Intergovernmental Agreement (IGA). Though he acknowledged not knowing what the IGA will look like or include, he also expressed concern that passage of Vega’s resolution might be premature, as the newly-formed Community Water Supply Planning Group continues its work.

“I see you getting in front of your own study group,” Huff continued. “I mean, my gosh, if that study group comes out and says, hey, there’s not going to be a Dry Gulch project, it’s going to be something else, there’s a whole different plan.”

Again, while Huff couldn’t predict what the study group might come up with over the next several months, he appeared confident that the district would look favorably upon its recommendations, while further implying that revenue from the WRF might still be necessary.

As the debate continued, both Vega and Huff belabored their respective points of view, each making valid arguments. Vega insisted that the WRF was inequitably applied, unfair and illegal, and Huff insisted that the district’s attorneys had thoroughly reviewed the fee before its inception, and that he remained confident it was lawful and appropriate.

Eventually, Hartvigsen asked for input from other board members. With that, Bunch briefly discussed projected population figures as the basis for deciding on the size of Dry Gulch and the existing WRF. According to his calculations, a “35,000-acre-foot reservoir” would accommodate 230,000 residents by 2055.

Meanwhile, director Windsor Chacey expressed additional concerns with Vega’s resolution, including an inaccuracy suggesting the district’s Capital Investment Fee was meant for “general improvement of existing water treatment and distribution systems.” In fact, the CIF is intended to pay for the expansion of existing facilities as is dictated by growth.

Chacey also took issue with Vega’s suggestion that no further spending be allowed on Dry Gulch, in spite of ongoing litigation between the district and Trout Unlimited. As part of the project, the district is seeking additional San Juan River water rights to eventually fill and maintain the reservoir. Both Chacey and Huff have said the pursuit of additional water rights should continue, regardless of whether Dry Gulch ever becomes a reality.

To further the argument, Hartvigsen insisted that two well-respected engineering firms evaluated the overall Dry Gulch project, determined that assessing a WRF on new construction was justified, and calculated its appropriate amount to be $5,617 per equivalent unit, or roughly one single-family resident.

At that point, Hartvigsen called on county commissioner John Ranson.

“I’m not here to speak for the BoCC … this has gone on for a long time. We’re in probably the worst economy that we’re going to see in our lifetime. Our constituents don’t really care if your lawyer calls these impact fees or what they’re labeled. We feel that it has hurt the economy.

“… there is backing up right now to re-look at this project and all of us are concerned about the fees and would like to see them lowered, even if it’s temporarily, until a decision is reached. I don’t think anybody at this table can argue that this has hurt our economy.

“I ran on it, you know I ran on it. These guys (Vega and Bunch) just went through an election and the people have spoken. We’re hurting out there, we need your help … we need for you guys to step up and help us. We’re trying to work with you guys in a professional way and don’t want it to be controversial, but we’re concerned about the people.

“Now’s a great time for you guys to step up and temporarily remove these things until the committee (Community Water Supply Planning Group [CWSPG]) can come up with a recommendation. Going along the same path like we have is not an option … all three commissioners feel strongly about that.”

Following Ranson’s powerful narrative, others, including developer Pat Alley and Steve Vanhorn, also offered compelling arguments against maintaining the district WRF.

Eventually, some two hours and 40 minutes into the debate, Huff indicated some willingness to reconsider his longstanding position, as Vega soon offered to amend his motion.

“I came in here with an ironclad feeling that I knew where I stood,” Huff said. “And, I am turning around somewhat, largely because of the rational voices I’ve heard. And, not having the WRF until the end of the year would not be a disaster to us, one way or another.”

Ultimately, Vega’s amended motion, which eliminated much but not all of his original resolution, failed by a three-to-two vote. Huff then made a motion of his own, advocating an immediate six-month moratorium on the WRF, with automatic reinstatement, depending on what recommendations the CWSPG might offer.

That vote passed, four to one, with Vega opposed.