During a work session held on Tuesday, Dec. 10, the Archuleta County Board of County Commissioners (BoCC) heard a presentation from Troy Bernberg, a financial director with Northland Securities, which provided a property analysis to aid in the county’s consideration of purchasing land for the construction of a new administration building.
Bernburg began by explaining that he “took a very practical approach” with his analysis, taking into consideration the availability of accessibility of utilities for each property, current and future needs, along with a price-per-square-foot comparison.
He mentioned that utility access “is extremely important to a project,” noting that the cost to bring utilities to certain properties that have a lower price per square foot could potentially be more expensive than a property with a higher price per square foot that has easier utility access.
“Since we’re talking about taxpayer dollars, I really took the approach of what’s the most cost effective ... for the county,” Bernburg said.
He explained that the property analysis includes seven properties that the county provided as potential sites.
According to the prospective property analysis, those seven sites include a property on Alpha Drive, 2901 Cornerstone Drive, two properties on West U.S. 160, a property on Rob Snow Road, 342 Harman Park Drive and 1050 San Juan St.
Bernburg mentioned that based solely on price per square foot, there is a “pretty wide range of dollar amounts,” but in general properties with a lower price per square foot have more work needed.
According to the prospective property analysis, the price per square foot of the seven properties ranges from 97 cents for the Harman Park property up to $10.79 per square foot for the Cornerstone property.
Bernburg also mentioned that he reviewed 20 other properties currently on the market within Archuleta County, noting he found an average price per square foot to be $8 to $10, and that only one of those properties is larger than one acre.
Bernburg went on to mention that his report does not include the potential costs of traffic impacts that could be associated with any of the properties, noting that he is not a traffic engineer and does not have the expertise to advise the county on potential traffic impacts.
Bernburg mentioned that the properties toward the west of town are more level, which could help eliminate costs during construction.
“I think that’s an important part of this. I think qualitatively,” he said, noting that rock removal is costly.
He went on to explain that finding a property that has less of that type of work needed “makes more sense in the long run for the county.”
Bernburg also spoke about the county’s options for purchasing a property, explaining that the county could purchase a property outright with cash or go through a financing process.
Bernburg commented that “cash investment is particularly lucrative” for local governments right now.
In his report, Bernburg provides an illustrative scoring table for the seven properties being considered by the county,which reflects the Alpha Drive property as scoring the highest.
He explained that the properties were given scores in categories such as price per square foot, available infrastructure, accessibility, cost and location.
He mentioned that the properties on the west end of town saw the most difference in price points due to the “well-established infrastructure” in the area.
“While there are some properties that are very attractively priced by square foot dollars, the amount of work you would have to do would add time and money,” he said.
Bernberg explained that his top two recommendations are the Alpha Drive property and the Cornerstone property, because those are the two properties that are most likely to have the least number of unknowns during construction.
He added that he is not able to foresee every potential unknown, but that, through his knowledge and experience, he is able to analyze the properties and determine which one is the most likely to produce the least number of unknowns.
“So, to the extent that we can limit that, I think makes more sense from a fiduciary standard,” he said.
Bernburg then spoke more about the county’s options for financing, noting that local governments typically use certifications of participation on lease-purchase financing.
“That’s literally how essential asset infrastructure gets built in Colorado on a local level,” he said, explaining that voters have not shown to be in favor of funding new county buildings because they don’t understand the value of it.
“Thats why lease-purchase financing exists in Colorado, because ultimately a lot of these things needed to get built and couldn’t rely on the other options,” he said.
Bernburg mentioned that the county currently has a good bond rating, which gives the county more options for financing.
“Your credit is so good that people are going to want to invest anyway,” he said.
County Manager Jack Harper indicated that the new administration building is planned to be approximately 30,000 square feet and will house all of the county’s departments except for Road and Bridge, Human Services, Public Health and the sheriff’s office.
Commissioner Veronica Medina asked how much land would be used for parking for a building of that size.
Bernburg explained that he would need to know how many people will be in the building, and that he would need to follow up to provide an answer to that.
Medina commented that the members of the community are saying the county is looking to build a “Taj Mahal” style administration building, which she stated is certainly not the case.
“They’re all wonderful properties in my opinion, but some make more sense than others,” Bernburg said, explaining that he takes his fiduciary duty seriously while considering the impacts this will have on residents.
He noted that land that is close to being “shovel ready” is priced accordingly.
“If one doesn’t work, I think there’s other workable options,” he added.
The matter was originally listed on the BoCC’s meeting agenda for Dec. 10 for the board to vote on letters of intent on multiple properties and a purchase and sales agreement with one of those companies, ArenaLabs, but was removed in order to schedule a public meeting for residents to provide comment on the matter.
During the work session, Medina stated that the matter would be removed from the afternoon meeting agenda to give the public the opportunity to speak on the topic, “because we’re absolutely gonna do what we said we were going to do.”
Commissioner Warren Brown commented that Bernburg’s report should provide the information that the public is wanting and the county is now “much better suited to make a good financial decision.”
On Monday, Dec. 16, from 5:30 to 7 p.m., Harper and County Attorney Todd Weaver will host an informational meeting in regard to the purchasing of approximately five acres of land for a new administration building, according to a press release from Archuleta County Communication Specialist Ashley Springer.
The press release notes that members of the BoCC will not be present during the Dec. 16 meeting.
Residents can also sign up to give public comment on the matter during the regular BoCC meeting scheduled for Tuesday, Dec. 17, at 1:30 p.m. at 398 Lewis St.
The county originally approved a letter of engagement with Northland Securities during a regular meeting held on Oct. 15, “to provide advice for the funding of Capital Projects for Archuleta County,” the Oct. 15 agenda states.
According to the letter of engagement, Archuleta County (the issuer) seeks to engage Northland Securities to serve as underwriter, and not as a financial advisor or municipal advisor, in connection with the issuance of certificates of participation for a new administrative building (the issue).
The letter also notes, “Northland’s compensation is based on the size of the Issue and is contingent on the closing of the Issue.”
clayton@pagosasun.com
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