The Pagosa Area Water and Sanitation District (PAWSD) Board of Directors agreed to reclassify the Aspen House project from commercial to residential following a presentation from Aspen House representatives and other community members asking for fee waivers at PAWSD’s May 14 meeting.
Aspen House is a planned home for adults with developmental disabilities in Archuleta County that is currently in the funding and construction process.
Aspen House Executive Director Pattie Copenhaver introduced the organization’s request, explaining that any fee waivers would help reduce the organization’s construction costs.
She stated that the organization is currently about $640,000 away from its final build, in addition to $1.2 million in fee reductions and donated work secured by the organization’s contractor, Tim Brown.
Brown explained that the project was started to serve people like his son and that he has seen extraordinary generosity from his subcontractors in donating work to help the project move forward.
The board also heard comments from a variety of other parents of children with special needs and people who work with them about the value of Aspen House and the importance of the project.
Archuleta County Commissioner John Ranson also spoke about the value of the project and his belief that PAWSD needs to support the community and provide the approximately $71,000 in fee waivers that were requested for the project.
He also noted that the county does not consider the property commercial, although PAWSD was calculating the fees for the property as commercial fees.
“All of us need to help on a project like this,” Ranson said. “This shouldn’t even be a debate.”
He added that he was not speaking for the Board of County Commissioners, but that he believes he could get the board to sign a letter supporting Aspen House’s request.
“This should not be a hard decision,” he said. “And please don’t tell me, ‘Well, we can’t afford this because of our modeling and our water loss and the costs that you’ve got out in the future.’ I don’t think you guys ever came to the county when you did your impact fee, which you’re supposed to do. I don’t want to go there.”
He explained that current PAWSD board members Bill Hudson and Glenn Walsh worked with the county against PAWSD to remove a previous impact fee, prior to their time on the board.
“I’m pleading with ya,” he said. “I don’t want $71,000, I don’t want $28,000 I’ve heard from individuals that have authority here. I’m asking to waive the whole thing.”
PAWSD board chairman Gene Tautges commented that the issue is particularly emotional, but noted that PAWSD is “personal, too,” and has fiduciary responsibilities.
Tautges then attempted to clarify the costs associated with the project, explaining that the building permit that Aspen House brought to PAWSD indicated that the project is commercial and that, if it is, it would cost about $76,000 in fees according to PAWSD’s rules and regulations, including modeling fees, capital investment fees (CIFs), and fees for installing pipes and meters.
However, if the project is actually residential, as the county now currently classifies it, the fees would drop to about $26,000 or $27,000.
This would also involve changing the number of equivalent units (EUs) associated with the project, Tautges explained, with the commercial classification allowing the current 2.5 EUs while a residential classification would, by definition, allow one EU.
He explained that this change to residential would not require board action, but that any further waivers would require discussion and a decision by the board.
In response to a comment from Ranson, Tautges added that the building permit for the project, not the county’s classification of the land where the project is located, would have to change.
Ranson added that PAWSD does not have to charge, which Tautges agreed with, and that the community is “pleading” with PAWSD to assist on this project.
Tautges invited Ranson to attend a later discussion of issues with the PAWSD budget, also covered in this issue of The SUN.
Brown stated that he is unsure why the project was classified as commercial to begin with and questioned why the district could not just forgive the fees instead of compelling Aspen House to go through the process of trying to change the building permits.
He also cited previous conflicts with PAWSD over other aspects of the project that “basically shut this project down for two years.”
Tautges stated that he appreciated Brown’s comments and that the board had the power to waive the fees, although whether doing so was the wise or correct thing to do remained uncertain.
PAWSD Programs Manager Renee Lewis also clarified in response to confusion from Aspen House representatives that the project was classified as a multi-dwelling project due to it being how other assisted living facilities in the area are classified.
Tautges also noted that the Pagosa Fire Protection District (PFPD) classifies the project as commercial and that it might be classified otherwise somewhere else.
Walsh commented that he does not see the project through an affordable housing lens, but does see it through the lens of the district’s previous favorable treatment or waiver of fees for other health care establishments in the community.
He added that he would support waiving fees for the project and that he believes that the district’s budgetary issues would not be significantly impacted by this project.
He also commented that he would hope that the district would not have to go above one EU and would also support reclassifying the project to residential if a majority of the board supported it.
PAWSD board member Alex Boehmer commented that he thought the board could “help this project out” by charging it as one residential EU.
He explained that he was nervous about PAWSD’s budget and desired to set a precedent that “we’re not a charity.”
Hudson commented that PAWSD has waived fees on a variety of other health care and public service projects in the community and that he views this project in a similar category to those.
He also noted that the project was classified as multifamily due to the number of fixtures inside and that staff did an “excellent” job of finding the lowest possible price that met the district’s rules and regulations.
The board then discussed potential approaches to reclassifying the project, with Boehmer suggesting that the district keep considering the project multifamily to keep it in line with how other districts assess it, but charge it the residential instead of multifamily rate.
Walsh then moved to charge the project as a single residential EU, noting the importance of finding a board compromise that could lead to a successful vote.
Boehmer asked if there would be negative impacts in terms of legal risk to the district for not doing water modeling.
PAWSD District Engineer Justin Ramsey explained that the PFPD and Aspen House’s own engineer determined there is enough water for fire suppression.
He added that the model is designed to ensure that PAWSD has enough water and infrastructure available once all houses in the area are built out.
Archuleta County Commissioner Veronica Medina then spoke, raising concerns that, if Aspen House is allotted one EU, it may use more water than that and have to pay increased monthly rates.
She added that she believes that the county would waive the fees if it was the county’s decision and suggested that PAWSD do so as well.
Boehmer asked if PAWSD could charge the one EU but still consider the project at 2.5 EUs and if that would be allowed in Walsh’s motion.
Tautges commented that he wished he had arranged the agenda in a different order so everyone could hear PAWSD’s financial report and the associated problems.
He noted that the district is in a difficult position and could potentially be in something equivalent to default if its debt service coverage ratios decrease.
PAWSD Comptroller Jack Dossett corrected Tautges, noting that the district would not be in default, but that its future capital would be more expensive.
Lewis added that this would also not impact PAWSD’s ability to get grants from the Colorado Department of Local Affairs, as Tautges speculated it would.
Walsh commented that the district’s budget issues would not be solved by fees for this project.
Tautges commented that, although the Aspen House situation would not break the district’s budget, it would “injure” it, in his opinion, and would “open up Pandora’s box.”
The board then heard more comments from supporters of Aspen House and clarifications about the motion and the state of the EUs for the property, with Walsh stating that he would want to keep his motion to count the property as one EU.
Ramsey added that considering the property as 2.5 EUs would lead to more water use allowed before additional charges, but would also lead to a 2.5 times larger water base water bill.
Tautges commented that he would agree with Walsh that keeping Aspen House at one EU would likely be ideal.
Walsh added that, if the project is regularly hitting penalty rates, they could request an additional EU of water service from PAWSD and pay increased rates in the future.
The board then voted on Walsh’s motion, with Walsh, Hudson and Boehmer voting in support and Tautges voting against, citing his concerns about the district’s financial situation.
Following the vote, the board received a comment from the audience that it did nothing to help the project compared to what it would have gotten from PAWSD if the project was reclassified as residential by the county.
Tautges replied that the decision was “discouraging” and encouraged audience members to stay to hear about the district’s financial issues.
The board closed the discussion with clarifications of a variety of other water issues related to the project and with Tautges and Lewis clarifying, in response to a question from Ranson, that PAWSD would still want the county to move forward with classifying the project as residential and informing PAWSD about this since it would impact other issues for PAWSD.
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