Building finance up to Avon voters
What’s the schedule?
Ballots on a referendum to approve a financing plan for the skier building have been mailed to registered voters in Avon. Those ballots should start arriving in mailboxes by Jan. 5. The votes will be counted Jan. 20.
To learn more, go to http://www.avon.org.
AVON — The Skier Building has faced tough sledding since town officials announced in October a plan to purchase the 16,000-square-foot building and use it as new town offices.
The purchase and finishing the building — which is a never-used empty shell — will cost an estimated $5.8 million. The town plans to pay for the project using certificates of participation. Those certificates are a commonly used method used by Colorado towns, counties and special districts. The certificates, which must be re-approved every year, use existing town revenues. The certificates are also a way local governments in Colorado get around some of the restrictions of a state constitutional amendment called the Taxpayers Bill of Rights. That amendment limits taxing and spending in Colorado, and generally requires voter approval to take on new debt.
A group of locals have objected to both the financing plan and the purchase itself. Those residents last fall gathered enough petition signatures to force a special election seeking to overturn the town ordinance passed authorizing issuing certificates for the purchase.
If opponents prevail, though, then the town could go ahead with the purchase. Avon Town Manager Virginia Egger said the Avon Town Council could approve buying the building with cash, or could arrange a lease-purchase deal with Starwood, which owns The Skier Building.
Here’s a look at some opponents’ questions, with responses from Egger and Avon Mayor Jennie Fancher.
While Avon and Starwood negotiated a $3.2 million purchase price, the town’s appraisal of the building was closer to $2 million. Starwood’s appraisal was closer to $4 million.
“We didn’t just split the difference,” Fancher said. “There were hard negotiations that went on for months.”
Resident Mark Kogan spent a career working on big commercial real estate deals for Goldman Sachs. He’s convinced the town is paying too much — perhaps millions too much — for The Skier Building project.
If the project is bought and built at its current estimates, then Kogan said the building would be the “most expensive commercial office building in the Vail Valley.”
In Kogan’s mind, one of the key questions about the purchase is “How much could a third party buy (the building) for without parking?”
The Skier Building was built as part of an agreement with Starwood for nearby lodging, and doesn’t have any parking of its own. That’s been a major point for opponents.
Town officials, though, say the building will use town-owned parking adjacent to the building. There’s also nearby parking available,” Egger said. If the deal goes through, then that parking will be attached to the building via zoning. That way, if the town sells the property in the future, parking will go along with deal.
But, Fancher said, “Municipalities don’t usually sell property.”
Is the building adequate?
Opponents have raised questions about the building from cracks in the foundation to the adequacy of the water supply, electricity and even the floor load.
Fancher said the building has been maintained by Starwood over the years — it was originally intended as retail and office space for the town’s Main Street Mall. Because of that, Fancher said the building’s elevator has been inspected on schedule and repaired as needed. The building’s water main is also appropriate for the size of the building, she said.
The building’s floors are also rated to a load of 60 pounds per square foot, Fancher said. Town code requires a floor load rating of 50 pounds per square foot.
A fact sheet issued by the town notes that the building has been inspected and evaluated by Eagle Eye Home Inspections. Egger said that company is certified to inspect commercial buildings, and that between 10 and 15 percent of the company’s business comes from work at commercial buildings.
The fact sheet also sates that Monroe & Newell Engineers, a local company, was hired to provide an opinion about the building’s integrity.
“The firm’s subsequent letter to the town, dated Oct. 2, 2014, found no concerns,” the fact sheet states.
What’s wrong with the old town hall?
Town resident and deal opponent Laurie Adler said she’s skeptical that the town needs to move its offices to the new building. She said she believes a needs analysis that was done by town employees represents a conflict of interest on their part.
“They needed someone from the outside to do that analysis,” Adler said.
Kogan said he believes the town could renovate its existing town hall over time for less money than buying The Skier Building.
But town officials say buying The Skier Building will actually cost a bit less than a full-on renovation of the current town hall. And, they said, town hall could be used for other purposes.
When the Benchmark Corp. first gave the new town of Avon land for a municipal building, that gift came with legal restrictions on future use. According to the town’s fact sheet, those uses include everything from parking to a convention facility to expanded uses of Nottingham Park. That’s a key element of the plan, Egger said, adding that merely renovating the current town hall “would be putting good money after bad.”
Opponents wonder what will happen to both the existing town hall and the town’s police department offices. Town officials say they’re still looking at potential uses for the current town hall site, and there are still-developing plans to move both the police department and the town’s fire station.
The Eagle River Fire Protection District is a separate entity from the town, and provides fire protection from the top of Tennessee Pass to Wolcott, not including Vail. That department’s Avon station is owned by the town. The fire district owns property near Northside Kitchen & Coffee. Egger said the town and fire district are working on plans to use that property as a combined police/fire station.
Having both the existing town hall and current fire station available for redevelopment is a great opportunity for the town as it seeks to create a community center, Egger said.
The performing arts pavilion at Nottingham Park became a serious problem for the town in 2014. That project, put on a fast track by town officials, doubled in cost in what seemed like a matter of days.
That has made some residents leery of what hidden costs might lurk in The Skier Building.
Egger and Fancher noted that while there were mistakes made on the pavilion project, the town in the past couple of years has brought several projects in on-time and on budget, including the town’s transportation maintenance center, improvements to Post Boulevard and improvements at the town’s recreation center.
And, Fancher said, the council has learned important lessons from the pavilion project.
“What happened with the stage will never happen again,” she said.
Adler isn’t so sure.
“I just don’t think (town officials) know the true cost,” she said. “There are so many unknowns. … There’s a risk of overpaying, and a potential waste of taxpayer money.”
Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, email@example.com and @scottnmiller.