The Plains Metropolitan District is not obligated to build any tennis courts, swimming pools or a soccer field under the terms of the special district service plan conceived in 1985, a Jefferson County district judge ruled Jan. 14 in an exhaustive 16-page decision.
The ruling represents an enormous setback, if not the final blow, in Ken-Caryl Ranch Metro District’s quest to force a neighboring district to pay for the promised $3.5 million in recreational amenities. A decision on an appeal is pending.
Plains argued the facilities are not mandatory, are not needed and are not its responsibility. Both districts are in the unincorporated foothills area of South Jeffco west of C-470.
“The board is disappointed because they believe the community relied on the promise to build the facilities. They still believe that. The real loss is to the youth,” said Darrell Windes, executive director of the Ken-Caryl Ranch Metro District. “The way we saw it, the community was willing to pay more for upkeep and to maintain what they had.”
He said the case cost the district about $400,000 over five years.
“It was such a humiliating judgment,” said Paul Hotchkiss, president of the Plains Metro District. “The judge ruled against them on six out of seven motions.”
In a key ruling, Judge Tamara Russell said the special district service plan is not legally binding. Attorney John L. Watson of Ryley Carlock and Applewhite had argued on behalf of the Plains district that the service plan was more of a wish list than an iron-clad accord.
“The language of the Special Districts Act regarding compliance with the service plan makes it clear that it is not a plan that must be followed as if it were a contract, but a plan that shall be conformed with as far as practicable. The implication is that the service plan is just that, a plan that is to guide the special district in the future,” Russell wrote.
‘Speculative’ in nature
“The Colorado legislature requires all special districts in the state to preserve taxpayers’ money by exercising their educated discretion in following the guidelines set down by an approved service plan rather than requiring mandatory adherence to each particular. The 1985 service plan is, by its very nature, speculative,” Russell says.
Even if the service plan was intended to be a contract, the court found the three-year statute of limitations had expired for such a claim.
“The Plaintiffs must certainly have been on notice in 1998 when the Deer Creek Golf Course was built in the location specified for three soccer/baseball fields. … The statute of limitations likely began running in the mid-1990s and was certainly running in 1998, therefore the statute of limitations would bar a breach of contract claim brought in 2004,” Russell wrote.
Windes said the board always thought there was plenty of room for Plains to build the fields in a different location.
‘Disingenuous, to say the least’
Russell also rejected the argument that any changes made in 2005 to the 1985 service plan were made without following required procedures under the Special District Act. However, she chastised Plains officials at the time for not making a better effort to convey their intentions to Jefferson County officials.
“The Court finds, based upon the foregoing exhibits and the trial testimony of David Peak, that PMD misled Jefferson County into believing that the changes proposed in the 2005 Amended Service Plan would not be considered to be material changes by KCRMD. By doing so, PMD avoided the County giving KCMRD notice of the proposed revisions. This is particularly troubling in light of the ongoing litigation between these parties over the very provisions that PMD amended … . By telling Jefferson County that no notice was needed because the modifications were not material but not disclosing this litigation, PMD was being disingenuous to say the least, but did not violate the procedures …,” Russell concludes.
Ken-Caryl Ranch officials said the community relied on Plains’ promises and that the recreation facilities are much needed.
“The evidence established that the developers that formed PMD not only promised the community … in the Service Plan, they also made this promise to Jefferson County and the District Court to obtain approval to form PMD. Also the developers knew that their sales representatives were telling purchasers of homes that PMD would build the facilities when PMD had developed to the point that it had an adequate tax base to pay for them. … By 2004, PMD had paid all of its infrastructure bonds, and PMD can now afford to build the facilities it promised without increasing its relatively small mill levy of 8 mills,” the Ken-Caryl Ranch Metro District board of directors said in a news release.
During the trial, the attorney for Ken-Caryl, Richard Shearer of Ireland Stapleton, argued that Jefferson County had approved the service plan and could easily raise the money to pay for new amenities.
“They got off easy, and now they want to get off with nothing. They get a lot of benefit and increase in property value,” Shearer said at the time, referring to the athletic complex supported by Ken-Caryl’s taxpayers.
Where’s the funding?
“Nothing ever happens in a service plan unless it’s funded. Our constituents would never vote for that,” said Paul Hotchkiss, president of the Plains Metro District.
“We also showed there was no need for the facilities to begin with,” Hotchkiss said.
There was an attempt to come up with an agreement in 1988, but it was never concluded and never signed, Hotchkiss said.
“It’s been terribly annoying. None of the board had any desire to spend that kind of money (about $400,000) when we realized how frivolous this was,” Hotchkiss said.