At 10 a.m. council will vote on whether to allocate $2.5 million in short term rental tax revenues, a sum that they believe will spur enough philanthropic funding to buy the senior living community.
Correction: This story has been updated to correct that Receiver Bellann Raile has not indicated what size offer would be accepted to buy Casey's Pond. Raile has a fiduciary responsibility to get the highest and best price possible for bondholders.
Update: Just before 11 a.m. on Wednesday, Steamboat Springs City Council approved the emergency ordinance. Read more here. Following the initial publication of this story, Yampa Valley Community Foundation CEO Tim Wohlgenant told The Yampa Valley Bugle that they do not have funders identified to buy Casey's Pond. "We're trying to find somebody like that, but we don't have anybody lined up," he said. Council will reconvene at 10 a.m. to consider the emergency ordinance. Steamboat Springs City Council will consider an emergency ordinance on Wednesday to allocate $2.5 million in short-term rental tax revenue as part of an attempt to save Casey’s Pond.
Council voted unanimously to continue their Tuesday night meeting to 10 a.m. on Wednesday, where they are expected to allocate the funding. Council member Joella West said philanthropic funding would be available “in an amount that is close to but not exactly” the amount believed to be needed to buy Casey’s Pond out of receivership.
“The condition on that will be that the city steps up,” West said. “This is just coming up, I don’t know any more details than that except that it’s real and it will require some city funding, or there will be no such accumulation of many millions of dollars.”
West said the prospects of getting a sizable amount of private funding through the Yampa Valley Community Foundation arose earlier in the day on Tuesday. If council votes to allocated the emergency funding, the justification will be related to attainable housing, as STR tax revenues are dedicated to addressing the community’s housing issues. There are currently 15 workforce housing units at Casey’s Pond that are used to house nurses and other staff.
Council member Steve Muntean said he believed the city needed to move quickly on Tuesday because it would get harder to save Casey’s Pond as more residents move out in anticipation of the Doak Walker Skilled Nursing House closing on Oct. 27. A proposal submitted to the city suggests a competitive offer would need to be between $25 million and $28 million, though Receiver Bellanne Raile has a fiduciary duty to get the "highest and best price possible."
“Everyday that goes by, Casey’s Pond is diminished in terms of our ability to save it,” Muntean said. “If we really want to save Casey’s Pond we have the wherewithal to significantly influence a group of people in the community to step up, but they won’t step up without us.”
In addition to agreeing to consider approving emergency funding, City Council also discussed the prospects of bringing forward a ballot question this fall to impose a property tax in the city that could be used for both eldercare and child care — a concept referred to as “cradle to grave.”
Council doesn’t have much time to draft and approve a ballot question, as the deadline to submit ballot questions to the Routt County Clerk is the first week of September. City Attorney Dan Foote will bring back potential ballot language at Council’s Aug. 20 meeting.
“From our discussions on the [Colorado Department of Transportation] child care facility, we know there is an operational deficit,” said Council President Gail Garey. “I would be more in support of directing [Foote] to bring forth language that would be broader and address both of those needs.”
Casey’s Pond was put into receivership on June 30, a process that aims to sell the senior living community to recoup money for the property’s bondholders. Reporting from The Yampa Valley Bugle shows Casey’s Pond has lost $36.9 million since it opened in 2013, with $30 million of that being interest expenses.
Financial struggles for Casey’s Pond have been presented as connected to debt obligations, and not necessarily operating expenses. A proposal submitted to the city seeking $10 million in STR dollars to save Casey’s Pond from the current operator suggests it could cover costs as soon as 2025 if debt obligations are wiped away.
“Casey’s Pond is operationally sustainable,” says the proposal from Christian Living Communities, which currently operates Casey’s Pond through its management arm Capella Living Solutions. “Casey’s Pond currently generates enough revenue to cover its routine operational expenses with a 7% to 9% margin.”
Financial projections provided by Christian Living Solutions suggest the annual cash flow of Casey’s Pond in 2025 would be around $450,000, a number that would increase to $630,000 by 2029. Council members indicated they preferred to remove efforts involving Casey's Pond from the city's near-term housing solutions process.
How much of a property tax a potential ballot question would put in place is still up in the air. City manager Gary Suiter suggested something in the area of one to two mills would be enough, with one mill equating to about $1.3 million in revenue.
“If we are able to put something this broad on to a ballot and actually turn it over to the voters and say, ‘what do you want to do,’” West said. “If they say yes, we’re going a long way toward dealing with figuring out how to provide adequate child care and figuring out how to provide adequate senior care.”
Earlier this year, City Council decided they would not pursue asking voters for funding this fall on a number of issues. While Steamboat was ready to move forward with a ballot question about a Regional Transportation Authority this year, smaller communities were not ready to move that quickly. Council also discussed a property tax to support parks and recreation or other city uses, but opted to push off a potential ballot question to next year.
Last month, Council members Bryan Swintek and Muntean presented a plan that would consolidate Steamboat Springs Fire Rescue with the surrounding fire district, a plan that would add a property tax for fire services within the city limits it approved. They suggested bringing that question in 2025.
Council member Michael Buccino said he was not supportive of a ballot question that only supported Casey's Pond, but was open to a broader question.
“We’re going to have a nice robust conversation in the next couple of weeks,” said Council Member Michael Buccino. “I would hope that this community does come out in public with the urgency of [what] we’re talking about and help us guide what that ballot language will be.”
Top Photo Caption: Casey's Pond (Dylan Anderson/The Yampa Valley Bugle)
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