Developers argue payments required to improve roads are excessive, potentially violate U.S. Constitution.

Editor's Note: This story was updated at 9:50 a.m. to correct a quote. Commissioner Macys and the letter said "illegal exaction." Developers of the 200-unit Tailwaters project near Stagecoach will need to pay $7.8 million to support road improvements to roads including Routt County Road 14 if they want their project to move forward, the Routt County Commissioners decided Tuesday.
Commissioners ultimately tabled the final decision to March 25, but clarified that they agreed with the staff recommendation and were not intending to change that condition of approval.
Tailwaters developers feel they are being asked to pay an outsized portion of the nearly $50 million in improvements identified for roads in the Stagecoach area in a 2024 traffic study. Not only do they feel the traffic study unfairly places repairing poorly designed roads on their shoulders, but developers believe it also overestimates the number of trips their development would produce.
But Routt County staff stuck to their recommendation that would allocate about 16% of the cost for road improvements on the Tailwaters project, a sum that would need to be paid before construction can start.
“The county needs to be protected here and this is something that is strongly recommended by all staff to not repeat history,” said Routt County Planning Director Kristy Winser. “We can’t forget what we are talking about here, this is Stagecoach with a long history of failed developments.”
Tailwaters is the first of several projects working through the planning process currently, with the most notable of those being Stagecoach Mountain Ranch, a private community built around the former Stagecoach Ski Area that submitted a development application in December. Tailwaters developers assert they have nothing to do with that project, adding that Tailwaters was proposed prior to talks about the private community.
Tailwaters features 200 market-rate homes including 24 quarter-acre single-family lots, 66 smaller single-family lots, 33 duplex lots and 40 multi-family units. Developers didn’t share potential sales price ranges for these homes. They speculated some of them may be purchased as a second home.
Because the application for Tailwaters was deemed complete in March of 2024, before Routt County’s updated Unified Development Code went into place, this project is subject to the county’s previous set of regulations. That means Tailwaters is not subject to newly adopted public benefit and affordable housing standards.
Commissioner Sonja Macys suggested tabling the development application to allow more time to find agreement on the traffic study and impacts of the development, adding that a mention of legal action against the county was concerning to her.
“The applicant’s attorney is calling this an illegal exaction and referring to taking,” Macys said. “That really concerns me quite a bit.”
Prior to Tuesday’s meeting, a lawyer representing Tailwaters at Stagecoach, LLC sent a letter to Commissioners contending that the county’s traffic study is flawed and requires them to contribute to improvements that are not needed to accommodate their development. The letter says such a requirement would amount to “taking,” evoking the Takings Clause included in the Fifth Amendment of the U.S. Constitution.
“The county requiring nearly $10 million to be put in a fund now and just sit there for 10 years, that is a huge burden on anyone,” said Tim McGuire, a principal with Minturn-based developer, Contour Design Collective.
Commissioners Tim Redmond and Angelica Salinas said they were comfortable with the $7.8 million and requiring that payment upfront.
“I feel that staff has done excellent research. I feel that with a legal review and being willing to defend the county in that situation, I am quite comfortable moving forward,” Redmond said.
“A project of this scale needs clear and enforceable commitments from the developer and that the developer should pay upfront,” Salinas said. “That investment must be secured up front — not deferred, not left up to chance. … Stagecoach exists as it does today because of unfulfilled commitments by developers who promise a thriving residential area and failed to live up to those expectations.”
Commissioners agreed to table the decision on Tailwaters until March 25. Still, Redmond and Salinas said they were supportive of the staff recommendation to assess the $7.8 million and require payment up-front, indicating that the condition of approval wasn't going to change.
“We believe that the money needs to be paid upfront in escrow and we support staff’s recommendation of $7.8 million,” Salinas said. “We’re not asking for clarification or any additional changes on that condition.”
Dueling traffic studies

The county’s traffic study, dated August 2024, sought to assess the cumulative impacts on roadways from this development and others being proposed in Stagecoach in addition to impacts from existing lots the county has platted that have not been built out.
Scott Kilgore, a transportation engineer with Fox Tuttle Transportation Group, who conducted a traffic study for Tailwaters, explained that by their analysis, the project wouldn’t cause traffic impacts that would lead to these road upgrades. Instead, the Fox Tuttle study shows that only the intersection of County Roads 14 and 16 would see decline from its current grade of A to a grade of C. Grades of D are generally considered acceptable at peak times.
Kilgore also questioned the number of trips each study projected for the Tailwaters project, saying the county study is “extremely high.” While Kilgore found that there would be roughly 2,300 new trips per day, the county’s traffic study found more than 4,100 new trips. This disagreement stems from different initial assumptions.
Holly Kirsner Strablizky, with the Steamboat-based law firm Sharp, Sherman & Engle, LLC, on Tuesday, who is representing the Tailwaters project said they agree they can be required to mitigate harm, but that one of the conditions asks them to pay for improvements that are miles away.
“Historically, Routt County has known that this is an issue. As early as 1989 it has been in one traffic study or another,” Strablizky said, referring to the stretch of County Road 14 from Stagecoach State Park to Highway 131. “That seems to be an old problem and is not legal to be requiring a new development to pay for existing problems.”
Strablizky said they would agree to a condition that required them to make improvements already planned as part of the project, while making no additional contribution to other road projects.
Routt County’s transportation engineer, Josh Gibbons of Hales Engineering, said the assumptions they used in the study are national standards. Additionally, Gibbons said he used an earlier version of the Tailwaters study as part of the data for his, and the Tailwaters study changed assumptions when it was updated in January 2024.
Routt County Attorney Erick Knaus said he felt the argument wasn’t about whether the development should need to pay for road improvements, but rather how much. He added that Routt County is being assessed 27.3% of road improvement costs due to lots that were platted but were never developed.
“The county is aware of Colorado Law, and the Sheetz case and rough proportionality requirements in the law,” Knaus said, referencing a 2024 U.S. Supreme Court Decision Strablizky cited. “We’re not arguing that standard doesn’t apply, there just doesn’t seem to be agreement on what the deficiencies are or are not, and what the rough proportionality standard means in this particular case.”
Commissioners dissatisfied with wildlife impacts

All of the Tailwaters project is within an area considered high priority habitat for Columbian sharp-tailed grouse and county staff feel there is really no way to avoid or minimize the impacts. Initially, developers approached Colorado Parks and Wildlife about a 1% transfer fee on properties sold to fund projects that would improve habitat.
Goldich, the senior planner, said staff couldn’t recommend that, because there was no nexus to the level of the fee. He added that since the developer is causing the disruption of habitat, they should also be the one paying for it.
“[CPW] suggested that a valuation for the loss of habitat be conducted to determine an appropriate amount,” Goldich said, adding that the valuation hadn’t been conducted, but once it is Commissioners would need to approve it.
Commissioner Macys said the real estate transfer fee was a non-starter, while Commissioner Redmond said he was disappointed with CPW — “I don’t think they gave us what we we’re really looking for to work with in this situation,” Redmond said.
“This is not the first time and part of the reason I am flagging this with such forceful nature is that it’s not going to be the last time either,” Macys said. “If the county doesn’t decide to create some standards that are acceptable to us, I have a feeling we are going to be out here in the same position on any other development.”
Macys said that the mitigation plan needs to be improved before they meet again in March, suggesting a variety of ideas she thought could be acceptable.