2017 Year in Review MAY

Colorado Atty General, Cynthia Coffman

Attorney General Coffman Holds Listening Tour Meeting for Prowers County

Colorado Attorney General Cynthia Coffman spent the majority of her day, Tuesday, May 23rd at the Prowers County Annex in Lamar, holding a series of listening sessions that began with local, elected officials and continued through the day with such topics as farming/ranching, a sex assault program at Lamar Community College and efforts of a local substance abuse group to curtail drug use in the community. She was accompanied by several staff members including Laura Chartrand, a water attorney for the state natural resources and environment, Jose Esquibel, Director for the Office of Community Engagement as well as State Senator Larry Crowder from the 35th District and Kimmi Lewis, State Representative for the 64th District of Colorado.

The almost 20 yearlong battle with the State Department of Revenue and IRS over conservation easements took most of the two hour session set aside for farming and ranching topics. Local farmer, Jillane Hixson, spoke at length, along with another farmer, Linda Groner, about the negative impact the easements have had on over 800 farming and ranching operations in Colorado, including several hundred in the Arkansas Valley.  Hixson opened her comments with the statement that, “Nothing has been more detrimental to this area than the Colorado Department of Revenue’s disallowance of tax credits and a decade of litigation,” she said.

A problem developed for those who took advantage of the offered property tax credits, offered through the easement beginning in 2000, only to have their land later be determined to have either no value or less than they were awarded in credits and nay of those who registered had to pay back the assessment on their land. Hixson said she has a 20 year settlement to pay off and the easement is still attached to her property and she is only one of many who are in this situation.  Several other landowners told Coffman and her staff they had spent money in a legal battle that hasn’t been resolved and additional funds have been spent in attempts to secure documents under the Open Records Act, only to find many of them have been redacted.  Hixson told Coffman that as State Attorney General, her office is not representing the landowners, but the agencies they are opposing in their lawsuits.  Hixson asked Coffman to consider suspending the issuance of new easements, a matter that was taken up by State Representative Kimmi Lewis.  She stated that even with the evidence of problems with the program, 62 new easements have been generated and she is now dealing with similar problems from one of her constituents from her district.  Lewis said she has knowledge of over a page of statute violations that have occurred with the way the easements were dealt with.

Coffman asked to have documented information be sent to her office for a review. She acknowledged that with her limited time as Attorney General, she is familiar with the easement issue, but not in as much detail as had been outlined in the listening session.  She said that she comes from a farming and ranching background and is a 5th generation farmer from Missouri and can share the concern expressed by those present.

Lamar City Councilman, Oscar Riley, said the topics covered at the start of the session, held for elected officials, dealt with state regulatory requirements for rural landfills, asbestos abatement procedures, the homeless in rural communities and substance abuse prevention programs.

Coffman and her department representatives held a similar session in the Limon/Hugo area the day before.  Prior to the session, she said they are intended as an exchange of ideas and concerns and a means by which her office can connect local officials to various departments that can offer aid, information or connections to other elected officials.

Holly Trustees are Third ARPA Member to Approve Settlement

The Holly Trustees voted to join their counterparts in Las Animas and Springfield, voting unanimously May 3rd, in favor of the proposed settlement agreement in litigation between Arkansas River Power Authority, ARPA and the City of Lamar. ARPA general manager, Rick Rigel, was on hand for the monthly Trustees meeting to offer explanations on the resolution or answer questions regarding its impact on member municipalities.  “We believe Trinidad and La Junta will consider the issue by the middle of the month,” he explained, adding that the process will then forward the matter before each of the two board representatives for the ARPA communities.  “Once we’re at that point, a unanimous yes vote from all parties will move the issue to the Lamar City Council for their decision on the settlement,” he stated.

Terms of the settlement call for the City of Lamar to receive an upfront payment of $1M from ARPA as well as $400,000 a year for the next 26 years. Other items in the settlement, according to Rigel, are the coal domes and related unloading coal conveyors some property, all situated on the north side of East Maple Street, the site of the Lamar Repowering Project.  “In exchange, the city will abide by the terms of the organic contract, re-affirming contractual obligations to ARPA and this includes continuing to purchase power from ARPA though the payment of the bonds, including any refunding.  This means the litigation between both parties will be dismissed.”  Rigel said if anyone is not on board with the settlement, the case goes back to court and he predicted a timeframe for that to occur beginning around late fall or early winter.  “Regardless how this turns out, I feel the losing party will appeal the decision and that process may take another two years until its conclusion.  And while this is taking place, ARPA cannot take any steps to refund the bonds,” he explained.  Rigel said he had no idea what the City of Lamar intended to do with their settlement award.

He added, “If we didn’t have the suit, there’s a potential for savings based on current market prices of about $800,000 a year. The market has been in our favor since the start of the year.  But on the other side, if the market loses, we could see reduced savings.  We feel acting quicker would be a way we could achieve more stable rates.”  The ARPA general manager said ARPA is much healthier now compared to a low point in 2011.  “We had $200K in the bank and that year, a negative net income of $370K.  We also owed $1.87M for prepaid electricity we had to borrow from our members to meet a bond reserve account obligation.  Those have been paid off as of 2014 and we now have $5M in the bank and last year our net income was $3.6M.”

On a question from one of the Trustees on predicting how much could be saved on a reduction of the bond interest rates, Rigel replied, “It’s difficult to do that because we had five bond series issued between 2003-2010 and each have varied interest rates. We can see some savings in them, but all can be called at different times and at a different rate.”  Rigel said the savings will help with continued stable rates, but there are so many variables.  Legal fees on a number of different lawsuits between 2011 and 2016 are at $5.5M; power supply costs are expected to go up about 2.5% this year, while transmission rates may see a reduction by 2019 through actions taken by the state’s transmission operators and WAPA, a power supplier, may have a 14% rate decrease in 2018.  On another question, Rigel said about from $110M to $120M would be available for potential refunding.  “We still have an obligation with a purchase power contract until 2025 and the WAPA contracts are until 2024 and 2054.”