By Rudy Hemmann

The Surveyor

Tuesday’s town board meeting, which was called to order at 6:30 p.m. and was mercifully brought to a quick end following a five-minute recess at about 9:30, was certainly a contentious one. The bone of contention was regarding the following question: Should the town go into debt to build a recreation center, and if so, how much debt should be allowed? (In other words, how badly do Berthoud residents want a recreation center?)

Town Administrator Chris Kirk stated the message sent by Berthoud residents during the Nov. 6, 2018, election was a mixed one. Measure 3I, which established a new one-percent sales tax, the proceeds of which were to be used to fund recreational amenities for the town, passed by 67 votes. Measure 3J, which would have authorized the town to increase its bonded indebtedness by up to $30 million, was rejected by 343 votes.

An information sheet provided by town staff states, “With that in mind, in addition to a general discussion regarding the board’s preferred direction for expending the newly-approved tax revenue, Kyle Thomas, from George K. Baum and Associates, will attend the meeting to discuss Certificates of Participation (COPs) that do not create a long-term debt obligation for the town but that could still generate the revenue necessary to construct the proposed improvements.”

According to the presentation made by Thomas, the COP would make funds available to the town and the amount borrowed would still need to be paid back, just as a general obligation bond would, its simply that the COP is “subject to annual appropriation (not a long-term debt obligation)” that makes all the difference.

Thomas explained other “pro” points of the COP are:

“A Certificate of Participation is a common form of municipal lending.

– Certificates are sold in the public market and have fixed interest rates.

– A trustee acts as the lessor of the property and town as the lessee.

– No mortgage on the property, the trustee has a leasehold interest only.

The trustee leases the site from the town for 30 years in exchange for a one-time payment ($20 million).

The town leases the rec center back from the trustee in exchange for annual rent payments ($1.1 million).”

The concept was rejected by Trustee Pete Tomassi who stated in his opinion the voters had spoken with a voice which said, at least to him, the residents did not want any more long- term debt, at least not now.

However, to other trustees, namely Jeff Hindman, Brian Laak and Maureen Dower the voices were equally as loud from the other direction.

Later in the meeting, during the discussion, it became clear that the COP is a long-term debt and could be projected out to 30 years, renewed through the budget process annually.

Tomassi had questions regarding the ethics used by the Kids & Community faction, and in his opinion, stated that numbers regarding mileage and annual costs generated by Kids & Community, misled voters.

Dowd and Hindman challenged Tomassi’s points.

Several people in the audience expressed frustration with the fact that the town board would commit the town to millions of dollars in debt without their voices being heard. The failure of 3J to pass in the November election indicated the voters were opposed to more debt.

Editor’s note: We invite every resident of the town to visit the town’s website and watch the video of the special town board meeting held Dec. 4. Become informed and let your voice be heard. You can view the meeting at https://www.berthoud.org/government/board-of-trustees/trustee-meeting-videos by clicking on the Government tab at Berthoud.org. Contact Town Clerk Christian Samora, 970-532-2643, if you need assistance on the town’s website.