City council approves amended service plan for Lee Farm metropolitan districts to allow development financing

The Loveland City Council voted to approve an amended and restated consolidated service plan for the Lee Farm Metropolitan Districts 1–4 at its May 6 meeting, allowing the districts to proceed with development financing under updated terms that align them with the city’s current model (the “17 plan”).

Attorney David O’Leary, representing the Lee Farm districts, told the council the amendment modernizes an original 2016 plan and updates key financial parameters to reflect current market and assessment-rate conditions. He said the maximum aggregate debt limit remains $22,000,000 and that the total mill-levy cap would be 60 mills (50 mills for debt service plus a 10-mill O&M cap). O’Leary described the project as residential and phased; current estimates in the revised plan show about 1,019 total residential units, including duplexes, townhomes and single-family lots.

City finance staff and outside reviewers supported the amendment after review. Brian Walies, the city’s chief financial officer, and Hilltop Securities reviewed the district’s financial plan and advised the council the projections and mill-levy structure are sufficient to support the public improvements the districts propose to finance. Dalton Kelly of the law firm Butler Snow and Amanda Worrall, a city project manager, explained that the amendment moves the assessment base year from 2016 to 2025 and treats the districts, for the purposes of issuing debt, like a new district because initial debt has not yet been issued.

Key terms presented to council include: a maximum $22 million debt limit, an aggregate mill-levy cap of 60 mills (50 debt + 10 O&M), repayment deadlines (individual issuances limited to 40 years and all district debt to be retired within 45 years of issuance, subject to homeowner-board extensions in limited circumstances), and annual disclosure and reporting requirements to the city and state. The amended plan also requires initial debt to be issued within a specified window (subject to city approval for extensions) and to comply with public-improvement dedications.

Council discussion addressed park and pond dedications, parking impacts if a previously proposed Draper development does not proceed, and how the district’s proposed park and stormwater facilities would be reviewed and accepted by the city. Several councilors said they remain critical of metropolitan district financing in general but supported the amended plan because the applicant complied with the city’s requirements.

Council adopted the resolution approving the amended and restated service plan. The vote count on the resolution was recorded as 5 in favor and 3 opposed.