Castle Rock Town Council Meeting - October 17, 2023: Budget Approvals and Annexation

The Castle Rock Town Council met on October 17, 2023, from 6:00 PM to 8:13 PM, to consider and approve the 2024 budget, various financial plans, and several ordinances and resolutions, including a property exchange for the Crystal Valley Interchange and an annexation eligibility resolution.

Consent Calendar

The consent calendar was approved unanimously (7-0). Items included:

• Ordinance 2023-024: Amending Title 9 of the Municipal Code to add Chapter 9.06 “Offenses Related to Morals” (Second Reading).
• Ordinance 2023-025: Amending Section 2.02.040.C regarding protocol for regular Town Council meetings (Second Reading).
• Resolution 2023-122: Contribution funding agreement with Dawson Trails Metropolitan District No. 1 for the Crystal Valley Parkway Interchange Project.
• Resolution 2023-123: Construction contract with Applied Ingenuity, LLC for the 2023-2024 Denver Basin Aquifer Rehabilitation and Pumping Equipment Replacement Project (seven wells in Red Hawk, Woodlands, Castle Oaks, Bell Mountain Ranch).
• Proclamation 2023-012: Declaring November 13-17, 2023 as Crash Responder Safety Week.
• Minutes of October 3, 2023 Town Council meeting. Councilmember Cavey clarified that budget money set aside for the Brickyard development does not constitute project approval.

Public Comments & Testimony

During the Festival Park Commons General Improvement District meeting, two Encore residents spoke:

• Adrian Sweeney requested access to inspect the four budgets associated with the GID. Staff agreed to provide the information.
• Chuck Coker noted that the 45-mill levy for the GID is the largest single line item on his property tax bill, exceeding school taxes.

Discussion Items

• 2024 Budget Adoption (Ordinance 2023-026): Town Manager David Corliss presented the $10 million budget allocation for the proposed Sports Development Center at Brickyard, emphasizing that full approval requires multiple future steps. The budget reflects priorities including public safety, roads, water infrastructure, parks, and open space. Property tax mill levy will decrease to 0.92 mills due to charter limits (5.5% revenue growth cap), down approximately 46% over the past decade. Sales tax growth has slowed, and building permits are budgeted at 400 annually (half the historical average). The ordinance passed unanimously (7-0).
• Water, Wastewater, and Stormwater Rates and Fees (Ordinance 2023-027): Mark Marlowe, Director of Castle Rock Water, presented changes: water rates +4.5%, wastewater 0%, stormwater +4.5%, water resource fees +7.5%. System development fees for new development increased 10% for water, 10% for Plum Creek stormwater, and 3% for wastewater and Cherry Creek stormwater. From 2018 to 2024, total residential water bills increased 5.5-8.3%; system development fees increased 91-93%. The town is transitioning from groundwater to renewable water supply, investing $211 million to date and projecting $453 million through 2065. Extraterritorial customers (Macanta, Bell Mountain Ranch) pay surcharges of 10-25%. Councilmember Cavey raised concerns about disclosure of these surcharges to homebuyers. The ordinance passed unanimously.
• Property Tax Levy (Ordinance 2023-028): Assistant Director Pete Mangers presented the ordinance levying general property taxes for 2023 (collected in 2024). The mill levy is reduced to 0.92 mills, reflecting a 46% decrease over the decade. Passed unanimously.
• Five-Year Capital Improvement Program (Resolution 2023-124) and Balanced Financial Plan (Resolution 2023-125): Corliss presented both together. The CIP includes projects for fire, police, roads (Crystal Valley Interchange, Crowfoot Valley Road), water, and parks. Revenue from impact fees is declining due to slower growth; the town may need alternative revenue sources in the future. Both resolutions passed unanimously.
• Downtown Development Authority (DDA) Budget (Resolution 2023-126): Kevin Tilson presented the DDA's 2024 budget, including a trolley program, carriage rides, facade improvements, beautification ($82,000), and potential streetscape investments. The DDA had a clean audit. Passed unanimously.
• DDA Mill Levy (Ordinance 2023-029): Tilson recommended a temporary reduction in the DDA mill levy from 3.0 to 2.905 mills for one year, providing an estimated $22,000 in taxpayer savings. Councilmember Cavey asked about duration; Tilson said one year. The ordinance passed unanimously.
• Miller's Landing Business Improvement District Budget (Resolution 2023-127): Mangers presented the 2024 operating plan and budget. The landfill has been remediated, but no additional improvements have occurred. Passed unanimously.
• Festival Park Commons General Improvement District (GID) – Budget and Mill Levy: In a separate board meeting, the GID approved its 2024 budget with a 45-mill levy to pay for bonds for the 308 public parking spaces at Encore. The total cost was approximately $10 million. Town Manager Corliss explained the revenue streams: property tax increment, sales tax increment, public improvement fee, and GID property tax. Once the bonds are paid off, the mill levy will be dissolved. Councilmember Brooks noted that his metro district charges twice the school district tax. The board approved the budget and mill levy unanimously.
• Sales Tax Simplification (Ordinance 2023-030): Mangers presented a repeal and reenactment of the sales and use tax code to adopt standardized definitions and implement economic nexus and marketplace facilitator provisions per the Wayfair case. The tax base and rate do not change. The ordinance passed 6-0 (Councilmember Bracken absent).
• Property Exchange for Crystal Valley Interchange (Ordinance 2023-031): John LaSala presented a land swap with ACM Dawson Trails VIII JV LLC. The town grants a section of existing territorial road to Dawson Trails in exchange for easements and right-of-way needed to construct the interchange improvements, including sedimentation ponds and roadways (Dawson Trails Boulevard and Crystal Valley Parkway extension). Passed unanimously.
• Crowfoot Valley Road Annexation (Resolution 2023-129): Tara Vargish presented a quasi-judicial hearing for the annexation of four parcels (5.3 acres) currently owned by the town but in unincorporated Douglas County. The parcels are right-of-way for Crowfoot Valley Road, already maintained by the town. The eligibility findings under Colorado statute were approved unanimously. The final annexation ordinance will be considered on November 7, 2023.

Key Outcomes

• All consent calendar items approved 7-0.
• 2024 Town Budget adopted on first reading (7-0).
• Water, wastewater, stormwater, and water resource fee changes approved (7-0).
• Property tax levy ordinance approved (7-0) with mill levy reduced to 0.92 mills.
• Five-year Capital Improvement Program and Balanced Financial Plan approved (7-0).
• DDA 2024 budget approved (7-0); DDA mill levy temporarily reduced to 2.905 mills for one year (7-0).
• Miller's Landing BID budget approved (7-0).
• Festival Park Commons GID budget and mill levy (45 mills) approved (7-0).
• Sales tax simplification ordinance approved on first reading (6-0).
• Property exchange ordinance for Crystal Valley Interchange approved on first reading (7-0).
• Eligibility resolution for Crowfoot Valley Road annexation approved (7-0); final annexation scheduled for November 7, 2023.