Taxpayers may have to shell out more to keep USOC in the Springs

Colorado Springs taxpayers may have to cough up an additional $1.9 million this year — and at least $2.5 million more in the future — to meet the terms of the renegotiated agreement to keep the U.S. Olympic Committee in the city.

At issue is the money needed to buy the former Colorado Springs Utilities gas operations building, which would be used to house several USOC national governing bodies.

The agreement called for the city to issue so-called certificates of participation, a form of borrowing that doesn’t require voter approval, to pay the remaining balance of the property.

But that didn’t happen.

Although the government issued more than $32 million in COPs, the proceeds covered only the purchase of the top five floors of a building at 27 S. Tejon St. that will be the USOC’s new headquarters and improvements to the Olympic Training Center.

Terri Velasquez, the city’s chief financial officer, said the building wasn’t included in the financing because city officials had “contemplated” that Utilities would donate the gas operations building as an economic development contribution to the USOC project.

Mayor Lionel Rivera said Monday that council members have had informal discussions in private about the proposed donation from Utilities.

“We have to have a public discussion on whether or not the majority of council wants to do that,” he said. “At least my conversations with council over the last couple of months have indicated that’s what they want to do. Now, when it comes to public discussion and people putting their chips on the table, that’s another issue. I hope they stand by what they said they want to do.”

That’s not the only issue.

Utilities CEO Jerry Forte said the proposed donation will require a legal review.

“The board policies prohibit me as the CEO from donating or transferring any asset without getting the market value for it,” he said. “There are some issues with bond covenants that would certainly need to be reviewed if that were done.”

Rivera, however, said City Attorney Patricia Kelly has advised council members that Utilities can donate the property, which is in southwest downtown near America the Beautiful Park.

“The city attorney has told us that if we chose to direct Colorado Springs Utilities to make an economic development contribution to the project, we can direct them to do that,” he said.

Another hurdle is ballot Issue 300, which prohibits gifts, loans and subsidies to the city government from the enterprises.

“That’s another issue that I think the city attorney needs to weigh in on,” Rivera said. “When we had initial discussions, 300 hadn’t passed.”

The city government is obligated to pay Utilities nearly $4.4 million for the property, plus interest, “by making one payment annually in each of five years,” according to city documents.

Since city officials contemplated that Utilities would donate the property, they did not budget for payments last year or this year.

Under a proposal the City Council will consider Tuesday, officials would dip into the city’s rainy day fund to the tune of $1,891,568 to make the two payments. The city has been making payments on the property since 2002.

Velasquez said the amount owed to Utilities was in place since then under a previous agreement for redevelopment purposes and later became part of the USOC project.

“Whether we would have utilized that building for the NGB or not, the city would have owed these funds,” she said.