What would happen if Greeley voters on Tuesday were to approve Ballot Issue 1A, which would repeal the city-approved zoning for the proposed $1.1 billion Catalyst entertainment district and the Cascadia mixed-use project that would surround it on Greeley’s western edge?
The issue’s two competing sides present vastly different answers.
Spokespeople for the “yes” side say it would give the community a voice in coming up with alternatives to what they call a too-risky project. Those who support the project and urge a “no” vote on repeal say it would continue Greeley’s downward spiral in sales-tax revenue and send a message to potential developers that the city is hostile to business.
“Greeley has a mystique of always missing the cool deals,” said Cascadia developer Martin Lind. “I’m fearful this would be the final nail in the coffin. If a small group of people can stop a project of this magnitude, it would be hard to entice other developers to invest in Greeley in the future. The biggest concern I have, for the entire region, is the public perception that Greeley just is a risky place to invest. We don’t see that. We believe in Greeley. It’s the biggest and most dynamic city in Northern Colorado. Greeley would take a really bad black eye.”
However, according to a statement emailed to BizWest from Issue 1A supporter Greeley Demands Better, “every ‘what if’ the pro-Cascadia side is raising assumes that a yes vote ends Greeley’s future. In reality, a yes vote is the beginning of getting this deal done right — not the end of development.”
For the first and only time since the campaign began, both sides went head to head Friday at a forum sponsored by the League of Women Voters of Greeley and Weld County. Several dozen people in attendance at Family of Christ Presbyterian Church got to hear representatives of Greeley Demands Better make the case for derailing the zoning while project supporter Greeley Forward outlined the perils of a repeal.
“Catalyst is a high-risk project, placing all the risk on Greeley taxpayers,” Greeley Demands Better co-chair Brandon Wark told the crowd. “So there’s a lot of risk and a lot of concerns.”
Repeal would mean “the property owners would be required to submit a new application for zoning,” he said. “The City Council would be prohibited from applying this planned-unit development zoning for the property for one year from the date of the repeal.”
A “yes” vote would revert the property to its previous zoning designation, “holding agriculture,” but construction would stop. Other than members Tommy Butler and Deb DeBoutez, the City Council majority strongly favors the project and would likely seek alternative forms of zoning for Cascadia. However, passage of 1A would exert substantial pressure on the panel to acknowledge the advice of the majority of the voting electorate.
The contract between the developers and the city is contingent on the zoning, Wark said, “so if the ordinance is repealed, there’ll be no zoning, so the project will not move forward at that time. This gives us the opportunity to renegotiate and make sure this is the right thing to do.”
But Lind, interviewed by BizWest earlier this month, said “it’s no secret that they’re using a land zoning issue as the Trojan horse to try to kill the deal. They admit that.”
At Friday’s event, Greeley Forward representative Marcus Pachner noted that, “for the third year in a row, Greeley tax revenue is down. We are primarily a sales-tax revenue city. There is no Plan B to generate additional revenue” if this passes.”
Actually, Lind said, “there’s always a Plan B, but it doesn’t fit into the timing.
“It’s a timing issue, and all projects are reliant on timing,” he said. “We have this structured so 100% of Greeley’s investment is paid back to Greeley when we issue the bonds in June. The liability of this project leaves Greeley and it goes to the bondholders in June. If that doesn’t happen and if this referendum is successful, that June date’s off, and I can’t tell you when it comes back into play. The timing of that would be delayed, which brings enormous risk onto the city.”
Pachner told the audience on Friday that studies show the project would generate 1,385 new jobs as well as $75 million in revenue in its first 10 years. “We generate $110 million in (annual) sales taxes,” he said. “This will bring in $11 million. That’s a 10% bump.”
Cascadia, a master-planned community spearheaded by Lind’s Windsor-based Water Valley Co., would surround the city-owned Catalyst entertainment district, which would include a hotel, Mattel-branded water park and an arena with youth hockey ice sheets that also would be home to Lind’s Colorado Eagles minor-league hockey team.
Tuesday’s election, which the city estimates will cost it $350,000 to conduct, will be held as the result of a successful petition drive by Greeley Demands Better. The ballot issue asks voters to repeal the City Council’s Sept. 16 vote to approve a planned unit development for more than 833 acres of the project on the north side of U.S. Highway 34, east of Weld County Road 17.
The City Council approved last May a financing plan for the entertainment district, authorizing the use of $115 million worth of “certificates of participation” to lease several high-profile city facilities as collateral to pay for the plan, money that would be paid back through the revenue that Catalyst would generate. Those certificates were issued last fall to NBH Bank, a subsidiary of National Bank Holdings Corp. (NYSE: NBHC) headquartered in Denver; Collegiate Peaks Bank, a division of Glacier Bank in Seattle; and MidWestOne Bank in Denver.
COPs are also being used to finance the downtown Civic Campus project, which will include city, county and school district offices, as well as police facilities.
Certificates of participation are a financing tool used for new government buildings in Colorado. The idea behind using such financing tools is to find ways to build new community buildings without increasing taxes on residents.
For Catalyst, former mayor John Gates told BizWest, the COPs are one piece of a four-step process in which a nonprofit group would pay off the COPs and issue bonds. In the future, a general improvement district fee collected from the new development would go to repay debt. The city would make an annual economic development payment — previously reported at $12 million per year — to establish reserves to ensure the debt payment.
Greeley Forward spokesman Bill Rigler echoed Lind’s fear, noting what he sees as “the adverse impact all of this will have on the city’s reputation and its ability to attract new businesses, high-quality development and investment.
“Basically, if this passes, it tells the world that Greeley is closed to business and that if for some reason you want to undertake business in Greeley, you will be subject to an untenable process, indeterminable requirements, high costs and voter-induced ambiguity,” Rigler said. “With all the competing communities and opportunities in NoCo, what business in their right mind would subject themselves to this type of treatment?”
Greeley Demands Better co-chair Rhonda Solis dismissed that fear at Friday’s event, noting that “all I know is that there’s growth, and when there’s growth, businesses start.”
In an email to BizWest, Greeley Demands Better called Lind’s and Rigler’s warnings “a classic developer scare tactic.
“The message a yes vote sends is crystal clear, and it’s a good one,” the 1A proponents said. “It says that Greeley welcomes development, but not at any cost. Developers who come to Greeley with projects that share risk fairly, operate transparently and genuinely benefit the community will be welcomed. Developers who demand that taxpayers carry 100% of the financial risk while they collect guaranteed fees? That’s not a partnership — that’s exploitation.
“No serious developer is going to avoid Greeley because voters exercised their democratic rights,” the statement said. “What developers avoid are cities with fiscal mismanagement, bloated debt and failing infrastructure — which is exactly what Greeley risks if this project moves forward as structured and fails.
“The ‘chilling effect’ argument assumes that developers want cities that roll over for bad deals. The opposite is true: Sophisticated developers want stable, fiscally responsible partners who won’t be crushed by risky ventures. A yes vote protects Greeley’s long-term viability as a development partner.
“The message we’re sending to developers is simple: Greeley is open for business, but we’re not a piggy bank. Bring us projects with shared risk and real guarantees, and we’ll welcome you. Ask us to guarantee $840 million while you take zero risk? That’s not development — that’s a shakedown.”
Rigler pointed to last Tuesday’s Loveland City Council approval of a business-assistance agreement designed to bring big-box membership retailer Costco to the Centerra development, just five miles west of the proposed Cascadia site, and to the Board of Larimer County Commissioners’ Jan. 26 approval of the 314-acre Ranch Events Complex’s amended master plan for a more than $110 million makeover, funded by a voter-approved 0.15% dedicated sales and use tax extension through 2039.
“Both of these things should scare Greeley residents to death,” Rigler said. “Loveland is doubling down on attracting visitor dollars and increasing their sales tax. What’s Greeley going to do?”
Construction on the Cascadia site began in earnest about six weeks ago, Rigler said. “There’s 300 construction workers on the site now; it’s all horizontal development. If 1A passes, those 300-odd employees are out of a job immediately.”
Once vertical construction begins, he said, the project would bring 3,500 construction jobs and $212 million in payroll,” all of which would be jeopardized if the zoning repeal is approved.
Rigler also pointed to a repeal’s effect on the already-issued certificates of participation.
“Without the proceeds coming from the long-term funding of the Catalyst project to repay the COPs, the city would not be able to repay the COPs according to their existing terms,” he said. “The city could then, one, default on the COPS, which would subject all the collateral to foreclosure and would have a highly adverse impact on the city’s ability to ever borrow money again under any structure, or, two, a more likely scenario is for the city to restructure and refinance the COPS and pay them off over a 20-year period, which would subject the city and its general fund to an approximately $10 million annual payment for the next 20 years. This would add significant additional stress to an already tight general-fund budget.
“The ‘yes’ campaign’s argument is, ‘I’m going to stop paying my mortgage for a year,’” Rigler said. “Ask any bank what happens if you did that.”
Greeley Demands Better called that stance “fear-mongering designed to make voters feel trapped” and charged that the COP financing structure “was chosen specifically to avoid requiring voter approval. The city structured this deal to circumvent democratic input — and now they’re using that same structure to threaten voters with financial consequences if they exercise their rights.
“If the project is truly viable and benefits Greeley,” the 1A proponents’ statement said, “the developer and city can renegotiate terms that don’t put 100% of the financial risk on taxpayers. A yes vote creates leverage to demand better terms — including shared risk and genuine guarantees.”
Issue 1A’s supporters contended that “paying back the COPs is a one-time cost,” while “covering operational losses is a multi-decade drain that could cripple city services. The question isn’t, ‘Can Greeley afford to pay back the COPs?’ The question is, ‘Can Greeley afford to guarantee $840 million on a project that – according to a study project opponents commissioned – “independent analysts say will lose hundreds of millions of dollars?’ A yes vote chooses the smaller, manageable cost over the catastrophic one.”
Winna Ironkwe, the City of Greeley’s director of communication and engagement, said the COP payments are designed to “use capitalized interest for the first three payments. Of the $115 million from the COPs, $8,620,276.65 of that is capitalized interest.”
She said the first interest-only payment is $3,295,859.99 due on March 1. The second interest-only payment is $3,194,650, due on Sept. 1. However, the third payment could differ.
“If we refinance, the payment would be $2,219,766.66 due on Jan. 1, 2027,” she said. “If we do not refinance, the third interest-only payment is $3,194,650, due on March 1, 2027, and would be partially funded by capitalized interest.”
All remaining COP payments thereafter become interest and principal payments, she said. “If we do not refinance, the first interest and principal payment will be $13,384,650 on Sept. 1, 2027. If we refinance, the amount due on Sept. 1, 2027 should be lower than the $13.38 million payment. The actual amount will depend on the outstanding balance of the COPs, when the first payment is due, and if we do any capitalized interest.”
Rigler said “the city’s general fund is already under enormous strain. The addition of $10 million of required annual expenditures to service the COP debt (which would have otherwise been paid off by the long-term funding of the Catalyst project) will only serve to significantly intensify the problem.
“If this were to occur,” he said, “multi-year, massive cuts to capital projects and community programs would undoubtedly need to occur and the city may need to consider raising taxes, which is the irony of the ‘yes’ vote. On the other hand, the new taxes collected from the Catalyst project would go a long way to solving the city’s existing fiscal problems.”
Added Lind, “When you have $100 million in COPs and you don’t have a project any more, now we’re paying off bonds when we don’t have a project. That’s a disaster for our economic outlook.”
Not surprisingly, the two sides on the ballot issue differ on a repeal’s effect on the downtown civic campus project as well.
Rigler said “the city’s plan for its civic campus is completely predicated on the availability of funds via the issuance of COPs. If the city defaults on the current COPs, there is not a prayer of the city raising any money for the civic campus, which will completely derail the project.
“In addition,” he said, “amortizing the COPs over a 20-year period and the associated estimated $10 million annual payments, will have a significant adverse impact on the city’s fiscal condition and its ability to service any debt or other costs associated with the civic campus. If all this happens and the city cannot pursue its portion of the civic campus, this may force Weld County to reconsider its plans for its new courthouse.”
Greeley Demands Better called that “a false choice — and it reveals the absurdity of the Cascadia financing structure.
“If Greeley can’t afford to both build a necessary civic campus and carry an $840 million guarantee on a failing project, that’s exactly the problem,” the 1A proponents wrote. “The city is already facing budget shortfalls for basic services. The civic campus is essential infrastructure. Cascadia is a speculative bet. We shouldn’t be choosing between critical city needs and a risky development deal.
“A yes vote doesn’t kill the civic campus; it protects the city’s ability to fund it,” they wrote. “If Cascadia proceeds as structured and loses $300-400 million, where does that money come from? It comes from exactly the kind of essential city projects like the civic campus. Voting yes preserves fiscal flexibility for actual city priorities.
“The civic campus and Cascadia are not linked projects,” Greeley Demands Better said. “They’re being linked rhetorically to create a hostage situation: ‘Give us what we want or the civic campus dies.’ That’s not good-faith governance — it’s blackmail.”
Rigler said the city would face massive and expensive legal liability if 1A passes.
“In short, delaying or halting the project would cause a legal mess,” he said. “Defaults on the COPs and project contracts with the associated ramifications and remedies will take an enormous effort to address, adjudicate and resolve, costing the city untold dollars, time, and energy.”
He also said Lind’s contracts with contractors also would likely go into default and be subject to legal remedies, “or would need to be renegotiated if the parties so choose.
“Of greatest concern,” he said, “is the lease with the Colorado Eagles, which has significant ramifications including legal remedies if the city defaulted and was unable to deliver the new arena on time.”
Lind agreed that “the project would not be able to fulfill its contractual obligations to have an arena in 2028” for his hockey team. “I don’t have the gray matter to think about it,” he said. “If I do have to think about it, I’ll start on Wednesday.”
Under the lease agreement, the Eagles are to pay between $20,000 and $22,000 per game at the new arena, resulting in at least $792,000 to be paid to the city for a season of hockey. As part of this agreement, the usage cost will increase by 10% every five years, reaching a total of $47,210 for every game with fewer than 5,000 tickets sold. Additionally, the city will also receive 70% of parking fees, 90% of revenue for youth hockey games and 50% of revenue for college hockey games, only needing to share revenue if youth and college games are held in the main arena.
“Greeley can still develop this land” and “the Eagles can still have an arena,” Greeley Demands Better wrote. “The city can still attract quality development. But it needs to be done with shared financial risk between developer and city, real guarantees — not just projections, transparent process with voter input on major financial commitments, (and) terms that don’t jeopardize essential city services and infrastructure.
“A yes vote isn’t anti-development,” the group wrote. “It’s pro-accountability.”
How an entertainment district with an arena and water park on the city’s western edge would affect downtown is a subject that divides even downtown business owners. But Pachner, a Greeley resident whose Denver-based Pachner Co. is a government affairs firm that represents clients before local governments, told the audience Friday that, “even if just 10% of the 400,000 estimated visitors coming to Cascadia visit downtown, that’s still 40,000 new visitors.”
Who will win all these arguments? We’ll know in just two days. Ballots were mailed out earlier this month, and voters can return them to any of four secure drop-box locations. To be counted, they must be received by the office of City Clerk Heidi Leatherwood by 7 p.m. Tuesday.The first public count of election results will be posted by the city online after 8 p.m.
