ISSUE # 72: From My vANTage Point

INEPTOCRACY (in-ep-toc'-ra-cy): A system of government where the least capable to lead are elected by the least capable of achieving, and where the members of society least likely to succeed or even to sustain themselves are abundantly rewarded with goods and services paid for by the confiscated wealth of a diminishing number of producers.

 CARBON MONOXIDE IS POISON

I've had the Aspen Volunteer Fire Department (A.V.F.D.) on my mind a lot over the past few days. Yes, I do enjoy a regular coffee at Peach's, next door to the fire station, but it's more than just checking out the awesome fire equipment. It's Thanksgiving season, and this one marks 3 years since the carbon monoxide poisoning deaths of my dear friends the Lofgren family, who died tragically at a rental house in Aspen that they acquired at a school auction. This sad anniversary was exacerbated this year by the Thanksgiving Day suicide of local restaurateur Scott DeGraff, a married father of 2, who chose carbon monoxide as his means of escape from life's troubles. Many of the same firemen who were first-responders to the Lofgren tragedy also went out on the DeGraff call.

Our fire department is comprised of community volunteers. That's why it's called the Aspen VOLUNTEER Fire Department.

PLEASE be sure that you have carbon monoxide detectors in your home. No more senseless and preventable carbon monoxide-related tragedies for our fire department or our community, please.

Lofgren update: The criminal cases in the Lofgren matter were recently dismissed. Yep, thrown out. The judge (Judge Boyd) ruled that the statute of limitations on the charges had expired. A former city of Aspen building inspector and the owner of a Glenwood Springs-based plumbing and heating company walked, just weeks before they were scheduled for jury trials on four counts each of criminally negligent homicide. The city/county argument? Implementation of a building code is voluntary and shields the inspector from any civil or criminal liability. Swell, then why have an inspector?? A civil case remains. And don't forget, as a community, we paid the $250K+ in defense bills for the former building inspector with public funds.

As a result, there are still so many unanswered questions related to the Lofgren tragedy:

• Why was this home so lethal?
• Why was there no carbon monoxide detector as required by law?
• Why did this home have a certificate of occupancy?
• Who is responsible for their deaths?

And most notably, with no criminal trials, there will be no insight obtained as to what actually happened. The friends and family of Caroline, Parker, Owen and Sophie will never hear the evidence that the grand jury heard; evidence that compelled them to issue indictments. There were countless failures that led to this tragedy. By dismissing the cases, the judge, and we, as a community, have again failed the Lofgrens. Carbon monoxide detectors save lives. Get yours today. And give one to a friend.

(Side note: Judge Boyd is the same judge who dismissed Marilyn Marks' lawsuit against the city for refusing to disclose the anonymous voted ballots from the 2009 municipal election. His dismissal was recently slapped down when the Appellate court overturned his decision unanimously, 3-0.) 

HYDRO PLANT: THE ECONOMIC BASICS

I recently got so fed up with the ineptitude of those on city council who regularly continue to blindly grant more and more funding (today we're up to $9.5M on the $6.3M project, and FAR from finished) for the ill-conceived Hydro Plant and Castle Creek Energy Center that I did a top-line economic analysis of the project. When both papers refused to run my essay as a Guest Opinion (lest they give me any credibility), it was likely because the piece blew several enormous holes in the B.S. the city has been peddling in defense of this misguided endeavor. So, The Red Ant purchased a full-page ad in the paper and ran it anyway over Thanksgiving weekend. HERE it is: 

ASPEN'S WATER-GATE: THE HYDRO PLANT DEMONSTRATES HUBRIS WITHOUT PARALLEL

Aspen's exclusively political program of environmental hubris, funded by the bottomless pit of its underrepresented tax base and fueled by the misleading 2007 ballot measure promising clean energy at a construction cost of $6.3 million, is finally facing its Waterloo. If built, the Castle Creek Energy Center will for decades be defined as Aspen's "environmental loss leader," costing millions more to build and operate than it can recover in energy revenue over the next half century. Here are three important numbers:

• 2.83 cents: The 2010 actual direct cost per kilowatt hour (kwh) to generate 16.8 million kwh of hydropower from the City's two existing hydro facilities at Reudi Reservoir and Maroon Creek.
• 9.47 cents: The estimated direct cost per kwh to generate 5.6 million kwh (8% of the City's 2010 total energy load of 69 million kwh) of hydropower annually from Castle Creek. That's more than three times the 2010 actual cost.
• $1.9 million: The resulting - very, very conservatively estimated - loss in current year dollars of operating Castle Creek over the coming half century.

The City currently pays just 4.6 cents (plus a small charge for transmission services) per kwh for wind energy purchased from its primary energy provider, the Municipal Energy Agency of Nebraska (MEAN). That's less than half of Castle Creek's projected cost. Why does the City insist on passing such costs along to its customers when far less costly yet still "renewable energy" options exist?

Because destiny trumps environmental stewardship, Aspen's leadership seeks not just political credit but political immortality. A permanent edifice to their wisdom, like a marble statue of a Greek tragedy, the Castle Creek Energy Center is their end goal. And when seeking immortality, cost becomes secondary when it's somebody else's money. Their arrogance enables the over-estimation of their own competence, resulting in tragically poor decisions despite overwhelming facts and recommendations to proceed differently; the very definition of hubris.

For those with the stomach for it, here are the underlying details, derived directly from information provided by the City through numerous Colorado Open Records Act requests. The most recently disclosed Castle Creek Energy Center construction budget, which includes a new 1.175 megawatt hydro plant, is $9.5 million. A 50% increase over the original budget, it is sure to increase, but $9.5 million provides a conservative starting point for this analysis.

Cost of Capital

Capital always comes at a price. Assigning a conservative 3% cost of capital and a 50-year life expectancy to this $9.5 million "investment," the resulting 6.64 cents per kwh cost of capital alone is over twice the total cost of power generation from the debt-free Reudi and Maroon Creek hydro facilities.

Operations

Let's conservatively assume the cost per kwh to operate Castle Creek will be the same as Reudi and Maroon Creek. The combined cost of capital and operations (6.64 + 2.83) brings the estimated direct cost for Castle Creek to 9.47 cents per kwh.

Loss Leader

At 9.47 cents per kwh, power from the Castle Creek hydro plant is so expensive it would cost more to generate than the City could charge under its 2010 rate structure. Specifically, Castle Creek power will be 43% and 12.7% more expensive than the City's 2010 residential and commercial base energy rates of 6.6 and 8.4 cents, respectively. This translates to an estimated loss of $38,000 per year, or $1.9 million in red ink over 50 years. And those are just the conservatively estimated direct costs of a facility designed to provide only 8% of the City's power load. This analysis does not reflect the very real additional costs of overhead and administration.

The financial shock from this new cost center has already resulted in rate increases for local residents and businesses. Earlier this year, city council increased electric rates an average of 16% over the next four years (for a residential customer using 1,350 kwh per month). The first phase of this increase became effective November 1, and future annual increases through 2015 have already been approved. Without this pricier new rate structure, the annual losses for the hydro plant would be an order of magnitude greater. Even with these rate increases, however, the hydro plant will still operate at a loss for its entire lifetime.

Not only will the Castle Creek Energy Center be a loss-leader for the City, it will be the most expensive source of power in the City's energy portfolio. Combining Castle Creek's cost with that of Reudi and Maroon Creek, and conservatively assuming the new hydro plant will run at full capacity, the "blended" cost for all City of Aspen hydro power generation will increase 58%, from 2.83 to 4.48 cents per kwh. In reality, however, this 4.48 cents per kwh rate will likely be much higher because Castle Creek will not initially and may never run at full capacity to produce the promised 8% of total power generation.

In Aspen's council chambers, political hubris reigns. City leaders seek the credit while we pay the ever-increasing costs and on-going subsidies. With cheaper and more environmentally friendly options at their fingertips, City leaders aspire to an expensive and ill-conceived "clean green" destiny despite the fundamental flaws in their plans. Why? Political credit outweighs public benefit. Ambition trumps principles. Immortality overshadows environmentalism. And political destiny, no matter how misguided, is worth more than any amount of other people's money necessary for its attainment.

STOP THE HYDRO PLANT TODAY! NO MORE SPENDING UNTIL THE LEGAL CHALLENGES ARE RESOLVED AND THE ENVIRONMENTAL IMPACTS ARE KNOWN!

Immediately after this ad ran, council quickly postponed its impending meeting on rezoning a city-owned parcel of land along Castle Creek upon which the city intends to build the Castle Creek Energy Center from "residential" to "industrial use."  Council will now have a work session on December 12 to discuss "economics" and "water quality" issues pertaining to the Hydro Plant and Energy Center and will follow up on the rezoning issue in January. Of note, it appears that the city is now attempting to seperate one project (Hydro) from the other (Energy Center). I see this as positive indication that the city is fearful that its $9.5M investment in the Hydro Plant infrastructure (built prior to having a permit and with a current lawsuit challenging the water rights to even build one) is in serious jeopardy. But, while the Hydro Plant may get tied up, the rezoning of this specific parcel (amidst a residential neighborhood) for an undisclosed "industrial use" stands to proceed. If I had to speculate on what's going on, I'd guess this t.b.d. "industrial use" could at some point in the future be so intrusive to the neighborhood that the neighbors might regret not allowing a hydro plant there. How's that for vengeance? These guys are bad. Really bad.

**And a big THANK YOU to readers of The Red Ant who generously contributed to this impactful "strategic communication" (advertising) effort. I'd like to run the ad again. If you are interested in helping with the cost, please "reply" to this email.     

BALLOT BROU-HA-HA: THE CONDENSED VERSION

The legal fight continues with the city's recent appeal to the Colorado Supreme Court. It's really simple: the city attorneys argue that public disclosure of voted ballots will cause public harm because (in Aspen) ballots may not be anonymous, therefore they must remain secret, where only election officials and city staff can see them and know how people voted. Now remember, by law, if the city doesn't conduct an election that ensures anonymous untraceable ballots, that election is unconstitutional. Period. And an unconstitutional election can be nullified by the courts, even years after the election.  (Get the picture why city council might be a little worried about exposing the ballots?) Like I said, it's simple. Somehow, the city geniuses (this includes city council) feel that Aspen is special and our ballots SHOULD be traceable to the voter and available only to "insiders," therefore they cannot be made public and must be kept secret. The legal update: Marilyn's original case against the city (to disclose the 2009 ballots) was dismissed in bureaucracy-friendly district court (the case was deemed not worthy of being heard), but when she appealed to the State Appellate Court, surprise, they came down 3-0  strongly and clearly in her favor. The city is ignoring the appellate ruling while it appeals, likely risking hundreds of thousands of taxpayer dollars to keep whatever it was they did to those 2009 ballots in the dark. For now. THE PATTERN OF SECRECY LIVES ON I looked back at an earlier issue (#48) of The Red Ant that focused on "Secrecy at City Hall," the subject of a speech I made at a September 2010 Aspen Business Luncheon. It's frightening how little has changed. The city's legal obsession with "secret" vs "anonymous" ballots fits right in, underneath the big "secret" umbrella. I hate to pull a "Danforth" (the owner of the Aspen Daily News who regularly recycles old columns instead of writing new ones), but I thought the following excerpt from the Business Luncheon speech was worth running again amidst the latest goings-on: "I'm here today to talk for a few minutes about what I see as the "Culture of Secrecy" at Aspen's City Hall. In general, when I use the term "city hall," I am referring to city council, city attorneys John Worcester and Jim True, and city manager Steve Barwick. Now, it's no secret that I was appointed to be an Election Commissioner in 2009, just prior to the now infamous IRV election. In short, here's how it went ---- The public voted in 2007 to use Instant Run-off Voting in our elections. That there were multiple methodologies of the controversial vote-counting scheme was kept secret from the voters. The "rules" for Aspen's vote count were determined mostly in secret meetings of city staff, the city attorneys and the incumbents running for office -- Mick and Jack. Among other problems, as an election commissioner I witnessed messed up pre-election software testing. In one case, the candidate with lowest number of votes came out as the winner, while the candidate with the highest number of votes became the loser. Reminds me of the biblical reference "the first shall be last and the last shall be first."   ---- But I digress..... This precipitated some late-night last-minute software changes in the wee hours before the election. City attorney Jim True tested this software alone, in secret, in his office. And after the election, when the city's election contractor discovered a vote tabulation error, the city kept this secret until the deadline for a recount had passed. But when the election commissioners began to ask questions, we were swiftly "disappeared." Before I left ---- one big secret had been revealed: the city knows how you voted. It's been proven. Your constitutional right to an anonymous ballot has been violated, and this was likely not the first time. Now the city calls that election "the most transparent" in history. WRONG. It's all a big secret. It comes down to this fundamental question: Why won't the city show the same ballot images that they showed on television screens the night of the election? What are they hiding? It will be extremely difficult for the current election commission to make the changes that the city attorneys and city council don't want made. But laws were broken, and we must demand that integrity and honesty be returned to our local elections. That's no secret." Scary, huh? As true today as it was 15 months ago. THE "YOU CAN'T MAKE IT UP" FILE Remember the city's messy and loud $200K geo-thermal drilling experiment (See Issue #67)? A friend of The Red Ant informs me that "not only have they not hit ANY water, hot or cold, the city has asked them to drill down to 1500 feet. We were told that the contract was for 1000 feet. And they are to be finished by December 1. I hate to bitch, but .... Oh yeah, it's our city. Gotta trust them, right? You should know!" .... Like I said, you can't make this stuff up!! AND ONE MORE ADDITION TO THE "FILE" Check out this official agenda from the city clerk's office for the recent Election Commission meeting on November 29. Yes, you are seeing it right. I received an email the morning of November 29 with the following message: "Damn. We missed the meeting. It was at 1am. (City clerk) Kathryn Koch confirmed last night that it was at 1pm. In the dark of night is where city council does its business." Now at least we have the answer to all of the "darkness" that pervades local governance.

ISSUE # 71: RampANT Abuse in Subsidized Housing

"Subsidizing the markers of status doesn't produce the character traits that result in that status; it undermines them. It's easy to see why. If people don't need to defer gratification, work hard, etc., in order to achieve the status they desire, they'll be less inclined to do those things. The greater the government subsidy, the greater the effect, and the more net harm produced."  

                     --- "Philo of Alexandria," 2010, blogger 

SUBSIDIZED HOUSING: THE BIGGEST "GAME" IN TOWN Despite recent news of an unprecedented glut in local subsidized housing inventory, and ongoing record levels of foreclosures in the working-class neighborhoods of the mid-valley, the city of Aspen's plans for 167 more subsidized housing units at Burlingame phase 2 continue. There is $7.2 million proposed for infrastructure construction at Burlingame in the city's 2012 proposed budget. And the city is even planning to lease excess seasonal rental units at Burlingame to the Aspen Valley Medical Foundation for use by the local homeless. Remind me again why we need more subsidized housing?? Over 200 people have signed up for subsidized units at Burlingame 2 on the no-risk waiting list, but to-date, just 22 are both APCHA and bank loan pre-qualified. Council has indicated though that with 60 pre-qualified buyers (who still won't have to commit - financially or contractually), they will likely give the go-ahead to begin construction. Even if the plans are delayed a year, the city will spend $1.9M in 2012 "planning" Burlingame 2.  In the meantime, the city is currently running half-page 4-color ads in the local papers, imploring those interested to "Do your part (get qualified with APCHA and for a loan) so we can start digging in 2012."  Shameless. This is all before city council's promised "strategic review" of subsidized housing, allegedly an in-depth analysis of critical issues facing the program, including: retirees in housing created for workers, governance of the program, and the government's role in HOA solvency issues, among others. It seems that the bureaucrats at city hall simply intend to steam forward despite the economy, the enormous excess housing inventory and all matters of better judgment. *** I've been planning a multi-issue expose on housing, and there's no time like the present to launch it. Reader's Tip: In early 2009, Issue # 22 of The Red Ant "Affordable for Whom?" outlined the subsidized housing basics. I don't plan to bore you by repeating them. Please take a minute and glance back through that installment to refresh your memory on how subsidized housing works around here. The one key point is to recall that two-thirds of the 1.5% Real Estate Transfer Tax (RETT) goes to the subsidized housing fund. If this money was not thus dedicated, we would not be having this discussion. However, the use of "other people's money" has made it far too easy to be careless with this particular "marker of status." This issue will simply whet your appetite for what's to come, and several issues that follow (schedule to be determined by the events of the day) will explore and expose the corrupt underbelly of our subsidized housing program, focusing primarily on the ineptitude of the Aspen Pitkin County Housing Authority (APCHA), its board and its rules, and demonstrating through blatant mismanagement, negligence, lack of proper oversight, and special favors for special people that the program is the embodiment of the law of unintended consequences. In short, we need more subsidized housing like we need a hole in the head. I am often challenged on my disdain for our subsidized housing program. It's true, I think it stinks. This fabulous community asset has been so horrendously mismanaged since its inception that gaming the system has become the rule vs. the exception, and as many subsidized housing complexes find themselves horribly underfunded for ongoing and deferred maintenance, it becomes ever more clear that the program was doomed from the start. The continual answer to compliance problems is simply to build more housing; somehow non-compliant dwellers and those who constantly want to move to newer units are seen as indicators of legitimate demand for the construction and funding of more and more units. The telling quote of the decade related to the substandard maintenance of subsidized housing came from former city councilwoman and Housing Frontiers Group member Jackie Kasabach, who asserted (4/18/11), "Nobody thought about it... that this program (subsidized housing in Aspen) would last 30 years and that these buildings would need to be maintained." (It's a naive perspective for sure, but indicative of how many residents of our subsidized housing projects actually think!) Of course nobody thought of it. And there's a long list of other things nobody thought of. Such as selling homes to people without explaining the responsibilities of home ownership (like paying association dues), and turning these multi-million dollar public housing complexes over to residents to manage (and theoretically collect association dues from their friends). Each complex's set of rules and declarations is different, and APCHA has no, zero, zip role in ongoing "management" once the units are sold, aside from "dealing with" compliance issues, which they do very very poorly. And this is not to mention APCHA's chain of title/custody dilemma: each time a unit is sold to a new buyer, APCHA oh-so-briefly holds title to the unit. As the rapid and unchecked deterioration of the housing stock continues, APCHA's responsibility for disclosure and overall liabilities increases. There is a troubling groundswell among various subsidized housing project residents that the deferred maintenance issues should be paid for by taxpayers, never mind it was the private property owners who subsidized these places to begin with and the deferred maintenance is solely because the residents neglected to contribute to and build up their own reserve accounts! So, as questions arise about funding more and more and more subsidized housing units, I feel strongly that it is far more important for this community to get a handle on just what it is we currently have in our inventory (APCHA cannot produce a comprehensive inventory list, just that we have approximately 2800 units), who lives there (APCHA's list is sketchy and not easily obtained - it should be a matter of public record), whether or not the current residents qualify (there are various income maximums, asset maximums and annual work requirements), what the unfunded HOA liabilities are across the portfolio, who is responsible for making up the shortfall(s), who is ultimately "in charge," and what can be done to better prepare ourselves and these complexes for the next 30 years. Clearly the status quo is an abject failure. In short, before we build more units, we must learn to take care of what we have. (Ya think?) And if that means blowing APCHA and its incompetent board up in the process, that's a start. To illustrate the caliber and quality of work done by the 12 members of the APCHA staff (at combined salaries totaling approximately $658K annually) and its equally dysfunctional board, here are a few colorful vignettes. Sadly, this is just a sample of the recent goings-on:  APCHA STAFF ATTEMPTS TO CONCEAL PUBLIC RECORDS/ALTER POLICY DOCUMENTS The Red Ant regularly employs the Colorado Open Records Act (CORA) to obtain public documents from our local government. In the process of trying to obtain APCHA materials, I was met with great push-back. When finally directed by the city to provide me with the requested information, APCHA director Tom McCabe went berserk. Wildly making hundreds of copies of documents and commissioning the county's outside council to review them, McCabe tried to charge The Red Ant nearly $1000 for the materials and legal advice --- a foolish attempt to punish The Red Ant for making an in-depth inquiry. (I am incidentally a member of the Colorado Press Association and enjoy all the rights and privileges of working press throughout the state.) When questioned about the $475 hourly rate paid to local attorney Tom Smith through yet another CORA request ("please show me all billing statements for Tom Smith in 2011"), ooops, APCHA was forced to admit that they lied. Mr. Smith apparently "only" gets paid $250/hour. APCHA was just trying to stick it to The Red Ant for digging around, and no, of course The Red Ant will not be paying one cent for that! And all those copies? Bummer. That's not how it works. After a CORA request, the requestor can review the materials but must only pay for any copies that are taken away - not the entire request before review! Another attempt to keep The Red Ant at bay. Best of all was the CORA request about APCHA's own CORA policies. When I received the document via email, it was hilarious to see in the embedded meta-data that the document had been conveniently edited THAT DAY! Hmmm. Wonder what it is they're hiding!?! The liars, cheaters and scofflaws at APCHA thought they were thwarting The Red Ant and my access to public information. But alas, they simply showed the caliber of their own professionalism. INMATES RUNNING THE ASYLUM In case you were wondering how the egregious decisions affecting our housing inventory are made, it's best to start by looking first at who makes those decisions. In the case of the APCHA board, this means Marcia Goshorn, Ron Erickson, Kristen Sabel and Erin Smiddy. And when you include APCHA director Tom McCabe, it is noteworthy that ALL live in subsidized housing -- the very inventory they are designated to oversee and whose rules they are responsible for enforcing. (At press time, congratulations are in order to former APCHA board member Cathy Markle who recently purchased a free market home in Eagle County, taking full advantage of the recent decline in real estate prices -- the original intention of the subsidized housing program!) Frankly, it's Aspen's very own "Peter Principle" in full force at APCHA: in a heirarchy, every employee tends to rise to his level of incompetence.  All these entrenched bureaucrats with no place else to go, making the same mistakes and intentional oversights again and again and again.... A SPECIAL DEAL FOR AN OLD FRIEND When former county commissioner Wayne Ethridge was found in violation of his deed restriction (renting out one unit that he owns while living in another, owned by his ex-wife), the APCHA board voted to let this infraction slide. Even APCHA staffer Julie Kieffer who is a "qualifications specialist" to the tune of $52K annually, recommended that APCHA force Ethridge to sell his Aspen Village trailer or force his ex-wife to sell the W/J Ranch unit where he currently resides. (In his own defense for breaking the rules, Ethridge claimed he would lose most of his life savings if he sold in this market.) Kieffer reminded the board that "we never guaranteed a profit," but the board completely ignored her recommendations. They just kinda felt bad for their friend. RESIDENTS WASTE ENERGY WHEN THEY DON'T PAY THE BILLS! Tenants of the Truscott Place subsidized housing project (next to the golf course) have long had utilities included in their rent. But with no incentive to conserve energy, residents were known to often leave the heat on with windows open throughout the winter. In late 2010, APCHA decided to pass the electric costs along to tenants in addition to their rent in 148 of 198 units there. (50 units do not have individual meters so these will see 5% annual rent hikes beginning in 2012 to account for the electricity costs.) Sounds pretty reasonable, especially for a city with aggressive energy conservation goals! But wait, APCHA then decided to lower the rents for these new electricity customers since they might see a considerable jump in expenses if they have to pay rent plus electricity! APCHA director Tom McCabe somehow thinks that conserving energy will be "more apparent" to renters who pay their own bills, but I disagree -- not in this case. It won't happen if the rent is reduced accordingly "to make the cost of rent and electricity roughly equal to what tenants are paying now." C'mon! Theoretically, grown-up local workers live at Truscott. In order to get people to conserve energy, make them pay for their electricity usage just like the rest of us. Obviously. W/J RANCH vs ORDINANCE 22 (APCHA vs FREE MARKET) - TOTAL HYPOCRISY! Remember Ordinance 22 of 2008? (Read Issue #9) The punitive and anachronistic measure made certain that owners of adjoining condo/townhome units in the city of Aspen could not combine multiple units into a single larger space -- without building a subsidized housing unit on-site -- because this would create a "loss" of rental inventory, presumably for local workers. Many local residents own multiple units in in-town complexes and had intended to combine their units, but Big Brother stepped in and said No Way, No How. But then it happened in subsidized housing! Picture this up at the subsidized W/J Ranch (on McLain Flats Road): guy owns one side of a duplex, girl owns the other. They date, marry and adopt two kids. And then they knock out the common wall to make the duplex into a larger family home. APCHA thinks this is just great. Board member Ron Erickson even went so far as to endorse the violation, "I don't see this as a problem in keeping with the spirit of the housing code - to accommodate families as they grow. They just took a short cut." C'mon Ron, they broke the rules! Current housing guidelines do not allow a household to own two separate subsidized housing units. But the APCHA board didn't care. As long as the wall is replaced when the family moves, they can maintain their status quo. I wonder what would happen if someone tried this at South Point (free market) condos? What's good for the (silent tax-paying) goose is clearly not good for the (entitled) gander. And now there's one less subsidized housing unit available for a qualified employee or family as a result. Ahhh the hypocrisy! SCOFFLAWS WELCOME APCHA currently has no policy for background checks on applicants for subsidized housing. In late 2010, the idea was brought before the county commissioners by APCHA's attorney. Predictably, Jack Hatfield saw the concept of checks as "oppressive and draconian," but George Newman saw the wisdom, "Housing is not a right, it's a privilege." The permissive nature of the APCHA program has enabled several of our recently-busted alleged cocaine dealers to enjoy living in subsidized housing, and has even enabled a local scofflaw to rent a studio apartment at Truscott despite trashing her previous free-market rental and telling the judge that she couldn't/wouldn't pay the damages because she has no job and no income. How does this happen? How and why can she occupy a subsidized housing unit for local employees if she doesn't work? Strangely, she and her boyfriend (who listed his official address as the Pitkin County Jail) managed to pay rent at their free market rental, but she now claims (and collects) disability which she uses to pay $642/mo rent and live subsidized at Truscott. The judge has ordered her to pay her former landlord $3000 for repairs to the trashed apartment, but to-date she has merely sent in a $5 bill. But she's safe and warm in her APCHA studio. APCHA claims she provided proof of Pitkin County employment and disability, but these records were not kept. Puh-lease! Talk about corruption! The Red Ant is in possession of photos of this tenant's move-in to Truscott -- using a RFTA truck to do so. Apparently her brother works at RFTA. Hmmm. Is this why she gets a subsidized housing unit without working and doesn't have to pay court-ordered penalties?? LITTLE APCHA FACTIODS TO SHOCK AND AWE In 2009, 7 owned subsidized housing units went into default. Of these, 3 went through foreclosure. In 2010, these numbers were 9 and 4. When a subsidized housing owner forecloses on a unit, there are several little-known "special funds" at the city (#150: Affordable Housing/Daycare Fund and #160: Housing Authority, and perhaps others) that the city uses to buy the note (and thus the unit) from the foreclosing bank. In 2010, the city used at least $567K from these two funds to buy foreclosed subsidized housing units. The Red Ant is investigating these funds, the available balances for such purposes, and other interesting tidbits. Can this go on indefinitely? How soon until the foreclosing banks can sell the note(s) to just ANY buyer?  Stay tuned.... In 2008, a survey of APCHA owners and renters showed the average age of the owner as 48 and the average age of the renter as 44. It's late 2011, so these numbers are now approaching 52 and 48! APCHA does not know how many of its units are currently for sale. (Not all units are required to list with APCHA.) The weekly listing in the Aspen Daily News on Wednesdays used to fit into a vertical half-page spot. Today the listings fill a full page. There have been ZERO evictions for employment non-compliance (not working) by APCHA since the beginning of 2009. In 2010, APCHA was granted permission to "randomly audit" 100 owners of APCHA units for compliance. To date, APCHA has not audited any. APCHA has no idea the number of retirees currently occupying subsidized housing units. (This is distinctly one reason why I do not refer to the units as "employee housing.")

And like I said, this is only the beginning.  There is much more to come on the corrupt underbelly of our subsidized housing program.

** MY "RIDDICU-LIST" -- THE "YOU CAN'T MAKE IT UP" FILE

It was confirmed by Aspen's Sister Cities organization on October 14 that, in addition to the $2418 mayor Mick got from the Aspen taxpayers for his European vacation, Aspen's sister cities program gave him $500. (Yes, sister cities gets its $15,750 annual budget from the city of Aspen, so taxpayers paid twice!) I wonder where else the mayor finagled public money for his boondoggle.... The water fund? The housing fund? Let's face it. When lazy and incompetent city manager Steve Barwick approves such reimbursements, it's amazing there isn't more fraud. Or is there? 

Notably, when The Red Ant notified council of this additional stipend for the mayor, Mick suddenly announced at the October 24 council meeting that he would be returning the $500 -- not because he admitted wrong-doing (he would NEVER do that), rather, so that he could participate in a discussion over a local event that benefits the Sister Cities program.  I'll be following up to make sure he does return the cash!

ON A LIGHTER NOTE....

On the subject of mayor Mick's taxpayer-subsidized European vacation, local resident Denise Malcolm submitted one of the better letters to the editor I've read in a long time, entitled "Love the New City Program." For a good laugh:

Editor:

I was delighted to discover that Aspen has a new vacation subsidy program. I had a wonderful two week vacation last month with my two daughters in England and France and those 5 euro cokes at Parisian cafes start to add up. Like mayor Mick, I would estimate that I shared the "awesomeness of Aspen" message at least two out of three vacation days with local people that I met. Of course, in all fairness, I probably spent less than 1 percent of my total vacation time sharing that message, but it appears that the proration formula is that any day that you share the "awesomeness of Aspen" message, you can get a reimbursement of your total vacation expenses - excluding traffic tickets incurred by your loved ones - regardless of how much actual time was spent sharing the message. 

Since mayor Mick was not on pre-authorized city business, it would seem that all local residents should be eligible for this vacation subsidy program. Where should the residents of Aspen be directing their 2011 vacation invoices? How much detail should be included about our personal campaigns to promote the awesomeness of Aspen while on vacation?

I am getting ready to plan my vacation for the summer of 2012, so just to clarify, are all overseas destinations eligible for this vacation subsidy program, or just Europe? Will Aspen establish an Affordable Vacation Authority to run this new program?

Denise Malcolm
Aspen 

ISSUE # 70: IncessANT Taxation

"You cannot help the poor by destroying the rich. 

You cannot strengthen the weak by weakening the strong. 

You cannot bring about prosperity by discouraging thrift.

You cannot lift the wage earner up by pulling the wage payer down.

You cannot further the brotherhood of man by inciting class hatred.

You cannot build character and courage by taking away people's initiative and independence.

You cannot help people permanently by doing for them what they could and should do for themselves."  

                                        --- Abraham Lincoln

Election season in Aspen never seems to end. This time, it's an off-year Pitkin County election, conducted solely by mail-in ballot. Remember, these must be received by the clerk no later than 7p local time on Tuesday, November 1. For more information, go to www.PitkinVotes.org THIS IS NO TIME FOR PUNITIVE ARROGANCE We have relatively few issues to decide on this election cycle. The biggie is Referendum 1A: Dedicated Property Tax for Healthy Community Fund. In short, we've had the Healthy Community Fund since 2002 with about $800K in annual funding from property taxes for its first 5 years.  In 2006, voters upped the take to $1.25M a year through 2012. The money supports a wide range of "social services" non-profits and cannot be used by the government for any other expenses. With the fund's expiration on the horizon, Referendum 1A is on the ballot, not as a renewal, but as an increase to about $1.9M annually.  That means a property tax hike. I briefly grappled with 1A but just can't support it. The county commissioners originally debated a simple renewal of the fund at its current funding level. Had they done this, I'd go along. However, when commissioner Rachel Richards pushed for a $3.5M funding level and the issue was later "compromised down" to a $446,000 increase ($1.9M annually), it made me sick. Why? She knows (as do you and I) that property tax measures regularly pass in Pitkin County. (It's because so many of the voters pay so little of the taxes.) In this economic environment, for Richards and her cohorts Michael Owsley and Jack Hatfield to simply up the ante just because they can is punitive arrogance; plucking the silent goose yet again. I REALLY don't like the government deciding which charities I MUST support either. My guess is that this, like other property tax measures before it, will pass. But not with my vote. FYI: THE GOVERNMENT "WINNERS" Referendum 1A can be viewed as a tax that makes select local non-profits into component units of government, reducing and potentially eliminating their need to fundraise, and replacing private donations with tax dollars.  This would make these non-profits subservient to the government's political mission rather than their own missions to serve people directly.  And who is the government to pick non-profit winners and losers anyway? The following is a list of local non-profits that the government has deemed "winners" - a bigger pot of gold with a new and bigger "fund" will add to these organizations' dependence on your tax dollars. Among others, you're already donating to these organizations, like it or not: Mountain Valley Developmental Services RESPONSE Family Visitor Programs Community Health Services Mountain Family Health Centers Planned Parenthood Sopris Therapy Centers Aspen Counseling Center The Right Door Valley Partnership for Drug Prevention Alpine Legal Services Colorado West Psychiatric Hospital Roaring Fork Early Learning Fund GRASSROOTS TV Aspen Public Radio Aspen Center for Environmental Services (ACES) Independence Pass Foundation Roaring Fork Outdoor Volunteers This is NOT a judgment of any kind on these entities, just an FYI to let you know that you already support them so you can now make your discretionary charitable donations to other worthy programs that are not on the government's list of "winners" and likely REALLY need your contributions! HERE'S HOW I'M VOTING To see a sample ballot, click HERE. State of Colorado Proposition 103: NO (I hate property tax increases and sales tax increases, and I especially hate throwing good money after bad at our failed education system.  HERE is an intelligent commentary by Joyce Rankin on why this measure and Garfield County's 3A won't change a thing, other than  your property taxes!) Referendum 1A: NO (I'm taking a stand and falling on my sword.) Referendum 1B: YES (Expands the current FM radio and TV translator tax to include wireless and internet when the technology is available and affordable. No tax increase today, just the ability to expand the category of services.) Referendum 1C: YES (House-keeping edits to County's Home Rule Charter.) Referendum 1D: YES (House-keeping edits to County's Home Rule Charter.) Referendum 3A: NO (I like term limits. A lot.) School Board: I do not have an educated opinion on any of the candidates. (Garfield County/Referendum 3E:  NO.  See Prop 103 above.) PITCO'S VOTER ROLLS Ever wonder how and why a county with a total population of 17,148 (according to the 2010 US Census) can have 14,000 people on its voter rolls? I wonder all the time. The reason is simple: our voter rolls are swollen with former residents, wanna-be residents and residents of the afterworld. No kidding. I know this because I acquired a copy of the list and was horrified to see the names of many people who simply should NOT be registered to vote here!  And they're all being sent ballots this week!  (WHERE will these end up!?!) AN ELECTION INTEGRITY EXERCISE -- EVERYONE CAN HELP! HERE is the hot-off-the-press list of all 14,000 registered voters in Pitkin County. Yep, 14,000 is a lot of names, but do me a favor. Glance through it online. (You know you're curious!!  I sure was!!)  It's easy - the names are alphabetical and it really goes quite fast. And yes, it is entirely legal that I have this list.  It's a public record.  Jot down the names that you believe to be on the list in error (for whatever reason) and please send these to me. This exercise won't remove anybody from the official list, but will likely demonstrate what I know to be true - our list isn't accurate. I plan to compile one comprehensive list of suspected "erroneous" names and provide them to the County Clerk. It will become that office's responsibility to look into these potential problems, if they so choose. I already have a list started. I'd like to add your findings to it. It won't be scientific by any stretch, but is intended to make the case that we have some spring cleaning to do! As you are all too aware, our local elections are hotly contested and every single vote counts. It is more important now than ever that we work to clean up our database. Besides, the 2012 general election is shaping up to where Colorado is highly likely to be a bell-weather state for the Presidential election. Voter integrity is of the utmost importance. Thanks in advance for your assistance with this unique grassroots exercise!

THE "YOU CAN'T MAKE IT UP" FILE As we all watch "Occupy Wall Street" across the country with varying degrees of bemusement and dismay, did you realize that we had a fledgling "Occupy Aspen" event last week in Wagner Park?  Thankfully the small handful of participants didn't camp out, but the sentiment was the same -- "People get so fed up and pissed when they don't have jobs and when they don't have money," according to one of the organizers.  The irony?  Their next organizing meeting is tomorrow at a home in the Burlingame subsidized housing project.  Yep, the same project for which the evil Aspen private property owners paid a $350K+ per unit subsidy.

ISSUE # 69: September bANTer

"We must be vigilant to guard against the hubris of elected officials."  -- Keith Self

"My reading of history convinces me that most bad government results from too much government."    -- Thomas Jefferson

**VOTER NOTE: NOV 1 COUNTY ELECTION IS MAIL-IN BALLOT ONLY

Take 2 minutes right now and go to www.PitkinVotes.org to verify your voter registration status and mailing address in the "Voter Services" section. If you do not show up in the system as an ACTIVE voter, you will not be sent a ballot.  Make any and all changes before October 3.  Ballots will be sent by October 14.

HYDRO: FINALLY, A LAWSUIT TO STOP THE MADNESS

Litigation. It's all they understand at city hall. Lazy and incompetent city manager Steve Barwick and his wingman, crooked city attorney John Worcester, regularly break the rules and frequently dare citizens to sue them, knowing that most won't. But when citizens do, it's often very bad news for city hall.

Think of the Wienerstube lawsuit (challenging the Aspen Area Community Plan), which the city settled (lest the document be deemed simply advisory), yielding what is now to become the new Aspen Art Museum complex at Spring St and Hyman Ave, to be designed and built without Planning & Zoning review, per the terms of the settlement.

Then there's the city's fight with the owners of the Hotel Jerome over nearly $500,000 in real estate transfer taxes. Despite the current owners acquiring the property though a "deed in lieu of foreclosure" proceeding, the city went after them for the cash as though it were a standard sale. This was a pure attempt at a money-grab by the city. The judge ruled in favor of the hotel owners in June, and refused to reconsider her ruling.

And don't forget Marilyn Marks' lawsuit challenging the city's adherence to Open Records laws, specifically pertaining to anonymous voted ballots from the 2009 municipal election. The city won the first round in our notoriously government-friendly district court, but a ruling on appeal is expected any day now. In the meantime, a state court judge in Saguache County (CO) has ruled that voted ballots are indeed public records as there is no way to link a voted ballot to a voter, that is, if the election was conducted fairly and legally. Advantage, Marilyn.

On Friday, a local non-profit called "Saving Our Streams," joined by a group of neighbors whose homes exist along Castle and Maroon Creeks, filed a lawsuit against the city to stop the beleaguered hydro plant dead in its tracks! Their case? It appears that regarding the Castle Creek flume ditch, the Midland flume ditch and Maroon flume ditch, "the city of Aspen has not used the water rights decreed for hydropower use for over fifty (50) years, the city of Aspen has shown its intent to abandon the water rights decreed for hydropower use by not using the water right for this purpose for over fifty (50) years, and the city of Aspen has shown its intent to abandon the water rights decreed for hydropower use by, among other things, deciding to decommission the hydropower plant for which the right was decreed, by dismantling the electrical generation equipment, by allowing the water delivery pipelines to deteriorate to an unusable condition, by failing to repair the water delivery pipelines to the hydro plant, and by purchasing its electrical energy from Holy Cross and others since 1957."

No one is questioning or challenging the city's municipal water rights to the streams for domestic or irrigation uses. Just for hydropower generation. In short, use it (for hydro) or lose it. And they haven't used it in over half a century. (According to abandonment lists maintained by the Colorado Department of Natural Resources, there is legal precedence where the State water courts have declared specific decreed uses within a larger water right abandoned.) Read the full complaint HERE.

But perhaps the juiciest and most colorful part of the whole hydro debacle is the "Mick vs the Koch Brothers" sideshow. Obsessed with the politically conservative Koch brothers of Wichita, KS, Charles and David, Mick regularly carries on about a vast right-wing conspiracy that he portends exists whereby the water from Castle Creek will be sold to the front range of the Rocky Mountains if somehow the city of Aspen does not harness it for hydropower. This is of course preposterous. Charles and David Koch have nothing political to do with Aspen or Pitkin County, and it's their brother Bill who owns the former Elk Mountain Lodge at the upper end of the Castle Creek Valley and is one of many plaintiffs in the lawsuit. The family ties simply send Mick into a tizzy. "It's an open mystery why someone would be concerned about water being diverted eight miles downstream from them," Mick recently told the Aspen Daily News. Hmmm. I wonder how SkiCo green guy Auden Schendler feels about such a strange statement. (Schendler spent the last week in Washington DC, trying to get lawmakers there to focus on environmental issues here. And that's quite a distance greater than 8 miles away!)

MICK'S SOLYNDRA

It sounded so "green." Hydro power. Vote for it (in 2007) and feel the love. (And we did.) Never mind the facility can never cover its costs, even over a 50-year lifespan. (And the costs have escalated from $6.3M to $8.3M, so far.) Build it without permits; nobody will notice. Lie about an "existing" conduit in order to get an exemption from federal environmental impact studies and oversight. Ahh, but the truth comes out in the end. While the neighbors have now tied up the project and any possible federal approvals (the feds certainly can't and won't grant approvals when the water rights are in question), the city's arrogant indifference continues:

• Inept city attorney John Worcester said of the lawsuit, "It's a shame that citizens have to sue each other and attack our water rights since they belong to everybody." Well Worcester, no citizens are suing each other. They're suing YOU, the city of Aspen. And they're suing over water rights for a hydro plant that apparently YOU no longer have after abandoning and decommissioning the previous hydro plant in 1957, more than 50 years ago. Worcester's inane statement vividly illustrates the city's willingness to sacrifice the environment in order to build its precious hydro plant in hopes of someday being able to say its energy is "100% green." The city's real political end-game? Green energy at ANY price, even if it turns out not to be so green. The environment be damned!

In response to the city's arrogance, Ken Neubecker, director of The Western Rivers Institute responded in a RECENT LETTER to the editor:

• "Save Our Streams, American Rivers, The Western Rivers Institute and others have all tried to work with the city on this project and create something that meets both the goals of clean energy and protecting the stream environments. The city has been nothing short of obstinate and disingenuous." He continues, "Aspen says it wants to set an example to the world on how to be environmentally responsible. They are doing a pretty poor job so far."

The Red Ant is all over the financial picture. It's bleak. What did they know and when did they know it? Stay tuned. I'm all over this one!

THE GROCERY BAG TAX

The latest is that the boys moved toward an outright ban on plastic bags (instead of levying a 20 cent "fee" on each one), but then they'll charge that same "fee" for PAPER bags. No plastic bag option, just paper bags - for 20 cents each. And only at grocery stores. Does this really solve anything? Perhaps the most intelligent thoughts on the matter were summed up in a recent Aspen Daily News guest column by former city finance director Paul Menter. Read it HERE. In short, Menter argues that the "assignment of an arbitrary economic value for bags is an illegitimate use of regulatory authority. Dollars collected will fund environmental programs rather than address the impact of the bags themselves. The bags will become like cigarettes, primarily a source of government 'sin tax' funding and bureaucracy expansion; only secondarily an environmental problem to be eliminated."

He continues with a thoughtful argument that this so-called "fee" is actually government-mandated price fixing, a government-assigned price for a private good. Next, he illustrates that the "fee" is not a "fee" at all. "Fees" are set to "cover the cost of services provided to individuals, such as water and sewer services." This government-imposed charge on purchase and sale transactions to provide community programs is "the very definition of a sales tax, not a fee." He concludes by pointing out that such a sales tax does not comply with the US Constitution's 14^th Amendment's equal protection provisions, nor does it comply with TABOR (Taxpayer's Bill of Rights). The "equal protection issue" relates to the "grocery stores only" aspect of Aspen's plan, and TABOR requires all new taxes and changes in tax policy be approved by the voters.

In a subsequent letter to councilmembers, Menter continued with his analysis: "Your policy approach seems fractured and based on something other than the law, environmental protection, or good governance. To ban plastic bags and charge a fee on paper bags that are arguably worse for the environment illustrates this point. You want to be seen as 'leaders' but don't want to take the risk required to lead. Plus you have been persuaded that it is proper policy to 'feed the bureaucratic beast' by collecting money from private businesses through this policy without asking the voters if this is their desire. Not only is this illegal, it is a deeply cynical act, rooted in the belief that conscripting private businesses to do your policy bidding is proper governance. Its magnitude keeps it below the radar, but it is really, really bad policy and a dangerous slippery slope. Be very careful what you agree to. You are being asked to carry water for people who don't care about the consequences."

I couldn't have said it better myself. The updated plastic bag ban / paper bag "fee" ordinance will come before council in October. In case you were wondering what our local Gestapo thinks about being able to enforce the bag ban amidst speculation of myriad legal issues, city attorney (my, he's gotten vocal lately) John Worcester told the Aspen Daily News that he is confident "the city of Aspen has the requisite police powers to ban plastic bags." Nice. Police powers. Just what we need. In the meantime, make your thoughts known through letters to the EDITOR and/or letters to COUNCIL.

A $2418 SUBSIDIZED VACATION FOR MICK? JUST SAY NO! 

The following is a Letter to the Editor of the Aspen Daily News than ran today: 

Upon learning that Mick charged the city $2418 for a portion of his summer vacation in Europe, I looked into the Sister Cities program to research their mission for a better understanding of why our mayor deserved this subsidized trip.

Ironically, Sister Cities does not endorse individual visits by elected officials between cities.  It endorses information sharing (brochures, city reports, videos), strong city hall and business support through committees made up of a wide range of citizens, officially planned delegation visits (including a high-ranking city official, representatives of the business community, an official of the Sister Cities program, an educator and someone such as a performing artist who can highlight local culture), and specific substantive exchange reports. 

When Mick visited Aspen's Sister Cities of Davos, Garmisch-Partenkirchen and Chamonix, it was clearly not an officially planned delegation visit.  He was just there with his girlfriend.  Inquiries to Aspen's Sister Cities organization have gone unanswered, but I highly doubt they knew Mick planned to charge taxpayers for portions of his European vacation under the auspices of their esteemed program.

I've consulted with a city councilman and the city clerk, and both say there was no council pre-authorization of such travel by the mayor, despite the city's travel policy which states that personal travel may be combined with business travel only with notice to the department head.  In the case of the mayor, it is reasonable to assume such notification would be to city council.  Regardless, Mick's trip gives no appearance of official business travel to begin with.  Mick simply returned home and arbitrarily divvied up his vacation expenses, charging 60 percent of his airfare, half of his rental car bill, two of six tanks of gas, toll road charges and dinner with the Sister Cities folks in Garmisch to the Aspen taxpayers.  And city manager Steve Barwick presumably approved the fraudulent reimbursal.  Such leadership at city hall!

Can't you just picture the courteous Europeans unwittingly entertaining Mick and his lady during these unofficial and unapproved visits?  And, you can bet that Mick took full advantage of the gracious trappings of their hospitality.  One can only wonder the monetary value of these gifts.

Mick, if you cannot afford a European vacation, don't take one.  Get a job, or take a vacation in Moab on your own dime.  In the meantime, reimburse the city the full $2418.  Your European boondoggle was not city business and we shouldn't pay a dime for it!

Elizabeth Milias

I will be relentless in my pursuit of this reimbursal.  Stay tuned.

MICK: A 4-LETTER WORD, BUT A 4-YEAR TERM TOO?

Just six months into his third term as mayor, Mick predictably moved to extend the mayoral term from two to four years. He has done this without success in each of his previous terms, but this time he threw in the plea for beefier salaries for himself and fellow councilmen, likely to buy the support of his buddies at the table. (Recall that Mick does nothing professionally except reign over us all, so he is likely a wee bit worried about May 2013 when he is term-limited out of office and will no longer receive the $27,900 mayoral stipend plus city employee health benefits that he lives on.)

Mick complains that the job has become a full-time commitment, and the mayoral races start earlier each cycle, requiring more and more fundraising. Most notably, he fears that every election could possibly yield 3 newcomers to the council table. (Two council seats are up every four years.) The Red Ant asks, since when is the ability to change the majority with each election a bad thing?? He wanted the election commission to take the issue on and theoretically recommend a ballot measure.

The good news is many-fold. The election commission wanted no part in Mick's highly politicized request, as their focus is on election conduct and integrity. And, despite what was written in the papers, council did not fall for Mick's bribe. Torre went so far as to submit a letter to the editor, reiterating that he does NOT support Mick's request to change the mayoral term! And, in a subsequent personal conversation with councilman Steve Skadron, I learned that he too feels that a two year term is just fine.  

Additionally, while many feared that Mick would finagle another couple of years onto his current term, this cannot happen. A change to the mayoral term would need to be approved by voters in the next municipal election, which marks the end of Mick's current term. If anything were to change, it wouldn't affect him because thankfully, he'll be gone. He does need to sit on the sidelines for a couple of years before running again thank goodness, but considering his employment prospects (after 18 years in elected office in the county and city), he'll be back. What else can he do? In the meantime, he's not giving up. Mick plans to try again with council soon, this time to propose a "citizen review committee" that will study his request. Look for a team of sychophants to comprise THAT panel!

The Red Ant says, "If the 435 members of the U.S. House of Representatives can run for re-election every 2 years, so too can Aspen's mayor!"

MY "RIDDICU-LIST" - THE "YOU CAN'T MAKE IT UP" FILE

You recently read about the city's desire to harness geothermal energy from beneath the earth's surface by drilling 1000' holes right here in Aspen (ISSUE # 67). Turns out the $200K test-drilling project has attracted a total of ZERO bids. Yep, ZERO. Apparently it's the first time in 10 years that NO BIDS have been received for a city project. Maybe it's just a REALLY bad idea. Ya think?

DESPITE THIS CITY HALL B.S., THERE'S A LOT TO LOOK FORWARD TO AND BE PROUD OF...

I attended the ACRA luncheon on Friday, Sept 9, at the Sundeck atop Aspen Mountain. In addition to culinary treats from various SkiCo on-mountain restaurants, there is much good news to share:

• World Cup returns to Aspen Thanksgiving weekend
• The benevolent SkiCo owners, the Crown Family, have invested $26 million in on-mountain capital improvements. These include:
  • $6M renovation of Merry-Go-Round restaurant at Highlands
  • $7M Tiehack Express chair will take 7 minutes from bottom to top; opens Dec 10
  • A new Elk Camp Restaurant at Snowmass, to open Winter 2012-13
  • 50 miles of biking terrain at Snowmass on the Free Ride Trail
• Aspen will welcome up to 30 daily flights into ASE from 6 hub cities:
  • American Airlines begins service into Aspen from DFW (its largest hub) and LAX
  • Frontier will offer 4 flights daily from Denver, its hub, through 4/15/12
  • United will offer 2 daily flights from Houston, 4 from LAX, 2 from SFO, plus 12 from Denver
• The discovery of mastodon and other prehistoric bones in the Ziegler Reservoir at Snowmass have put Aspen/Snowmass on the elite map in yet one more category:
  • According to the Denver Museum of Nature & Science, the skeletons (almost 5000 fossils were found) are like "tweets from deep time" 
  • Snowmass is "the richest mastodon site in the world, by far"
  • The Ziegler Reservoir site is "the best high level ice age site in the world"
  • Who knew?

Happy fall.

ISSUE # 68: MiscreANT - $1 Million Barwick Bailout

"Guilt is the price we pay willingly for doing what we are going to do anyway."   -- Isabelle Holland  

*** BREAKING NEWS *** What kind of defendant settles a lawsuit by giving the plaintiff everything they asked for? A GUILTY ONE!  Especially when the defendant can use other people's money and has zero accountability! Just prior to a sexual discrimination trial against the city of Aspen and city manager Steve Barwick (it was scheduled to begin Wednesday), the city settled. It's unconfirmed, but sources close to the case tell The Red Ant that the city has agreed to pay former Aspen police officer Melinda Calvano the full amount she sought PLUS all legal fees.  (Calvano sued the city and Barwick in 2007 following her termination over a controversial "use of force" incident, alleging that the city manager ignored her claims of sexual harassment in the Aspen Police Department. The lawsuit included claims of wrongful termination, gender bias, a hostile work environment, as well as sexual harassment.)  The settlement deal, inked late Tuesday night, is estimated to be worth as much as $1 million. Could there be any greater admission of guilt?   Mick and the boys on city council approved this last minute bail-out of our very own lazy and incompetent city manager with allegedly $1 million dollars of your tax money! Yep, just like when they voted to give the financial fraud-favoring city CEO a $170K annual contract, the boys once again voted to throw Barwick a bone, presumably because, as Torre likes to say, "He's a good guy."  Some good guy.... How much more of Barwick and his "leadership" can we take?  How much more can we afford?? The Red Ant has learned that the facts surrounding the case and the long list of witnesses chomping at the bit to testify against Barwick were far more damning than the case itself!  I'm hearing from many of them and it's shaping up to be a fascinating story!  (For $1 million, I suppose it'd better be!)  You'll read ALL about it here in upcoming issues -- this story is not going away! Rest assured, The Red Ant has sources everywhere, and distance is no excuse for not telling it like it is!  In the meantime, on nANTucket, we're battening down the hatches in ANTicipation of hurricane Irene's arrival later this weekend!

ISSUE # 67: pANTs On Fire

"I'm upset that you lied to me; I'm upset that from now on I can't believe you." -- Friedrich Nietzsche  "If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie.  It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State."  -- Joseph Goebbels **SAVE THE DATE:  Sunday 9/11, 5 pm Aspen photographer Andrea Booher was one of two official government photographers at the WTC site from September 12, 2001, until late November that year.  She has just completed a documentary for A&E on her experiences reconnecting with 10 first responders she met there amidst the rescue and recovery efforts.  The 90-minute documentary will be shown as a public event, free of charge, at the Wheeler on the 10th anniversary of 9/11 at 5 pm.  Andrea will additionally have a Q&A following the film. SOMETHING'S BURNING Eeeeew. What's that smell?  Could it be the acrid smoke from one of Aspen's medical marijuana dispensaries?  Nope. More like burning khakis. Smoldering jeans. Trousers a'flame.  Pants on fire. The following recent examples of malfeasance at city hall are mere examples that yet again further illustrate a culture of lies and corruption in our local government.  Aspen's city hall has become a place where truth and transparency do not matter.  City staff has been conditioned to say or do whatever furthers council's agenda.  (Actually, Mick's agenda, but since no one on council stands up to him, they're all complicit.)  This behavior is all that's rewarded.  LIES & THEFT IN THE PARKING DEPARTMENT In their July 18 edition, the Aspen Daily News asserts to have notified the city that their solar-powered parking meters, designated to collect parking fees 10a-6p Monday through Saturday, continue to accept credit card payments after these hours.  The city, specifically parking director Tim Ware, claimed to know nothing about the problem.  "Nobody's called to complain so we didn't know," Ware told the Daily News.  He also claimed that there is no way to determine how much money has been collected by the city from these unnecessary payments. Tim Ware is a LIAR.  It turns out that Ware and the parking department have known of this problem for 3 years and did nothing to fix it.  Local resident Jena Wright emailed Ware in 2008 specifically on this issue.  He responded, telling her that the issue would be remedied with the next software update later that year.  Once caught in this LIE, Ware, with his tail between his legs, stated, "The program hasn't had a major update in 3 years, which is when the problem was slated to be fixed but was forgotten about.  I didn't catch it.  It's my fault."  Yes indeed it is.  But that Ware LIED when first questioned is reprehensible, dontcha think?!   The city still stands by its stated inability to determine how much money was collected fraudulently.  This is another LIE.  Anyone with a shred of know-how about credit card processing knows that each and every transaction is time and date stamped as a matter of course.  It would be exceedingly easy for the city to determine this amount.  My bet is that they absolutely know it but don't want you to.  It's just easier to LIE. This is nothing more than the city KNOWINGLY turning a blind eye to a flaw in its software that enables it to collect money it is not due from out-of-towners who don't know the rules.  Hey, just let them pay a little more because they can afford it, and besides, they drove their evil cars into town anyway, right? As you can imagine, Tim Ware reports to inept and lazy $170,000-a-year  city manager Steve Barwick, and the two were undoubtedly aware of this financial windfall all along. Barwick, known for his sketchy "off the books" financial deals, once again commits intentional financial fraud.  After all, it's easier to collect from unknowledgeable tourists than to collect the town's own receivables from unpaid parking tickets.  (This figure is cited by parking officials to be in the $250K range, but the former city finance director confirms it was already over $500K when he was there in 2005.)  Ware told the paper, "It's not as bad as you think."  REALLY? This is one more example of the pattern of malfeasance and poor management at city hall.  In fact, I'd call it corruption!  Why does Ware still have a job?  (Why does Barwick? This is simply the latest financial scandal that occurred on his watch!) CITIZENS CRY FOUL Local Wilbur Rutledge sent a series of humorous and pointed letters to the Aspen Daily News editor on this very issue.  This one is my favorite:  "Just when you thought it couldn't get any better, ticket head Ware gives another half-hearted apology and more excuses for straight-up lying about not knowing about the parking meters taking after-hours charges.  What is more of a priority than stopping what's under your watch from stealing?  To make things more hilarious, the city doesn't know how much it over-collected but the lead article on the same front page documents a local city budget surplus of almost a million freakin dollars.  And icing on the cake?  The last sentence of the article on Ware: '..at least we got Sundays and holidays right.'  Stop while you're behind, buddy."  --  July 25, 2011 Daily News columnist Sheldon Fingerman added, "How long have we had paid parking and how many times have you seen someone trying to feed the meters after hours and on Sunday?  And someone is just noticing this?  So, for years, those in power have been clueless, and all they had to do was walk around town and open their eyes.  More than once I've had to tell a tourist there was no need to feed the meter after hours." It is yet to be seen what the city will do to re-program the meters and fix the problem now that they've been caught.  My bet is that they'll do absolutely nothing, at least until the busy and lucrative summer tourist season ends! CARPOOL PASSES:  PARKING DEPT CAUGHT LYING YET AGAIN Along the same LYING lines, this classic came to me from a down valley commuter who caught the city in yet another parking-related LIE.  It's a classic.   In March of this year, the city abruptly stopped giving this driver and his family a carpool parking pass because they suddenly "didn't qualify."  (According to the ordinance - Sec 24.16.080 - the city issues daily High Occupancy Vehicle - HOV - parking passes to "vehicles with 3 or more occupants for use on the day of issue only.")  They were suddenly told that since their two high school-age children were not licensed drivers, they did not count as eligible passengers.  The following is a condensed version of the email exchange between the driver and several morons in the city's parking department.  Brace yourself -- it's a doozy! Driver to city:  I do not understand the rules and how they are being applied. From my experience, they are not being applied as written.  After being told that our children are no longer eligible for carpools, I watched the attendant give a carpool pass to a woman alone in her car with an infant in the back seat.  I asked him about it and he said that the rules allow for a single adult in cases when there is a child under 3 in the vehicle.  I have never heard this rule and it is not disclosed either on the pass or on the city website.  Where did this rule come from and who approved it?  It makes no sense whatsoever from a carpool policy perspective to allow this so I question the veracity of what I was told. Furthermore, the passes themselves say that there must be "two (2) adults of driving eligible age" for a pass to be given.  There is nothing about infants on the pass or the city website.  There is nothing about requiring a driver's license of the second adult, only that they be of driver eligible age.  Obviously we would like to regain the right to get a pass with just one of us and one of our children in the car, but if not, that's fine, just please enforce the rules fairly and state clearly what they really are on the pass and the website because according to both, we are indeed eligible. Parking Department to Driver: The intent of the carpool passes is to take another driver off the road, so driving age doesn't really do anything unless they have a driver's license.  As far as the driver with the infant, that was not in the original rules but as an afterthought agreed upon by the city manager's office (Barwick!!) to appease mothers with babies.  I think this is a difficult job to decide who qualifies for a permit but I always try to keep in mind the intent. The Red Ant:  Who hired this moron?  It's the easiest job on earth.  Read the rules.  Issue passes or don't according to them.  Period. Driver to City:  I am afraid that your response is not a legitimate defense of the manner in which these rules and laws are being administered.  As I read the code, it does not say anything about the age of the passengers.  How then can the city administratively modify a law approved by council and modify its intent by reducing from three to two the number of occupants necessary for a permit? The pass itself says "two or more adults of driving eligible age."  This is different from the law that says three people are required and makes no reference to their ages.  "Of driving age" therefore DOES have a lot to do with it.  Seems as though this restriction is directly contrary to the policy intent you stated which is to take potential cars off the road.  In the case of the mom with an infant, the infant is not going to drive itself into the city, so I am at a total loss to see how giving a pass to an individual driver with an infant in the car furthers the policy intent.  Finally, I don't understand why the city manager's office (Barwick!!) is administratively modifying the intent of the municipal code in a manner that restricts its intent without approval of the council.  The city manager should follow the law or get council to defer authority to him so that he can do the arbitrary things he wants.  I would appreciate either an explanation of where my assessment is wrong, or some other understanding of why the policy as currently implemented is proper, or the right to a HOV carpool pass under the terms of the current law. Parking Dept to Driver:  It does bother me that I can't give people the answer they want to hear.  I'm dealing with guidelines and lots of abuse when it comes to free parking.  Everyone is looking for a way to park for free.  I get that.  You are right, the ordinance that states 3 or more people does not require an age, but when it was modified to only 2 people that is when it was decided that it would only apply to adults.  I personally would like to see it fair and consistent to everyone and have some meaning for its intent.  I will share your comments and get back to you next week with more on the carpool pass issue. The Red Ant:  This idiot has a salary and benefits that you pay with your tax dollars! Driver to city:  One more question.  You say the ordinance was "modified," so you mean the council amended the ordinance so the law is different?  If so, can you please send me that ordinance language?  Or do you mean the city manager's office (Barwick!!) changed their administrative rules for following the ordinance?  And again, if so, could you please send me a copy of those administrative rules? Parking Dept to Driver:  You may now receive a carpool permit with your children. The Red Ant:  Hmmm. Makes you wonder how many other honest folks are being gamed by the city and its arbitrary enforcement of the local parking laws. WHEELING AND DEALING WITH THE WHEELER SUBSIDIES I'm clearly in the mood today to be the aggregator of many city LIES, so I've included the links to two poignant letters to the editor on the subject of the Wheeler Opera House and the money we pay to keep its doors open.  In (very) short, the city would have you believe that the annual subsidy to run the place is in the $200K-$300K range.  This is of course what the papers report. But it's a BIG FAT LIE.  The annual shortfall is in the MILLIONS.  Please take a minute to read Mike Maple's thoughtful letter of July 26 entitled "Wheeler Subsidies Too High," and one that I wrote earlier this summer, "Wheeler Subsidies Are Outrageous."   When Gram Slaton, executive director at The Wheeler says to council, "The best way to make money at the Wheeler is to shut the doors and turn out the lights," it's clear we have a very big problem.  A hard look at The Wheeler and its subsidies has thankfully made the list of Council's top ten priorities for the year.  The truth will now come out, and hopefully big changes will be made! THE GEOTHERMAL EXPERIMENT:  THE CITY IS IN HOT WATER In another attempt to "go green" with your tax dollars, the city is looking to tap into geothermal energy below the earth's crust right here in Aspen!  No kidding. The guys will be digging a 1000' well on city-owned land along the Roaring Fork River across from Heron Park, beginning in September.  The digging and drilling experiment is expected to last 45 days.  But don't worry, the city is happy to report that the homes closest to the mess are mostly owned by part-time residents!  Despite many questions (like WHY, to begin with), the city has already identified several other in-town drilling sites for future geothermal energy harnessing. Their big hope is that the estimated 100 degree water temps below our surface can be somehow harnessed to provide energy to heat and cool local buildings, and the greenies at the city are elated.  They don't give a whit about the cost, but I do.  The city has already dedicated $150K to the project.  But $50K of that came as a grant from the Colorado Governor's office.  So THAT's free money, right?  HA. (OK, technically this isn't a LIE per se at this stage, but this one has "WARNING" written all over it.  Need I mention the hydro plant to remind you of what happens - and the LIES that are told - when these guys get ginned up on a new green project?? Heads up.  Buyer beware.) AN OFFICIAL COMMENT:  THE PLAN IS A BUNCH OF HOT AIR An exasperated high level government official (who contacted The Red Ant and approved this reprint under condition of anonymity, for obvious reasons) wrote: "Here is one more insane city project for you to expose: the geothermal test well that is planned for construction this September.  The city has already budgeted $200K (sic) for this and possibly one more test well to determine if there is enough hot water underground to heat part of or the entire city.  Oh yeah, $50K comes from a grant from the state.  Never mind that state money is our tax money too, and they are broke to begin with.  The first well will be located across Neale Street from Heron Park and right next to the Roaring Fork.  Will the hot water coming from the well, which possibly contains heavy metals, flow right into the river?  Where does the $150K (sic) come from? That's easy, the city water and electric funds.  But does a geothermal project benefit either of these enterprises?  Don't think so.  And most important of all, what if there is plenty of hot water under the city, how much would it cost to construct an infrastructure to harness this resource? 50 or 100 million dollars? Does anyone know?  And would we all have to rebuild the heating systems in each of our homes?  Sure.  So what is the point in going ahead with this test project if we can't afford the final system in the end?  It's another waste of money, risking huge environmental damage to solve the world's energy issues.  Oh really, Mick!" THE RESIDENTIAL TAX: THE TRUTH OF THE MATTER This same friend went on to write about the proposed 2% tax on private rentals.  (The city continues to LIE about this as well.  The purpose is not at all to "level the playing field" between the lodging community and private property owners who elect to rent their homes as they claim.)  "And I agree with you on the short term rental issue.  This is not just an issue of the city trying to control the property owners and get in their pockets.  It is a rezoning of the entire city's residential zones.  It adds approximately 10,000 bedrooms to the tourist lodging base while the council would not approve one hotel room.  The council is threatening to destroy our community.  The short term rental rezoning has huge unintended ramifications for Aspen.  Don't think it's been thought out at all. And it's so unnecessary." In a guest column on the subject, Phil Verleger adds, "The imposition of the proposed tax will also force some to put their properties on the market. The supply of free market and deed restricted properties will increase. At the same time, buyers will adjust their expectations, offering less because they will fear they cannot capture that additional income from their properties. The consequence will be lower real estate prices. Those who own properties in Aspen will find that buyers are offering even less. Those that are just hanging on will be pushed to sell, accelerating the price decline. Revenues to the Wheeler fund from real estate transfer tax payments will drop. Aspen and Pitkin County will find that assessed valuations are even lower in 2013 than in 2011. Lower assessments mean lower tax revenues. Are you listening Mick?" Local resident Jerry Bovino added in a recent letter to the editor, "I am not sure why they don't see the natural fall-out from a tax that would discourage homeowner rental, especially on smaller apartments. As regulation and taxation serve to limit the number of one bedroom and two bedroom units in the rental pool, the likely result is that hotels will be able to raise rates, not lower them. To my knowledge, the law of supply and demand hasn't been repealed." The residenital rental tax will come before council this month.  Please continue to write and speak out against this ludicrous idea.  The unintended consequences are terrible! THE LATEST ON HYDRO: A WATERSHED MOMENT Imploring the city to "do the right thing" and withdraw its conduit exemption application, the Colorado director of American Rivers, Matt Rice, asserted in a recent letter to the editor that they "are not convinced the city is proceeding in the best interest of Castle and Maroon Creeks or the community.  We can no longer work with the city to design a public and open process for permitting the Castle Creek project." In response, petulant city manager Barwick told the Aspen Daily News that Rice and other observers can make as much noise as they want; City Council will act when it is ready.  (Isn't he a gem?)  It seems the city is now backing down on its rhetoric of building the drain line from Thomas Reservior as an "emergency" (now that $3M has been spent on this LIE).  The "new emergency" justification for the hydro plant is to provide power for the Aspen Rec Center (ARC) in times of natural disasters, such as floods and tornadoes.  Supposedly we will all be able to camp out at the ARC when something terrible happens.  Right. Thankfully, The Red Ant has word that a lawsuit against the city is pending.  This will hopefully put an end to the hydro plant once and for all.  (It will surely slam the brakes on the project!) Then we can cut our losses, make some personnel changes and move on. A CULTURE OF LIES  All of this adds up to a culture of deception, misinformation and lies. The city's (Barwick's!!) approach to management has filtered through the organization to the point where I don't think staff even considers whether something is truthful before they say it or use it to justify their actions. The only consideration is whether or not it furthers Mick's ends. Truth is not even secondary, it's non-existent.  If they think it will help them, they say it or use it.  And if it doesn't they ignore it. Aspen's city hall has become a completely unprincipled, souless place. It's a direct result of lousy leadership.  In a small way, I actually feel sorry for Tim Ware because he is just following the direction of his bosses. Nothing else is rewarded.  Of course, that's his choice, so he deserves whatever he gets. Until the head of the beast is severed, this stuff is sure to continue.  No lie.

ISSUE # 66: BlatANT Disregard

"We do not say that a man who takes no interest in politics is a man who minds his own business.  We say that he has no business here at all."

                             -- Pericles

As they say, when the cat's away, the mice will play.  In Aspen's case, while The Red Ant's away, the Ba'ath Party continues its regulatory march toward more intrusion into our personal and financial lives, its obscene cover-up of the costs and issues associated with the hydro plant, and its misguided and self-serving plans to shove more subsidized housing down the throats  of local taxpayers with a likely 8-figure general obligation bond for Burlingame Phase 2 as early as this November!
 

THE TATTLE-TALE TAX: A NEW TAX ON RESIDENTIAL RENTALS

Ever rent out your Aspen place?  Ever think about it?  Given the IRS lets you do this for up to 2 weeks tax-free annually, many private property owners in Aspen do so in order to offset costs.  But our friends at the city see this "rental activity" as yet another revenue stream they can tap into for about $100K in annual incremental revenue.  It seems the "lodging community" sees private home rentals as cutting into their business and they want to "level the playing field" as well, so the city has cooked up a revocable Permit to Rent that includes a new forced-payment 2% lodging tax.  

Social engineering.  Class warfare.  It is NOT AT ALL about the money.  There just isn't very much in this program.  The city simply wants to extend its regulatory control over free-market residential properties.  And they can.  How? It's already in the local tax code!  Yep.  Section 23.32.090 subjects "lodging services" to a tax.  And Section 23.32.100 specifically exempts lodging rentals from a sales tax when the duration of stay is 30+ days.  This whole idea appears to be a land use issue -- the city will just change the zoning to include residential properties and voila -- control.  

If this thing is enacted, private property owners who choose to rent out their units/homes for less than 30 days at a time will have to jump through a number of bureaucratic hoops:  obtain a small business license from the city for a $150 annual fee, hire a local owner's rep, notify all neighbors within 300' of the intent to rent and provide contact info for the owner's rep, and get Homeowner Association approval.  Then, pay the city 2% of the gross rental income.  It's preposterous, and not just because it will cost more to administer than it will bring in to city coffers; it's just one more punitive slap in the face of private property owners in Aspen.  And it's sure to pit neighbor against neighbor.  For more information, read THIS  excellent letter to the editor from local realtor Mark Kwiecienski that outlines the pros (none) and cons (many) of this insipid idea.  I couldn't have said it better myself!

And did you know, when there's a "compliance" or "mis-use" violation (like illegal rentals) in SUBSIDIZED HOUSING, there is no anonymous reporting allowed. You must leave your name as the tattle-tale. Reports are therefore minimal. In the free-market program, however, this will not be the case. City enforcers will be strictly protecting the new revenue stream and exerting their new-found control!  And you know they'll just love the inevitable neighbor vs. neighbor conflicts!

Write to council today (see addresses below)! Tell them to focus on REAL community issues and shelve this idea!!  Besides, didn't we just approve a 1% lodging tax that specifically benefits the lodging community for marketing purposes?!  What is with the greed?!
 

PANTS ON FIRE: LIES IN THE HYDRO PLANT BOND PROSPECTUS

They lied from the beginning.  In a recent review of the "Official Statement" (government parlance for "prospectus") for the issuance of the $5.5M in bonds for the Castle Creek Hydro Plant, several blatant problems leap off the page.  Remember, any time a government issues bonds, they must publish an Official Statement (O.S.) that discloses fairly and accurately the purpose of the debt issuance and how the bonds will be repaid. Such disclosures are regulated by the Securities and Exchange Commission (SEC), and federal anti-fraud laws require that all material facts be presented accurately, completely and honestly.

SEC attorney Mary Simkins stated (1999):
"The folks whose money you borrow expect your disclosure to be true.  Not surprisingly, so does the law.  This is where we at the SEC come in.  Federal securities law has protected investors for over 65 years by requiring the information provided investors be accurate, complete and not misleading.  Issuers of municipal bonds such as yourselves are forbidden from making statements or omitting material facts from the disclosure you make in official statements and annual financial information.  These provisions, known as the anti-fraud provisions, apply to any person."

The city of Aspen told lies.  Intentional lies, designed to mislead both investors (to promote bond sales) and the feds (to fraudulently obtain a conduit exemption).  The Red Ant is not an attorney, but should these intentional lies be determined to be "material misstatements" in a court of law, the city officials responsible for including them in the O.S. could face charges of securities fraud.  The O.S. cites the following city officials - elected and hired - as responsible for its contents (ca. 2008):  Mayor Mick, Dwayne Romero, Jack Johnson, Steve Skadron and JE DiVilbiss, along with City Manager Steve Barwick, City Finance Director Don Taylor, and City Attorney John Worcester.

Again, Mary Simkins:
"In essence, the anti-fraud provisions say that any person may not make any untrue statement of material fact or omit to state a material fact necessary to make something said not misleading in connection with the offer, purchase or sale of a security."

Remember Enron? Worldcom?  On a scale of 1-100, with these being examples of 100 in the world of securities fraud, Aspen's hydro plant probably rates a 20.  But lies and fraud are lies and fraud just the same.  It is simply egregious to see what our city officials (elected and hired) have done!

The following 6 lies by city officials are quoted directly from the O.S.  

LIE #1:

"The project is planned to RE-ESTABLISH the generating capacity of the original plant.... The project is also planned to include ENLARGING portions of the Castle Creek pipeline (raw water supply) to eliminate deficiencies in hydraulic capacity."  (Emphasis added)

Horse-puckey! The original hydro plant has been non-existent for over half a century. Enlarging?  There is no raw water line to enlarge!  At one point in time, prior to when the former hydro plant ceased operation  in 1958, there had been a small raw water pipeline, but in 2007, this was non-functioning and had been abandoned for decades.  But before its remnant disconnected parts and pieces were finally removed when the city constructed its fraudulent $2.3M drain line from Thomas Reservoir under "emergency" auspices, city officials intentionally lied in an SEC-regulated O.S. that a working raw water line was already in place.  The only reason to make such a false statement was to intentionally mislead the feds while applying for a "conduit exemption" that would enable the city to bypass federal oversight and environmental review.
 

LIE #2:

"The City's total budget for the project is currently $6,197,981."  (This was the project's original budget.) "The project is anticipated to be funded from proceeds of the Bonds, payments from CORE (Community Office of Resource Energy), and available monies in the City's Electric Enterprise Fund."  

The city's budget for the hydro project is $8.3M today. That's 34% over budget, and there's no end in sight.  No funds were cited to be pillaged from the Water Utility which recently kicked in over $700K as an interim cash-infusion just two weeks ago, with millions more still needed and certain to additionally be taken from this source.  It's also highly likely that utility rates will increase substantially to cover additional cost over-runs.  

The O.S. additionally stated the hydro plant would begin generating power in 2010, but its custom-built turbine remains in storage in another state.  At the rate the hydro plant is going, it will not recover its capital investment for nearly a century, and that's only if it operates at 100% capacity!  (Never mind the O.S. promises a 75-year life expectancy for the plant. And it's not likely the plant will EVER run at 100% capacity!)

The Red Ant asks, at what point does underestimation become a material misstatement of fact?  While this example may not be criminal, it surely is incompetent!!
 

LIE #3:

"The City presently expects to receive the exemption in ordinary course, and is not aware of any insurmountable obstacles, based upon a reconaissance-level evaluation of the FERC requirements."  

The city states in the O.S. that the conduit exemption is all but a foregone conclusion, but it seems they didn't count on the Castle Creek neighbors, the environmentalists (local and national groups) and The Red Ant to look closely at what they were trying to sneakily accomplish!  Big big mistake!

Reconaissance?  Try hubris!  The city made this statement with full knowledge that its application for a conduit exemption did not ever once comply with federal requirements. They said an existing raw water line needed to be upgraded when there was no raw water line to upgrade.  Then they spent $2.3M to build one and claim THIS NEW LINE as the "existing" line!

At press time, the city is dithering over whether or not to withdraw its conduit exemption application in favor of a "small project license" application, but there are no guarantees even if they go this route, and the latter comes with a long list of requirements and intense federal oversight.  The conduit exemption application was a sham from the start.  Far from the slam-dunk the city asserted in the O.S., the entire project has proven itself to be a web of lies, intended to avoid/escape federal oversight and true disclosure of the environmental impacts.

Yep, the city is in a pickle!  In fact, there are several hydro plant opponents who hope the city sticks with their current application because they believe the feds see right through the city's fraudulent behavior and there is no chance on earth they will grant a license.
 

LIE #4:

"In addition to applying for FERC licensing, the city is presently in the process of completing engineering design work for and construction of some of the project elements that are necessary for the purpose of ENHANCING the raw water supply system available to the city for is potable water supply or that are otherwise necessary for utility purposes, and that do not require FERC licensing."  (Emphasis added.)
 

What??  ENHANCING some old decrepit broken-down pipeline that hasn't functioned since 1958?  Yeah, right.  This sounds like a nervous attorney's vague C.Y.A. disclosure that there was indeed no raw water drain line from Thomas Reservoir in 2007, thus revealing the city's dark secret: With no existing drain line, the city would just have to build one to claim one.  Maybe no one would notice! Nice try!
 

LIE #5:

"The city expects the proposed facility to last at least 75 years.  The proposed date for completion and operation of the project in 2010 meets the requirements of the city's action plan for reduction of greenhouse gas emissions.  Meeting this schedule will also enable the city to avoid expected increases in fuel costs that would potentially raise the rates the municipal electric utility charges its customers, maintaining stable and low electric rates in comparison with other electric utilities throughout Colorado."  
 

OK, this isn't really a lie per se, but these are goals the city clearly did not meet, despite being promised in a SEC-regulated document.
 

LIE #6:

"The city expects its expenditures for the purchase of electric energy from the Municipal Energy Agency of Nebraska (MEAN) will decrease, resulting in an increase in the city's Electric Enterprise Fund revenues expected at approximately $300K annually."  

Worst of all, and illustrative of the fact that the city knew from the start that the hydro numbers did not pencil out, they lied to voters in 2007 and in the O.S. about the revenue-generating potential of the hydro plant.  In short, there is none.  

The O.S. promises a $300K annual increase in revenue for the city once the plant is fully operational, while simultaneously disclosing annual debt service costs on the $5.5M bonds of $350K per year for the next 20 years.  

The city started this project knowing full well that the hydro plant would NEVER cover its own costs, and it's only gotten worse.  With the budget increases approved by council, the annual cost of capital is approaching $540K annually for the next 20 years.  Add in operating costs and the city's overhead, the Castle Creek Hydro Plant will cost around $700K per year, and run at a $400K annual loss for the next 2 decades!

Translation:  Higher utility costs for all, especially Aspen businesses who comprise the majority of the electric utility cost base.  The city did not disclose this (for obvious reasons) in the O.S., nor did they disclose that the project will require subsidies from sources other than self-generated revenue for its entire lifetime!

Appalled yet?  Are there legal ramifications to all of this, specifically intentionally lying in an O.S.?  I'm not entirely sure, but the stench is becoming unbearable!  What do you know?  Any bond-holders out there?  Talk to me.... (And if you want an email copy of the O.S., please let me know and I'll send you one.)
 

BURLINGAME 2: BUILD IT AND THEY WILL COME?

Ahh the pre-sale process for Burlingame 2 is on.  And what a joke it is.  "No Lottery - No Deposit - No Commitment" reads the brochure.  It's true.  The city will be looking at this pathetic show-of-hands measurement to determine whether or not to move forward with a likely 8-figure ($50+M) bond to build the 167-unit 2nd phase of the Burlingame subsidized housing project.  The only requirement of those raising their hands?  They must qualify with APCHA, our inept housing authority.  No mortgage pre-approval.  No matter if they already live in subsidized housing elsewhere in the inventory.  No nuthin'.  Just raise your hand and Mick can declare this as sufficient demand to build more and more subsidized housing.  This is what the city does with what they see as "free money." 

In its inimitable fashion, the city has come up with an idea to "minimze" costs:  build Phase 2 in 2-4 small parcels!  As if!  Like building in smaller parcels will net a lower end-cost.  Ha.  Do these fools REALLY know NOTHING about economies of scale?  Apparently.  They're far more focused on the APPEARANCE of a less-costly project than actually building one!  Never mind there is NO (zero, zip, nada) compelling research that truly demonstrates an actual need for more subsidized housing in Aspen, especially at subsidies of over $300K per unit!  But I digress... At press time, council has all but green-lighted Phase 2.  They treat it as a foregone conclusion -- the only question is how to fund it and when.  It doesn't look like the bond issue will be on the November 2011 ballot, but that is still to be determined. The future of Burlingame 2 is an issue to follow closely this summer.  
 

FOOLS RUNNING AMOK

They will not stop on their own, obviously.  Keep writing to council members: Mick, Steve, Derek, Adam, Torre.  Attend the meetings (council meetings and specific agendas can be found in the Calendar & Events section on the home page of www.AspenPitkin.com).  Express yourselves through letters to the editor.  This is no time for apathy!  And FYI, the dreaded AACP seems to be a big summer topic for both the city and the county.  Stay involved and stay in touch!

ONE TIDBIT OF GOOD NEWS

The county has announced that the Pitkin County Library has decided not to hit voters up for $10M in November to fund an expansion.

ISSUE # 65 .... How RedundANT: Hydro Shaping Up to be the Burlingame of 2011

"Oops, I did it again." --- Britney Spears

MOVING $$ AROUND: A FINANCIAL SHELL GAME AT CITY HALL  

How do you go $1M (and counting) over budget on a project you don't even have permission to build?  Well, you can count on the city of Aspen to find a way!  In 2007, misled voters approved a bond measure that provided $5.5M for constructing and equipping a new hydroelectric facility on Castle Creek.  Fooled by the "green" promise of our local bureaucrats (yes, our boy Mick), voters ignored or didn't even ask about the costs vs benefits of the project, the fact that the plant will only operate a couple of months a year, and the property tax increases if (more like when) the electric utility revenues generated are insufficient to service the debt, not to mention the heinous environmental damage that could be caused to the stream's health and riparian habitat by significant reductions in water levels.  (Since they don't yet have a federal permit to build a hydro plant, they are burning though money on a drain line, the purchase of a custom turbine and a new "Energy Center" which will do nothing more than to serve as an edifice to city council's misguided aspiration of environmental immortality.)

Now it seems the "budget" has been increased to at least $8.3M because they've gone $1M over.  But wait.  Was what the $5.5M for?  And how'd it get to $7.3M?  Why do they need another $1M?  Who is the mathematician here?  Must be incompetent and lazy city manager Steve Barwick!  These numbers are an insult to taxpaying citizens of Aspen.  First of all, the $8.3M has already been allocated!  And the water department insists that these figures aren't even close to being final, there are more expenses to come!  So that's not a budget!  JUST WHAT IS THE BUDGET?  Does this sound like another Burlingame?  It sure does to me!  At press time, despite NUMEROUS requests of both the water department and the finance office, no comprehensive BUDGET has been made available.  My guess is that's because there isn't one.  They continue to move money from this fund to that, muddying the waters in order to  prevent citizens from ever discovering the true costs of this latest boondoggle!

WHAT IS THE MUNICIPAL WATER FUND AND HOW MUCH IS IN IT?

In a May 3, 2011, email, the city finance director told The Red Ant that nearly $1M "was transferred from the water fund" to pay for some of the excess expenses from the fraudulent and unnecessary "emergency drainage line" the city built from Thomas Reservoir in an attempt to trick the feds into issuing a "conduit exemption" that would enable the city to bypass environmental studies and sneak by without federal oversight.  Interestingly, the water department officially asked city council for this extra $1M on May 31, exactly 4 weeks AFTER the money had already been transferred!  Barwick!  What kind of organization is this fool running?    

Still claiming that the fraudulent conduit line was constructed for "emergency" purposes, city officials feel that the Water Fund (and therefore the residents who pay into it) should pay for this alleged "necessity" above and beyond the revenues provided by the bonds (and inevitable property tax increases)!  And the budget hawks on council think it's just a-ok to fund some of the ongoing overages with money from OUR water fund. Really?

In a written response on June 23, 2011, city utilities director Dave Hornbacher, who declined to meet with The Red Ant, had his predecessor Phil Overeynder write of the municipal water fund:

"The Water Fund was established by the finance department, I assume, to properly account for revenues generated by and expenses of the City's water department.  Again, I assume that the Fund was established to segregate such revenues and expenses from the City's General Fund and other operating funds. Since the 'operation and control' of the City's water system and Water Department fall under the direction of the City Manager, it is his call as to what type of expenses are 'legal uses' of water funds."

Sources of funding of the Water Fund include: applications for utility service, utility investment charges, utility hook-up charges, monthly fees for metered/unmetered water service, late payment charges, investment and hook-up charges for snowmaking services, violations and sancitions, etc.

As of May 31, 2011, the municipal Water Fund had a cash balance of $9.4M.  (Cash balance or cash cow?  You decide.)

BARWICK'S ATTEMPT AT .... (WHO KNOWS WHAT HE'S DOING)

It would be funny if it weren't so pathetic.  Steve Barwick, CEO of the city and czar of the Water Fund, has yet to pull the city's draft application for a "conduit exemption" from the feds, despite being directed to do so by council in April.  Instead, he wants national organizations and other outside groups to put their support of the City's change of course from a "conduit expemption" to a "small project license" in writing.  As if.  Just because someone doesn't support the city's original plan (to defraud the feds) doesn't mean they will blindly support the city's next move!  Simply preposterous.  Make the change Barwick!  Council voted and told you to!  All this delay does is increase the timeframe needed for the new application, delay the mandated environmental studies, and of course, add to the costs.

THE "8%" NUMBER 

Famous for its major capital project "brochure errors" (remember Burlingame?), the city issued a $3000, 4-page propaganda insert in the June 14, 2011, issue of The Aspen Times that stated, "Right now, the City's utilities are already 75% renewable and the hydro plant would boost this number by 8%, resulting in 83% of the City's utilities providing clean energy and reducing the City's reliance on coal as well as reducing emissions."  Yes, it's poorly written and confusing, but there's that 8% number.  Skeptics question whether the "8%" is consumption by the entire community or just by the city government itself.  City communications director Mitzi Rapkin assures The Red Ant it is the entire community's usage that is impacted.  I darned well hope so, but when the city states, "The Castle Creek Energy Center can provide back-up power for the City in times of emergency by acting as a sole power source for some municipal buildings that could act as shelters," it certainly makes one wonder.... Here are the two scenarios:

        

The elephant in the room:  Is "8%" the maximum amount of power the hydro plant can generate?  Is this projection based on the hydro plant operating full-time or just a couple months of the year?  And what if the feds require more water to remain in the stream than what the city likely based the 8% projection on?  Sounds to me like 8% is aspirational at best!

ASPEN: DOING IT MICK'S WAY VS. THE RIGHT WAY

In a June 24 phone interview with Matt Rice, director of American Rivers, I learned a great deal about Aspen's hydro plant as it relates to what's going on nationally.  In short, there are very few new "conventional" hydro plants (like ours) being built these days, however, there are many municipalities pursuing hydro power on existing dams, etc. 

The difference is that inherent to the design of Aspen's new hydro plant, water will be diverted and the streams will be de-watered as a matter of course.  You just don't see this being done much these days because the environmental impacts most often far outweigh the power benefits.  It's very rare for it to work out otherwise.  Notably and ironically, Colorado is a great example of a state that is creating incentives for what's called "conduit hydropower" (not to be confused with Aspen's fraudulent attempt at a "conduit exemption"), which promotes the use of existing diversions and conveyance systems.  This form of hydropower has NO ENVIRONMENTAL IMPACT, and American Rivers is seeing a lot of "conduit hydropower" projects here.  In fact, the State of Colorado and FERC are actually working together to streamline the process for these installations. 

Rice concluded with a reminder that "small" as in "small project license" refers to the amount of power generated, not the size of the environmental impact (which can be just as big as that of a large hydro project).

THE HYDRO FORUM: QUICK RECAP

Here are the links from GrassRoots TV to the first, second and third sections of the June 16 Hydro Forum.  For a very brief overview, watch the "second" section (link above) and fast-forward ahead to 10:32, local water attorney Paul Noto's successful de-bunking of mayor Mick's crazy "the front range is gonna steal our water if we don't build a hydro plant" rhetoric.  (Click "watch now" and enlarge your screen.  To fast-forward, press and hold down the double arrows pointing right.)  Noto's intelligent overview of the water rights specifically on Castle Creek is extraordinarily informative, with even the city's water attorney agreeing.

But don't miss the "third" section!  Fast forward to 21:00 to see mayor Mick in all his defensive nastiness.  On a panel among national experts, our boy behaved like a petulant teenager.  Don't take my word for it.  See for yourself.

WHY NOT SOLAR, FOR EXAMPLE?

Never mind the economies of scale associated with this low-cost, low-impact means of clean energy.  Never mind the scale-ability of solar farms.  Never mind that property values just a few miles from Aspen are currently affordable and solar panels there generate a third more energy than Aspen panels because of the better weather west of Snowmass Canyon.  Never mind the US Dept of Energy offers consumer tax credits from the American Recovery and Reinvestment Act of 2009 called "Residential Renewable Energy Tax Credits" that enable consumers who install solar energy systems (including solar water heating and solar electric systems), small wind systems, geothermal heat pumps, and residential fuel cell and microturbine systems to receive a 30% tax credit (with no upper limit; principal residences AND second homes qualify) for systems placed in service before December 31, 2016.  And never mind that entrepeneurs from the Carbondale-based Clean Energy Collective that has solar farms in El Jebel and in Rifle presented a proposal to council in April called "community solar," a concept where multiple homeowners pay into large solar arrays that are professionally maintained and situated in places with maximum sun exposure, thereby enabling large energy consumers to mitigate their energy use through this already-existing local source of clean energy.  Shouldn't THESE ideas be what we SHOULD AT LEAST BE considering?  But no.

Mayor Mick simply didn't like the "community solar" idea one itty little bit because the energy would not be coming from Aspen itself.  He said in an interview with the Aspen Daily News, "It's troubling to send a message that, as an energy-hogging homeowner, you can cut a check and outsource your mitigation requirements to Carbondale."  For Mick, it's really not about the environment at all.  It's punitive.  It's always punitive!  Does that really surprise you??  And of course it's all about his resume.  He wants home-grown energy.  Down Valley energy, regardless of the economics or environmental wisdom or any other potential win-wins, is just not home-grown enough for Mick.  

MY HYDRO GOAL

I'm putting it in writing right here, right now.  We need to stop this hydro fiasco in its tracks TODAY.  The charade is up.  Had nobody been looking, the city might have gotten away with it.  But instead, the eyes of the Castle Creek neighbors, local environmentalists, national organizations and The Red Ant are all over this mess, and what a mess it is.  Costs are approaching $10M today, and at this rate could easily DOUBLE.  The city hasn't even started its new course toward a "small project license," and none of this includes the costs of the environmental impact studies that will be required.  The $5.5M in bond funds were issued in early 2008.  There's nearly $400,000 in debt service every year for this project alone, and that began in 2009.  It is next to impossible to get a straight answer from the city on where the money to pay the debt is coming from!  They're spending and spending because Mick tells them to.  IT MUST STOP.

Now is the time for this community to come together to enact a "stop work" order and/or get a legal injunction in place until a) the environmental impact studies are completed and the results discussed throughout the community, b) an external and independent financial audit is conducted to determine the financial feasibility of this hydro plant and is shared in its entirety with the community, and c) the costs/benefits of the proposed hydro plant are compared and contrasted with several other forms of clean energy.  (Another option is, of course, to cut our horrendous losses and walk away.  Remember, the city does not yet have permission to build this thing.  How much are we willing to spend and potentially waste if the final answer is a big fat NO?)

The city doesn't like citizen feedback.  It never has.  Mick has never let the facts get in the way of another resume-building endeavor built with public funds.  And just because there's no budget is no reason for him to slow down. But this time it's different. 

The financial picture will soon become abundantly clear.  It's bad, folks.  Really bad.  Put it this way, power generated from Castle Creek is going to be so expensive it will cost the city far more to generate than they will be able to charge for it.  Stay tuned!

"It's the only accounting system they are comfortable with, as it's the only accounting system they know how to use.  The ends justify the means.  The hydro plant is green and therefore good, and so it doesn't matter what it costs because it's politically correct and therefore priceless.

They have committed to the plant, and they never back down once they've made a commitment.  This is a crew that never gives an inch, never admits error, and never waivers from their dogma that green is good and money is evil.  And what is money?  It's not something they earn.  Rather, it's something they take from other people, especially rich people who can't vote here;  their voting base lives in deed restricted housing and so is largely protected from taxes.

And so they will keep feeding the plant, if for no other reason than if they don't feed the plant it will die and they've invested so much already in feeding the plant that what's a few more million of other people's money?  What's important here isn't the money, it's the plant.  And so the plant screams:  FEED ME!!!"      ---      An Angry Red Ant Reader