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HomeMy WebLinkAbout2007-12-04 Support Documentation Town Council Evening Session VAIL TOWN COUNCIL EVENING SESSION AGENDA 6:00 P.M. TUESDAY, DECEMBER 4, 2007 VAIL TOWN COUNCIL CHAMBERS 75 S. Frontage Road W. Vail, CO 81657 NOTE: Times of items are approximate, subject to change, and cannot be relied upon to determine at what time Council will consider an item. 1. ITEM/TOPIC: Citizen Participation. (10 min.) 2. ITEMlTOPIC: Consent Agenda. (5 min.) a. Approval of November 6, 13 & 20 Minutes. b. Lease of town owned properties located at 241 South Frontage Road West, Suite 2 and 100 East Meadow Drive, Unit 2 to Plum TV, Inc. BACKGROUND: The proposed lease is in the packet to Town Council. ACTION REQUESTED OF COUNCIL: Make a motion approving and authorizing the Town Manager to execute, on behalf of the Town, the lease agreement between Plum TV and Town of Vail in substantially the same form as presented and to take whatever steps are necessary to complete the execution of the lease agreement. STAFF RECOMMENDATION: Approve the lease agreement with Plum TV, Inc. for the two town spaces described above: 3. Stan Zemler ITEM/TOPIC: Town Manager's Report. (10 min.) • Revenue Update. • Construction TCO Status. • Update on I-70 Summer'08 Paving. 4. Kent Meyers ITEMlTOPIC: Summer Air Update. (20 min.) 5. ITEMlTOPIC: First reading of Ordinance No. 37, Series of 2007, An Ordinance Adopting a Use Tax on Construction and Building Materials; Amending Title 2, Revenue and Finance, Vail Town Code with the Addition of Chapter 8 "Use Tax on Construction and Building Materials"; and Setting Forth Details in Regard Thereto. (30 min.) ACTION REGIUESTED OF COUNCIL: Approve, amend or deny first reading of Ordinance No. 37, Series 2007. BACKGROUND RATIONALE: The construction use tax ballot question approved by Vail voters on November 6`h gives Town Council the authority to implement a 4% tax on building and constriction materials consumed or used in the Town of Vail Proceeds .of the tax are to be used exclusively for capital acquisitions and capital projects in the town. Implementation of the tax is accomplished by two readings of an ordinance which sets the policy and administrative details relating to the tax. Additional background information is included in Council's packet. STAFF RECOMMENDATION: Approve, amend or deny first reading of Ordinance No. 37, Series of 2007. 6. Stan Zemler ITEMlfOPIC: Consideration of an amendment to the 2004 Core Site Development Improvement Agreement in regard to housing obligations. (30 min.) 7. Rachel Friede ITEM/TOPIC: The applicant, the Town of Vail, is requesting a first reading of Ordinance 33, Series of 2007, an Ordinance to enact prescribed regulation amendments to Title 12, Vail Town Code, to require public art for certain new development and redevelopment projects in Lionshead Mixed Use 1, Lionshead Mixed Use 2, Public Accommodations, Public Accommodations 2, Commercial Core 1, Commercial Core 2, Commercial Core 3, Ski Base Recreation, and Ski Base Recreation 2, and setting forth details in regard thereto. (10 min.) ACTION REQUESTED OF COUNCIL: Staff requests that the Vail Town Council approve, approve with modifications, or deny Ordinance No. 33, Series of 2007, on first reading. RECOMMENDATION: Staff recommends the Vail Town Council approve Ordinance No. 33, Series of 2007, on first reading. 8. Kathleen Halloran ITEM/TOPIC: FIRST READING OF ORDINANCE NO. 38, Series of 2007, AN ORDINANCE MAKING SUPPLEMENTAL_ • APPROPRIATIONS TO THE TOWN OF VAIL GENERAL FUND, CAPITAL PROJECTS FUND, REAL ESTATE TRANSFER TAX .FUND, DISPATCH SERVICE FUND AND. HEAVY EQUIPMENT FUND OF THE 2007 BUDGET FOR THE TOWN OF VAIL, COLORADO; AND AUTHORIZING THE EXPENDITURES OF SAID APPROPRIATIONS AS SET FORTH HEREIN; AND SETTING FORTH DETAILS IN REGARD THERETO. (10 min.) ACTION REQUESTED OF COUNCIL: Approve or approve with amendments the first reading of Ordinance No. 38, Series of 2007. BACKGROUND RATIONALE: To be provided in a separate memo. STAFF RECOMMENDATION: Staff recommends that the Town Council approves or approves with amendments Ordinance No. 38, Series of 2007, upon first reading. (10 min.) 9. Rachel Friede ITEMlTOPIC: Table Second reading of Ordinance No. 32, Series of 2007, an Ordinance to enact prescribed regulation amendments to Title 11, Sign Regulations, and Title 12, Zoning Regulations, Vail Town Code, to allow for amendments to regulations pertaining to outdoor display, sales signs, menu boards, and setting forth details in regard thereto. (5 min.) ACTION REQUESTED OF COUNCIL: Table Ordinance No. 32, Series of 2007 until 12.18.07. 10. Scot Hunn ITEM/TOPIC: Second reading of Ordinance No. 34, Series of 2007, an ordinance amending the Official Zoning Map for the Town of Vail in accordance with Title 12, Zoning Regulations, Chapter 5, Zoning Map; Rezoning Lot 86, Block 2, Vail Potato Patch, from High Density Multiple Family (HDMF) District to Housing (H) District, and setting forth details in regard thereto.. (PEC07-0059). (5 min.) ACTION REQUESTED OF COUNCIL: Approve, approve with modifications, or deny Ordinance No. 34, Series of 2007, orr second reading. BACKGROUND RATIONALE: On October 8, 2007, the Town of Vail Planning and Environmental Commission held a public hearing on a request to amend the Official Zoning Map for the Town of Vail in accordance with Title 12, Zoning Regulations, Chapter 5, Zoning Map; Rezoning Lot 8B, Block 2, Vail Potato Patch, from High Density Multiple Family (HDMF) District to Housing (H) District, and setting forth details in regard thereto. (PEC07-0059). Upon review of the request, the Planning and Environmental Commission voted unanimously (5-0-0) to forward a recommendation of approval of the request to amend the Official Zoning Map to the Vail Town Council. On November 20, 2007, the Council voted unanimously to approve Ordinance No. 34, Series of 2007, on first reading. STAFF RECOMMENDATION: Staff recommends that Town Council approves Ordinance No. 34, Series of 2007, on second reading. 11. Scot Hunn ITEM/TOPIC: Second reading of Ordinance No. 35, Series of 2007, an ordinance amending Sections 12-61-3, Conditional Uses, and 12-16-7, Use Specific Criteria and Standards, Vail Town Code, to add "Professional Offices and Business- Offices" to the list of allowable conditional uses in the Housing (H) District, and setting forth details in regard thereto. (PEC07-0059) (5 min.) ACTION REQUESTED OF COUNCIL: Approve, approve vrith modifications, or. deny Ordinance No. 35, Series of 2007, on second reading. BACKGROUND RATIONALE: On October 8, 2007, the Town of Vail Planning and Environmental Commission (PEC) held a public hearing on the request for a text amendment to the Vail Town Code. Upon consideration of the request, the Commission unanimously (5-0-0) to forward a recommendation of approval of the text amendment request to the Vail Town Council. On November 20, 2007, Council voted unanimously to approve Ordinance No. 35, Series of 2007, on first reading, with suggested revisions to the text amendment. Staff has made the requested revisions to the text and presents the Ordinance for second reading. STAFF RECOMMENDATION: Staff recommends that Town Council approves Ordinance No. 35, Series of 2007, on second reading. 12. Kathleen Halloran ITEM/TOPIC: Second reading of Mill Levy Certification, Ordinance No. 36, Series 2007. (10 min.) ACTION REQUESTED OF COUNCIL: Approve Ordinance No. 36, Series 2007, on first reading. BACKGROUND RATIONALE: Mill Levy Assessments must be certified to the County for collection annually; this ordinance authorizes certification. Please note that these numbers are only an estimate. We are waiting for current information from Eagle County for accurate numbers. STAFF RECOMMENDATION:. Approve Ordinance No. 36, Series 2007, on first reading. 13. ITEM/TOPIC: Adjournment. (8:20 p.m.) NOTE UPCOMING MEETING START TIMES BELOW: (ALL TIMES ARE APPROXIMATE AND SUBJECT TO CHANGE) THE NEXT VAIL TOWN COUNCIL REGULAR WORK SESSION WILL BEGIN AT TBD, TUESDAY, DECEMBER 18, 2007 IN THE VAIL TOWN COUNCIL CHAMBERS. Sign language interpretation available upon request with 48-hour notification. Please call 479-2106 voice or 479-2356 TDD for information. Vail Town Council Evening Meeting Minutes Tuesday, November 6, 2007 6:00 P.M. Vail Town Council Chambers The regular meeting of the Vail Town Council was called to order at approximately 6:00 P.M. by Mayor Rod Slifer. Members present: Dick Cleveland, Mayor Margaret Rogers Mark Gordon Andy Daly, Mayor Pro-Tem Kevin Foley Kim Newbury Farrow Hitt Staff Members: Stan Zemler, Town Manager Matt Mire, Town Attorney Pam Brandmeyer, Assistant Town Manager Bill Jewitt Remembrance. Mayor Slifer opened the meeting and asked for a moment of silence to honor the passing of former Councilman Bill Jewitt. The firsfiitem on the agenda was Citizen Participation Town Manager Stan Zemler presented the outgoing council members with a memento in appreciation of their service. Logan thanked staff for their efforts and diligent work in moving the town in a positive direction. Slifer stated, "It's been a pleasure." Tom Steinberg then thanked Slifer for his work as Mayor. Slifer then received a standing ovation from those in attendance. Vail Chamber and Business Association Executive Director Kaye Ferry announced that on November 29, from 5:00 to 6:30 p.m. in the Vail Town Council Chambers, an open house will be held with the Colorado Department of Transportation to discuss community preferences regarding the next phase of the I-70 repaving work through Vail. The focus of the meeting will be to discuss the pros and cons of different paving methods; night versus day versus after Labor Day work, etc. CDOT has indicated it will follow the recommendations derived from this meeting. The second item on the agenda was the Consent Agenda Approval of October 2, 16 & 30 Meeting Minutes. Moffet moved to approve the consent agenda with Foley seconding. The motion passed unanimously, 7-0, The third item on the agenda was the Town Manager's Report. • Revenue Update. Finance Director Judy Camp reported sales tax collections for the month of September are expected to be $905,132, up 8.7% from September, 2006. Year-to-date collections of $14.6 million through September continue to exceed last year's year-to-date by 6.8%. For comparison, inflation as measured by the consumer price index was up 2.8% in September compared with the prior year. Construction permit revenue, which can be considered an indicator of redevelopment activity, continues its strong trend with year-to- date construction permit fees of $2.4 million, up 43% from the same period last year. Year-to-date permit fees include $1.8 million from major construction projects: 9 Vail Road, the Arrabelle at Vail Square, Cascade, Forest Place, Four Seasons, Front Door, Lodge at LionsHead, Manor Vail, Mountain View (formerly Apollo Park), Ritz Carlton, Solaris, Vail Plaza Hotel, Westhaven Condominiums, and the Willows. Construction permit fees include building, electrical, mechanical, plumbing and sprinkler permits. Year-to-date Real Estate Transfer Tax (RETT) collections through October 31, 2007, total $4.7 million compared with $4.3 million for the same time period last year, an increase of close to ten percent. Major redevelopment projects including Forest Place, Gore Creek Place, Manor Vail and One Willow Bridge Road contributed $835,726 or 18% of the total in 2007 while only $464,500 or 11% of the total in 2006 consisted of major redevelopment projects. • Construction Update. Public Works Director Greg Hall reported, "Solaris continues storm sewer work...Work on the Seibert Circle fountain is ongoing...Beaver Dam road is almost complete... Arrabelle at Vail Square is continuing to put down heated pavers in the mall ...Loading and delivery (new schedule and use of service bays) will be under town rules when ski season begins." The fourth item on the agenda was a CenturyTel Update on Vail Wi-Fi. Recent upgrades include: 1. Upgrade of the nodes over the summer has resulted in a 31% increase in coverage. 2. CPE (Customer Premise Equipment) product has been deployed (sold at Market Computers or on-line purchase) which has allowed many users to connect wha previously were out of range of the nodes. The deployment of an Outdoor CPE unit within the next month will further the range. 3. Direct mail piece is going out this week with a coupon to reduce the CPE cost by $50 with a one year subscription purchase. 4. Eleven new nodes are in the design process that will be deployed in areas where CenturyTel•has had the most customer calls and requests for service. 5. New pricing plan was put in place during the summer lowering the monthly rate to $25 for those subscribing for one year or $29.95 for those buying the service month- to-month. 6. Deployment of this technology has allowed CenturyTel to partner with Eagle County Schools and TV8 to grow solutions for their businesses. Ron Braden, the town's director of information technology, introduced CenturyTel Business Sales Manager Eric Zimmer. Zimmer noted the recent improvements to the wireless system as noted above. He said the improvements have increased the system's coverage which currently stands at about 90 to 95 percent outdoors and approximately 60 percent indoors. In an attempt to meet revenue requirements for the network and to ensure its future sustainability, Braden and Zimmer presented a request to modify the free Wi-Fi service model to increase the subscriber base for the network. The recommendation would eliminate free one hour Wi-Fi service to outlying neighborhoods and hotel properties, while retaining the free service in public buildings and other public spaces. He also explained the company had arranged for installation of CPE devices that would improve access to the broadband wireless service. "This is all in an effort to make the network more user friendly and a better customer experience...We are providing our customers reliable wireless service for $25 a month with ayear-long commitment...This was a very aggressive pricing move on our part...We are trying to create a profitable network," Zimmer said. Gordon clarified the speed of the service is comparable to DSL service or that purchased through local cable carrier Comcast. Moffet expressed concern the proposal would eliminate the one hour of free residential service currently provided. Zimmer said he hoped to change the pricing structure as CenturyTel had invested $500,000 more on the network than originally anticipated. Council did not agree to amend the current contract. Therefore, the free service arrangement will continue. The fifth item on the agenda was Memorandum of Understanding (MOU) between the Town of Vail and the Vail Recreation District (VRD). Town Attorney Matt Mire asked Council to discuss and/or ask questions concerning the proposed MOU with the Recreation Task Force, consisting of VRD board members Michelle Hall and Joe Hanlon; Town Councilmen Mark Gordon and Greg Moffet; and members of staff from both organizations. The task force has been working over the last two years to cooperatively address issues related to town-owned, VRD-managed facilities. The Memorandum of Understanding was intended to memorialize the agreements and intentions of the parties. It provides a basis for future deliberations and negotiation of leases. Moffet clarified the VRD had approved the MOU. "Both parties are moving forward in all good faith." Moffet moved to approve the MOU with Gordon seconding. `This is really gratifying and overdue." Slifer asked if parking at Ford Park was still an option. Zemler clarified, "We can not bind future Council's to financial commitments." VRD Executive Director Mike Ortiz clarified the locations of proposed improvements. Gordon said, "Here we finally have something that is concrete...This is the direction we want to move ahead." During a pause for public comment, Stephen Connolly commended the VRD Board and Council for their collaboration. He did have concern over the potential uses of Dobson Ice Arena listed in a conceptual lease. "If we use this, we might as well just melt the ice now." Mire explained the attached lease was in a conceptual form. "We have expressly asked that Council not go into the purviews of the Iease...We didn't want to get into the lease because it is an incomplete document at this time...This (MOU) was only meant to be a bridge from this Council to the next Council...We are not here to debate those terms." The sixth item on the agenda was an appeal, pursuant to Section 12-3-3, Appeals, Vail Town Code, of the Town of Vail DRB approval of an administrative approval, for a change to approved plans, pursuant to Chapter 12-11, Design Review, Vail Town Code, to allow for a change to the configuration of retaining walls associated with driveway access, pursuant to Section 14-6-7, Retaining Walls, Vail Town Code, located at 1772, 1778, and 1788 Alpine Drive/Lots, 10, 11, and 12, Vail Village West Filing 1. Warren Campbell informed Council that they could uphold, overturn, or modify the Town of Vail DRB approval of an administrative approval, of the change to approved plans application pursuant to Section 12-3-3, Appeals, Vail Town Code. On October 3, 2007, the DRB upheld an administrative approval of a change to approved plans application to change the configuration of retaining walls associated with driveway access, for the new residences being constructed at 1772, 1778, and 1788 Alpine Drive. Council "called-up" the DRB approval of an administrative approval due to concerns about the compliance of the retaining walls with applicable Town of Vail Zoning Code provisions. Campbell clarified there was a portion of retaining wall sitting on the property line and did not meet the required 2-foot setback. Moffet moved to uphold with a condition the DRB approval with Foley seconding. Hitt expressed concern that the structure was not harmonious with the surrounding neighborhood. "I believe with more landscaping that this retaining wall can be softened...) think we need to readdress our DRB process...The retaining wall just doesn't look like it fits." Gordon and Newbury said the next Council needs to readdress steep slope requirements. "Due to a personal interest in the site, Hitt recused himself from the item. The motion passed unanimously, 6-0. The seventh item on the agenda was a Teva Mountain Games Funding Request. Special Events Coordinator Sybil Navas explained that in August of this year, Untraditional Marketing (UM) was informed by USA Climbing that the Climbing Wall World Cup had been awarded to Vail. Originally, UM was going to ask the.Commission on Special Events (CSE) for '08 cash funding of $110,000 ($90,000 was awarded in 2007). Due to this additional award of the World Cup, UM requested another $50,000, bringing the overall cash funding between the CSE and Council contributions to $160,000, with in-kind of $9,500. The event proposal has now been seen and endorsed by the CSE, with a recommendation Council provide the additional $50,000 in funding for the '08 Climbing Wall World Cup. At this time, the CSE average contribution toward the TEVA Mountain Games is $95,000, which final action will be taken at their next regular meeting on November 27. When this was presented to Council in September, Council asked to have a thorough review of the merit of the Climbing Wall World Cup, and if needed, return to Council for '08 funding of this specific event. The CSE listened to the full funding request of $160,000 on October 23, but with over $1.3 million in special events requests, felt they did not have the funds available to support this additional event. Staff recommended funding up to $50,000 from Council contributions specific to the '08 USA Climbing Wall World Cup. Staff will continue to work with both the CSE and the Vail Recreation District (VRD) to establish a permanent climbing wall location, a requirement of a multiple year award of this event. Moffet moved to adopt the staff recommendation with Newbury seconding. Zemler clarified Council would have the ability to call up any CSE recommendation. The motion passed 6-1, Foley opposed. Hitt clarified a permanent location for a climbing was being explored. Foley said he believed the Vail Local Marketing District needed to directly fund more special events. The eighth item on the agenda was a Vail Resorts Housing Obligation Discussion. Due to a predetermined conflict of interest (Vail Resorts affiliation) Gordon and Slifer recused themselves and left the Council Chambers. Moffet moved to table the item to an undetermined date with Foley seconding. The motion passed unanimously, 5-0. Vail Resorts CEO Rob Katz thanked Council for their diligent efforts in the past. The ninth item on the agenda was an Open/Hillwood Proposal for the Redevelopment of Timber Ridge. Representing Open/Hillwood Partners, Mark Masinter discussed four proposed financing options to redevelop the Timber Ridge affordable housing parcel. In response to a question regarding the use of reservation fees in two of the options, Masinter responded, "Our comfort in reservation fees has come from speaking with several employers in town and it makes us feel that what we are proposing is fair...Without paying a reservation fee, the rents will be higher." Moffet clarified with Masinter that one option includes $10 million of town-issued bonds supported by Tax Increment Financing (TIF) to finance the project. Finance Director Judy Camp estimated Timber Ridge could generate sufficient TIF revenue to issue approximately $4 to $6 million dollars of bonds, depending upon final configuration of a redevelopment project. Masinter then explained the Eagle River Water and Sanitation District may be requested to waive tap fees associated with the project. Masinter continued by explaining the town could also maintain a financial stake in the project. He then confirmed with Council that Open/Hillwood is ready to pull the trigger on the project. Referring to option 1, Logan stated, `There is a capital gap that has to bridged in some shape or fashion.... Are you willing to commit without any assurance that you can sell 116 market-rate units?" Masinter said, "We are comfortable that we can...lf you allow me to do any of these options we are ready to go...We realize we have to commit to this now." Logan clarified if the town became a partner in any of the proposals the town would have to refinance the property. Moffet and Newbury said the proposed rents were appropriate as compared to the current free market. Vail Resorts CEO Rob Katz said, "V11e are fully prepared to buy our beds in this project...We have been waiting for clear direction from Council....We are certainly willing to push forward on this." Representing the Solaris development, Reid Weilly asked why other developers did not have the opportunity to participate in the redevelopment of Timber Ridge. Mire clarified there was not a current request for proposal process for Timber Ridge. Gordon commented, "I would not agree to a proposal that only benefited one or two businesses in town." Michael Cacioppo asked for a clarification regarding the Vail Resorts housing obligation. Logan said Katz's comments were helpful and useful. "The successful redevelopment will require a partnership." The tenth item on the agenda was the second reading of Ordinance No. 23, Series 2007. An Ordinance Deleting Section 5-1-5, Vail Town Code, Regarding Abatement of the Mountain Pine Beetle; Amending Title 5 Vail Town Code with the Addition of Chapter 10 "Abatement of the Mountain Pine Beetle and Wildfire Fuels Reduction. Within the State of Colorado and within the town there exists a growing mountain pine beetle epidemic. The presence of the mountain pine beetle 'and beetle infested trees within the town presents a real and substantial risk to the public health, safety and welfare, including the increased risk of rapidly spreading fire. In addition, the presence of dead or substantially dead trees, regardless of the cause, also presents the increased risk and danger of rapidly spreading fire as described above. As such, certain text amendments are necessary to the Vail Town Code, as they relate to the abatement of the mountain pine beetle, dead or substantially dead trees and other fire fuels to protect the health, safety and welfare of the town and its inhabitants. Moffet moved to approve the ordinance with Gordon seconding. Foley and Slifer thanked staff for their successful efforts. The motion passed unanimously 7-0. The ordinance requires removal of beetle infested and dead trees, or an acceptable plan for the removal of the trees to be submitted, when the trees are determined to be a wildfire fuel hazard by the town within 30 days of notification. Trees not removed within 30 days may be removed by the town with twice the costs charged back to the property owner. The eleventh item on the agenda was the second reading of Ordinance No. 31, Series of 2007, an ordinance approving a major amendment to Special Development District (SDD) No. 4, Vail Cascade, pursuant to Article 12-9A, SDD, Vail Town Code, to allow for an increase in the number of dwelling units, located at 1310 Westhaven Drive/Vail Cascade Subdivision. Planner Scot Hunn explained that on September 24, 2007, the PEC held a public hearing on a request for a major amendment to SDD No. 4, Vail Cascade, pursuant to Article 12-9A, SDD, Vail Town Code, to allow for an increase in the number of dwelling units, located at 1310 Westhaven Drive/Vail Cascade Subdivision, and setting forth details in regard thereto. (PEC07-0058). Specifically, the Applicant proposes to increase the number of dwelling units from eleven (11) to fourteen (14) within the "CMC" building, with no increase to Gross Residential Floor Area (GRFA). Upon review of the request, the PEC voted 6-0-0 to forward a recommendation of approval, with condition, of the request to amend Special Development District No. 4, Vail Cascade, to the Vail Town Council. On October 16, 2007, the Council voted 5-1-0 to approve Ordinance No. 31, Series 2007, on first reading. Moffet moved to approve the ordinance with Newbury seconding. The motion passed 6-1 with Foley opposed. Foley said he believed the project should have employee housing requirements associated with it. The twelfth item on the agenda was the resolution No. 27, Series of 2007, a resolution to adopt the Vail 20/20 Strategic Action Plan. Planner Rachel Friede provided an overview of the Vail 20/20 process that started in early 2006 and included numerous opportunities for community participation that resulted in updated community values and vision statements, as well as a strategic action plan that takes steps to move closer to a common vision for Vail. On August 7, 2007, staff returned to the Council with a draft of the Vail 20/20 Strategic Action Plan. At that time Council provided input and authorized staff to hold an open house where members of the community could provide additional input. The open house was held on August 16, 2007 at Donovan Pavilion, and allowed members of the public to interact with staff and provide final comments on the goals, actions and strategies in the plan. Staff also distributed the drafts to the public and took input via the web, email and phone. The latest draft of Vail 20/20 Strategic Action Plan reflects the input of the public, staff and other stakeholders. Zemler explained the plan was built around goals and actionable strategies. It was noted the plan can be modified in the future by passing a resolution. Hitt asked if the plan could be less specific. Gordon expressed interest in modifying the plan to ericourage growth in the diversity of residents in the community. Friede reported environmental sustainability was noted as most important by the community. In reviewing the housing section, Hitt expressed concern about a recommended action to "evaluate employee housing options on the Middle Bench of Donovan Park, recognizing the dual community interest in maintaining the property as a park." Council members agreed to remove the provision. Michael Cacioppo said the Middle Bench was intended to be open space when it was originally purchased. Gordon commented, "This was a pretty amazing process...We got a large population of Vail to participate in this." Gordon moved to approve the resolution with Logan seconding. The motion passed unanimously, 7-0. Hitt and Logan then complimented Friede for her efforts on the project. The thirteenth item on the agenda was Adjournment. Moffet moved to adjourn with Newbury seconding. The motion passed unanimously, 7-0. Rod Slifer, Mayor ATTEST: Lorelei Donaldson, Town Clerk Minutes provided by Corey Swisher. Vail Town Council Evening Meeting Minutes Tuesday, November 13, 2007 12:00 Noon Vail Town Council Chambers The regular meeting of the Vail Town Council was called to order at approximately 12:00 Noon. Members present: Dick Cleveland, Mayor Margaret Rogers Mark Gordon Andy Daly, Mayor Pro-Tem Kevin Foley Kim Newbury Farrow Hitt Staff Members: Stan Zemler, Town Manager Matt Mire, Town Attorney Pam Brandmeyer, Assistant Town Manager The first item on the agenda was the Swearing in of Newly Elected Council Members. All five newly elected Council Members Cleveland, Daly, Foley, Newbury, Rogers) were asked to stand and raise their right hands as Town Clerk Lorelei Donaldson administered the oath. The second item on the agenda was a Town Organizational Meeting. As per Section 3.3 -3.4 of the Vail Town Charter: Selection of Mayor/Mayor Pro-Tem. Newbury moved to appoint Dick Cleveland the Mayor with Daly seconding. The motion passed unanimously, 7-0. Rogers then moved to appoint Daly the Mayor/Pro-Tem with Hitt seconding. The motion passed unanimously, 7-0. As per Section 7.2 of the Vail Town charter: Selection of the Municipal Judge. Newbury moved to appoint buck Allen the Town of Vail Municipal Judge with Foley seconding. The motion passed unanimously, 7-0. The third item on the agenda was adjournment. Newbury moved to adjourn with Hitt seconding at approximately 12:10 p.m. The emotion passed unanimously, 7-0. Dick Cleveland, Mayor ATTEST: Lorelei Donaldson,.Town Clerk Minutes provided by Corey Swisher. Vail Town Council Evening Meeting Minutes Tuesday, November 20, 2007 6:00 P.M. Vail Town Council Chambers The regular meeting of the Vail Town Council was called to order at approximately 6:00 P.M. by Mayor Rod Slifer. Members present: Dick Cleveland, Mayor Margaret Rogers Mark Gordon Andy Daly, Mayor Pro-Tem Kevin Foley . Kim Newbury Farrow Hitt Staff Members: Stan Zemler, Town Manager Matt Mire, Town Attorney Pam Brandmeyer, Assistant Town Manager The first item on the agenda was Citizen Participation. There was none. The second item on the agenda was the Town Manager's Report. • Construction Update. Public Works Director Greg Hall reported construction is winding down. Good weather has allowed progress on all projects. Hall explained work on Seibert Circle art feature is continuing with completion scheduled in December. Hitt thanked Hall for facilitating additional streetscape in LionsHead. He said the merchants were appreciative. • Water Quantity/Quality (QQ) Update. Staff spoke with Chuck Ogilby who said he had an upcoming water quality meeting and preferred to report back to Council after that meeting. The third item on the agenda Iron Casting Workshop and Events. Council approved a request 7-0 by Art in Public Places (AIPP) Coordinator Leslie Fordham for funding to host an Iron Casting Performance in Vail in January 2008, following approvals made by the AIPP board. During the discussion, Fordham explained that nearly 20 artists and a total of 55 participants would take part in a 5;000 year old process of iron casting works. This would include heating metal in cauldrons and then pouring it into molds made by community members. The event would take place for three evenings, Jan. 18-20 near the International Bridge. In addition to the three evening performances, the artists will conduct workshops with community members as well as work with Vail schools. Artwork produced at the event would then be on display at the Vail Library. Fordham said both the Vail Fire Department and the town's Human Resource director have given approval regarding risk and safety of the event. The total cost of the event is $40,185 and would include workshops, materials, event production, advertising, brochures, video and still photographic documentation. Town Attorney Matt Mire clarified the artists would be required to carry adequate liability insurance. Hitt moved to approve the project with Rogers seconding. The fourth item on the agenda was a discussion of the Willows Public Art Obligation. Council approved 7-0 a proposal by AIPP Coordinator Leslie Fordham to allow the Willow's public art condition to be used for an art festival versus standing art pieces. AIPP's proposal included a $50,000 standing obligation of the Willow's redevelopment, also known as Triumph Development, plus an additional $50,000 donation from Triumph for an annual art event. Fordham said the event, which would be called Triumph Winterfest, would use ice, snow, illumination and wind components in areas near the Gore Creek Promenade. Fordham said, in addition to the $50,000 obligation and the donation of another $50,000 by Triumph, Winterfest could be a five year event lasting through Vail's 50th anniversary in 2012. Fordham said the AIPP board envisions the event growing in size and reputation each year and with additional sponsors it would be a successful program. Following approval by Council, the first Triumph Winterfest is scheduled to begin Jan. 8, 2008. The event will feature ice sculptures, with an environmental theme, designed by artist Lawrence Argent, who is known for his Big Blue Bear at the Denver Convention Center. Hitt moved to approve the project with Gordon seconding. The fifth item on the agenda was Council Committee Appointments. Council voted unanimously to approve the following committee appointments. COMMITTEE/TASK FORCE 1. NWCCOG COUNCIL MEMBERS Dick Cleveland -Voting Staff: Stan Zemler -alternate 2. NWCCOG Water Quality/ To Be Determined Quantity Committee 3. CAST Dick Cleveland -Voting Staff: Stan Zemler 4. VRD/Council Subcommittee Mark Gordon Andy Daly Staff: Stan Zemler Staff: Pam Brandmeyer 5. Commission on Special Events Staff: Kelli McDonald Staff: Pam Brandmeyer 6. Bravo! Vail Valley Music Festival Margaret Rogers -Voting Staff: Pam Brandmeyer 7. Town of Vail Housing Authority 8. Channel 5 Vail Valley Community Television Board 9. Art In Public Places 10. Mauri Nottingham Environmental Award 11. Vail Valley Exchange/Sister Cities 12. Eagle County Regional Transportation Authority (more) Town of Vail Add 4/ Nov. 20 Highlights 13. Ford Park Parking Management Plan 14. TOV Open Space/Charter Committee 15. Colorado Ski Museum and Ski Hall of 16. Vail Youth Recognition Award 17. Vail Alpine Garden Foundation Board Kim Newbury -Voting Representing community-at-large Mark Gordon -Voting Staff: Pam Brandmeyer, Voting/ Community Member Margaret Rogers -Non-Voting Farrow Hitt -Voting Kim Newbury -Voting Kevin Foley Staff: Mike Rose -Alternate Staff: Pam Brandmeyer Mark Gordon -Voting Stan Zemler -Voting David Viele / PEC -Voting Fame Dwight Henninger -Advisory Kim Newbury -Voting Staff: Pam Brandmeyer 18. Vail Local Marketing District Advisory Council Mark Gordon -Voting Farrow Hitt- Alternate 19. Parking Task Force Kevin Foley -Voting Farrow Hitt -Voting 20. Vail Child Care Center Kim Newbury Staff: John Power 21. Rural Resort Region Dick Cleveland Andy Daly- Alternate Staff: Stan Zemler 22. Donovan Park Pavilion Diana Donovan Staff: Pam Brandmeyer 23. Timber Ridge Affordable Housing Corporation (`TRAHC") 3 Town Manager, President Community Development Director Public Works Director Facility Maintenance Manager Finance Director 24. Visitor Center Sub-Committee Kim Newbury Farrow Hitt Staff: Stan Zemler Staff: Suzanne Silverthorn Staff: Krista Miller 25 26 27 28 29. 30. 31 Eagle County Blue Ribbon Working Housing Committee Mark Gordon Eagle County Blue Ribbon Housing Margaret Rogers Committee Technical Advisory Committee Eagle County Citizens Open Space Advisory Committee Greg Moffet Vail Economic Advisory Council Chamonix Parcel Planning Committee Rocky Mountain Rail Authority I-70 Transportation Corridor Coalition Mark Gordon Dick Cleveland Margaret Rogers Andy Daly Staff: Stan Zemler Staff: Greg Hall Staff: Stan Zemler Staff: Greg Hall Farrow Hitt Newbury moved to appoint staff, Council and community members listed on a provided committeeltask force document provided by Pam Brandmeyer, dated November 20, 2007 with Daly seconding. The sixth item on the agenda was the first reading of Ordinance No. 32, Series of 2007, an Ordinance to enact prescribed regulation amendments to Title 11, Sign Regulations, and Title 12, Zoning Regulations, Vail Town Code, to allow for amendments to regulations pertaining to outdoor display, sales signs, menu boards. Council voted 7-0 to approve modifications to the town's sign code as it relates to seasonal promotional signage, menu/ specials boards and lease options for displays on public and private property. Town Planner Rachel Friede explained the modifications had been reviewed and recommended for approval by the Vail Economic Advisory Council (VEAC) and Planning and Environmental Commission (PEC). The Council approved text modifications as follows: Menu boxes will be limited to two menu boxes of up to 6 sq. ft. and one specials board of up to 3 sq. ft. per business frontage with a public entrance. This has changed from allowing one menu box of up to 6 sq. ft. Unlimited number of sales signs for up to 3 sq. ft of signage. Prior, businesses were allowed one sale sign of up to 1.5 sq. ft. with a special provision for additional signage during the winter. Outdoor displays on public right-of-ways will be leased via a new leasing program to be created by the town. The leasing will be reviewed by Council during an upcoming meeting. Prior, outdoor displays were allowed in commercial and business districts on a business' own property, without regulation. Hitt clarified the allowed square footage of displays is measured from the outside edge to the outside edge of the display case. Rogers verified there was no time limit on the amount of time a sale sign could be displayed. Newbury moved to direct staff to proceed and develop a public signage leasing program and limit the number of menu boxes to one equaling a maximum of six square feet with Rogers seconding. The seventh item on the agenda was the first reading of Ordinance No. 34, Series of 2007, an ordinance amending the Official Zoning Map for the Town of Vail in accordance with Title 12, Zoning Regulations, Chapter 5, Zoning Map; Rezoning Lot 8B, Block 2, Vail Potato Patch, from High Density Multiple Family (HDMF) District to Housing (H) District Council voted unanimously to approve a request to amend the town's official zoning map to a Housing (H) District on Lot86, Block 2, Vail Potato Patch. Town Planner Scot Hunn explained the rezoning would. allow the property owner to build 63 new, deed restricted employee housing units. Hunn said the PEC recommended approval for the rezoning at its Oct. 8 public hearing. The H District zoning was created five years ago and currently only applies to Middle Creek and Timber Ridge. Representing the Vail Village Homeowner's Association, Jim Lamont questioned the lack of master planning on ~H District parcels and encouraged Council to follow design standards as projects are approved. Cleveland thanked the applicant for his efforts to provide non-required employee housing. Newbury moved to approve the project with Gordon seconding. The eighth item on the agenda was the first reading of Ordinance No. 35, Series of 2007, an ordinance amending Sections 12-61-3, Conditional Uses, and 12-16-7; Use Specific Criteria and Standards, Vail Town Code, to add "Professional Offices and Business Offices" to the list of allowable conditional uses in the Housing (H) District. Council voted 7-0 to approve a text amendment to the town code to allow 15 percent of the total square footage of an H District project to be professional and business offices. This follows a recommendation by the PEC at its Oct. 8 public hearing. Community Development Director George Ruttier clarified the background rationale for allowing 15 percent is determined when the housing square feet totals are completed. Community member Tom Steinberg questioned whether adequate parking would be able to exist on the site with the inclusion of business offices. Newbury moved to approve the ordinance with Daly seconding. The ninth item on the agenda was the first Reading of Mil Levy Certification, Ordinance No. 36, Series of 2007. Council voted 4-3 (Daly, Cleveland, Hitt opposed) to approve certification of the town's 4.742 Mil Levy for 2008 to Eagle County. Finance Director Judy Camp explained the mil levy assessments must be certified to Eagle County for annual collection. Daly questioned why property tax revenue would increase a projected 53 percent in 2008. Camp explained the increase is unusual and is being attributed to new projects being completed. Camp also explained that Town of Vail residents are taxed a total of 49.625 mils with the town's mil at less than ten percent of this at 4.69 percent. Daly motioned to lower the mil levy to reduce the property tax generated revenue by $300,000 with Hitt seconding. The motioned failed 3-4 (Newbury, Gordon, Rogers and Foley opposed). Newbury, Gordon and Rogers spoke in opposition to the motion explaining the town recently passed the construction use tax to compensate fora projected capital improvement shortfall and the reduction in the mil levy would be inconsistent to the voters. Hitt said he believed the construction use tax would remedy the shortfall subsequently justifying a mil levy reduction. Newbury moved to pass the ordinance as read with Gordon seconding. The tenth item on the agenda was a discussion of Draft Ordinance No. 37, an ordinance adopting a use tax on building and construction materials; amending Title 2, Revenue and Finance, Vail Town code with the addition of Chapter 8 "Use Tax on Building and Construction Materials. Council discussed implementation of the four percent construction use tax on building and construction materials consumed or used in the town, approved by voters Nov. 6. Proceeds of the tax are to be used exclusively for capital acquisitions and capital projects in the town. Finance Director Judy Camp explained Colorado's provisions required for implementation include: Construction materials can not be taxed twice and no double, taxation (two jurisdictions taxing the same product) could occur. Cannot tax on materials, which have been committed by contract. Non-profits and government entities are exempt from the tax. During the discussion, Town Attorney Matt Mire asked Council four questions specific to implementation of the tax to be considered during first reading of the ordinance. . 1) When will the tax be collected? Camp explained most municipalities collect the tax with building permit fees. 2) Considering projects estimate their value at 50 percent materials and 50 percent labor, shall the tax be considered at 50 percent of the total valued building permit? Mire explained most municipalities collect at 50 percent of the total project valuation. 3) Shall deed restricted housing being exempt? Newbury -had questions on how this would be considered and whether to exempt employee housing when it is required for development, versus employee housing that goes over the requirements of a development. Community member Bob Armour encouraged council to exempt employee housing as a means to encourage the community to build more. Tom Steinberg emphasized there would be opportunities for someone to avoid the tax if purchased in another community. 4) Other exemptions such as small projects that could include lower priced remodels and projects applications approved prior to Jan. 1, 2008. Council agreed during discussions to exempt the first $10,000 of any project's ,valuation.. Council also agreed to exempt projects that have approved development applications by Jan. 1, 2008. Mire encouraged Council to be consistent when deciding exemptions as any increase in revenue based on a change in policy would lead into Tax .Payer Bill of Rights (TABOR) issues. Mire said a public hearing for approval of implementation will be held Dec. 4 and18 during the Council's evening meeting. The tenth item on the agenda was resolution Number 28, Series 2007. A Resolution Deferring the Regular Meeting of the Vail Town Council, Pursuant to Section 1-5-11 of the Vail Town Code, From January 1 to January 8, 2008 and January 15 to January 22, 2008. Council voted unanimously to approve a resolution that will move the Jan. 1 Council meeting from New Year's Day to the following Tuesday, Jan. 8 and move the Jan. 15 meeting date to Jan. 22. Mire explained pursuant to Title 1, Chapter 5, Section 11, Vail Town Code, for "good cause" the council at a regular meeting preceding the regular meeting which will be deferred may defer the regular meeting to a subsequent date not later than one week after the deferred regular meeting date. Hitt moved to approve the resolution with Foley seconding. The eleventh item on the agenda was Adjournment. Newbury moved to adjourn with Daly seconding at approximately 8:05 p.m. The motion passed unanimously, 7-0. Dick Cleveland, Mayor ATTEST: Lorelei Donaldson, Town Clerk Minutes provided by Corey Swisher. LEASE AGREEMENT by and between THE TOWN OF VAIL and PLUM TV, INC. This Lease Agreement (the "Lease") is made on this day of , 2007, and is entered into by and between Landlord (as defined below) and Tenant (as defined below). In consideration of the payment of the Rent (as defined below); all costs, charges, and expenses which Tenant assumes, agrees, or is obligated to pay to Landlord pursuant to the Lease (the "Additional Rent"); and the performance of the promises by Tenant set forth below, Landlord hereby leases to Tenant, and Tenant hereby accepts, the Leased Premises (as defined below), subject to the terms and provisions set forth in the Lease. PARTIES, PREMISES, AND DEFINED TERMS 1. Landlord: The Town of Vail, a Colorado municipal corporation (the "Landlord") Tenant: Plum TV, Inc., a Delaware corporation (the "Tenant"). 3. Premises: Landlord is the owner of certain real estate with an address of 241 South Frontage Road West, Suite 2, ,the Town of Vail, County of Eagle, State of Colorado (hereinafter "Premises A"). In addition, Landlord is the owner of certain real estate with an address of 100 East Meadow Drive, Unit 2, Town of Vail, County of Eagle, State of Colorado (hereinafter "Premises B"). Premises A and Premises B are more specifically set forth and depicted in Exhibit A to the Lease, attached hereto and incorporated herein by reference. Hereinafter, Premises A and Premises B may be collectively referred to as the "Leased Premises." 4. Term: Landlord Leases Premises A to Tenant, for Tenant's exclusive use, from twelve o'clock noon on the 15` day of November, 2007 and until 11:59 p.m. on the 315` day of March, 2011. Landlord additionally leases Premises B to Tenant, for Tenant's non-exclusive use, from twelve o'clock noon on the lsc day of November, 2007 and until 11:59 p.m. on the 30'h day of April, 2008, and for Tenant's exclusive use, from twelve o'clock noon on the 1S1 day of May, 2008 and until 11:59 p.m. on the 31St day of March, 2011 (hereinafter collectively referred to as the "Term"). 5. Rent: Rentai for the Term is Two Thousand Two Hundred Dollars ($2,200.00) per month payable monthly in advance to Landlord on the first day of each calendar month for that month's rental before twelve o'clock noon, without notice (the "Rent"), commencing May 1, 2008 and continuing every month thereafter for the term of the Lease. Unless otherwise provided in the Lease, all payments due under the Lease, including Additional Rent, shall be mailed, or delivered to Landlord at the following address: 75 South Frontage Road West, Vail, CO 81658. If the Term does not begin on the first day of the month, the Rent shall be prorated accordingly. Rent for subsequent years of the Term shall be increased. In the event Rent is subject to increase, it shall be increased as mutually agreed to by the parties. . 6. Option: Tenant shall have the option to extend the Term, pursuant to the terms and conditions contained herein, for two additional one year terms (the "Option"). In the event Tenant desires to exercise the Option, Tenant shall, at least ninety (90) days before expiration of the Term, provide Landlord with written notice of its intent to exercise the Option. Rent shall be adjusted and payable as mutually agreed upon by the parties. The option shall only be exercisable provided that no Tenant Defaults currently exist and that no Tenant Defaults have occurred over the Term of the Lease which have not been cured by Tenant as provided by the Lease. 7. Security Deposit: Prior to occupying the Leased Premises, Tenant shall keep on deposit with Landlord a security, cleaning, and damage depasit in the amount of Ten Thousand Dollars ($10,000.00) as security for the return of the Leased Premises at the expiration of the Term in as good a condition as when Tenant entered the Leased Premises, normal wear and tear excepted, as well as the faithful, timely, and complete performance of all other terms, conditions, and covenants of the Lease (the "Security Deposit"). TOWN OF VAIL/PLUM TV LEASE (Page 1 of 15) Initials: Landlord Tenant 8. Use: The Leased Premises shall be used for a television production company, and for no other use whatsoever, provided this use conforms to applicable zoning regulations. Tenant shall not, without the prior written consent of Landlord, permit the Leased Premises to be used for any other purpose. 9. Utilities/Additional Rent: a. Association Dues: Tenant shall pay annual association dues (which currently amount to Twenty Three Thousand Two Hundred Dollars ($23,200.00)) payable in equal monthly installments, commencing May 1, 2008 as Additional Rent. Landlord shall remain solely responsible for all special assessments. b. Additional Rent: In addition to rent, Tenant shall also provide services, on an annual basis, as more specifically set forth in the attached Addendum to this Lease, which is attached hereto and incorporated herein to the Agreement. ~. Utilities: Tenant shall be responsible for paying the following utilities on the Leased Premises: ®Electric ®Gas ®Water ®Sewer ~ Phone ®Cable/Satellite T.V. ®Internet Access ®Refuse Disposal ^ Other . If the Leased Premises does not share meter facilities for utilities and if the utility or utilities are not provided as part of the CAM: Costs (as defined below), tenant shall contract directly with all utility providers and all utility payments shall be directed to the respective utility providers. If the Leased Premises shares meter facilities for utilities, the charges shall be allocated to each tenant by Landlord based upon a reasonable basis and shall be payable to the Landlord as Additional Rent. In the event that Landlord shall elect to supply any utilities, then, insofar as and to the extent that such is permitted pursuant to applicable law and the regulations cif the applicable utility company, Tenant agrees to purchase the same from Landlord, provided the rate does not eacceed the rate which Tenant would be required to pay on a metered basis to the utility company furnishing the same to the Parking Structure. d. CAM Costs: Omitted. e. Tax Costs: Tenant shall pay all taxes which may be lawfully charged, assessed, or imposed upon all fixtures and equipment and personal property in the Leased Premises, and Tenant shall pay all license fees and other charges which may lawfully be imposed upon the business of Tenant conducted from the Leased Premises. f. Landlord's and Tenant's Insurance Costs: The Landlord shall procure and maintain such fire and casualty, loss of rents, and liability insurance on the Property as it deems proper and appropriate ("Insurance Costs"). Such insurance shall not be required to cover any of the Tenant's property and the Tenant shall have no interest in any of the proceeds of such insurance. Tenant. covenants and agrees that it shall continuously keep its fixtures, merchandise, equipment and other personal property from time to time located in, on or about the Leased Premises, and all leasehold improvements to the Leased Premises constructed or installed by Tenant insured against loss or damage by fire with all risk endorsements in amounts equal to the full replacement cost thereof. Tenant shall furnish to the Landlord certificates of such insurance satisfactory to the Landlord. It is understood and agreed that Tenant assumes all risk of damage to its own property arising from any cause whatsoever, including, without limitation, loss by theft or otherwise. 10. Payment of Additional Rent: All Additional Rent shall be paid by Tenant to Landlord in equal monthly installments concurrent with the Rent. 11. Late Payments: If any Rent, Additional Rent, or other payment is received later than five (5) days after the date when due, the parties agree that Additional Rent in the amount often percent (10%) of the outstanding sums shall also be due and payable. The addition of such amount and the collection thereof shall not operate to waive any other rights of Landlord for nonpayment of Rent, or for any other reason. 12. Repairs and Maintenance of the ]Leased Premises: The Landlord shall maintain the foundation, exterior walls, and roof of the Improvements in good repair. The Tenant agrees to keep all the other improvements (including plate glass and other windows, window frames, and doors) upon the Leased Premises repaired and maintained in good order as described in the Lease. The Landlord shalt properly irrigate and,_care for all txees, shrubbery, and lawn and the Landlord shall keep all driveways, sidewalks, and parking areas on the Leased Premises free and clear of ice and snow. TOWN OF VAIL/PLUM TV LEASE (Page 2 of 15) Initials: Landlord Tenant 13. Parking: For the Term, Landlord grants to Tenant and its employees and invitees, at no additional charge, a Parking License. The Parking License is anon-exclusive license for the use of two (2) blue parking passes in the Town of Vail for the 2008-2009 winter ski season and one (1) parking space at the Town of Vail Municipal Building located at 75 South Frontage Road West, Vail, Colorado (the "Parking License"). The Parking License shall be effective for the term of the Lease (unless otherwise set forth above) as defined below. LEASED PREMISES 14. Common, Areas: The common areas are all areas outside of the Leased Premises as more specifically set forth in Exhibit B of the Lease Agreement, designated by Landlord for common use of Tenant, its employees, licensees, invitees, contractors, and Landlord (the "Common Areas"). Landlord grants to Tenant, its employees, licensees, invitees and contractors anon-exclusive license over such Common Areas of the Property necessary to the use and occupancy of the Leased Premises (the "Common Area License"). Said License shall be effective for the Term of the Lease. Tenant shall not use Common Areas for any type of storage, or parking of trucks, trailers, or other vehicles without the advance written consent of Landlord. All parking and Common Areas of Property shall at all times be subject to the management of Landlord, and are not part of the Leased Premises. All use of the Common Areas shall be at the sole risk of Tenant, and Landlord is not liable for any damages, or injuries occasioned by such use. Landlord shall have the right, power, and authority to compile, promulgate, change, and modify all rules and regulations that it may, in its sole discretion, deem necessary for use of the Common Areas. Tenant agrees to abide by and conform with all rules and regulations pertaining to such Common Areas. Landlord shall have the right to construct, maintain, and operate lighting facilities; to police and from time to time change the area, location, and arrangement of the Common Areas and facilities; to restrict employee parking to certain areas; to temporarily close all, or any portion of the Common Areas; to discourage non-customer parking; and to do and perform any and all such other acts in and to said Common Areas and facilities as Landlord shall determine in its sole and absolute discretion. 15. Condition of Leased Premises and Representations: Tenant is familiar with 'the physical condition of the Leased Premises and the Property. Except as may otherwise be provided in the Lease, Landlord makes no representations, or warranties as to the physical condition of the Leased Premises, or the Property, or their suitability for Tenant's intended use. In the event that Landlord agrees to provide any renovations, build-out, or any other labor and materials for the improvement of the Leased Premises, or any allowance for improvements to be effected by Tenant, such work, or allowance shall be specified and agreed to between the parties in a separate document appended to this Lease and which shall constitute a part of this Lease ("Work Letter"). Other than the work, if any, to be performed pursuant to Tenant's Work Letter, the Leased Premises are rented "as is," in current condition, and all warranties are hereby expressly disclaimed. Landlord makes no representations, or warranties as to the suitability of the Leased Premises for Tenant's intended use. Landlord further makes no representations, or warranties as to whether Tenant's intended use will necessitate changes, or alterations to the Leased Premises in order to comport with local, state, or federal laws and regulations. Such laws and regulations include, but are not limited to: health code regulations, access regulations (including, but not limited to, the Americans with Disabilities Act), and zoning regulations. Tenant understands and agrees that in the event actions, alterations, or improvements are required in order to bring the Leased .Premises into compliance with any local, state, or federal laws and regulations because of Tenant's intended use, Tenant shall be solely responsible for any and all associated costs and expenses relative thereto. Tenant further indemnifies and agrees to hold Landlord harmless from any and all claims . and liabilities that may arise by virtue of Tenant's use of the Leased Premises in violation of any local, state, or federal laws and regulations. 16. Check-In Inspection: Landlord and Tenant may conduct an inspection of the Leased Premises at the time of possession. Acheck-in inspection sheet may be completed at that time and the information contained therein shall be sufficient and satisfactory proof of the condition of the Leased Premises at the time of possession, should a subsequent dispute arise at a later date as to the condition of the Leased Premises at the time of move-in. 17. Use of Leased Premises: Tenant, inconsideration of the leasing of the Leased Premises, agrees as follows: a. Use of Leased Premises: To use and occupy the Leased Premises solely as and for the use specified in Paragraph 8 of the Lease. Landlord's consent to the aforementioned use is not an assurance, or warranty that the Leased Premises' attributes are sufficient for Tenant's use. Tenant represents and warrants that it TOWN OF VAIL/PLUM TV LEASE (Page 3 of 15) Initials: Landlord Tenant has conducted sufficient due diligence to assure itself that the Leased Premises are suitable for its use, and that such use is permitted by applicable law. Landlord expressly reserves its right to lease space within the Property as it sees fit, unless explicitly prohibited by other provisions in the Lease. Landlord's demise of the Leased Premises to Tenant does not preclude Landlord from leasing other parts of the Property to other tenants who may be viewed objectively, or subjectively as competing with Tenant. b. Signage: Tenant shall be permitted to erect a sign or signs upon the Leased Premises, provided all signage is in compliance with size anti other requirements of Landlord and as may be set forth by applicable ordinances and regulations including, but not limited to, sign and design ordinances. All signage shall conform to aesthetic and design criteria, themes, and standards of the Property and the Improvements. Additionally, Landlord may provide signage space on a common, or community sign located on the Property. Otherwise, Tenant shall not install, place, inscribe, paint or otherwise attach and shall not permit any sign, advertisement, notice, marquis or awning on any part of the outside of the Leased Premises (including any portion of the Leased Premises fronting on any interior corridor or lobby) or on any part of the inside of the Leased Premises which is visible from outside the Leased Premises or on any part of the building (including the outside walls and the roof) without the prior written consent of Landlord in each instance. Any permitted signs shall comply with the requirements of the Town of Vail and Tenant shall be solely responsible for such compliance. Tenant shall, at its own expense, maintain in first class condition all permitted signs and shall, on the expiration or termination of this lease and at its own expense, remove all such permitted signs and repair any damage caused by such removal. Landlord shall have the right to remove all non-permitted signs without notice to Tenant and at the expense of the Tenant. Tenant's obligation under this Paragraph 17b shall survive the expiration or termination of this lease. c. Vacancy: It will be deemed a Default of the Lease if the Leased Premises are left vacant and unoccupied for over thirty (30) days. In addition to other remedies contained in the Lease, the Landlord may, without being obligated to do so, and without terminating the Lease, retake possession of the Leased Premises and relet, or attempt to relet them for such rent and upon such conditions as the Landlord deems best, making such changes and repairs as may be required, giving credit for the amount of rent so received, less all expenses of such changes and repairs. Tenant shall be liable for the balance of the Rent and Additional Rent herein reserved until the expiration of the Term. d. Legal Compliance: Tenant and its licensees and invitees shall comply with and abide by all federal, state, county, and municipal laws and ordinances in connection with the occupancy and use of the Leased Premises. Tenant and its licensees and invitees may not possess, or consume alcoholic beverages on the Leased Premises unless they are of legal age. No alcoholic beverages shall be sold upon the Leased Premises unless proper licenses have been obtained. No illegal drugs or controlled substances (unless specifically prescribed by a physician for a specific person occupying or present upon the Leased Premises) shall be permitted upon the Leased Premises. Tenant hereby covenants and agrees to use its reasonable efforts to prevent and preclude its employees, guests, invitees, etc. from the aforementioned illegal conduct. Tenant and its licensees and invitees shall not use the Leased Premises in any way that may result in an increase of the rate or cost to the Landlord to insure the Property. No hazardous or dangerous activities are permitted upon the Leased Premises. e. Additional Prohibitions: Neither Tenant nor its subtenants, licensees, volunteers; employees, guests, or invitees shall act .in any manner that would interfere with, or be a nuisance to, other subtenants, occupants, or invitees of the Leased Premises, or adjacent property owners, or adjacent tenants, or that would interfere with those other parties' quiet enjoyment of their Leased Premises. Said prohibition includes, but is not limited to, loud noises, loud music, noxious or unpleasant odors, and disruptive behavior or actions. Tenant shall not permit any portion of the Leased Premises to be used in a manner that may endanger the person or property of Landlord, co-tenants, or any person living on or near the Leased Premises. Tenant shall keep all portions of the Leased Premises in a clean, safe, sanitary, and habitable condition. f. Pets and Animals: Pets or animals shall not be permitted upon the Leased Premises. g. Storage/Trash: Tenant shall store all personal property entirely within the Leased Premises. Tenant shall store all trash and refiise in adequate containers within the Leased Premises, which Tenant shall maintain in a neat and clean condition, or within designated Common Areas so as not to be visible to members of the public in, or about the Property, and so as not to create any health or fire hazard. TOWN OF VA[L/PLUM TV LEASE (Page 4 of 15) Initials: Landlord Tenant h. Hazardous Material Prohibited: Tenant shall not cause or permit any hazardous material to be brought upon, kept or used in, or about the Leased Premises by Tenant, its agents, employees, . contractors, or invitees. If Tenant breaches the obligations stated in the preceding sentence, or if the presence of hazardous material on the Leased Premises caused, or permitted by Tenant results in contamination of.the Leased Premises, or if contamination of the Leased Premises by hazardous material otherwise occurs for which Tenant is responsible to Landlord for resulting damage, then Tenant shall indemnify, defend, and hold Landlord harmless from any and all resulting claims, judgments, damages, penalties, fines, costs, liabilities, or losses. i. Quiet Enjoyment: Landlord agrees that upon Tenant paying the Rent and performing Tenant's obligations under the Lease, Tenant shall peacefully and quietly have, hold, and enjoy the Leased Premises throughout the Term or until the Lease is terminated pursuant to its terms. Landlord shall not be responsible for the acts or omissions of any other tenant or third party that may interfere with Tenant's use and enjoyment of the Leased Premises. In the event of any transfer or transfers of Landlord's interest in the Leased Premises or in the Property, other than a transfer for security purposes only, the Landlord shall be automatically relieved of any and all obligations and liabilities accruing from and after the date of such transfer. j. Rules and Regulations: Landlord shall provide Tenant with a copy of all rules and regulations affecting the Leased Premises, and Tenant shall abide by all such rules and regulations. k. Right of Access: Landlord and its designees shall have the right, upon reasonable prior written notice to Tenant (which notice shall not be required in the event of an emergency or if Landlord's entry shall be in the non-public areas of the Leased Premises only), to enter upon the Leased Premises at all reasonable hours for the purpose of inspecting or making repairs to the same or exhibiting the same to prospective purchasers and lenders. In making such entry, Landlord shall not unreasonably interfere under the circumstances with Tenant's business operations in the Leased Premises. If repairs are required to be made by Tenant pursuant to the terms of this Lease, or if Tenant is required to perform any other obligation under this Lease, Landlord may demand that Tenant make such repairs or perform such obligation forthwith, and if Tenant refuses or neglects to commence such repairs or performance and complete the same within ten (10) days after such demand, subject to delays beyond Tenant's reasonable control, which shall be determined by Landlord. Landlord may (but shall not be required to) make or cause such repairs or performance to be done and shall not be responsible to Tenant for any loss or damage that may accrue to its merchandise by reason thereof. If Landlord makes or causes such repairs or performance to be done, or endeavors so to do, Tenant agrees that it will forthwith, on demand, pay to Landlord the cost thus incurred by or on behalf of Landlord, and if Tenant shall default in such payment, Landlord shall have the remedies provided in the event of a default pursuant to this Lease Agreement. 1. Leasing Activities: For a period commencing six (6) months prior to the expiration of this Lease or any renewal period, Landlord may have reasonable access to the Leased Premises for the purpose of exhibiting the same to prospective tenants. 18. Subletting or Assignment: Tenant shall not sublet the Leased Premises or any part thereof, nor assign the Lease or any interest therein, without the prior written consent of Landlord. Such consent shall be at the sole discretion of Landlord. As a condition of assignment or sublease, Landlord may require the. continued liability of Tenant or a separate personal guaranty by Tenant or its principal. If Tenant is a corporation, limited liability . company, or other entity that is not a natural person, any change in ownership of more than thirty percent (30.0%) (over any period) of the ownership interest shall be deemed an assignment of the Lease. In the event an assignment or sublease is permitted, all payments from assignee or sublessee shall be made directly by said party to Landlord, and not through Tenant. 19. Surrender of Leased Premises: Tenant will return the Leased Premises to Landlord at the expiration of the Term in as good order and repair as when Tenant took possession, loss by casualty and normal wear and tear excepted. Any deterioration or damage caused by accident, abuse, carelessness, or negligence shall not be considered normal wear and tear. In the event that Tenant fails to redeliver the Leased Premises in appropriate condition, Landlord may restore the Leased Premises to appropriate condition, including repair, replacement, and cleaning. The cost of any work necessitated shall be deducted from the Security Deposit; if the Security Deposit is insufficient to cover work performed, Tenant shall be obliged to pay the additional balance. 20. Removal of Fixtures/Redelivery: Tenant shall remove, at the termination of the Lease, provided Tenant is not in Default, Tenant's moveable trade fixtures and other items of personal property that are not TOWN OF VAIL/PLUM TV LEASE (Page 5 of 15) Initials: Landlord Tenant permanently affixed to the Premises. Tenant shall remove the alterations and additions and signs made by Tenant as Landlord may request and repair any damage caused by such removal. Tenant shall peaceably yield up the Leased Premises and all alterations and additions thereto (except such as Landlord has requested Tenant to remove); and all fixtures, furnishings, floor coverings, and equipment that are permanently affixed to the Leased Premises which shall thereupon become the property of the Landlord. Any personal property of Tenant not removed within five (5) days following such termination shall, at Landlord's option, become the property of Landlord. PAYMENTS 21. Payments/Dishonored Checks: Payments shall be deemed received when actually delivered to, and received by, Landlord at the payment location. Dishonored checks and any checks received late in the mail will be treated as late payments. Additional bank and handling charges may also be assessed in the event of a dishonored check. The foregoing items shall be deemed Additional Rent. Landlord may require Tenant to replace such dishonored check with a money order, cashier's check, or other good funds. Landlord may further require that all subsequent payments after a dishonored check be paid with a money order, cashier's check, or other good funds. 22. Partial Payment: If any partial payment is made by Tenant, it shall be allocated first to the payment of Additional Rent, including, without limitation, utilities (if applicable) and other expenses; and second to unpaid Rent. Acceptance by Landlord of any partial payment shall not waive the right of Landlord to require immediate payment of the unpaid balance of Rent ot• waive or affect Landlord's rights to institute legal proceedings including, without limitation, an eviction action. 23. No Offset: No assent, express or implied, to any Default of any one or more of the agreements hereof shall be deemed or taken to be a waiver of any succeeding or other Default. The covenants set forth in the Lease are independent. Tenant shall have no right to withhold or set off any Rent due Landlord. 24.. Joint and Several Obligations of Tenant: In the event more than one person comprises Tenant, it is expressly understood and agreed that each person comprising Tenant is jointly and severally liable for any and all obligations of Tenant in the Lease. This means that all persons comprising Tenant are each, together and separately, responsible for all of Tenant's obligations. Landlord may, at its option, determine whom to hold responsible. SECUR][TY bEPOSIT 25. Security Deposit: a. Security Deposit: To secure the faithful performance by Tenant of all of Tenant's covenants, conditions, and agreements in the Lease to be observed and performed, Tenant shall deposit with Landlord the Security Deposit prior to commencement of the Lease. The Security Deposit may also be used in the event of termination of the Lease by re-entry, eviction, or otherwise. In addition, the Security Deposit shall be forfeited by Tenant should Tenant fail or refuse to take possession of Premises B on or prior to May 1, 2008. b. Application of Security Deposit: The parties agree: (1) that the Security Deposit or any portion thereof, may be applied to the curing of any Default that may exist, and/or payment of subsequent damages and costs incurred by Landlord, without prejudice to any other remedy or remedies that the Landlord may have on account thereof, and upon such application Tenant shall pay Landlord on demand the amount so applied, which shall be added to the Security Deposit so it will be restored to its original amount; (2) that should the Leased .Premises be conveyed by Landlord, the Security Deposit or any portion thereof may be turned over to Landlord's grantee, and if the Security Deposit is turned over, Tenant agrees to look to such grantee for such application or return; (3) that Landlord shall not be obligated to hold Security Deposit as a separate fund; (4) that should the Rent be increased, the Security Deposit shall be increased in the same proportion within thirty (30) days of such Rent increase; and (5) that should a Default occur, Landlord may, as an additional remedy, increase the Security Deposit at its sole discretion. c. Return of Security Deposit: If Tenant shall perform all of its respective covenants and agreements in the Lease, the Security Deposit, or the portion thereof not previously applied pursuant to the provisions of the Lease, together with a statement, shall be returned to Tenant without interest, no later than sixty (60) days after the expiration of the Term, or any renewal or extension thereof (or such earlier time if required by applicable law), .provided Tenant has vacated the Leased Premises and surrendered possession thereof to Landlord. TOWN OF VAIL/PLUM TV LEASE (Page 6 of 15) Initials: __ Landlord Tenant REPAIRS AND MAINTENANCE 26. Improvements, Repairs, and Maintenance: Subject to the limitations set forth in Paragraphs 27 and 28 below, either Landlord or Tenant, as specified in Paragraph 12 above, shall be responsible for the cost and condition of the respective improvements, repairs, and maintenance relating to all structural components, interior and exterior walls, floors, ceiling, roofs, sewer connections, plumbing, wiring, appliances, and glass used in connection with the Leased Premises. 27. Landlord's Limited Responsibility: In the event Paragraph 12 of the Lease provides for Landlord's responsibility for certain repair and maintenance, Landlord shall be responsible for: (i) any repairs, replacements, restorations, or maintenance that have been necessitated by reason of ordinary wear and tear, and (ii) any repairs, replacements, restorations, or maintenance that have been necessitated by sudden natural forces, or acts of God, or by fire not caused by Tenant. The cost of any maintenance, repairs, or replacements necessitated by the act, neglect, misuse, or abuse of Tenant, its agents, employees, customers, licensees, invitees, or contractors shall be paid by Tenant to Landlord promptly upon billing. Landlord shall use reasonable efforts to cause any necessary repairs to be made promptly; provided, however, that Landlord shall have no liability whatsoever for any delays in causing such repairs to be made, including, without limitation, any liability for injury to or loss of Tenant's business, nor shall any delays entitle Tenant to any abatement of Base and Additional Rent or damages, or be deemed an eviction of Tenant in whole or in part. 28. Tenant's Allowed Responsibilities: In the event Paragraph 12 of the Lease provides for Landlord's responsibility for certain repair and maintenance, Tenant shall not perform or contract with third parties to perform any repairs of any kind upon the Leased Premises or structure upon which the Leased Premises are located. In the event any repair that is the responsibility of Landlord becomes necessary, Tenant shall notify Landlord as soon as possible, and allow reasonable time for the work to be completed. Any unauthorized work performed or contracted for by Tenant will be at the sole expense of Tenant. 29. Tenant's Duty to Repair: In the event Paragraph 12 of the Lease provides for Tenant's responsibility for certain repair and maintenance, Tenant shall, at Tenant's sole cost and expense, maintain the Leased Premises; including, but not limited to, the plumbing, exterior plate glass, other windows, and window frames, electric wiring, HVAC equipment, fixtures, appliances, and interior walls, doorways, and appurtenances belonging thereto installed for the use or used in connection with the Leased Premises (and including the foundation, exterior walls, and roof of the Improvements, if so provided in Paragraph 12). Tenant shall, at Tenant's own expense, make as 'and when needed all repairs to the Leased Premises and to all such equipment, fixtures, appliances, and appurtenances necessary to keep the same in good order and condition. Tenant repairs shall include all replacements, renewals, alterations, and betterments (the "Tenant Repairs"). All Tenant Repairs shall be equal or better in quality and class to the original work. In the event Tenant fails to complete Tenant Repairs, Landlord may obtain them and bill Tenant for such work as Additional Rent. 30. Tenant Improvements: Unless otherwise provided in the Work Letter, Tenant shall be solely responsible for any and all improvements and alterations within the Leased Premises necessary for Tenant's intended use of the Leased Premises, including, but not limited to, electrical wiring, HVAC, plumbing, framing, drywall, flooring, finish work, telephone systems, wiring, and fixtures necessary to fmish the Leased' Premises to a condition suitable for Tenant's use (the "Tenant Work"). 31. Improvements/Prior Landlord Consent: Tenant agrees to submit to Landlord complete plans and specifications, including engineering, mechanical, and electrical work covering any and all contemplated Tenant Work, if applicable, and any subsequent improvements or alterations of the Leased Premises. The plans and specifications shall be in such detail as Landlord may require, and in compliance with all applicable statutes, ordinances, regulations, and codes. As soon as reasonably feasible thereafter, Landlord shall notify Tenant of any failures of Tenant's plans to meet with Landlord's approval. Tenant shall cause Tenant's plans to be revised to the extent necessary to obtain Landlord's approval. Tenant shall not commence any Tenant Work, or any other improvements, or alterations of Leased Premises until Landlord has approved Tenant's plans. 32. Tenant Work and Repairs/Compliance with Codes/Mechanic Liens: Tenant shall procure all necessary permits before undertaking Tenant Work or Tenant Repairs. Tenant shall perform all Tenant Work or TOWN OF VAIL/PLUM TV LEASE (Page 7 of 15) Initials: Landlord Tenant Tenant Repairs in a good and workmanlike manner. Tenant shall use materials of good quality and perform Tenant Work or Tenant Repairs only with contractors previously approved of in writing by Landlord. Tenant shall comply with all laws, ordinances, and regulations, including, but not limited to, building, health, fire, and safety codes. Tenant hereby agrees to hold Landlord and Landlord's agents harmless and indemnified from all injury, loss, claims, or damage to any person or property (including the cost for defending against the foregoing) occasioned by, or growing out of Tenant Work or Tenant Repairs. Tenant shall promptly pay when due the entire cost of any Tenant Work or Tenant Repairs on the Leased Premises undertaken by Tenant, so that the Leased Premises shall at all times be free of liens for labor and materials. Tenant hereby agrees to indemnify, defend, and hold Landlord harmless of and from all liability, loss, damages, costs, or expenses, including reasonable attorneys' fees, incurred in connection with any claims of any nature whatsoever for work performed for, or materials, or supplies furnished to Tenant, including lien claims of laborers, materialmen, or others. Should any such liens be filed or recorded against the Leased Premises or the Improvements with respect to work done for, or materials supplied to, or on behalf of Tenant, or should any action affecting the title thereto be commenced, Tenant shall cause such liens to be released of record within five (5) days after notice thereof. If Tenant desires to contest any such claim of lien, Tenant shall nonetheless cause such lien to be released of record by the posting of adequate security with a court of competent jurisdiction as may be provided by Colorado's mechanic's lien statutes. If Tenant shall be in default in paying any charge for which such mechanic's lien or suit to foreclose such lien has been recorded or filed and shall not leave caused the lien to be released as aforesaid, Landlord may (but without being required to do so) pay such lien or claim and any associated costs, and the amount so paid, together with reasonable attorneys' fees incurred in connection therewith, shall be immediately due from Tenant to Landlord as Additional. Rent. 33. Common Area Maintenance: Landlord shall use reasonable efforts to maintain and repair Common Areas of Property, including walks and parking lots. The cost of any maintenance, repairs, or replacements necessitated by the act, neglect, misuse, or abuse by Tenant, its employees, licensees, invitees, or contractors shall be paid by Tenant to Landlord. Landlord shall use reasonable efforts to cause any necessary repairs to be made promptly; provided, however, that Landlord shall have no liability whatsoever for any delays in causing such repairs to be made, including, without limitation, any liability for injury to or loss of Tenant's business, nor shall any delays entitle Tenant to any abatement of Rent or damages, or be deemed an eviction of Tenant in whole or in part. 34. Keys/I.ocks: Tenant shall not place any additional locks upon the Leased Premises, including, but not limited to, exterior and interior doors. Tenant shall not cause any of the locks or cylinders therein to be changed or re-keyed. 35. `Vaste/Rubbish Removal: Tenant shall not lay waste to the Leased Premises. Tenant shall not perform any action or practice that may injure the Leased Premises or Property. Tenant shall keep the Leased Premises and the Property surrounding the Leased Premises free and clear of all debris, garbage, and rubbish and in accordance with all Town of Vail Ordinances. Unless otherwise provided for in the Lease, Tenant shall b~- responsible for contracting for and paying for trash and debris removal required by Tenant's use of the Leaed Premises. DEFAULT, NOTICE AND REMEDIES 36. Default: If Tenant is in arrears in the payment of any installment of Rent, any Additional Rent, or any portion thereof, or is in violation of any other covenants or agreements set forth in the Lease (a "Default") and the Default remains uncorrected for a period of three (3) days after Landlord has given written notice thereof pursuant to applicable law, then Landlord may, at Landlord's option, undertake any of the following remedies without limitation: (a) declare the Term of the Lease ended; (b) terminate Tenant's right to possession of the Leased Premises and reenter and repossess the Leased Premises pursuant to applicable provisions of,the Colorado Forcible Entry and Unlawful Detainer statute; (c) recover all present and future damages, costs, and other relief to which Landlord is entitled; (d) pursue Landlord's lien remedies; (e) pursue breach of contract remedies; and (f) pursue any and all available remedies in law or equity. In the event possession is terminated by reason of a Default prior to expiration of the Term, Tenant shall remain responsible for the Rent and Additional Rent, subject to Landlord's duty to mitigate such damages. Pursuant to §§ 13-40-104(d.5) and (e.5), and 13-40-107.5, C.R.S., hereby incorporated by reference, in the event repeated or substantial Defaults(s) under the Lease occur, Landlord may terminate Tenant's possession upon a written Notice to Quit, without a right to cure. Upon such termination, Landlord shall have available any and all of the remedies listed above. TOWN OF VAIL/PLUM TV LEASE (Page 8 of 15) [nitials: Landlord Tenant 37. Abandonment: In the event of an abandonment of the Leased Premises, Landlord may, without being obligated to do so and without terminating the Lease, retake possession of the Leased Premises and exercise any of the remedies contained in Paragraph 38 below. . 38. Re-Entry: In the event of re-entry by Landlord as a result of abandonment or a Default by Tenant: a. Tenant shall be liable for damages to Landlord for all loss sustained, including, without limitation, the balance of the Rent and Additional Rent, court costs, and reasonable attorneys' fees; b. Tenant's personal property and the personal property of any guest, invitee, licensee, or occupant may be removed from the Leased Premises and left on the street or alley, or, at Landlord's option, it may be removed and stored, or disposed of at Landlord's sole discretion. Landlord shall not be deemed a bailee of the property removed and Landlord shall not be held liable for the property. Tenant shall indemnify Landlord for any expense in defending against any claim by Tenant or third party and for any legal expense, cost, fine, or judgment awarded to a third-party as a result of Landlord's action under the term of the Lease; c. Landlord may attempt to relet the Leased Premises for such rent and under such terms as Landlord believes appropriate; d. Landlord may enter the Leased Premises, clean and make repairs, and charge Tenant accordingly; e. Any money received by Landlord from Tenant shall be applied first to Rent, Additional Rent, and other payments due; and f. Tenant shall surrender all keys and peacefully surrender and deliver up possession of the Leased Premises. INSURANCE AND INDEMNIFICATION 39. Negligent Damages: Tenant shall be responsible for and reimburse Landlord for any and all damages to the Leased Premises or Property and persons and property therein caused by the negligent, grossly negligent, reckless, or intentional acts of itself, its employees, agents, invitees, licensees, or contractors. 40. Liability Indemnificatiort/Insurance: Tenant shall hold Landlord, Landlord's agents, and their respective successors and assigns, harmless and indemnified from all injury, loss, claims, or damage to any person or property while on the Leased Premises, or any other part of the Property, or arising in any way out of Tenant's business, which is occasioned by a negligent, intentional, or reckless act, or omission of Tenant, its employees, agents, invitees, licensees, or contractors. Tenant shall maintain general liability insurance insuring Landlord and Landlord's agents, as their interest may appear, against all claims, demands, or actions for injury to or death in an amount of not less than one million dollars ($1,000,000) arising out of any one occurrence, made by, or on behalf of any person, fum, or corporation, arising from, related to, or connected with the conduct and operation of Tenant's business, including, but not limited to, events on the Leased Premises and anywhere upon the Property. Tenant shall also obtain coverage in the amount of one million dollars ($1,000,000) per occurrence covering Tenant's contractual liability under the aforesaid indemnification clauses. 41. Fire/Casualty Insurance: Tenant shall maintain plate glass insurance covering all exterior plate glass in the Leased Premises, fire, extended coverage, vandalism, and malicious mischief insurance and such other insurance as Tenant may deem prudent, covering all of Tenant's stock in trade, fixtures, furniture, furnishings, floor coverings, and equipment in the Leased Premises. 42. Insurance Requirements: All of Tenant's insurance related to the Leased Premises and the Property shall be in the form and from responsible and well-rated companies satisfactory to Landlord, shall name Landlord as an additional insured thereunder, and shall provide that the insurance will not be subject to cancellation, termination, or change except after at least thirty (30) days prior written notice to Landlord. The policies or duly executed certificates for such insurance shall be provided to Landlord prior to commencement of Term and upon request of Landlord. TOWN OF VAIL/PLUM TV LEASE (Page 9 of 15)' Initials: Landlord Tenant 43. Waiver of Liability: Landlord and Landlord's agents and employees shall not be liable for, and Tenant waives all claims for, damage to property sustained by Tenant, employees, agents or contractors, or any other person claiming through Tenant, resulting from any accident in or upon the Leased Premises or the Property of which they shall be a part, including, but not limited to, claims for damage resulting from: (1) any equipment or appurtenances becoming out of repair; (2) Landlord's failure to keep the Property or the Leased Premises in repair; (3) injury done or occasioned by wind, water, or other act of God; (4) any defect in, or failure of, plumbing, heating, or air-conditioning equipment, electric wiring, or, installation thereof, gas, water and steam pipes, stairs, porches, railings, or walks; (5) broken glass; (6) the backing-up of any sewer pipe, or downspout; (7) the bursting, leaking, or running of any tank, tub, sink, sprinkler system, water closet, waste pipe, drain, or any other pipe or tank in, upon, or about the Property or Leased Premises; (8) the escape of steam, or hot water; (9) water, snow, or ice being upon, or coming through the roof, skylight, doors, stairs, walks, or any other place upon, or near such Property, or the Leased Premises, or otherwise; (10) the falling of any fixtures, plaster, or stucco; (11) fire or other casualty; and (12) any act, omission, or negligence of co-Tenants, or of other persons or occupants of the Property, or of adjoining or contiguous buildings, or of adjacent or contiguous property. 44. Third-Party Liability: Landlord shall not be liable to Tenant for any damage by or from any act or negligence of any co-tenant or other occupant of the Improvements, or by any owner or occupant of adjoining or contiguous property. Landlord shall not be liable for any injury or damage to persons or property resulting in whole or in part from the criminal activities of others. To the extent not covered by normal fire and extended coverage insurance, Tenant agrees to pay for all damage to the Improvements. 45. Landlord Insurance: Insurance shall be procured by Landlord in accordance with its sole discretion. All awards and payments thereunder shall be the property of the Landlord, and Tenant shall have no interest in the same. Notwithstanding. the foregoing, Landlord agrees to obtain building liability and hazard insurance required to be carried for the Property and Leased Premises and adequate hazard insurance, which covers replacement cost of the Property and Leased Premises. 46. Indemnification Fees and Costs: In case any claim, demand, action, or proceeding is made or brought against Landlord, its agents, or employees, by reason of any obligation on Tenant's part to be performed under the terms of the Lease or arising from any act of negligence of Tenant or its agents or employees, or which gives rise to Tenant's obligation to indemnify Landlord, Tenant shall be responsible for all costs and expenses, including, but not limited to,. reasonable attorneys' fees incurred in defending or prosecution of the same, as applicable. . OTHER PROVISIONS 47. Destruction, or Condemnation of Leased Premises: Landlord's and Tenant's duties and responsibilities are as follows when destruction or condemnation of the Leased Premises occurs: a. Partial Destruction of the Leased Premises: In case of partial destruction of the Premises by fire, or other casualty, Landlord at its discretion may repair the Leased Premises with reasonable dispatch after notice of said partial destruction. Tenant shall remain responsible for payment of Rent. Subparagraph (d) of this Paragraph 47 shall apply if i,,andlord determines that the partial destruction will not be repaired. b. Leased Premises Untenable: If the Leased Premises are made totally untenable by fire, the elements, or other casualty, or if the building in which the Leased Premises are located is partially destroyed to the point where Landlord, within a reasonable time, decides not to rebuild, or repair, then Subparagraph (d) of this Paragraph 47 shall apply. c. Condemnation: If the whole or part of the Leased Premises are taken by any authority for any public or quasi-public use, or purpose, then Subparagraph (d) of this Paragraph 47 shall apply. All damages and compensation awarded for any taking shall be the sole property of Landlord. d. Termination of Term: Tenant agrees that if Landlord decides not to repair, or rebuild the Leased Premises where the destruction has occurred as described in Subparagraphs (a) and (b) of this Paragraph 47, the Term hereby granted by the Lease shall cease ~ and the Rent and Additional Rent shall be prorated and payable up to the time of the cessation of the Term. A refund will be given for the balance of any Rent paid in advance for which Tenant did not have use of the Leased Premises due to the cessation of the Term under the TOWN OF VAIL/PLUM TV LEASE (Page 10 of 15) Initials: Landlord Tenant conditions of this Paragraph 47. Where the Leased Premises have been taken due to condemnation as described in Subparagraph (c) of this Paragraph 47, the Term of the Lease shall cease and terminate upon the date that possession of the Leased Premises is taken by the authority. Rent and Additional Rent shall be prorated and payable up to the time of the cessation of the Term. Tenant shall not hold Landlord liable for any damages as a result of any of the acts or events described in this subparagraph. 48. Holdover: Tenant shall vacate the Leased Premises and remove all of Tenant's personal property from the Leased Premises prior to 11:59 p.m. on the date the Term expires. Landlord may immediately commence eviction proceedings at its sole discretion. If, after the expiration of the Lease, Tenant shall remain in possession of the Leased Premises and continue to pay Rent without a written agreement as to such possession, then such tenancy shall be regarded as a month-to-month tenancy, at a monthly rental, payable in advance, equivalent to the last month's Rent paid under the Lease, and subject to all the terms and conditions of the Lease. 49. Entry by Landlord: Landlord may enter the Leased Premises at reasonable hours for reasonable purposes (such as repairs, inspections, or re-letting to prospective new tenants), upon reasonable notice to Tenant. Landlord may also enter the Leased Premises in the event of emergency, without notice, or in the event of vacancy of the Leased Premises, as described in Paragraph 38. 50. 'Guarantor: In the event the Lease is guaranteed, the person(s) guaranteeing the Lease ("Guarantor") hereby absolutely guarantees Tenant's obligations and performance under the Lease. Guarantor further agrees to be bound by the same covenants and conditions of the Lease and hereby makes the same warranties and representations as Tenant hereunder. If Tenant defaults in the performance of its obligations under the Lease, Guarantor will perform said obligations. 51. Subordination/EstoppeUAttornment: The Lease shall be subordinate to all existing and future mortgages, deeds of trust, and other security interests on the Leased Premises and to any and all extensions, renewals, refinancing, and modifications thereof. Tenant shall execute and deliver whatever instruments may be required for such purposes, or for the purpose of informing a potential or existing lender or purchaser of the Property as to the status of its tenancy. Any such instruments or estoppel letters shall contain all information reasonably required by Landlord or other entity in conjunction with such transaction. Tenant agrees to attorn to a lender or other party coming into title to the Property upon written request of Landlord. 52. Bankruptcy: If Tenant shall become a debtor under the United States Bankruptcy Code, 11 U.S.C. §§101 et seq. (the "Bankruptcy Code") then, to the extent that the Bankruptcy Code may be applicable or affect the ,provisions of this Lease, the following provisions shall also be applicable. If the trustee or debtor-in-possession shall fail to elect to assume this Lease within sixty (60) days after the commencement of a case under the BanlQUptcy Code, this Lease shall be deemed to have been rejected; and Landlord shall be thereafter immediately entitled to possession of the Leased Premises and this Lease shall be terminated subject to and in accordance with the provisions of this Lease and of law (including such provisions for damages). No election to assume (and, if applicable to assign) this Lease by the trustee or debtor-in-possession shall be permitted or effective unless: (i) all defaults shall have been cured and Landlord shall have been provided with adequate assurances reasonably satisfactory to Landlord in Landlord's sole discretion, including (a) any reasonably required guaranties and/or security deposits, and (b) any other reasonably required assurances that there will continue to be sufficient funds and personnel available to professionally merchandise, stock, promote, staff and operate the Leased Premises in strict compliance with all provisions of this Lease; and (ii) neither such assumption nor the operation of the Leased Premises subsequent thereto shall, in Landlord's reasonable judgment, cause or result in any breach or other violation of any provision of this Lease or any other applicable lease, mortgage or other contract, or disrupt the tenant mix of the Parking Structure; and (iii) the assumption and, if applicable, the assignment of this Lease satisfies in full the provisions of the Bankruptcy Code, including, without limitation, Sections 365(b)(1) and (3) and (f)(2); and (iv) the assumption has been ratified and approved by order of such court or courts as have final jurisdiction over the case. No assignment of this Lease by the trustee or debtor-in-possession shall be permitted or effective unless the proposed assignee likewise shall have satisfied (i), (ii), (iii) and (iv) of the preceding sentence regarding such assignment, and any such assignment, shall, without limitation, be subject to the provisions of this Lease. When, pursuant to the Bartl~uptcy Code the trustee or debtor-in-possession is obligated to pay reasonable use and occupancy charges, such charges shall not be less than the Base Rent and other charges specified herein to be payable by Tenant. Neither Tenant's interest or estate in the Leased Premises herein or created hereby nor any lesser interest or estate of Tenant related to the Leased Premises shall pass to anyone under any law of any state or jurisdiction without the prior written consent of Landlord. In no event shall this Lease, if the Terrn has expired or if TOWN OF VAIL/PLUM TV LEASE (Page 11 of 15) Initials: Landlord Tenant this Lease has been terminated in accordance with the provisions hereof, be revived, and no stay or other proceedings shall nullify, postpone or otherwise affect the expiration or earlier termination of this Lease pursuant to the provisions of this Paragraph 52 or prevent Landlord from regaining possession of the Leased Premises thereupon. 'T'his Paragraph applies equally to any Guarantor of this Lease Agreement. 53. Notices: All notices required to be sent under the Lease shall be in writing and either: (i) delivered as provided by applicable law, including, inter alia, § 13-40-101, C.R.S., et seq., [Colorado Forcible Entry and Unlawful Detainer statute]; (ii) personally delivered, with proper proof of service; or (iii) sent via U.S. first class mail, postage prepaid. All notices required to be sent to Landlord shall be sent or delivered to the address where the Rent is to be paid, which of the date of this Lease Agreement is 75 South Frontage Road West, Vail, Colorado 81657, and all notices required to be sent to Tenant shall be sent or delivered to the Leased Premises, unless otherwise specified in the Lease. Notwithstanding the foregoing, all notices involving or concerning § 13-40-101, C.R.S., et sey. shall be delivered as provided by statute. 54. Attorneys' Fees: In the event Tenant or Landlord fails to perform any of its obligations under the Lease, or in the event a dispute arises concerning the meaning or interpretation of any provision of the Lease, the defaulting party, or the party not prevailing in such dispute, as the case may be, shall pay any and all costs and expenses incurred by the other party in enforcing or establishing its rights hereunder, including, without limitation, court costs and reasonable attorneys' fees. 55. Governing Law: The Lease shall be governed by and construed in accordance with the laws of the State of Colorado. Venue shall be proper in the county where the Leased Premises are located. 56. Amendments and Termination: Unless otherwise provided in the Lease, the Lease may be amended, modified, or terminated only by a written instrument executed by Landlord and Tenant. 57. Captions: The paragraph titles or captions in the Lease are for convenience only. and shall not be deemed to be part of the Lease. 58. Pronouns; Joint and Several Use of Certain Terms: Whenever the terms referred to in the Lease are singular, the same shall be deemed to mean the plural, as the context indicates, and vice versa. All references to the "Landlord" shall mean Landlord ancL'or its authorized agents, contractors., or employees as may be required by the specific context. All references to the "Tenant" shall mean each and every person comprising Tenant, or an individual person, or combination of persons comprising Tenant as may be required by the specific context. 59. Waivers: No right under the Lease may be waived except by written instrument executed by the party who is waiving such right. No waiver of any breach of any provision contained in the Lease shall be deemed a waiver of any preceding or succeeding breach of that provision, or of any other provision contained in the Lease. No extension of time for performance of any obligations or acts shall be deemed an extension of the time for performance of any other obligations or acts. 60. Heirs, Assigns, and Successors: The Lease is binding and inures to the benefit of the heirs, assigns, and successors in interest to the parties, subject to the restrictions on assignment in Paragraph 18. 61. Time of the Essence: Time is of the essence of the Lease, and each and all of its provisions. 62. Credit Reports: Tenant hereby grants Landlord permission to obtain from time to time investigative consumer reports to ascertain the creditworthiness of Tenant and Tenant's guarantors, if applicable. 63. Corporate Authorization: If Tenant is a corporation, each individual executing the Lease on behalf of the corporation represents and warrants that he is duly authorized to execute. and deliver the Lease on behalf of said corporation in accordance with a duly adopted resolution of the Board of Directors of the corporation and that the Lease is binding upon the corporation in accordance with its terms. Lessee agrees to provide Landlord with such a resolution within five (5) days of the execution of the Lease. 64. Severability: If any term, covenant, condition, or provision of the Lease, or the application thereof to any person or circumstance shall, at any time or to any extent, be invalid or unenforceable, the remainder cif the TOWN OF VAIL/PLUM TV LEASE (Page 12 of 15) Initials: Landlord I~enant Lease, or the application of such term, or provision to persons, or circumstances other than those to which it is held invalid, or unenforceable, shall not be affected thereby, and each provision of the Lease shall be valid and shall be enforced to the fullest extent permitted by law. 65. Lead-Based Paint Disclosure Rule: Housing built before 1978 may contain lead-based paint. Lead from paint, paint chips, and dust can pose health hazards if not managed properly. Lead exposure is especially harmful to young children and pregnant women. Before renting pre-1978 housing, landlords must disclose the presence of known lead-based paint and/or lead-based paint hazards in the dwelling. Tenant must also receive a federally approved pamphlet on lead poisoning prevention. In the event the Leased Premises were constructed before 1978, Landlord shall comply with the Lead-Based Paint Disclosure, 42 U.S.C. § 4852d. 66. Other Applicable Laws: Federal, state, county, or municipal laws and ordinances may affect the Leased Premises, the Lease, and Landlord/Tenant relationship that are not specifically addressed in the Lease. Landlord and Tenant should consult legal counsel prior to execution of the Lease to ascertain such information. 67. ADA Compliance: Tenant shall not cause or permit any violation of the Americans with Disabilities Act (the "ADA") to occur on, or about the Leased Premises by Tenant, its agents, employees, contractors or invitees: Tenant shall indemnity, defend and hold Landlord harmless from any and all claims, judgments, damages, penalties, fines, costs, liabilities, or losses (including, without limitation, diminution in value of the Leased Premises, damages for the loss or restriction of use of rentable or usable space, damages arising from any adverse impact on marketing of space, and sums paid in settlement of claims, attorneys' fees, consultation fees and expert fees) that arise during or after the Term as a result of such violation. This indemnification of Landlord by Tenant includes, without limitation, costs incurred in connection with any investigation of site conditions or any remedial work required by any federal, state, or local governmental agency or political subdivision because of any ADA violation present on or about the Leased Premises. Tenant shall be permitted to make such alterations to the Leased Premises as may be necessary to comply with the ADA, at Tenant's sole expense and upon the prior written consent of Landlord. Without limiting the foregoing, if the presence of any ADA violation on the Leased Premises caused or permitted by Tenant results in remedial work on the Leased Premises, Tenant shall promptly take all actions at its sole expense as are required by any authority to comply with the ADA; provided that Landlord's consent to such actions shall first be obtained, which shall not be reasonably withheld. 68. Recording: Tenant shall not record this Lease or any memorandum or short form thereof without the written consent and joinder of Landlord. Landlord shall have the right to record this Lease and, at the request of Landlord, Tenant agrees to execute the necessary acknowledgments required to record this Lease, in either short or long form. 69. When Lease Becomes Binding: The submission of this document for examination and negotiation does not constitute an offer to lease, or a reservation of, or option for, the Leased Premises, and this document shall become effective and binding only upon the execution and delivery hereof by both Landlord and Tenant. All negotiations, considerations, representations, and understandings between Landlord and Tenant are incorporated herein and may be modified or altered only by agreement in writing between Landlord and Tenant, and no act or omission of any employee or agent of Landlord shall alter, change, or modify any of the provisions hereof. Tenant specifically confirms and acknowledges that: (i) before entering into this Lease, Tenant has made its own observations, studies, determinations and projections with respect to Tenant's business in the Leased Premises and all other factors relevant to Tenant's decision to enter into this Lease, including, without limitation, competition, market size, sales volume, profitability and general "demographics", present and prospective; and (ii) neither Tenant nor any representative of Tenant has relied upon any representation by (or any "conversation" with) Landlord or any representative of Landlord with respect to any of said factors. 70. Force Majeure: Neither Landlord nor Tenant shall be liable for failure to perform any obligation under this Lease, except for the payment of money, in the event it is prevented from so performing by strike, lockout, breakdown, accident, order or regulation of or by any governmental authority or failure to supply or inability by the exercise of reasonable diligence to obtain supplies, parts or employees necessary to furnish such services or because of war or other emergency or for any other cause beyond its reasonable control; provided, however, that (i) Tenant shall not be excused from opening the Leased Premises for the conduct of business by reason of a failure to obtain any necessary permit, and (ii) financial inability shall never be deemed to be a cause beyond a party's reasonable control, and in no event shall either party be excused or delayed in _the payment of any money due under this Lease by reason of any of the foregoing. TOWN OF VAIL/PLUM TV LEASE (Page 13 of 15) Initials: Landlord Tenant 71. Interest: All payments becoming due under this Lease and not paid when due shall bear interest from the applicable due date until received by Landlord at the lesser of (i) twelve percent (12%) per annum above the prime rate announced from time to time in the Wal! Street Journal -Western Edition (Money Rates Section); or (ii) the highest lawful rate of interest permitted at the time in the State of Colorado; said interest charges shall be in addition to any late charge as established by this Lease. 72. Landlord's Lien and Enforcement: Tenant hereby grants to Landlord a security interest in all personal property of Tenant now or hereafter located within the Leased Premises as security for Tenant's performance of Tenant's obligations under this Lease. 73. Fees, Licenses, etc.: Tenant shall pay to Landlord all taxes, excises, license fees and permit fees of whatever nature, applicable to its operation in the Leased Premises and to take out and keep current all licenses, municipal, state or federal required for the conduct of its business hereunder. 74. No Representations by Landlorcd; Entire Agreement: Landlord (including its agents and employees) has made no representations, warranties, agreements or promises with respect to the Leased Premises, except such as are expressed herein. Landlord (including its agents and employees) has made no representations, warranties, agreements or promises with respect to the exact size of the Leased Premises. The entire contract of the parties is contained herein and there are no promises, agreements, representations, warranties, conditions or understandings, either oral or written between them other than as are set forth in this agreement. 75. No Partnership: Notwithstanding anything contained in this agreement to the contrary, Landlord is not and shall not in any way or for any purposes become principal or partner of Tenant in the conduct of its business, or otherwise, or a joint venturer or member of a joint enterprise with the Tenant. 76. Additional Provisions: An Addendum containing additional provisions relating to Plum TV services is attached. The Lease and the attached Addendum constitute the entire agreement between the parties. THE PARTIES SHOULD INITIAL EACH PAGE OF THE LEASE AND SIGN BELOW. EACH PARTY SHOULD RECEIVE A SIGNED COPY OF THE LEASE AND ANY ADDENDA. TOWN OF VAIL/PLUM TV LEASE (Page 14 of 15) Initials: Landlord Tenant TENANT: PLUM TV, INC., a DELAWARE CORPORATION, By: Its: Date: GUARANTOR (if applicable): [Signature) [Print Name) Date: TOWN OF VAIL/PLUM TV LEASE (Page 15 of 15) LANDLORD: THE TOWN OF VAIL, a COLORADO MUNICIPAL CORPORATION, By: Stan Zemler, Town Manager Date: ATTEST Lorelei Donaldson, Town Clerk Initials: Landlord Tenant Town of Vail Barter Proposal The following terms are based on an annual agreement commencing upon the signing of the lease. Ad runs will continue for the life of the lease. Comrrerciai spats will take approximately 2 months to produce and begin airing. Plum proposes to offer the Town of Vail the following in barter: • Creation of a promotional segment advertising Summer Vail, approximately 3 - 4 minutes in length. Segment will be reviewed and updated annually as needed. ,. Segment will air on Plum Vail 2x per day, ROS t6am -11pm1. ., Segment will be available in Denver on Video on Demand and Pium website. Segment will be made available f'or posting on TOV website. Value: $40,000 (approximately $55 per play) • Creation of 30 second promotional spot advertising Summer Vail. Plum will produce 3 separate versions of the spot in conjunction With seasonal updates. Spot will air 2x per day ROS t6am -11 pm) year round on Plum Aspen. t$1535b value) Spot wiN air 2x per day ROS t6am -11 pm) March -June on Plum in Nantucket, the Hamptons and Martha's Vineyard. ($15150 value) .. Spot will air 2x per day in Vail during the live winter morning programming, Fresh Tracks and a minimum of an additional 1x morning programming replay. ($8000 value) Value: $38,500 (Approximately $21 per play) • 50 hours of video production to be used for event coverage or infarmationai content for the Town of Vail. Value: $10,000 . • Plum will invite representatives from the Town of Vail to come on the live show once per week to discuss town related issues including public safety, fire safety, construction updates and promotional opportunities. Value: $4800 Total Value of Package: 593,300 '~;~ ~,~~ e Plum - Channe116 www..plu_mty._com. 953 S. rrontage Rd., W. 5ulte 100 Vail, CO 81657 Phone: 970.476.9600 Pax: 970.476.9696 EGE Air Service Summer History Flight Details Daily Available 2003 Non-Stop Inbound Inbound Carrier City Aircraft Frequency Seats Seats Contract American DFW 757 Daily 188 13,240 Yes United DEN Dash-8 3X-Daily 37 8,678 No Total 21,918 2004 American DFW 757 Daily 188 13,398 No United DEN Dash-8 3X-Daily 37 8,678 No United DEN Airbus 320 Daily 138 13,390 N/A Total 35,466 2005 American DFW 757 Daily 188 16,450 Yes United DEN Dash-8 4X-Daily 37 13,616 No United DEN Airbus 320 Daily 138 11,316 No United ~ ORD A320/757 Daily 138 17,374 Total 58,756 2006 American DFW 757 Daily 188 15,134 ,Yes United DEN Dash-8 4X-Daily 37 13,538 No United DEN Airbus 320 Daily 138 10,128 No United ORD Airbus 320 Daily 138 12,427 Yes Total 51, 227 2007 American DFW 757 Daily 188 15,040 Yes United DEN Dash-8 4X-Daily 37 13,616 No United DEN Airbus 320 Daily 138 12,282 No United ORD Airbus 320 Daily 138 12,696 No Total 53,634 Revenue Overview Cost Per: 70% Load factor 114,013 Pass Passengers $ 5.02 Lodging Guests 62,707 Lodge Guests $ 9.12 5.5 Nights 344,888 Room Nights Per Day or Nigflt $ 1.66 Total Guest Revenue $ 156,767,188 Financial Overview Cap Results $475,000 Loss $22K None Total No Contract was signed None County signed - N/A $150,000 Loss $50K None None County Community $ 22,000 $ - $200,000 Loss $200K Total $ 150,000 $ 100,000 $150,000 Loss$150K None None $150,000 Loss$150K Total $ 150,000 $ 150,000 $150,000 No Loss None None None Total $ - $ _ Grand T $ 322,000 $ 250,000 $ 572,000 Exhibit A EAGLE COUNTY REGIONAL AIRPORT (EGE) HISTORICAL PERBPECTNE OF 8UMMER ENPLANEMENTB V8 TOTAL BEATS STATISTICS BNOVM ARE FROM JUNE t -SEPTEMBER 30 OF EACH 8UMMER 8EA80N BASEO ON NUMBERS REPORTED BY EAOIE COUNTY REGIONAL AIRPORT / Fllphb CompNbd: M 0 81 a ae e2 BO UnBtdlUn6td EJCpTttt 308 108 388 464 440 44E TpBI: 306 IBS 460 642 622 626 /~6UUl Avtlaw. sass: Amtnc.n o ss24o s339e sa6o case s6osz UnBBdNrlBtd Eixpron 8876 6878 22068 37496 3E099 36666 TW/I Aw11BON atBb 8878 21918 36468 63846 61609 60977 lnpNntm/nM: M 0 10742 77029 11661 7002E 71964 UAL/UAX E39- 6640 17301 28292 78986 24029 Tahl: 8399 78682 28390 36848 29011 36383 Lad Faator. AmMan 81.1% 82.3% 70.2% E6.0% 76.6% Unlbd E7.9% 78.4% 87.6% 62.8% 87.0% TeLI: 73.7% 76.7% 79.9% 88.3% 88.3% 69.5% EGE Summer Load Factors eo.o% 80.0% 70.0% 80.0% 50.0% 40,0% 30.0% 20.0% EAGLE COUNTY REGIONAL AIRPORT (EGE) SUMMER GROWTH 6'' , 60000 --- ----- 46000 ~ ~ UAL/UAX OAA -~ Total Avallabla Saab 40000 36000 30000 26000 1~ 20000 15000 soooo 5000 0 . ~ ..,~~ .,. ExhibH B R ~ ~ ~y ~ ~^ 2902 2003 2004 2005 2008 2007 DFW -EGE CONTRACT REVENUE CALCULATIONS Jun. -Sept. 2007 (Summary) LOAD SEGMENT OPERATIONS FACTOR PSGRS REVENUE FACTOR DFW-EGE 80 75.4% 11,304 $1,537,018 -3.4% EGE-DFW 80 74.5% 11,182 $1,698,176 -3.4% TOTAL 80.0 75.0% 11,243.0 $ 3,235,194.00 -3.4% TOTAL REVENUE $1,484,759.39 $1,640,438.02 ~ $ 3,125,197.40 ~ BASE PSGR CHARGE x OPNS = SUBTOTAL CHARGE x PSGRS =SUBTOTAL $ 35,258 80 $ 2,820,640.00 $ 25.66 80 $ 2,820,640.00 BASE MRG 11,243.0 $288,495.38 11,243.00. $ 288,495 ~ $ 3,109,135.38 ~ BOB HILL CAPACITY PLANNING 817-967-2527 ~ $ 16,062.02 ~ Page 1 YEAR OVER YEAR COMPARISON INBOUND EGE PASSENGERS 2007 COMPARED TO 2006 SUMMER FINAL 09/11/07 Dallas as of 9/5/06 Month Ca acit Sold Load Factor June 3,008 2,121 71% July 5,828 4,357 75% August 5,828 3,367 56°!° September 752 181 24% TOTAL 15,416 10,026 65% Dallas 2007 FINAL Seat Sold Month Capacit Sold Load Factor Difference YOY June 3,008 2,275 76% 154 July 5,800 4,585 79% 228 August 5,640 4,239 75% 872 September 564 255 45% 74 TOTAL 15,012 11,354 76% 1,328 Service from June 14 -September 3 Page 2 Airplanners LLC Confidential YOY COMPARISON AMERICAN DALLAS (DFW) ADVANCE BOOKINGS SUMMER SERVICE DATES JUNE 14 -SEPTEMBER 3 DFW-EGE EGE-DFW Month Capacity Sold Load Factor Month June 3,008 2,275 76% June July 5,800 4,585 79% July August 5,640 4,239 75% August September 564 255 45% September Subtotal 15,012 11,354 76% Subtotal Combined Capacity Sold Load Factor ~ Month Capacity Sold Load Factor 2,325 1,577 68% June 5,333 3,852 72% 5,026 4,524 90% July 10,826 9,109 84% 4,944 4,533 92% August 10,584 8,772 83% 457 443 97% September 1,021 698 68% Airplanners LLC Confidential Page 3 EGE Top 50 O&Ds 14Jun-3Sep 2007 MARKET JUN JUL AUG SEP Grand Total DFWEGE 1,866 3,964 4,075 247 10,152 EGEMIA 168 487 457 37 1,149 EGEFLL 248 472 384 37 1,141 EGELGA 149 237 328 51 765 AUSEGE 60 260 227 17 564 EGEIAH 51 201 152 6 410 EGEEWR 61 124 151 7 343 BOSEGE 42 123 146 8 319 EGETPA 60 122 97 9 288 BNAEGE 49 115 110 6 280 ATLEGE 61 108 92 11 272 EGERDU 37 121 95 9 262 EGESAT 32 106 88 4 230 EGEORD 53 80 89 5 227 EGEMSY 70 88 47 2 207 EGEJAN 41 102 63 1 207 EGESHV 21 75 103 7 206 EGEPHL 39 89 60 7 195 EGESTL 17 76 73 4 170 EGEMCO 31 61 64 5 161 DCAEGE 21 49 79 8 157 EGEHOU 13 89 50 4 156 EGEIND 26 59 43 17 145 EGERIC 28 45 66 4 143 CRPEGE 16 52 62 3 133 DTWEGE 24 61 42 2 129 BHMEGE 17 48 60 2 127 CLTEGE 18 46 54 4 122 EGEPBI 33 38 37 10 118 EGELIT 6 53 50 1 110 EGEORF 14 43 48 4 109 EGEVPS 6 53 45 4 108 EGEJAX 28 38 35 3 104 EGEMTY 7 63 25 7 102 EGEMEX 21 40 39 1 101 BTREGE 19 52 28 99 EGERSW 15 28 51 2 96 EGEPNS 26 26 35 1 88 EGEPIT 18 45 21 4 88 EGEMOB 21 51 12 3 87 EGEGSP 13 24 37 11 85 EGETUL 1 56 20 7 84 CVGEGE 19 48 16 1 84 ACTEGE 9 38 29 8 84 EGEIAD 13 32 31 8 84 EGESJU 25 35 21 2 83 BWIEGE 18 39 18 3 78 EGEMFE 26 34 16 76 EGESDF 8 32 31 3 74 EGELFT 9 38 19 1 67 Grand Total 3,674 8,366 8,021 608 20,669 Other 2,072 Total 22,741 44.6% Dallas/Ft Worth 5.1 % Miami 5.0% Ft Lauderdale 3.4% NY LaGuardia 2.5% Austin 1.8% Houston 1.5% Newark 1.4% Boston 1.3% Tampa Bay 1.2% Nashville 1.2% Atlanta 1.2% Raleigh/Durham 1.0% San Antonio 1.0% Chicago 0.9% New Orleans 0.9% Jackson 0.9% Shreveport 0.9% Philadelphia 0.7% St Louis 0.7% Orlando 0.7% Washington National 0.7% Houston -Hobby 0.6% Indianapolis 0.6% Richmond 0.6% Corpus Christi 0.6% Detroit 0.6% Birmingham 0.5% Charlotte 0.5% West Palm Beach 0.5% Little Rock 0.5% Norfolk 0.5% Valparaiso 0.5% Jacksonville 0.4% Monterey, Mexico 0.4% Mexico City 0.4% Baton Rouge 0.4% Ft. Myers 0.4% Panama City 0.4% Pittsburg 0.4% Mobile 0.4% Greensboro 0.4% Tulsa 0.4% Cincinnati 0.4% Waco 0.4% Washington -Dulles 0.4% San Juan 0.3% Baltimore 0.3% McAllen 0.3% Louisville 0.3% Lafayette 9.1 Page 4 Fly Vail Summer Funding 2007 Pledge Funding Company/Organization 1st Tier 2nd Tier 1st Bank Yes AI ine Bank Yes Beaver Creek Resort Com an Yes Beaver Creek Resort Merchants Yes Peak Pro erties Yes Colorado Business Bank Yes Cordillera Metro District Yes Dollar Car A Rental Yes Dou Landin Yes Ea le Count Yes Yes East West Partners Yes Hi h Mountain Taxi Yes Jim Car ill Yes Manor Vail Yes Millennium Bank Yes Park H att Beaver Creek Resort and S a Yes R.A. Nelson Yes Ritz-Carlton, Bachelor Gulch Yes Slifer, Smith and Fram ton Yes Sonnenal Resort of Vail Yes Steadman Clinic Yes The Resort Com an Yes Town of Avon Yes Town of G sum Yes Town of Vail Yes Vail Board of Realtors Yes Vail Resorts Yes Vail Valle Chamber and Tourism Bureau Yes Vail Valle Jet Center Yes Vail Valle Sure Center Yes VVMC/Shaw Re Tonal Cancer Center Yes US Bank Yes Page 5 Airplanners LLC Confidental i TOWN OF VAIN Totun l~l~n~rger Mr. Robert Katz Chief Executive Officer Vail Resorts 390 Interlocken Crescent Broomfield, CO. 80021 November 29, 2007 Re: Compliance with the Core Site Development Agreement Dear Rob: Thank you for your letter dated November 20, 2007, responding the Town of Vail's request for compliance with the Core Site Development Improvement Agreement requirements for employee housing for the Arrabelle at Vail Square project. Your letter indicates Vail Resorts' willingness to post a Letter of Credit to secure its employee housing obligations and offers several options for the construction of the required employee housing. The Town considers your approach a meaningful step toward resolving this issue. I would propose that we move immediately to enter into an amendment to Paragraph 12 of the Core Site Development Agreement that will incorporate our understanding. The amendment should include the following terms: 1. Vail Resorts will post a Letter of Credit (LOC) for $17,345,789. The conditions under which the Letter of Credit can be drawn upon will be detailed in the amendment to the Core Site Development Agreement. In the event the Letter of Credit is drawn upon, the Town will use these funds only for construction of deed restricted workforce housing within the Town. 2. Upon posting of the Letter of Credit, the Town will consider this condition to the issuance of any certificate of occupancy for the Arrabelle at Vail Square project satisfied. Issuance of a temporary certificate of occupancy will depend upon satisfaction of the Town's building code and other requirements for issuance of a certificate of occupancy. 3. After considering the options outlined by Vail Resorts, the Town prefers Vail Resorts pursue the development of employee housing on the parcel referred to as the North Day Lot to satisfy requirements of Paragraph 12 of the Core Site Development Agreement. In order to move forward with development of the North Day Lot, the Town proposes the following sequence of actions: 75 Soaith Frontage Road Dail, Colorado ~165.~ • 970-479-2106 / Fr1X 970-479-2157 • wu~tu. vail~ov. conz ~ Wig, Ktcrci.rniareiz 4. On or before March 1, 2008, Vail Resorts will submit to the Town a ,complete development review application for the North Day Lot. The application must comply with the requirements of the Lionshead Master Plan. 5. The Town and Vail Resorts will work with diligence and in good faith to obtain appropriate development application approvals for the North Day Lot no later than October 31, 2008. If appropriate approvals are obtained by October 31, 2008, Vail Resorts will commence construction on the North Day Lot no later than May 1, 2009. Upon issuance of a certificate of occupancy for the North Day Lot project, the Letter of Credit will be returned to Vail Resorts. 6. If the appropriate approvals for the North Day Lot are not obtained by October. 31, 2008, or if Vail Resorts does not timely commence construction on the North Day Lot if appropriate approvals are timely obtained, the Town reserves the right to elect one of the following options to satisfy the employee housing obligation in the Core Site Development Agreement: a. The Town may proceed with redevelopment of the Timber Ridge site with Vail Resorts purchasing deed restricted workforce housing units in new Timber Ridge development. b. The Town may allow Vail Resorts to purchase units within the Town of Vail and place appropriate deed restrictions on those units. c. The Town will use its best efforts to offer to Vail Resorts an ownership opportunity to acquire all or a portion of the required. employee housing in an alternative project in the Town of Vail. d. In the event all efforts outlined above for the provision of employee housing are unsuccessful, the Town will draw on the Letter of Credit to the extent that the required employee housing has not been. provided. It is the preference of the Town that the North Day Lot be developed to meet the employee housing requirements of the Core Site Development Agreement. This will best accomplish the original intent of the parties. The Town commits to working with Vail Resorts to secure the necessary approvals for the North Day Lot. If an amendment to the Core Site Development Agreement incorporating these terms is acceptable, I can present such an amendment to the Town Council for approval in the near future. We look forward to resolving this complicated matter and celebrating the opening of this exciting new project in Vail. Sincerely, i' :._ /;~-- ~'`--5 an Zemler, Town Manager TOWN OF VAIL VAIL RESOR7S° Just Another Dey in Pornd(sc" November 20, 2007 Mr. Stan Zemler Town Manager Town of Vail 75 S. Frontage Rd. Vail, CO 81657 Dear Stan: Robert Katz Chief Executive Officer 303,404.1801 tel 303,404.6401 fax rketz@vailresorts.com Attached please find a summary term sheet which outlines many of the discussions we have been having over the past few weeks about our ultimate obligation to provide employee housing related to the. Arrabelle development. As you are aware, we do not believe there is any requirement that our company must have an "approved plan" for employee housing or post a letter of credit or bond to be granted a temporary certificate of occupancy ("TCO") for the Arrabelle project. At the same, we have heard from the Town that they are interested in having additional comfort that our company will ultimately provide the employee housing, as is required by the Core Site Development Agreement for the Arrabelle. As such, our term sheet indicates our willingness to post a letter of credit. While we do not agree with the Town's calculation of the $17.3 million, we have used this amount to provide further assurance to the Town o£ our commitment to provide this housing. As we have discussed, our one non-negotiable condition to posting this letter of credit is that our company be pxavided a reasonable path to actually building/purchasing the required employee housing and that this letter of credit be available to the Town only in the event that we default under that obligation. We think this term sheet covers all of the options available to us and fairly balances the Town's and our Company's need for comfort that this obligation will result in our Company's building/purchasing the required employee housing. Our Company is prepared to begin final documentation related to this term sheet immediately, as we will not be able to post the letter of credit until execution of the documentation related to it is complete. At the same time, we believe it is critical for all parties not to delay the issuance of a TCO for any part of the Arrabelle project. Even withholding TCOs for the residential portion of the project will elevate this issue between us and with our buyers. As we have previously indicated, our Company would be willing to ensure that the Town's issuance of a TCO in December does not prejudice any of the rights it believes are available to it to withhold TCOs for future portions of the project based on the employee housing issue. With only 20% of the estimated revenue from real estate sales for the project coming in December, there is ample opportunity for all parties to resolve this issue in an orderly manner. At the same time, we are fully prepared to finalize any agreement by the end of this rrionth, if.the Town desires to do so. BRECKENRIDGE ~ ~,~J~d~ T~~ ~V~ii. 0~~ l~SKrRE50RT iti;YSTOE~E' ~f~'eavenly ROCKRESOR75' `"~'LO°~~"D11~1~T'Y~ Vail Resorts, Inc. 390 tnteriacken Crescent Suite 1000 Broomfield, C080021 www.enow.com Z`D Despite the many miscommunications and misunderstandings between us, we believe that all parties agree on the most important point- that our company must fulfill its employee housing obligation related to the Arrabelle project. This proposal is our best .effort to memorialize this in a balanced approach. As you are also aware, we have held up resolving our employee housing needs for the Front Door project, awaiting the outcome of the Timber Ridge discussion. Our company is fully prepared to post a separate LC for that obligation as well under the terms outlined in the attached term sheet. Given the amount of beds related to Front Door and the ability of our company to satisfy that obligation anywhere within the Town of Vail, we do not see the same complexity to resolve that issue. We very much look forward to working with the Town on all of these matters, with the ultimate goal of improving the number and quality of employee and affordable housing units in the Town of Vail. Sincerel , ~.._.-- ~ Rob Katz Chief Executive Officer The Vail Corporation and Affiliates ("Vail Corp") Summary of Proposed Terms Employee Housing Requirements For Arrabelle Project November 20, 2007 For Discussion Purposes Only Vail Corp would satisfy its employee housirig requirements for the Arrabelle Project of 120 employee housing beds ("Required Beds") through one of the following options as more fully set forth below: i) development of Timber Ridge, ii) the purchase of units from a third party developer of Timber .Ridge iii) incorporation of the requisite 120 beds within a development of the North Day Lot, or iv) the purchase o~ establishment of deed restricted units within the Town of Vail. The Town of Vail may elect which option it desires the Vail Corp to pursue to satisfy its obligation and Vail Corp may at any time reduce its obligation to provide Required Beds through the purchase or establishment of deed restricted units within the Lionshead area of the Town of Vail. Vail Corp's performance shall be secured by a letter of credit which may only be drawn upon in the event that Vail Corp fails to perform under any of these options as set forth below. Vail Corp would post an irrevocable standby letter of credit in the amount of $17.3 million to secure the employee housing requirements. When the letter of credit is posted, all obligations of Vail Corp listed in Section 12 of the Core. Site Development Agreement would be satisfied in all respects. At the Town's election the parties could proceed to negotiate a ground lease for redevelopment of Timber Ridge (the "Timber Ridge Ground Lease") in accordance with Vail Corp's proposal to the Town dated October 24, 2007. The parties could also consider other development options for Vail Corp to pursue on Timber Ridge. (i} If and when the Timber Ridge Ground Lease is executed and the $22 million ground rent payment is made, or such other mutually agreeable development option is documented and executed between the parties, the letter of credit would be returned to Vail Corp. If the Town determines to redevelop Timber Ridge through athird-party developer: (i} Vail Corp would commit to acquire units on commercially reasonable terms sufficient to house the Required Beds {such units having features, amenities, sizing and design of comparable employee housing beds in the Town of Vail today). Vail Corp would purchase such units at the third party developer's cost, not to exceed $131,385 per bed. If the cost exceeds $131,385 per bed then Vail Corp would not be required to purchase the units from the third parry developer and the parties would work together to arrive at a mutually agreeable solution, or in the alternative tihe Town could elect for one of the other options hereunder. 803501.5 A[CFiANS (ii) Any purchase contract made (a "Timber Ridge Purchase Contract") would provide for closing 90 days after issuance of a TCO to the third party developer and. satisfaction of any other legal conveyancing requirements. Upon the closing under such contract the letter of credit would be returned to Vail Corp. {iii) If closing of any Timber Ridge Purchase Contract is not completed because of Vail Corp's uncured default there under, the Town may draw the letter of credit to satisfy the employee housing requirements. At the Town's election, Vail Corp would prepare and submit to the Town and diligently process a good faith proposal of a development plan for amixed-use project on the North Day Lot (NDL). The NDL development plan put forth would incorporate and subsume,, as part of the mix of uses that Vail Carp may propose, deed-xestricted units suff dent for Required Beds. The proposal would be reviewed under the applicable Town zoning standards and processes, with consideration of zoning modifications and variances as applicable, and with the Town also to proceed in good faith. The Town would not have the right to mandate material changes or additions to the proposed uses. However, in the event that Vail Corp and the Town of Vail are unable to arrive at a mutually agreeable mixed-use plan after a good faith effort, then the parties may mutually consider a plan for the NDL that includes employee housing only. If the parties are unable to mutually agree upon an employee housing only plan for the NDL then the Vail Corp shall not be required to proceed with such plan and instead the Town shall elect one of the other options hereunder. Further, if an NDL proposal made by Vail Corp is not approved by the Town within one (1) year after initial application, Vail Corp at its election could abandon the proposal, without the letter of credit being subject to draw, and the Town could then elect for one of the other options hereunder. If any NDL proposal is given Town approval, Vail Corp and the Town would then be obligated to proceed with the NDL development, with the letter of credit to be returned upon the issuance of a TCO for that development. As the Town's fourth option, and at the Town's election, Vail Corp would be obligated to satisfy the employee housing requirement by the provision ofdeed-restricted units within the Town that have capacity for the Required Beds. This may be accomplished by Vail Carp acquiring ownership of deed-restricted units and/or by securing the requisite deed restrictions on units owned by others. (i) Provision of the requisite units must be completed within one year after the Town gives notice exercising this election, or else the '1'ovvn may draw the letter of credit to satisfy the employee housing requirement. {ii) This election may not be exercised if a Timber Ridge Ground Lease or a Timber Ridge Purchase Contract has been made, or if an NDL development plan proposal has been approved by the Town; however, if closing of a Timber Ridge Purchase Contract fails for any reason other than Vail Corp's uncured default, the election may be exercised at that time. so}soi.s nruinrrs The Town shall be allowed to draw on the letter of credit only in the event that Vail Corp fails to perform under the four options and as expressly set forth above. In the event the Town draws upon the letter of credit, in whole or in part, such funds shall be used solely for the purpose of acquiring new employee housing within the Town and in accordance with the Town's new employee housing ordinance. In any event and at any time, the amount of the letter of credit would be reduced proportionately to account for deed-restricted units. provided by Vail Corp through any of the options listed above or by Vail Corp providing for ,deed restricted units in the Lionshead area of the Town of Vail. 803501.5 AK}fANS The Vail Corporation and Affiliates ("Vail Corp") Summary of Proposed Terms Employee Rousing Requirements The Front Door Project November 20, 2007 For Discussion Purposes Only Vail Corp would satisfy its aggregate employee housing requirements of 9 beds for the Front Door Project by the purchase ar establishment of deed-restricted units within the Town of Vail, as provided below. Vail Corp's performance in this regard would be secured by 2 separate letters of credit, as, set forth below, each of which may only be drawn upon in the event that Vail Corp fails to satisfy the employee housing requirement secured by that letter of credit, as also set forth below. The provision of the applicable letter of credit would satisfy in all respects the employee housing requirements secured by that letter of cxedit, including, without limitation, any related conditions to the issuance of certificates of occupancy. Vail Corp would post an irrevocable standby letter of credit in the amount of $823,784 to secure the employee housing requirement attributed to the skier services facility of 6.27 employee housing beds. Similarly, Vail Corp would post an irrevocable standby letter of credit in the amount of $358,681 to secure the employee housing requirement attributed collectively to the ski club and the Lodge at Vail spa (including the complement of new guest units} of 2.'73 employee housing beds. The letter of credit for the skier services facility would have to be posted pxior to the issuance of any certificate of occupancy for the skier services facility, and the letter of credit for the ski club and spa would have to be posted before the is:;uance of any certificate of occupancy for either of them. The amount of each letter of credit is based on the applicable number of employee housing beds multiplied by the prevailing in-lieu rate of $131,385 per bed under the Town's new "inclusionary" zoning (and we are proceeding in this fashion even though we do not necessarily concrtt that the application of the inclusionary zoning is appropriate). Vail Corp would be required to satisfy the employee housing requirement attributed to the skier services facility by the provision of deed-restricted units within the Town that have a capacity of 6 employee housing beds. Similarly, Vail Corp would be required to satisfy the employee housing requirf;ment attributed to the ski club and spa by the provision of deed-restricted units within the Town that have a capacity of 3 employee housing beds. This may be accornplished by Vail Corp acquiring ownership of deed-restricted units and/or by securing the requisite deed restrictions on units owned by others. Vail Corp must complete the provision of the requisite deed-restricted units within .six (6) months aftex the issuance of a certificate of occupancy for the applicable facilities (in the one case, the skier services facility, and in the other case, either the ski club or spa). If Vail Corp fails to do so in either case, TOV may draw the corresponding letter of credit to satisfy the employee housing requirements. 303579.2 RCFISH Any permitted draws under either letter of credit would be reduced proportionately (based on the in-lieu fee per bed} to account for any deed-restricted units provided by Vail Corp (whether by acquisition of the unit or the deed restriction) within the Town that are allocated to the corresponding employee housing requirement. The employee housing requirement for the skier services facility would be independent of the employee housing requirement for the spa and ski club, and any failure to satisfy one requirement would not constitute a deemed failure to satisfy the other requirement, Furthermore, the aggregate employee housing requirements for the Front Door Project would not be attributed to or imposed upon any components of the Front Door Project other than.the skier services facility, the ski club and the spa as set forth in the foregoing provisions. 803539.2 RCFlSH 2 MEMORANDUM TO: Town Council FROM: Community Development Department DATE: December 4, 2007 SUBJECT: Second reading of Ordinance No. 34, Series of 2007, an ordinance amending the Official Zoning Map for the Town of Vail in accordance with Title 12, Zoning Regulations, Chapter 5, Zoning Map; Rezoning Lot 8B, Block 2, Vail Potato Patch, from High Density Multi-Family (HDMF) District to Housing (H) District, and setting forth details in regard thereto. (PEC-0059) Applicant Planner: SUMMARY Sonnenalp Properties, Inc., represented by Gwathmey Pratt Schultz Lindall Architects Scot Hunn The Applicant, Sonnenalp Properties, Inc., represented by Henry Pratt, Gwathmey Pratt Schultz Lindall Architects (GPSL), is requesting a second reading of Ordinance No. 34, Series 2007, an ordinance amending the Official Zoning Map for the Town of Vail in accordance with. Title 12, Zoning Regulations, Chapter 5, Zoning Map, to allow for a rezoning of a property from High Density Multiple-Family (HDMF) District to Housing (H) District, located at 501 North Frontage Road, Lot 8B, Block 2, Vail Potato Patch. The Applicant has submitted the application in anticipation of the redevelopment of the property known as Solar Vail. BACKGROUND On October 8, 2007, the Town of Vail Planning and -Environmental Commission (PEC) held a public hearing on the request to amend the Official Zoning Map of the Town of Vail. Upon consideration of the request, as well as, applicable criteria and findings, the Commission unanimously approved a motion recommending approval of the rezoning request to the Vail Town Council. Additional background pertaining to the request, as well as, details of the proposed zone district boundary amendment, applicable criteria, and applicable findings are included in the October 8, 2007 Planning and Environmental Commission Staff memorandum. On November 20, 2007, the Council voted unanimously to approve Ordinance No. 34, Series of 2007, on first reading. STAFF RECOMMENDATION The Community Development Department recommends that the Town Council approves Ordinance No. 34, Series of 2007, on second reading, an ordinance amending the Official Zoning Map for the Town of Vail in accordance with Title 12, Zoning Regulations, Chapter 5, Zoning Map; Rezoning Lot 8B, Block 2, Vail Potato Patch, from High Density Multi-Family (HDMF) District to Housing (H) District„ and setting forth details in regard thereto. Staff's recommendation is based upon the review of the criteria noted in the October 8, 2007, staff memorandum to the Planning and Environmental Commission and .the evidence and testimony presented. Should the Town Council choose to ap~>rove Ordinance No. 34, Series of 2007, on second reading, the Community Development Department recommends the Town Council makes the following findings: "The Town Council finds that the applicant has demonstrated to the satisfaction of the Council, based upon the evidence and testimony presented: That the amendment is consistent with the adopted goals, objectives and policies outlined in the Vail Comprehensive Plan and compatible with the development objectives of the Town, based upon the review outlined in Section Vlll of the Staff's October 8, 2007, memorandum to the Planning and Environmental Commission; and 2. That the amendment is compatible with and suitable to adjacent uses and appropriate for the surrounding areas, based upon the review outlined in Section Vlll of the Staff's October 8, 2007, memorandum to the Planning and Environmental Commission; and 3. That the amendment promotes the health, safety, morals, and general welfare of the Town and promotes the coordinated and harmonious development of the Town in a manner that conserves and enhances its natural environment and its established character as a resort and residential community of fhe highest quality, based upon the review outlined in Section Vlll of the Staff's October 8, 2007, memorandum to the Planning .and Environmental Commission." IV. ACTIONS REQUIRED OF COUNCIL The Town Council can vote to approve, approve with modifications, or deny Ordinance No. 34, Series of 2007, upon second reading. V. ATTACHMENTS A. Ordinance 34, Series of 2007 ~.~ .~ Attachment A ORDINANCE NO. 34 Series of 2007 AN ORDINANCE AMENDING THE OFFICIAL ZONING MAP OF THE TOWN OF VAIL IN ACCORDANCE WITH TITLE 12, ZONING REGULATIONS, CHAPTER 5, ZONING MAP; REZONING LOT 8B, BLOCK 2, VAIL POTATO PATCH ,FROM HIGH DENSITY MULTIIPLE FAMILY (HDMF) DISTRICT, TO HOUSING (H) DISTRICT, AND SETTING FORTH DETAILS IN REGARDS THERETO. WHEREAS, Chapter 5, Zoning Map, of the Vail Town Code establishes the procedures for evaluating changes to the Official Zoning Map of the Town of Vail ("Zoning Map"}; and WHEREAS, the proposed amendment to the "Zoning Map" has been reviewed in accordance with the prescribed requirements outlined in Sections 12-3-1 through 12-3-7 of the Zoning Regulations of the Vail Town Code; and WHEREAS, on October 8, 2007, the Planning and Environmental Commission of the Town of Vail reviewed and forwarded a recommendation of approval of the proposed amendment to the "Zoning Map" to the Vail Town Council in accordance with the criteria and findings outlined in Section 12-3-7 of the Zoning Regulations of the Town of Vail; and WHEREAS, the Vail Town Council finds the proposed amendment to the "Zoning Map" is consistent with the adopted goals, objectives and policies outlined in the Vail Comprehensive Plan, the Vail Village Master Plan and is compatible with the development objectives of the Town; and WHEREAS, the Vail Town Council finds the amendment to the "Zoning Map" is compatible with and suitable to adjacent uses and appropriate for the surrounding areas; and WHEREAS, the Vail Town Council finds the amendment to•the "Zoning Map" promotes.the health, safety, morals, and general welfare of the Town and promotes the coordinated and harmonious development of the Town in a manner that conserves and enhances its natural environment and its established character as a resort and residential community of the highest quality. ORDINANCE NO 34, SERIES OF 2007 NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF VAIL, COLORADO, THAT: Section 1. Zoning Map Amendment: The purpose of this Ordinance is to amend the Official Zoning Map of the Town of Vail. The Official Zoning Map of the Town of Vail is hereby amended as follows: Lot 8B, Block 2, Vail Potato Patch, shall be re-zoned from High Density Multiple Family (HDMF) District to Housing (H) District, as illustrated on Exhibit A attached hereto. Section 2. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such decision shall not effect the validity of the remaining portions of this ordinance; and the Town Council hereby declares it would have passed this ordinance, and each part, section, subsection, sentence, clause or phrase thereof, regardless of the fact that any one or more parts, sections, subsections, sentences, clauses or phrases be declared invalid. , Section 3. The Town Council hereby finds, determines and declares that this ordinance is necessary and proper for the health, safety and welfare of the Town of Vail and the inhabitants thereof. Section 4. The amendment of any provision of the Town Code as provided in this ordinance shall not affect any right which has accrued, any duty imposed, any violation that occurred prior to the effective date hereof, any prosecution commenced, nor any other action or proceeding as commenced under or by virtue of the provision amended. The amendment of any provision hereby shall not revive any provision or any ordinance previously repealed or superseded unless expressly stated herein. ORDINANCE NO 34, SERIES OF 2007 Section 5. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are repealed to the extent only of such inconsistency. This repealer shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof, theretofore repealed. INTRODUCED, READ ON FIRST READING, APPROVED, AND ORDERED PUBLISHED ONCE IN FULL ON FIRST READING this 20"'day of November, 2007 and a public hearing for second reading of this Ordinance set for the 4th day of December, 2007, in the Council Chambers of the Vail Municipal Building, Vail, Colorado. Richard D. Cleveland, Mayor Attest: Lorelei Donaldson, Town Clerk INTRODUCED, READ, ADOPTED AND ENACTED ON SECOND READING AND ORDERED PUBLISHED IN FULL this 4th day of December, 2007. Richard D. Cleveland, Mayor Attest: Lorelei Donaldson, Town Clerk ORDINANCE NO 34, SERIES OF 2007 ~ ~ - .._ ~ - ., . ..,K-.. _., . . _ ._, ~. ~` Salar Vail - Lot. 8B, Block 2, Vail Potato~.Patch ~ Rezoning from High'Densty Multiple FamilyrDistrictto Housing 'District ~ ~~~~ ` ~ Ordina nce~34:, Series. 200 , = + ~ T i y. ~1 .~i ~.~ aG { GYl ''~~ .~ ~.. (•~ ,{ ~Y,~ ~~ '_ ~Irl ~ 1aY-' .J^`~tl air~JY *~"'$~~h ' f " * ' p V ' ~. ~ 1.,, ~ ~ . i ~ .. ~ ~ ~ , f ~, yw7~;A ~"' '~n ' is ~ x, ~ ~'[. r ^ ^ ' y ~ r^ . ~. {"; eiy-. z~ ~. ~..'"b~ j ~. ~*..t.1 r r~ ~5°'fFY ~-. r a ~' ?.S F"' ~, c '- t . `. v ' ^r ~ r . Yt; } ~'~ E4 it ~ C ' ~ ',~' ~ i. , ~,. 7..~ ~ ~{;' r ~.Y i .. ;~,r+ r` 7i r ` ~~ ,., v ~ Y~.~~t~ r Y s ~ .` '~ L. ~ ~T4+4-~`~~M-„ ~ r r t-~,,7-t~.~ .. ;~.~ ti, ti A ~~.. ,~ ,1 :3 x , x-~ 1 r r n~ ~ .'ic '~~ {~.r~ ,~~ ~, r~;,.r ;, ,~., .` ~`,~'.. ~ ,~ ~.s . - '+ lI .~rTM ! ~ ~' , j~ .{j ~,fl`' ~'~~'~'~ f ~! ++++yyyy G-~ 4y'_-~ ~ r r- a't f Y ~"j~ i 'r K 1~ 4Yr ~ y$ yr ~ ~ 1` ~ ~ ,F ~ l+~' ' " T iG ~ J ~' F I ; ' rn X . ~ e r~. ~/ '~''. X „ "~ r~ (Yra_ r ~ q/ r; v +, . . y r" ~ ~ ' ; ~~ ~ i ~ c ,r.* -~y , . Subject Site r ~ ' ~ . , • 3 ,,,. a . Iw t ' y ~ i St. 4 i r ^~ ~y J r~ `}vii` l ~t.~ ~. ` }~ YC-6 ~~~ ~ r `" .~ ~, '. ;~,s ~ I ~ ~ _ t ., % 'l ~a1~ ~P "s ~ r' 1}~~ ~~ ~Ya' ~ 1 FY 1'~ ~ ,". ..4 v . y V~/ a4 ~ ~ ~~f ~" ~ ~ ~j+' i~ ar ~ f.~~~-..~~ ~ ~ d w '~ Tr ''til 4_ ~'-! ` ~~.~;~' ST y.. -,~- - --- .,__ ~. ,, '--~ ,....- -...._...- _~~_, IMJ ZONING Two-Family Primary/Secondary Residential (PS) High Density Multiple Family (HDMF) . Housing (H) A Lionshead Mixed Use 1 (LMU-1) Outdoor Recreation (OR) w,~' ~ Natural Area Preservation (NAP) ~`;s; General Use (GU) Not Designated ~. lkD ©~p e ~ J Fir This maP'~'as aea[eE 6y 1he Twn at Val GIS workgroup. Use of W s map sM1wIE be fa genera! W rpottz orJy. p ~ 1~ TheTOwn of Vai does rrotvrnarathe acara<y of the lrrtartnaEOn mn2irieE bereln. (wlxre zbo•.m, parch ina work o apponmarei ~ MEMORANDUM TO: Town Council FROM: Community Development Department DATE: December 4, 2007 SUBJECT: Second reading of Ordinance No. 35, Series of 2007, an ordinance amending Sections 12-61-3, Conditional Uses, and 12-16-7, Use Specific Criteria and Standards, Vail Town Code, to add "Professional Offices and Business Offices" to the list of allowable. conditional uses in the Housing (H) District, and setting forth details in regard thereto. (PEC07-0059) Applicant: Sonnenalp Properties, Inc., represented by Gwathmey Pratt Schultz Lindall Architects Planner: Scot Hunn DESCRIPTION OF THE REQUEST The Applicant, Sonnenalp Properties, Inc., represented by Henry Pratt, Gwathmey Pratt Schultz Lindall Architects (GPSL), is requesting a second reading of Ordinance No. 35, Series of 2007, an ordinance amending Sections 12-61-3, Conditional Uses, and 12-16- 7, Use Specific Criteria and Standards, Vail Town Code, to add "Professional Offices and Business Offices" to the list of allowable conditional uses in the Housing (H) District, and setting forth details in regard thereto. As proposed, the text amendment would allow for the operation of both professional. and business offices, including "offices for physicians, dentists and similar medical practices" within the H District, as further defined in Section 12-2-2, Definitions, Vail Town Code, and with certain limitations and restrictions on each use as further set forth in Section 12-16-7, Use Specific Criteria and Standards. BACKGROUND On October 8, 2007, the Town of Vail Planning and Environmental Commission (PEC) held a public hearing on the request for a text amendment to the Vail Town Code. Upon consideration of the request, .the Commission unanimously approved a motion recommending approval of the text amendment request to the Vail Town Council. Additional background pertaining to the request, as well as, details of the proposed text amendments, applicable criteria, and applicable findings are included in the October 8, 2007 Planning and Environmental Commission Staff memorandum (Attachment B). On November 20, 2007, Council voted unanimously to approve Ordinance No. 35, Series of 2007, on first reading, with suggested revisions to the text amendment. Specifically, the Council directed staff to strike. sub-paragraph "a", of subsection 15, of Section 12-16-7: Use Specific Criteria and Standards, to specifically allow for "offices for physicians, dentists and similar medical practices." III. STAFF RECOMMENDATION The Department of Community Development recommends that the Vail Town Council approve Ordinance No. 35, Series of 2007, on second reading to amend Section 12-61- 3, Conditional Uses, Vail Town Code, to add "Professional Offices and Business Offices" to the list of allowable conditional uses in the Housing (H) District, and setting forth details in regard thereto. ,Staff's recommendation is based upon the review of the criteria noted in Section VI of the October 8, 2007 Planning and Environmental Commission Staff memorandum and the evidence and testimony presented. Should the Town Council choose to aapprove Ordinance No. 35, Series of 2007, on second reading, the Department of Community Development recommends the Town Council make the following findings: 1. That the amendments are consistent with the applicable elements of the adopted goals, objectives and policies outlined in the Vail Comprehensive Plan and is compatible with the development objectives of the Town, based upon the. review. outlined in Section VI of the Staff's October 8, 2007, memorandum to the Planning and Environmental Commission; and 2. That the amendments further the general and specific purposes of Title 12, Zoning Regulations, Vail Town Code, based upon fhe review outlined in Section VI of the Staff's October 8, 2007, memorandum to the Planning and Environmental Commission; and 3. That the amendments promote the health, safety, morals, and general welfare of the Town and promote the coordinated and harmonious development of the Town in a manner that conserves and enhances its natural environment and ifis established character as a resort and residential community of the highest quality, based upon the review outlined in Section VI of the Staff's October 8, 2007, memorandum to the Planning and Environmental Commission. IV. ACTION REQUIRED OF COUNCIL The Town Council can vote to approve, approve with modifications, or deny Ordinance No. 35, Series of 2007, upon second reading. V. ATTACHMENTS A. Ordinance No. 35, Series of 2007 Attachment A ORDINANCE NO. 35 SERIES OF 2007 ORDINANCE NO. 35, SERIES OF 2007, AN ORDINANCE AMENDING SECTION 12-61-3, CONDITIONAL USES, AND SECTION 12-16-7, USE SPECIFIC CRITERIA AND STANDARDS, VAIL TOWN CODE, TO ADD "PROFESSIONAL OFFICES AND BUSINESS OFFICES" TO THE LISTOF ALLOWABLE CONDITIONAL USES IN THE HOUSING (H) DISTRICT, AND SETTING FORTH DETAILS tN REGARD THERETO. WHEREAS, the Planning and Environmental Commission of the Town of Vail has held public hearings on the proposed amendments in accordance with the provisions of the Vail Town Code; and WHEREAS, the Planning and Environmental Commission of the Town of Vail recommended approval of these amendments at its October 8, 2007 meeting, and has submitted its recommendation to the Vail Town Council; and WHEREAS, the Planning and Environmental Commission finds that the proposed amendments are consistent with the applicable elements of the adopted goals, objectives and policies ou#lined in the Vail Comprehensive Plan and are compatible with the development objectives of the Town; and WHEREAS, the Planning and Environmental Commission finds that the proposed amendments promote the health, safety, morals, and general welfare of the Town and promote the coordinated and harmonious development of the Town in a manner that conserves and enhances its natural environment and its established character as a resort and residential community of the highest quality; and WHEREAS, the Vail Town Council considers it in the interest of the public health, safety, and welfare to adopt these amendments to the Town Code. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF VAIL, COLORADO, THAT: Ordinance No. 35, Series of 2007 Section 1. The purpose of this ordinance is to amend Section 12-61-3, Conditional Uses, Vail Town Code, to add "Professional Offices and Business Offices" to the list of allowable conditional uses in the Housing (H) District, and to amend Section 12-16-7, Use Specific Criteria and Standards, Vail Town Code, to add paragraph 15, "Business Offices and Professional Offices in the Housing (H) District". (Text that is to be deleted is ~+r Text that is to be added is bold. Sections of text that are not amended may be omitted.) Section 2. Section 12-61-3, Conditional Uses (in part) is hereby amended as follows: The following conditional uses shall be permitted in the H district, subject to issuance of a conditional use permit in accordance with the provisions of chapter 16 of this title: Commercial uses which are secondary and incidental (as determined by the planning and environmental commission) to the use of employee housing and specifically serving the needs of the residents of the development, and developed in conjunction with employee housing, in which case the following uses may be allowed subject to a conditional use permit: Banks and financial institutions. Child daycare facilities. Eating and drinking establishments. Funiculars and other similar conveyances. Health clubs. Personal services, including, but not limited fo, laundromafs, beauty and barber shops, tailor shops, and similar services. Retail stores and establishments. Business offices and professional offices as further regulated by Section 12-16-7 of this title. Dwelling units (not employee housing units) subject to the following criteria to be evaluated by the planning and environmental commission: . A. Dwelling units are created solely for the purpose of subsidizing employee housing on the property, and 8. Dwelling units are not the primary use of the property. The GRFA for dwelling units shall not exceed thirty percent (30%) of the total GRFA constructed on the property, and Ordinance No. 35, Series of 2007 2 C. Dwelling units are only created in conjunction with employee housing, and D. Dwelling units are compatible with the proposed uses and buildings on the site and are compatible with buildings and uses on adjacent properties. Outdoor patios. Public and private schools. Public buildings, grounds and facilities. Public parks and recreational facilities. Public utilities installations including transmission lines and appurtenant equipment. Type VI employee housing units, as further regulated by chapter 13 of this title. Section 3. Section 12-16-7 (in part) is hereby amended as follows: 15. Business Offices and Professional Offices in fhe Housing (H) District: a. Business and professional offices shall be secondary to the residential use of the District. The net floor area of the office use shall be not greater than 15% of the net floor area of the development site. b. The sale of merchandise shall be prohibited. c. Off-street parking shall be provided in accordance with the provisions of Chapter 12-10 of fhis title and shall be clearly separate from the area designated for residential parking. d. No overnight parking or storage of commercial vehicles associated with fhe professional or business office use shall be permitted. e. Signage shall be permifted in accordancde with Section 11-6-3-A: Business Signs within Sign District 1 (Title 11: Sign Regulations, Vail Town .Code) and shall be subject to design review. f. The number of employees allowed in a business office or professional office within the Housing District shall not exceed one employee for each 200 square feet of net f/oor area. g. Homeowner Association or property owner approval shall be required of all Conditional Use Permit applications for a Professional Office or a Business Office within the Housing (H) District pursuant to Section 12-11-4: B:D, Application Form, Vail Town Code. Section 4. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such decision shall not effect the validity of the remaining portions of this ordinance; and the Town Council hereby declares it would have Ordinance No. 35, Series of 2007 3 r passed this ordinance, and each part, section, subsection, sentence, clause or phrase thereof, regardless of the fact that any one or more parts, sections, subsections, sentences, clauses or phrases be declared invalid. Section 5. The Town Council hereby finds, determines and declares that this ordinance is necessary and proper for the health, safety and welfare of the Town of Vail and the inhabitants thereof. Section 6. The amendment of any provision of the Town Code as provided in this ordinance shall not affect any right which has accrued, any duty imposed, any violation that occurred prior to the effective date hereof, any prosecution commenced, nor any other action or proceeding as commenced under or by virtue of the provision amended. The amendment of any provision hereby shall not revive any provision or any ordinance previously repealed or superseded unless expressly stated herein. Section 7. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are repealed to the extent only of such inconsistency. This repealer shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof, theretofore repealed. INTRODUCED, READ ON FIRST READING, APPROVED, AND ORDERED PUBLISHED ONCE IN FULL ON FIRST READING this 20th day of November, 2007 and a public hearing for second reading of this Ordinance set for the 4th day of December, 2007, in the Council Chambers of the Vail Municipal Building, Vail, Colorado. Richard D. Cleveland, Mayor Attest: Lorelei Donaldson, Town Clerk Ordinance No. 35, Series of 2007 4 INTRODUCED, READ, ADOPTED AND ENACTED ON SECOND READING AND ORDERED PUBLISHED IN FULL this 4th day of December, 2007. Richard D. Cleveland, Mayor Attest: Lorelei Donaldson, Town Clerk "Ordinance No. 35, Series of 2007 5 ORDINANCE NO. 36 SERIES OF 2007 AN ORDINANCE PROVIDING FOR THE LEVY ASSESSMENT AND COLLECTION OF TOWN AD VALOREM :PROPERTY TAXES DUE FOR THE 2007 TAX YEAR AND PAYABLE IN THE 2008 FISCAL YEAR. WHEREAS, it is necessary for the Town Council to provide for the levy, assessment and collection of Town ad valorem property taxes due for the 2007 year and payable in the 2008 fiscal year. NOW, THEREFORE, be it ordained by the Town Council of the Town of Vail, Colorado, that: 1. For the purpose of defraying part of the operating and capital expenses of the Town of Vail, Colorado, during its 2008 fiscal year, the Town Council hereby levies a property tax of 4.742 mills upon each dollar of the total assessed valuation of $920,012,270 for the 2007 tax year of all taxable property within the Town, which will result in a gross tax levy of $4,363,022 calculated as follows: Base mill levy 4.690 $4,314,858 Abatement levy .052 48,164 Total, mill levy 4.742 4 363 022 Said assessment shall be duly made by the County of Eagle, State of Colorado, as directed by the Colorado Revised Statutes (1.973 as amended), and as otherwise required by law. 2. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining portions of this ordinance; and the Town Council hereby declares it would have passed this ordinance, and each part, section, subsection, sentence, clause or phrase thereof, regardless of the fact that any one or more parts, sections, subsections, sentences, clauses or phrases be declared invalid. 3. The Town Council hereby finds, determines, and declares that this ordinance is necessary and proper for the health, safety, and welfare of the Town of Vail and the inhabitants thereof. 4. The repeal or the repeal and reenactment of any provision of the Municipal Code of the Town of Vail as provided in this ordinance shall not affect any right which has accrued, Ordinance 36, Series of 2007 1 an_y duty imposed, any violation that occurred prior to the effective date hereof, any prosecution commenced, nor any other action or proceedings as commenced under or by virtue of the provision repealed or repealed and reenacted. The repeal of any provision hereby shall not revive any provision or any ordinance previously repealed or superseded unless expressly stated herein. All bylaws, orders, resolutions, and ordinances, or parts thereof, inconsistent herewith are repealed to the extent only of such inconsistency. This repealer shall not be constnied to revise any bylaw, order, resolution, or ordinance, or part thereof, theretofore repealed. INTRODUCED, READ ON FIRST READING, APPROVED AND ORDERED PUBLISHED ONCE IN FULL, this 20th day of November, 2007. A public hearing shall be held hereon at 6 P.M. on the 4th day of December, 2007, at the regular meeting of the Town Council of the Town of Vail, Colorado, in the Municipal Building of the Town. Dick Cleveland, Mayor ATTEST: Lorelei Donaldson, Town Clerk READ AND APPROVED AS AMENDED ON SECOND READING AND ORDERED PUBLISHED IN FULL this 4ti' day of December, 2007. Dick Cleveland, Mayor ATTEST: Lorelei .Donaldson, Town Clerk Ordinance 36, Series of 2007 2 .. ORDINANCE NO. 37 , Series of 2007 AN ORDINANCE ADOPTING A USE TAX ON CONSTRUCTION AND BUILDING MATERIALS; AMENDING TITLE 2, REVENUE AND FINANCE, VAIL TOWN CODE BY THE ADDITION OF CHAPTER 8 "USE TAX ON CONSTRUCTION AND BUILDING MATERIALS"; AND SETTING FORTH DETAILS IN REGARD THERETO WHEREAS, the Town of Vaif (the "Town"), in the County of Eagle and State of Colorado, is a home rule municipal corporation duly organized and existing under laws of the State of Colorado and the Town Charter (the "Charter"); WHEREAS, the members of the Town Council of the Town of Vail (the "Council") have been duly elected and qualified; WHEREAS, at an election held on November 6, 2007, the voters of the Town approved the .following ballot question: "SHALL THE TOWN OF VAIL'S TAXES BE INCREASED BY $4,000,000 IN FISCAL YEAR 2008 AND BY WHATEVER ADDITIONAL AMOUNTS ~ ARE RAISED ANNUALLY THEREAFTER THROUGH THE ADOPTION 'OF A USE TAX ON THE PRIVILEGE OF STORING, USING AND/OR CONSUMING IN THE TOWN OF VAIL ANY CONSTRUCTION AND/OR BUILDING MATERIALS PURCHASED AT RETAIL INSIDE OR OUTSIDE THE TOWN, AT THE RATE OF FOUR PERCENT (4%) OF THE RETAIL COST OF SUCH MATERIALS AND SHALL THE TOWN BE AUTHORIZED TO COLLECT AND SPEND SUCH REVENUES, INCLUDING ANY INTEREST AND INVESTMENT INCOME THEREON, EXCLUSIVELY FOR CAPITAL ACQUISITIONS AND CAPITAL PROJECTS IN THE TOWN OF VAIL AS A VOTER APPROVED REVENUE CHANGE .NOTWITHSTANDING ANY REVENUE OR EXPENDITURE LIMITATION, INCLUDING THOSE CONTAINED IN ARTICLE X; SECTION 20 OF THE COLORADO CONSTITUTION?"; and WHEREAS, the following amendments to the Vail Town Code are necessary to provide for the use tax approved at the election. Ordinance No. 37, Series 2007 ~ NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL Of= THE TOWN OF VAIL, COLORADO 'THAT: Section 1. Title 2 of the Vail Town Code is hereby amended. by the addition of a new Chapter 8 to read as follows: CHAPTER 8: USE TAX ON CONSTRUCTION AND BUILDING MATERIALS Section: 2-8-1: 2-8-2: 2-8-3: 2-8-4: 2-8-5: 2-8-6: 2-8-7: 2-8-8: 2-8-9: 2-8-10: 2-8-11: 2-8-12: 2-8-13: 2-8-14: 2-8-15: 2-8-16 Title, Purpose and Applicability Definitions Imposition and Rate of Tax Collection Exemptions Duties and powers of Finance Director Books, Records, Reports and Returns Audit Limitation of Actions Lien Penalties and Interest Remedies not Exclusive Refunds Hearing before Finance Director Disposition of Funds Violation and Penalty Ordinance No. 37, Series 2007 2 2-8-1: TITLE, PURPOSE AND APPLICABILITY: (A) This Chapter shall be known as and referred to as "Use Tax on Construction and Building Materials." (B) The purpose of this Chapter is to raise revenue for capital acquisitions and capital projects in the Town and provide a complimentary tax to the Town's sales tax. The Town Council finds that every person who uses or consumes in the Town any construction and building materials is exercising a taxable privilege. (C) Subject to the specific exemptions listed in Section 2-8-5 of this Chapter, the use tax imposed by this Chapter shall apply to any use or consumption in the Town of construction and building materials purchased at retail inside or outside the Town on or after January 1, 2008. 2-8-2: DEFINITIONS: When not otherwise clearly indicated by the context, the following terms, words, and phrases, as used in this Chapter, shall have the following meanings: APPLICATION FOR DEVELOPMENT REVIEW: An application submitted to the Town of Vail Community Development Department for administrative review, or for review by the Town of Vail Design Review Board, Planning & Environmental Commission and/or Town Council, as prescribed by Title 12, Zoning Regulations, Vail Town Code. BUILDING PERMIT: The permit, issued by the Town by authority of the adopted building codes of the Town allowing the permit holder to construct, enlarge, repair, move, demolish or change the occupancy of a building or structure, or to erect, install,. enlarge, alter, repair, remove, convert, or replace any electrical, gas, mechanical or plumbing system, which is regulated by the adopted building codes of the Town. A building permit shall not include any permit for demolition or de-watering. CONSTRUCTION AND BUILDING MATERIALS: Tangible personal property which, when combined with other tangible personal property, loses its identity to become an integral and inseparable part of a completed structure or project. Construction materials include, but are not limited to, such things as: asphalt, bricks, builders' hardware, caulking material, Ordinance No. 37, Series 2007 3 cement, concrete, conduit, electric wiring and connections, fireplace inserts, electrical heating and cooling equipment, flooring, glass, gravel, insulation, lath, lead, lime, lumber, macadam, millwork, mortar, oil, paint, piping, pipe valves and pipe fittings, plaster, plumbing fixtures, putty, reinforcing mesh, road base, roofing, sand, sanitary sewer pipe, sheet metal,. site lighting, steel, stone, stucco, tile, trees, shrubs and other landscaping materials, wail board, wall coping, wall paper, weather stripping, wire netting and screen, water mains and meters, and wood preserver. The above materials, when used for forms, or other items which do not remain as an integral or inseparable part of a complete structure or project, are not construction and building materials. CONSTRUCTION VALUATION: The total value of the work, including labor and construction and building materials, as determined by the Building Department for purposes of issuing the building permit for a project. The total value of the work shall include the combined value of all permits required for the project for which the building permit is issued. CONSUMPTION: The act or process of consuming; it includes waste, destruction, or use. Consumptic-n is the normal use of property for the purpose for which it was intended. FINANCE DIRECTOR: The administrative services director of the Town or such other person designated by the Town; Finance Director shall also include such person's designee. PURCHASE OR SALE: The acquisition for a price by any person of tangible personal property, including"'installment and credit sales, the exchange of property, as well as the sale thereof for money, and every such transaction, conditional or otherwise, for a consideration constituting a sale. PURCHASE PRICE: The aggregate value in money of anything or things paid or delivered or promised to be paid or delivered by a purchaser to a retailer or any person in the consummation of a retail sale as defined herein, without any deduction therefrom for the cost of the property sold, cost of materials used, labor or service cost, or any other expense whatsoever, and Ordinance No. 37, Series 2007 4 provided that when articles of tangible personal property are sold after manufacture or after having been made to order, the gross value of all materials, labor, service, and profit thereon, shall be included in the said purchase price; provided that the purchase price shall not include any direct tax imposed by the federal government, the State or this Chapter. RETAIL SALE OR PURCHASED AT RETAIL: Any sale or purchase of tangible personal property, except a wholesale sale or purchase for taxable resale. TAXPAYER: Any person from whom a tax is due, or against whom a deficiency is being asserted. ' USE: The exercise, for any length of time, by any person within the Town of any right, power, or dominion over tangible personal property when purchased at retail from sources either within or without the Town from any person. WHOLESALE SALE: A sale to a licensed retailer, jobber, dealer or other wholesaler for resale. Sales by wholesalers to consumers, including persons who use or consume construction and building materials, as defined by this .Chapter, are not wholesale sales. Sales by wholesalers to nonlicensed retailers are not wholesale sales. WHOLESALER: Any person selling to retailers, jobbers, dealers or other wholesalers, for resale, and not for storage, use, consumption or distribution. 2-8-3: IMPOSITION AND RATE OF TAX: (A) There is hereby imposed a use tax on the privilege of using or consuming within the Town construction and building materials purchased at retail inside or outside the Town on or after January 1, 2008; provided that any construction and building materials used or consumed on a project which has received final approval on all required applications for development review prior to January 1, 2008 shall not be subject to the use tax imposed bjr this Chapter. If any approval expires by its terms after January 1, 2008, such application for development review shall then be subject to the use tax imposed by this Chapter. Ordinance No. 37, Series 2007 5 (B) .The use tax imposed by this Chapter shall be at the rate of four percent (4%) of the cost of construction and building materials used or consumed in the Town. For purposes of this Chapter, the cost of construction and building materials is deemed to be fifty percent (50%) of the construction valuation. 2-8-4: COLLECTION: The use tax imposed by this Chapter shall be collected prior to the issuance of a building permit. 2-8-5: EXEMPTIONS: The following are exempt from the use tax imposed by this Chapter, provided that the list of exemptions cannot be increased by implication or similarity, and the burden of proof is upon the taxpayer to establish an exemption: (1) The use or consumption of any construction and building materials the sale of which is subject to a retail sales tax imposed by the Town; (2) The use or consumption of construction and building materials purchased for resale in the Town, either in their original form or as an ingredient of a manufactured or compounded product, in the regular course of a business; (3) The use or consumption of construction and building materials by the federal government, the State or its institutions or political subdivisions in their governmental capacities, or by religious or charitable corporations in the conduct of their regular religious or charitable functions; (4) The use or consumption of construction and building materials by a person engaged in the business of manufacturing or compounding for sale, profit, or use of any article, substance, or commodity, which construction and building materials enters into the processing of or becomes an ingredient or component part of the product or service which is manufactured, compounded, or furnished, and the container, label, or the furnished shipping case thereof; (5) The use or consumption of any construction and building materials the sale or use of which has already been subjected to a legally imposed sales or use tax of another statutory or home rule town, city, or city and Ordinance No. 37, Series 2007 6 J county equal to or in excess of the use tax imposed herein, in which case a credit shall be granted in an amount equal to the tax paid by reason of the imposition of such sales or use tax, provided that the amount of credit shall not exceed the amount of the use tax imposed by this Chapter; (6) The use or consumption of construction and building materials if a written contract for the purchase thereof was entered into prior to January 1, 2008; (7) The use or consumption of construction and building materials required or made necessary in the performance of any construction contract bid, let, or entered into at any time.prior to January 1, 2008; (8) The storage of construction and building materials; (9) The first ten thousand dollars ($10,000) of the construction valuation for a project; provided that where one building permit has been issued for the- construction of more than one building or structure which constitute a single project, the buildings or structures shall be considered under this subsection to be one building or structure; and (10) Any transaction which the Town is prohibited from taxing under applicable law. 2-8-6: DUTIES AND POWERS OF FINANCE DIRECTOR: The administration of this Chapter is hereby vested in the Finance Director; who shall prescribe forms and promulgate rules and regulations for the proper administration and enforcement of this Chapter, and may delegate to any pe°rson the power and authority necessary for the proper administration and enforcement of this Chapter. 2-8-7: BOOKS, RECORDS, REPORTS AND RETURNS: (A) Every person liable to the Town for any use tax imposed by this Chapter shall keep and preserve for a period of three (3) years all books, records, reports and returns necessary to determine the amount of tax liability. (B) All such books, records, reports and returns shall be open for examination at any time by the Finance Director. Ordinance No. 37, Series 2007 7 (C) .Except by court order or as otherwise provided by law, the Finance Director shall not divulge any information disclosed in any document, report, or return filed pursuant to this Chapter. (D) Nothing in this Section shall be construed to prohibit the publication of statistics so classified as to prevent the identification of particular reports or returns and the items thereaf, or the inspection of returns by the Town Attorney or other legal representative of the Town. (E) Notwithstanding this Section, the Finance Director may furnish to the taxing officials of any other state or its political subdivisions, to the State of Colorado or its political subdivisions, or to the United States any information contained in tax returns and related schedules and documents filed pursuant to this Code, or in the report of an audit or investigation made with respect thereto, provided that said jurisdiction agrees to grant similar privileges to the Town, and that such information will only be used for tax purposes. 2-8-8: AUDIT: (A) Within three (3) years from the issuance of any certificate of occupancy for the improvement on which the use tax was paid, the Town may audit the taxpayer or the taxpayer may request an audit. (B) If the recomputed use tax is less than the amount of use tax paid by the taxpayer, the difference shall be refunded to the taxpayer. If the recomputed use tax is more than the amount of use tax paid by the taxpayer, the difference shall be paid by the taxpayer to the Town. (C) Any audit requested by the taxpayer, regardless of the result, and any audit performed by the Town finding any failure, neglect or refusal to pay any use tax due to the Town, shall be at the taxpayer's sole cost. 2-8-9: LIMITATION OF ACTIONS: (A) Use tax, interest, and penalties shall be assessed, and any action to collect the same shall be commenced, within three (3) years of the issuance of certificate of occupancy for the improvement on which the use tax was paid. (B) Before the expiration of such period of limitation, the taxpayer and the Finance Director may agree in writing to an extension. Ordinance No. 37, Series 2007 $ 2-8-10: LIEN: The tax imposed by this Chapter, together with accrued interest and penalties, shall be a first and prior lien on any real property into which the building and construction materials were incorporated. 2-8-11: PENALTIES AND INTEREST: (A) If any person fails, neglects, or refuses to pay the use tax as required by this Chapter, or if any taxpayer fails to remit the proper amount of tax or underpays the tax, penalties, and interest shall be added and imposed in accordance with this Section. (B) if a person neglects or refuses to pay any use tax as required by this Chapter within ten (10)days after the same is due, the Finance Director shall make an estimate, based upon such information as may be available, of the amount of use tax due for the period for which the taxpayer. is delinquent and shall add thereto a penalty equal to fifteen dollars ($15.00) or ten percent (10%) of the amount due, whichever is greater, and interest on such delinquent taxes at the rate of one percent (1 %) per month from the time that payment was due. If any part of the deficiency is due to fraud with the intent to evade the tax, there shall be added a penalty of one hundred percent (100%) of the total amount of the deficiency, and in such case the whole amount of the tax unpaid, including the additions, shall become due and payable ten (10) days after written notice and demand by the Finance Director, and an additional three percent (3%) per month on said amount shall be added from the date payment was due, until paid. (C) The Finance Director may waive, for good cause shown, any penalty or interest. 2-8-12: REMEDIES NOT EXCLUSIVE: In addition to the remedies expressly provided by this Chapter, the Town may pursue any other remedies available at law or in equity. 2-8-13: REFUNDS: (A) A refund shall be made, or a credit allowed, for use tax paid under dispute by any person who is entitled to claim an exemption under Section 2-8-5, if a Ordinance No. 37, Series 2007 9 request for refund is made within sixty (60) days after issuance of the building permit for which the use tax was paid under dispute. (B) A refund shall be made, or a credit allowed, for any use. tax paid under this Chapter for construction and building materials used or consumed in the construction of any deed restricted employee housing units, as defined by Title 12, which deed restriction additionally includes a perpetual appreciation cap on either maximum rental rate or sales price, as approved by the Town. No request for refund or credit shall be processed by the Town until the applicable deed restriction has been recorded. (C) An application for refund of tax paid in error or by mistake shall be made within three years (3) after the date of use or consumption of the construction and building materials for which the refund is claimed. (D) The right of any person to a refund under this Chapter shall not be assignable and the application for refund shall be filed by the taxpayer. (E) The burden of proving the right to a refund shall be on the person claiming the refund. (F) Upon receipt of a timely application, the Finance Director shall promptly examine the application, make a decision, and notify the applicant in writing of the decision. (G) If the Finance Director finds that the use tax, penalty, or interest paid by any taxpayer is in excess of the amount due or has been erroneously collected, the Finance Director shall rule in favor of the taxpayer for refund, regardless of whether or not such sum was paid under dispute. The Finance Director shall issue payment to the taxpayer; provided that the Finance Director shall retain a statement setting forth the reason for the refund. If there is an unpaid balance of use tax, penalties, or interest owed by such taxpayer for any other period, the overpayment shall be applied against the amount due and any excess shall be refunded to the taxpayer. 2-8-14: HEARING BEFORE FINANCE DIRECTOR: (A) A taxpayer may file a written request for a hearing on any assessment or denial of refund request within ten (1Q) days of the decision of the Finance Ordinance No. 37, Series 2007 10 Director. The request for hearing shall set forth the taxpayer's reasons for the request and the disputed amount. (B) The hearing shall be held and a final decision issued within ninety (90) days of the date of the request, unless a delay is caused by the taxpayer, in which case the hearing shall be held and final decision shall be issued within one hundred eighty (180) days of the request. At least fifteen (15) days prior to the hearing, the Finance Director shall notify the taxpayer in writing of the time and place of the hearing. (C) At the hearing, the Finance Director may administer oaths and take testimony, and the taxpayer may assert any facts, make any arguments, and file any briefs or affidavits he or she believes pertinent to his or her cause. (D) Based on the evidence presented, the Finance Director may modify, refund or abate the use tax, penalty, or interest. (E) Upon rejection, in whole or in part of the claim for refund, or upon a finding that an assessment in whole or in part has been made against the taxpayer validly, the Finance Director shall. send a hearing determination notice to the taxpayer in compliance with Section 29-2-106.1(2)(a), C.R.S. (F) The decision of the Finance Director shall be final, subject only to the State hearing and appeal procedures outlined in Section 29-2-106.1, C.R.S. and judicial review. Unless a State hearing is requested, an appeal is filed or judicial review is sought, the use tax, together with interest thereon and penalties, if any, shall be paid within thirty (30) days after mailing of the Finance Director's hearing determination notice. (G) If a State hearing is requested, an appeal filed or judicial review is sought, the Finance Director may require payment of the tax or the posting. of security only as provided in Section 29-2-106.1, C.R.S. 2-8-15: DISPOSITION OF FUNDS: (A) All revenues derived from the'use tax, less costs of collection and administration, shall be placed in the Town's Capital Projects Fund and used for capital acquisitions and capital projects. Ordinance No. 37, Series 2007 11 (B) There shall be budgeted from 'the monies received from the imposition of the use tax an amount necessary to reimburse the Town for administrative and clerical expenses incurred in the collection and administration of the use tax. 2-8-16: VlOLATlOlV AN® PEtdALTY: (A) It is a violation of this Chapter for any person subject to the use tax levied by this Chapter to submit any false oi~ fraudulent use tax informatiori to the Town, to make any false statement on any document used to calculate taxes due under this Chapter, to fail or refuse to make payment of any taxes due, to evade the payment of any taxes due, or to aid or abet another in any attempt to evade the payment of any taxes due under_ this Chapter. (B) In addition to any other penalty provided in this Chapter, any person who violates any provision of this Chapter shall be punished as provided in Chapter 1- 4-1 of this Code. Section 2. If any part, section, subsection, .sentence, clause or phrase of this ordinance is for any reason held to be invalid, such decision shall not effect the validity of the remaining portions of this ordinance; and the Town Council hereby declares it would have passed this ordinance, and each part, section, subsectionv sentence, clause or phrase thereof, regardless of the fact that any one or more parts, sections,'subsections, sentences, clauses or phrases be declared invalid. Section 3. The Town Council hereby finds, determines and declares that this ordinance is necessary and proper for the health, safety and welfare of the Town of Vail and the inhabitants thereof. Section 4~. The amendment of any provision of the Town Code as provided in this ordinance shall not affect any riight which has accrued, any duty imposed, any violation that occurred prior to the effective date hereof, any prosecution commenced, nor any other action or proceeding as commenced under or by virtue of the provision amended. The amendment of any provision hereby shall not revive any provision or any ordinance previously repealed or superseded unless expressly stated herein. Section 5. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are repealed to the extent only of such inconsistency. This Ordinance No. 37, Series 2007 12 0 repealer shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof, theretofore repealed. INTRODUCED, READ ON FIRST READING, APPROVED, AND ORDERED PUBLISHED ONCE IN FULL ON FIRST READING this 4th day of December, 2007, and a public hearing for second reading of this Ordinance set for the 18th day of December, 2007, in the Councii Chambers of the Vail Municipal Building, Vail, Colorado Dick Cleveland, Town Mayor Attest: Lorelei Donaldson, Town Clerk Ordinance No. 37, Series 2007 13 :CIF:~IOR.~~'DC'~l To: Vail `I o~ti'n C OUI1Cl1 • From: Stan Zemlc;r, '~1att ~1irc, Judy Camp Date: f~ugust ?. X00? Subject: [;~~ T~tx Oll COnStI'UCtloI1 ~'I3[(;rlals The tullowin~.; information is presented for your discussion on `[~uesday ~vcning re~~ardinr a potential construction ~-ISC; tax in the Town ot~ Vail, which, as we have discussed, would require approval by Vail's electorate. Kev Dutcs O;SiU7i07 Council discussiOn of key elements of proposed use tax and review of ciratt t~allut language OS`? 1!07 Latest date for approval ofresolutiun; first dr~rtt of ordinance to implenlertt j~roposed use tar prepared for discussion U9!2 I!07 Last day for ['ro,'Con statements to be tilcd'with Tuwn Clerk 10;0~i07 Last day to mail TABOR ballot issue notices 1 I %06,'0? Election day 1 1;"20iO7 Fil'st reading of use tax ordinance, if approved by voters 1'?; 0=1; 07 Second reading of use tax ordinance, it approved by voters 12i 15,'07 Council meeting -back-up elate for ordinance ruldulg if neccled UI;UlJUS Earliest irr)plem~ntation of tax Note; These are key dates to m(:et the recluirerr)e:1ts for a Tr1E3OR erection schcc.iuie. ~--`•.dditional tirnc: for discussion of the draft ordinance col.ild be available during Septonlber and October council meetings as neec[ed. Use T•ttx C_'iuestions and r'~ns~,vers (Q~Rc:~) i~i'hat is a use tax:' G(°nerally, a use: tax is Ievic;d on file privilege of using; ur other~h~isc cwlsclntin~,T tangible personal property within a city ur county for which no sales or use tax has been previously paid. [t is cunsidcr(:c[ complementary' to a saps tax, anc! is applied regardlc;s5 of where the property was purchased. For example, if t[)e town levied a use tax un construction material, a ce:,ntractor purchasint material for his job ti-om an out-ot=state supplier could be assessed a us(: tax by the Town of Vail. A use tax may be applied generally to all tangible personal property used or consumed within a municipality or its application nlay be limited to ve}licles and,-ur construction and building materials. Staff' recuuuneu~ls Council lrtnit its c~nirside~•crtinn af' u.~•e tr~.r to c•niztitr~rrctron airrl bl!l~l~llla nurteriulti: y l Clow common is a use lax:' Ch cr halt• thr irlcurpuratccl 1nUr11CIpallllCS and cuuntres ua Colorado Icvy a use tax and the concept is well-suppor-tcd by Ic~aisiatie~n and case law in C'e~loradu. Examples ut ralunicipalities with iisi: tax on building materials include Broomfield, Denver, Eagle. Glen«~uod Spria~7s, Grand Junction. Gypsum, Lakewood, Mountain Village, and Steamboat Springs. What has been the espsri~~nce irl ether cornrr~r~nitres with use tax ballot issues'' In rlprii, 2007, Georgctor~•n's electorate approved an e:xtcnsion of their ~°-~ use tax on vehicles to include construction and buildinv materials. The ~°% rate is the same as Gcor~etown's sales tax rate. [n 1 ~~9j, Gypsum passed a ~°i~ use tax on residential construction and building nulte:rial with 2U°i~ directed to adrninistrti~tion ~u1d SU`ro dirc;cted to reads. 'The use tax is one percentage point lower than Gypsum's 4°~~ sales tax. In I X95, Eagle passed a 4°ii use tax on construction anil building materials ti;r capital protects. Eagle's sales tax and use tax are the same rate. Avon's 2002 building materials use tax ballot was defeated. The proposeei rare v,'as 4°~;, which is the ~sarne as Avon's saps tax. Breckenridge's 1995 use tux ballot was defeated. The proposi:d 2.5"„ rats was the same as Brcckenricige's saps tax rate. Aspen is considering a use tax ballot f~~r this November's election. dust the use tax rate he the carne as the sales tax rate? \~~, i:se tax rates are :nor,;etinaes ioi~ er til2rn the sales tax rite. What is meant by "construction materials:"' The Vail Town Code defines copse>uction materials a~ "Tangible personal property which, when combined with other tangible persvnal property, loses its identity to becor;;c an integral and inseparable part of a conlplcte structure i)r project including public and private improverllents. ~.Onsh'U1;t1011 materials include, but arc nest limited to, >uch thin~~s as asphalt, bricks, builder's l;ardware, caulking material, ceralent. concrete, conduit, electric wiring arld e;~~nnections, fireplace; inserts, electrical heatir« and cooling equipment, flooring, glass, gravel, insuation, lathe, lead, line, lumber, maaidarn miilwurk, mortar, ail, paint, piping, pipe valves, and pipe fittings, piaster, plumbing fixtures, putty, reinforciny~ mesh, road base, roofing, sand, sanitary sewer pipe, sheet metal, site libhtin~a, steel, stone, stucco, tile, trees, shrubs, and other landscaping,, materials, wallboard, wall coping, wallpapc;r, ~veathcr stripping, wire netting, and screen, water mains and meters, and wood preserver. The above materials, when used for forms., or other items which clo not remain as an integral ur inseparablo part of a completed structure ur hrojcct are rant e;r>nstruction materials. Construction materials do ni>t include uch things as: carpeting, ccluipmcnt, tlu~niturc, removable fixtw•cs, ~~ indinv co~~crin~as, ur similar items.,, If the Town already- has a sales tax, vv~hy do vve need a use tax on construction materials". C'unstructii~n and building materials as defined above are exempt ti•om the town's sales tax as lone as the purchaser has ubtaineci a building pet7~;it and provides the retailer selling him the material the pet'nllt nlllnbel'. Thel'efure, cimstructiun material is currently u category' of tangihlc persc;nal property upon which no tax is collected in the Town of Vail. . As discussed below, building materials picked up at a supplier in another city or town are ~ cun•ently subject to that town's sales tax. It~ Vail hod a use tax a~tlectcd at the ti;Ytc the building permit is issued, the tax dollars related to the purchase would benefit Vail rather than the other locale. ,A':so, a use tax on construction material may be counter-cyclical to the town's general sales tax, i.e., if sales tax is negatively impacted by construction, the use tax is in place to offset it during the construction period. l-low is a construction use tat collected? The simplest v~~ay to collect a construction use tax is to collect the entire am~~unt at the tirl?e the 17c:iiclir.g per;~~it is issued. Ilow is the amount of use tax determined? The use tax amount is cletennined by multiplying the use tax rata by the cost of the building materia}. When collected at the time the building permit is issued, the estimated cost of building and construction materials is generally calculated by multiplying by fifty percent the total valuation of the construction project as entered on the building p~rtnit by the to~tin building inspector. tiVhat if the builder/developer thinks the estimated value is too hi;;h or the town thinks the estimated value is too low? Use t:i~c orclinanees generally pre~vide fbr an audit c>f the taxable value by either party within a reasonable period after construction is rumplete. Interest on any refund ur deficiency is generally computed frnn the day the certificate of occupancy is issued. `'hat if a builder/developer purchases material for use in Vail from a supplier in a town that has a sales tzx? Will he,~she be subject to double taxation° tio. If the materials arc deiivr;red to Vail, the seller does not collect soles tax for the town or city wi~ere heishe is located, anti only Van's proposed use tax would apply. If the seder is located in Eagle County, he is required to collect Eagle County's l.~'%n sales tax. It he is located in Colorado, he is required to collect the Mate's 2.93'-,-sales tax. If~ the purchaser picks up the material from a seller li~cated in a town or city with a sales tax, the materials arc generally exempt from the local sales tax if~thc~ E~urchirsc~r prc~sc~nts -~- ,~ 0 to tlrc~ sc~lh-r a hrrilclirt /x~r•nrit c~r• crtlrc~r clc~runrc~ntcrtic~rr crc~cc~/ucrhlc' tc~ tlrc> /acct/ ~c~rc•rnnrrrrt <<~hc~r~c' tlrc~ pur-c•lrcr<~~ tcrkc.~ /,lace. slro~~ irrg t/alt cc usc~ tu.r /i~rs he-err /uric/. "Phis is required by state statute ti)r state-collected local jurisdictions and ~:cncrally included in tlrc ordinances of selt=collected local jurisdictions. Colorado state statute also prohibits state-collected local jurisdictions ti•om collecting a use tax oft nlatea"lals tier wlii~h a I:;gally imposed tax has already been cullccteci by another city ur town. If the saic> tax collected wars less than the use tax required; only this incremental alll(1lInC of the use tar may be collected. Agau1, this is required by state statute and generally included in ordinances of sc;lt=collected local jurisdictions. ~~'ill the proposed tax, add to the builder/developer's project cost'' If so, how much`' In most cases, a use tax would result in additional cost to the; purchaser of building rnatt;rials for use in Vail. The additional amount depends ul:,un the rate of the tax and how the builder is currently taking delivery on materials. For exanrpie, if the lnrikier is currently picking up materials in Avon, a 4'io sales t~,x is paid to the Town of Avon. It Vail had a 4~~ use; tax on construction materials, he,'she would still pay =I°%, but wool;. pay it to Vail as a use tax at the time a. building permit is issued. Heishe would not be required to pay the Avon sales tax. (Reference Avon Town Code 3.OS.3 20) Continuing with A~,~on as Sul example, i,F the huilde;r is doing business in Vail and hay-ing materials shipped to Vail, the materials are exempt from ,~won's T°~~, sales tax because the point of delivery is o~_itside the: Town of Avon. (Reference Avon Town Code 1.08.0=10) The materials are also exempt ti-um Vail's 4~io sales tax it• the purchaser preser;ts a building permit number to the; supplier delivering the material. Theretore, in tae situation where construction and building materials arc delivered into Vail for a project constructed under a building permit, a =1% use tax would increase the builder's' cost by apnroxirriately 20~~ of his total project valuation, representing a 4°i° use tax on the value of raterial, wliicli is estimated at 50",~ ofpruject valuation. liow much revenue would a construction use tax generate for the Town of Vail? The amount generated would be dependent upon the tax rate assessed and the valuation of building permits issued in any given year. A ~"'o tax on buiidino materials used in the town would have generated an estimated ~n2 million in 200; ~4 million in 2005; and S7 rr,illion in 2007. tiVhat would the revenue from a construction use tax he used for? A e:se tax can be used for any legitimate governmental purpose. including capital expenditures and operating expenses. T'he; ballot question put beti~re the voters in a "TABOR election should specify use of the tax. ~~re an~~ organizations exempt from use tax? Organisational exemptions vary by taxing jurisdiction. Staff recommends the Town of Vail provide the sure organizatic.~nal exemptions for i.rse tax as are currently detincd in the town's sales tax code: a. The United State government, the state, its depar-tn~ents ar.d institutions, and the political subdivisions thcre;uf in their governmental capacities only; -a- b. cilaritahle ,n"~~aniiatiuns in ti",C conduct of their rc`~ular rhuritahlc tunctrons an(I acti~itics; and c. schools, other than sch(wls hclei Or conducted for private or cot~xn"at(: profit. What considerations tan be riven to devetopers/builders who have alrcadr~ determined their project costs, but nor ~~et received a building permit`' Council could includ:; ti provision in the ordinance; to exempt from use tax any projects whose development application is approved prior to the cfteeti~re: date of the tax. T'he; development applicati(>~~ approval is recommended as the key (late because it marks the; point at which the deve;luper has vested rights to construct the project in accordance with the approved plan. Development of construction drawings and bidding of casts 'take place otter development plan approval. bVhat relief can he given to developers/builders who are constructing work force housing? Council could include a provision to rebate the use tax collected un materials used to build workforce: dousing. l.on~111o11t and E'ort Collins have 'ordinances including this provision. I~srles for Council to C.onsder • .A ~°'~ use tax has fife potc;ntial to gi;nerate Over 5'1 million in ~'.QQ8; this revenue is lost torevc;r ifthc haslet issue is delayed to a f:lture year. • A use: tax w(•,ui;.i ~uldre;ss, at Ieast in part, the ever-~.videnir:`7 tap for funding, of capitr:il p:"ojccis. The C~ipit:il Project Fund prajectior, prepared for Tuesday's ~~rork session inci~_leles ;a ~'~.~ ;i~iliii:,n shol"tfal! over tine years. A use tax on construction material gnarating ~~} to 5_5 million annually would essentially close the aap. Bondirg ,Igainst y4 million of annual use tax revenue could provide an estimated 5=10 million of capital projects funding. • Addition of a use tax on construction materials diversities the town's avenue sources. 5~.1 million from use tax reduces reliance on sales tax firom current estimate of ;y"%; of~tcital revenue ti-om all sources in '?OU8 to ;5"'0. Use tax play also offset a loss of sales tax revenue from construction activity. • A use tax on construction and building materials ci.ircctly impacts a narrow sc`~ment of the community. Tllis is the same segrnc:nt Uf tl-,e community impacted by the recent addition of comrr)crcial linkage and inclusionary zonint and cun-cnt COnS1ilCratlorl (it 11?Creases m r,)ad 11)"1paCt lees and ConstruCtli)n n'lltly~atli~rl te'eti. Imposition of a us; tar could discourate additional redevelopment acti ~ itv. • Builuint and curtstruction materials are the only major catcwurv of tangible personal pruper-ty speciticaily exempted ti-om the Town of Vail's sales taz ordinance. ,4 use tax would be complementary to the sales tax and provide consistent treatment among ail categoric, of tangible personal property purchased or used in Vail. Key Decisions for a Construction L'sc 'T'ax Ballot Issue ~~'hat is the proposed tax rate'? Staff recommends a =1°~, use tax on building and construction materials to be consistert with the sales tax rate. s- I is the proposed tai limited to huildin~ and consh•uction materials only'' 't'~s, stat~f rccommencls llnlliln`~ the prohosc:d u,c tax to building and construction materials only. Statt• further recommends a rebate un materials ued in the a~nst--uction i)t 1V01'h loi"l'e 110U51i1y~ unltS. }{orr• .mill the proposed taz he paid? Statt~ recomntencVs c~~llectir~n cat rlte hri_~hus~~d u~~ tc+x ;-t the time <- huileiin~= beanie is issued with the tax assessed ~m SU°t, of the valuatietn of the project as rcportal on the pe-~~iit. Ai.l;ushnents to the tax could he deterntincd by' an atuiit requested by the titrti'n i>r the taxpayer. When will the proposed tar be implemented? Statt~recommends the; tax become et;-ective with builciing permits issued at't~r January 1, ?t)08, with a sp~;citic exemptio~t for projects U-ho have received an u~prc~ve~! development plan prior to that dare. Revisions to approved development plans wuuId not be eligible for the cxempt-on. }low will the proposed tas be used? Statf recommcnd~ funds generated teem the proposed use tax be used for capital projects Such as public buildings, roads, and inti"a5tr>rtcturc. -r,- ~it:~i,~r Q~~~a"rio~; cc)~cr R`i:vr ~row~` c)i~ 1-~:~ii. co~s~rit~;c:'cio~ ~.se T,~X FOit \UVE:11t3E12 6:~L.LU"i' SHALL THE T01-~'N OF P'AIL'S 'TAXES BE INCRE.~ISEU B~' S~,000,OUO I\ FISCAL PEAR ?UUS AND. BY' ~~'H,~T'EVER ~DDITION:~~L :~.~10UNTS ARE R,~1SI:D ANNUALLI' TIIEREAF"fER "I'[[ROC,`GH THE ADOPTCGN OF A liSE T,~1X ON T[[E PRIVILEGE OF USING AND,OR CONSU1~11NG IN T[1E TOWN OF VAIL ANY' C'ONS'TRUCTION AND;OR BUILD[NG ~ti1.~TERIALS PURCFI.aSED A'I' RETAIL INSIDE OR OUTSIDE THE TO~~'N, AT THE R.-ATE OF FOUR PERCENT (=[°%) OF Tf-fE RETAIL COST OF SUCH ~1ATERIALS AND SHALL T~[E 'I"OWN` BE AUTHORIZED TO COLLECT AND SPEND SUCH REVENUES, 1NCLUUING ANY" INTEREST AND [NVEST:~IENT [NC0~1E'THEREON, EXCLUSIVELY' FOR CAPITAL. ,~C'QUIS[T[ONS AND CAPITAL PROJECTS IN T[-IE TOWN OF VAIL. AS A VOTER APPROVED REVSNUE C'HANGL NO"I-WIT[1STAND(NG ANY' REVSNUE OR EXPENDI"PURE L[iY11T,4T[UN, INCLUDING THOSE CONTAINED IN ARTICLE X, SECTION ?0 OF THE C.'OLORADO CONSTII~UT[ON'? vote: The above question was dra~I'tcd by Ie~al ~ou-isel in rontormancc: wit!1 the rc~quirements nor a TA BOR el::ctiot~. -~- ~IE~(ORANUl~1~! To: Vail Town Council From: Stan Zemler, Matt Mire, Judy Camp Date: August l6, 200? Subject: Lase Tax on Building and Construction Materials On Tuesday evening, you will be asked to consider Resolution \~. 19, Series 20~)?, a resolution submittinti to the registered electors of the Town of Fail, Colorado, at a re.~ular municipal election held on November G, 2007, a ballot issue concerning the adoptic~;-r of~a use tax to finance capital pre~jects and acquisitions; and pruvidino other details relating thereto. Your approval of this resolution is the first step in placing a construction use tax on the ballot. If a majority of the votes cast in the November election are in favor of the use tax, the: Town Council will he authorized to adopt an ordinance; levying the tax and providing for the administration and collection of the tax. The Taxpayers Bill of Rights (TABOR) requires outer approval for any new tax including the proposed construction use tax. The following information is provided for your a~nsideration. BAC;hGROUND AND RATIONALE During the past three budget cycles, a l~-year capital plan has been included in addition to the f-ve-year projections for the Capital Projects and Real Estate 'Transfer "Tax (RETT) Funds. These planning processes are desibned: to maintain the town's valuable existing facilities; and to identify projcct~ needed to keep pace with private development anti other community needs. Each year we have concluded existing sources of revenue are not sufficient to support the towel's critical capital needs through 200. The Vail 20120 Strategic Plan, which included input on this topic from the community and the Vail Economic Advisory Council, also supports this conclusion. The vision tier Vail's ccononry in 2020 includes, "'T'hroubh prudent cost managerri~.nt anti balancing ot~ dive~•sified revenue .snrrrces•, the municipality has ,u.staincrble.ftrndinr fo~• its capital and operational needs. One Goal of the plan is to irleutify and iniplenient additional reveruie soarrc•es to supporf L'ui['s cupitcrl needs. The 200? Community Survey also included the following capital-related items in the top I0 issues facing the, town: workforce housing; construction and/or maintenance of public inti-astructure; improving recreational facilities; and improving fire response time (e.g. thruugh a third tiro stationj. The primary sources of revenue f~~r capital projects include: saps tax; real estate transfer tax (RETT); federal transportation grants; rental income; invcstrment income, and tax increment financing ("I'[F). Two avenue categories, sales tax and RETT, support operations as well as capital projects. RETT is restricted in its use to parks, recreation, open space, and environmental sustainability. TIF is restricted to projects within an est~rblished TIF district. The LionsHead TIF district is the only one established at this p~~int; huwcyer, cunsideruti~~n was given to other TlF' disU~icts in the five and l ~-vc;.u- plans. ~~ use tax on construction and building materials .vas discussed as early as 1998. In ~U02, use tax was again discusse:ii as a potential ballot issue, but a property tax question was chosen instead. The proposed =~ mil property tax increase for the purposes i?t- "incrcasing fire protection and suppression resources and the constriction, acquisition, ur illtlint~n.ln~:t; ~~t t:.lpit,?1 pro~l'~'ts" ~~'~iC n£11TO~vlV dl'fcated (-~~°~u toC ~' ~~~/~ 3galnst~. Currently, building and construction materials are exempted from the 4°% sales tax applied to all other tangible personal property purchased in town or delivered into town. And since the to~~'n does not have a construction use tax, no municipal tax is collected on building and construction material purchased and,'or used in Vail for any project with a building permit. A 4~?-~ tax on building materials used in the town would have generated an estimated S2 million in 2005; 4 million in 2006; and S7 million in ?007. In 2008, a 4`% use tax has the potcr?tial to generate an estimated 54 million. This revenue is lost forever ifthe ballot issue is delayed to a future year. A use tax would aciclress, at bast in part, the ever-widening gap for funding of capital projects. The Capital Project Fund projection presented to you on August 7th included a 825.8 million shortfall over five v~ars after giving consideration to existing revenue sources, including T1F. A use tax on construction material generating 5=1 to 85 million annually would essentially close the gap. Bunciing against 8=t million of~ annual use ta.x revenue could provide an estimated x;40 million of binding for capital projects. A ,construction use tax would also prcivide diversification of the town's revenue a, described in the Vail 20/20Vision. For example, sales tax revenue represents an estirnatecl 38°'0 of the town's revr:nue from existing sources in 2008. Addition of X4.1 million from a construction use tax reduces reliance on sales tax to 35"% of total revenue from all sources. Use tax'may also oi'fset a loss of sales tax revenue from construction activity. hulloing and constriction materials are the only major category of tangible personal property specifically exempted from the Town of Vail's sales tax ordinance. A use tax would he complementary to tl~e sales tax and provide cot?sistent trcatn?c;r,t amen;, all categories of tangible personal property purchased or used in ;Vail. STAFF REC01'I1~IENDATI~~: Statt~rccornmends approval of Resolution No. 19, placing a construction use tax question un the November ballot and enabling the electorate to cast their vote for or against this source of funding for the town's capital projects. r c~o~~•rrt~;c~~rro~ t/~sF ~r.~~~ ~~~,h.srio`~s :~~n :,vsw>F ris 11~hat is a use tax'? Generally, a use tax is levied on the privilege of using ur otherwise consuming tun~;ib!c personal property within a city or county fur which nu sales or use ta.x has burl prcvirn+sly paid. It is considered complementary to a sales tax, and is applied rogardl:5s ut where the property ~~as purchased. For cxaniplc, if the town levied a use: tar un construction material, a contractor purchasing material fur his job from an out-ut=state supplier could bu assessed a use; tax by the "hown of Vail. A use tax may be applied generally to all tangible; personal property used ur consumed within a municipality or its application may be limited to vehicles and/ur construction anci building materials. The proposed use tar currently undc;r discussion t~~r the Town of Vail is limited to construction and building materials. Erow common is a use tax'? Over half the incorporated municipalities and counties in Colorado levy a use tax and the concept is well-suppat-ted by legislation anci case law in C'oloraclo. Examples of municipalities with use tax on building materials include Broomtield, Denver, Eagle, Glenwood Springs, Grand Junction, Gypsum, Lakewood, ;~luuntain Villag;, and Steamboat Springs. Horr• is a construction use tax authorized and implemented? Colorado statutes authorize use taxes un construction materials and on vehicles used within the municipality or county imposing the tax. Since implementing.a cunstructic~n use tax is a change in tax policy aid increases revenue, it must be approved b_y tl`ie ro~vn's electorate in a.TABOR election. .administrative details, such as how and when the tax is paid and what specific exemptions may apply, are; detinecl by ordinance. The fullo«-ing table idcntifi~s key dates fur the Ta~vn of Vail's prigposed construction use ta.x: 03/'1)1'07 Council discussion of key elements of proposed use tax and review of clratt ballot language 03/21/07 Latest date for Council considi;ratior. of a resolution to .place a construction use tax C1uc;STlOt1 on the vUVi;1T1bE;r' ballot 09%? 1107 Last day t~ir Pro/Con statements to be tiled with Town Clerk 10;0;07 Last day to mail TABC)R ballot issue notices 1 liU6,07 Election day 1 112()107 First reading of use tar in~piementation ordinance, ifapprovcd by voters 12!04;07 Second reading. of use tax itriplc-mentation ordinance, if approved by VOte;t's l2,%13,'p7 Council meeting -- back-up date for ordinance reading ifnceded 01;'01!03 Etfectivu date of tax -3- ~1`hat has peen the experience in other communities with use tax ballot issues:' In April, ?UO%, C;eur`~ctown's electorate approved an extension of their ~°~~ u;e tax un ~ ~hicles to include construction and building materials. 1'he ~"-4, rate is the same as Gei~rbctuwn's sales tax rate. In li)9~, Gypsum passed a ?"o use tax un residential construction and building material tti ith ~0"4, dircetc~d tr.; ;~ein~inistratir_tn .end 8~1°,~ directed to roads. Tho use t~~x is one percentage point lower than Gypsum's -~"% ;ales tax. In 1998, E:i~le passed a 4°/, use tax on constructii~n and building materials ti>r capittiil projects. Eagle's sales tax and use tax are the same rate. Aeon's Z()~? buiidir~g nlati:rials use tax ballot was cletcateci. "l~he proposed rate was =1`%, v.~hich is the same as .•~von's sales tax. Breckellridge's 1995 tise tax ballot was cletcated. T11e propr~scd ?.~° ~ rate ~~ as the sarnc as Breckenri~lbc's sales tax rate. Aspen i5 considering a use tax ballot ti>r this Novel~ibei••s olection. ,Must the use tax rate be the same as the sales tax rate:' Vie.>, use tax rats arc sometimes lu~,ver than the sales tax rite. 1~~'hatss meant by ``construction materials'"' The Vail Town Code defines construction materials as ``Tangible personal property ~,vhich, when combined with other tangible personal property, loses its identity to becurno. an integral anci inseparable part of a complete structure or project including public and private improvc;ments. Corr~truction materials include, but are not limited to, such things as asphalt, bricks, builder's hardware, caulking material, cerr~ent, cimcrete, conduit, electric wiring and connections, tlrt:place inserts, .;lectrical heating and coolin;r equipment, t~Ot)i"lllg, glass, gravel, insulation, lathe, lead, line, lulnber, macadam millwork, mortar, oil, paint, piping, pipe valves, and pipe fittings, blaster, pltllllblrl fixtures, putty, reinforcing mesh, rr~ad base, rooting.;, sand, sanitary sewer pipe, sheet metal, sitelighting, steel, stone, stucco, tile, trees, sllnibs, ~ and other landscaping, materials, wallboard, wall cnping, wallpaper, weather stripping, wire netting, and screen, water mains and meters, and- wood preserver. The above materials, when uscci ti)r furrns, or other items w~}uch do not remain as an integral ar inseparable part of a completed structure or project are not construction materials. Construction materials do not include such things as: carpeting, equipment, furniture, removable fixtures., ~,vindow coverings, ur similar items." If the Town already has a sales tar, why do we need a use tar on consh•uction materials:' Construction and buildin~~ materials as cletined above sire exempt from the town's sale; tax as lung as the purchaser has obtained a. building penllit and provides the retailer -a- selllilg hlnl the mate'rlal the h~l•Illil I11I111bG1•. '1 hel'Ct(ire, l;unJtl'Ul'hl)n ntatl'I'1~11 is currently a category lit' tangible personal property upon which no tax is culicctcd in the -I`own ~,t Vail. :~s discussed beliiw, building materials picked up at a supplier in another city or to~cn are cun•ently subject to that t~~tivn's sales tax. !f Vail had a use tax collected at the timer the building pel7nit is issued, the tax dollars rel~ited to the purchase would benefit Vail rather than the ether locale. Also, a use tax on construction material may be counter-cyclical to the town's ~~eneral sales tax, i.e., if sales tax is negatively impacted by construction, the use tax is in place to i)ft~ct it during the; construction period. i-iow is a construction use tax collected? The simplest way to ci~llect a construction use tax is ti, collect the entire amount at the time the building permit is issued. t{ow is the amount of use. tax determined? The use tax amount is detel-tnirled by multiplying the; use tax rata by the cost of the buiicting material. When ei~lleeteci at the time the building permit is issued, tl;e estimated cost of building and cunstruction materials is generally calculated by t?1Ultipl~~ing by titty percent the total valuation of the construction project as entered on the building pel•nait by the town building inspector. ~L'hat if the builderideveloper thinks the estimated vafuc is too high or Hie to~i'n thinly the estimated value is too low? Use tax ordinances generally provide for an audit of the taxable value by either party within a reasonable period after construction is complete. Interest on any rebind or deficiency is generally computed ti•om the day the certificate of occupancy is issued. What if a builder/developer purchases material for use in Fail from a supplier in a town that has a sales tax? ~~'ill he/she be subject to double taxation:' \'o. If the materials are delivered to Vail, the seller dues not coilee;t sales.t~ix for the town or city where he,~shc is located, and only Vail's proposed use tar would apply. if the seller is located in Eagle County, he is required to collect Eagle Couiltv's 1.~°.~o salr;s tax. it he is located in Coloradi~, he is required to collect the state's 2.9'io sales tax. (f the purchaser picks up the material ti•om a seller located in a~town or i;ity with a sales tax, the materials arc generally exempt from the local sales tax i/'tlzc pi~~•c•kasc~r prc'scnts to the seller a birildi~z,; permit ar athcr dociu~zc~rtatio~l ucccptubl~~ to t{~c fecal ;cnjc~^nmcnt lrllere. tltc plll'C/ICISC' to/;cs place, shat-rrn,; that u use tirx bus been piri~l. This is required by state statute for both statutory and home rule municipalities. (Colorado Revised Statutes, Title 29j Colorado ,state statute also prohibits local jurisdictions from collecting a use lax un ma±erials for ~s~hich a legally imposed tax has ah-eady been collected by another city or -~- town. It the sales tax a~llecte;d was less than the use tax required, only the incremental amount of the; uc tax may he: e:ullcctcd. Will the proposed tax add to the builder/de~~eloper's project cost:' If'so, how much? In most case,, a use; tax would result in additional dust to the purchaser of huiltling rnat.;rials t~)I- use' in Fail. "Che additional amount dcpcncis upon the rate of the tax and hove the builder is currently taking delivery. on materials. Fur example, if the builder is ~urrenr.iy picking up n~ate~rials in Avon. ~~ =t°-o sales tax is paid to tl,c T~>nm ;>f .Av~un. !f Vail had a ~°,~o use tax un construction materials, he/she vvvuld still pay -f°%; but woulc:i pay it to Vail as a use tax at the time a building permit is issued. He/she would nut he required to pay the Avon sales tax. (Ref~rcnce Avon Town C'udc 3.08.321)) Continuing with Avon as an example, if the builder is doing business in Vail and having ;rurterials shipped to Vail, tl~e materials are exempt from Avon's ~~'o sales tax because the point of delivery is outside the Tovvn of Avun. (Re;fercnce ,anon Tovvn Code: 3.08.0=10) The materials are also exempt ti-om Vail's =1'% soles t~:x if' the purchaser presents a building permit number to the supplier delivering the material. Therc;ti~re, in the s;tuation where construction a;.d building materials are d.;livered into V"ail for a project constructed under a b~_rlding permit, a 't°~~, use tax would. increase the builder's cost by ~cpproximate;ly 2"out iris total pr~,j~ct valuation, representing a 4°~~ ;;se tax on the value ut material, which is estimated at 30'% of project valuation. I~oov much revenue would a construction use tax generate for the Todvn of Vail? "I~he amount generated would be dependent upon the tux rate asse;sscd and the valuation <~fbuilding permits issued in any given year. ,~\ '1°~~ tax on building materials used in the tt)wn would have generated an estimated ~2 million in 2005; 8=t million in 2006; and `~ i million in 2007. What would t!te revenue from a construction use tax he used for? A use: tax can be usc.l for any t~gitimate gen~ernm~nt:al purpose including capital cxpcnciitures and operating expenses. ~~'ail's proposed ballot question specities the tax. vvuuld be used exclusively for capital acquisitions and capital projects within the; Town o1' Vail. .arc any' organizations crempt from use tax? Organizational exemptions vary by taxing jurisdiction. Statt~ recommends the To~.vn of Vail provide the same organizational cxez~nptiuns tor. use tax as aF-c cur-ently detin.;d in the town', sales tax code: a. The United State government, the state, its clepai-tments and institutions, and the political subdivisions thereof in their governmental capacities onl}; b. charitable organizations in the conduct of their regular charitable functions and activities; and c. schools, other than schools held ur conducted for private or corporate profit. ~, - 11~hat considerations can be given to developers/builders who have already determined their project costs, but not vet received a building permit? Town Council could include a provision in the 1111plcmentatiun urilinance to rebate or exempt ti-um use taY any projects whose devcloprnent application is crpp~•nver/ prior to the et~tcctivc date of the tax. .The development application approval 19 re.CCltllmtlldeCl as the key date because it marks the point at which the develi~per h.is vested rivhts to u~nstruct the project in accordance with the uppruvec} plan. Dcvcli~pment ot• construction dra~~ in~_s ~.nd bidclin~ ofcosts take place attar development plan approval. What relief can be given to developers; builders who are constructing. work force housing:' Similarly, Town Council could include a provision to rc;bate the use tax collected on materials used to build workforce housing. Luntmont and Fort Collins have ordinances including this provision. g RESOLUTION iti'O. 19 SERIES 2007 •~ RESOLUTION SUB~IITTIti'G TO THE REGISTERED ELECTORS OF THE TO"'~' OF VAIL, COLORADO, q1' A REGULAR ~~IU\ICIp•-~L ELECTIOti' HELD Oy NOVEJIBIER 6, 2007, A BALLOT ISSUE CONCERNING THE ADOPTION OF A LSE T.AX TO FINANCE C.~pI T .~L PROJECTS :tip gCQUISITIONS; AND PROVID[NG OTHER DETAILS RELATING THERETO. WHEREAS, the Town of Vail, in the County of Eagle and State of Colorado (the "Town"), is a home rule municipal corporation duly organized and existing under laws of the State of Colorado (the "State") and the Town Charter (the "Charter"); and WHEREAS, the members of the Town Council of the Town (the "Council") have been duly elected and qualified; and WHEREAS, the Council hereby finds and determines that it is in the public interest to adopt a four percent (4%,) use tax in the Town on the privilege of storm ,using and/or consuming any construction andr'or building materials purchased at retail ig ide or outside of the Town; and WHEREAS, Article X, Section 20 of the Colorado Constitution, also referred to as the Taxpayer's Bill of Rights ("TABOR" any increase in any tax rate, the creation of any debteand the spendin fof c rt new tax, above limits established by TABOR; and g gin funds WHEREAS, TABOR requires the Town to submit ballot issues (as defined in TABOR) to the Town's electors on limited election days before action can be taken on such ballot issues; and WHEREAS, the Town will hold its regular municipal election on November 6, X007 (the "Election"); and WHEREAS, November 6, ?007, is one of the election dates a.t which ballot issues may be submitted to the Town', electors pursuant to TABOR; and WHEREAS, pursuant to Section 2.3 of the Charter, the Council hereby determines that the Election shall be held and conducted as a polling place election in accordance with Article 10 of Title 3I, Colorado Revised Statutes ("C.R.S." "Municipal Election Code"); and ) (the WHEREAS, the Council is of the opinion that the Town should seek voter approval to increase taxes for the purpose provided in this resolution; and WHEREAS, it is necessary to set forth certain procedures concerning the conduct of the Election. Resolution ~Vo, 19, Series 2007 NOW', THEREFORE, I3E IT RESOLVED BY TEIE TOWN COUNCIL OF T'HE TOW"N GF VA1L, COLORADO: Section 1. Unless otherwise defined herein, all terms used herein shall have the meanings defined in TABOR and in Section 31-10-102, C.R.S. Section 2. Pursuant to Section 31-10-105, C.R.S. and Section ?.5 of the Charter, the Election Commissicm .of the Town shall perti~rm all acts required or ljeJ-J.7itted by law in connection with the Election, which- Election shall be held and conducted as an independent polling place election. Section 3. Pursuant to the applicable laws of the State and the Charter, the Council hereby determines that the following ballot issue is hereby referred to the registered electors of the Town and shall appear on the ballot of the Town of Vail, Color~d~, at the Election: SHALL THE TOWN OF VAIL'S TAXES BE INCREASED BY 54,000,000 N FISCAL YEAR 2008 AND BY ~'~`HATEVER ADDITIONAL AMOUNTS ARE RAISED AN'?VUALLY THEREAFTER THROUGH THE ADOPTION OF A USE TAX ON THE PRIVILEGE OF STORING, US_~tG AND/OR CONSUiv1ING IN THE TOWN OF VAIL ANA' CONSTRUCTION AND.~OR BUILDING MATERIALS PURCHASED A'T RETAIL INSIDE OR OUTSIDE THE TOWN, AT THE RATE Or FOUR PERCEN'T' 1,4°~0) OF THE RETAIL COST GF SUCH MATERIALS AND SHALL THE TOWN BE AUTHORIZED TO COLLECT AND SPEND SUCH REVENUES, INCLUDING .~~N~% INTEREST AND INVESTMENT I?VCONIE THEREON, EXCLUSIVELY FOE: CAPITAL ACQUISITIONS AND CAPITAL PROJECTS IN THE TOWN OF VAIL AS A VOTER APPROVED REVENUE CHANGE NO'1'yVITHST.4NDING ANY' REVENUE OR EXPENDITURE LIMITATION, IhJ'CLUDING THOSE CONTAINED IN ARTICLE X, SECTIOZr 20 Or THE COLORADO CONSTITUTION? Section 4. If a majority of the votes cast on the question to levy a use tax submitted at the Election shall be in favor of issuance of the levy of the use tax as provided in such question, the effective date of said tax shall be January 1, 2008, and the 'Gown, acting through the Council, shall be authorized to adopt an ordinance levying the tax in accordance with such question and to provide for the administration and collection of the tax. Any authority to levy the use tax, if conferred by the results of the Election, shall be deemed and considered. a continuing authority to levy the tax so authorized at any one time, or from time to timo, and neither the partial exercise of the authority so conferred, nor any lapse of tune, shall. be considered as exhausting or limiting the full authority so conferred. Section 5: It is the intention of the Council that when an ordinance is adopted to levy, administer and collect the use tax, said ordinance shall include a provision to exempt or to rebate the use tax collected on materials used to build workforce housing. Resolution No. 19, Series 2007 Sc;ction 6. The otticcrs and rmplovees of the To~~•n are hereby authorized and directed to take all action necessary or appropriate to ~ftectuate thy; provision, ofthis resolution. Section 7. All actions heretoti~re taken (not inconsistent with the provisions of this resolution] by the Town and the officers thereof, directed to~i~ards the Election and the objects and purposes herein stated are hereby ratified, approved and confirmed. Section 8. If any section, paragraph, clause or provision of this resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability ofsuch section, para~'aph, clause or provision shall to no manner affect any remaining provisions of this resolution, the intent being that the same are severable. Section 9. All resolutions or parts of resolutions. inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revive any resolution or part of any resolution heretofore repealed. I~,rTRODliCED, READ, APPROVED AND ADOPTED this August 21, ?007. Rodney E. Slifer, Mayor (SEAL) ATTEST: Lorelei Donaldson, Town Clerk Resolution No. 19, Series 2007 STATE OF COLORADO } COUNT`,! OI' EAGLE )SS. TOWS; OF VAIL ) I, the 'T'own Clerk of the Town of Vail, Colorado, do hereby certify that: 1. The foregoing pages are a true, perfect and complete copy of a resolution {the "Resolution") passed and adopted by the Town Council (the "Council") constituting the governing board of the Town of Vail, Colorado (the "Town"), at a regular meeting of the Town held at the Town Hall on August 21, 2007, convening at the hour of 6:00 p.m. as recorded in the reorular book of official records of the proceedings of sai;i Town of Vaii kept in my office. 2. The Resolution was duly moved and seconded and the Resolution was adopted at thy; meeting of August 21, 2007, by an affrmative vote of a majority of the men-~bers of the Council as follows: Name `'Yes" - - ~ ~ "No~' ~ Absent ~ Abstain Rod Slifer ~ ~, Kevin Foley ~ I ~ _X Mark Guidon ~{ - ~ Kim Newbury ' ~ K:;nt Logan I I ~ f ~- ~ Greg ~tiloffet j ~ ~ ~ ~ j Farrow Hitt ; ~ 3. The members of the Ccui,cil were present at such meeting and voted on the passage of such Resolution as set foith above. Resolution No. 19, Series 2407 4• 7'he Resolution was appro~~ed and authenticated by the signature of the Mayor, sealed with the Town seal, attested by the Town Clerk and recorded in th minutes of the Council. e 5. might prohibit the adoption of said Resolution. b• The notice of the meeting of August 21, 2007, in the form attached hereto as Exh__~ was posted at the Town Hall, not less than 24 hours rior to meeting in accordance with law. p ~~ WITNESS my hand and the seal of said Town aftixed this August 21, 2007. 1 own Clerk (SEAL) There are no bylaws, rules or regulations of the Council which Resolution No. 19, Saries 2007 E~HIB[T A (attach Form of;Viceting Noticej Resoluticn No..9, Series 2007 ~ow~oeunn, November 29, 2007 OCTOBER 2007 VAIL BUSINESS REVIEW The October Vail Business Review breaks down the four percent sales tax collected for October and the summer season (May -October). Overall October sales tax increased 5.8% with Retail decreasing 2.5%, Lodging increased 3.9°Io, Food and Beverage increased 29.8% and Utilities/Other (which is mainly utilities but also includes taxable services and rentals) increased .7%. The summer (May -October) resulted in a 9.3% increase overall with Retail increasing 5.4%, Lodging increased 9.0%, Food and Beverage increased 12.2% and Utilities increased 13.4%. Town of Vail sales tax forms, the Vail Business Review and the sales tax worksheet are available on the Internet at www.vailgov.com. You can subscribe to have the Vail Business Review and the sales tax worksheet e-mailed to you automatically from www.vailgov.com. Please remember when reading the Vail Business Review that it is produced from sales tax collections, as opposed to actual gross sales. If you have any questions or comments please feel free to call me at (970) 479-2125 or Judy Camp at (970) 479-2119. Sincerely, ~.J~ Sally Lorton Sales Tax Administrator October 2007 SALES TAX VAIL VILLAGE October October October 2006 2007 .% Collections Collections Chan e Retail 72,299 64,412 -10.9% Lodging 27,235 - 30,13'.1 10.6% Food & '~ Beverage , 72,393 82,696 14.2% Other 2,511 1,15 -53.8%° Total 174,438 17,398 2.3%° LI®JVSHEAD October 2006 Collections Retai I Lodging Food & Beverage Other 15,11.7 October October 2007 Collections Change --- ~ 23,692 19,41.4 2,48 26,605 12.3% ...32,881 6.9.4%° ...:.5,872 136.0% --- Total 60,711 77,638 27.9% i October 2007 SALES TAX CASCADE VILLAGE/EAST VAIUSANDSTONE/WEST VAIL Retail Lodging Food & Beverage Other Tota I 32,866 4;435 October October 2007 Collections Change 101,436 36% 26,678 -1009% 46,275 40:8% 3,213 -27.6% 164,958 177,602 7.7% - - - OUT OF TOWN October October October 2006 2007 Collections Collections Change Retail 52,,880 53,969 2.1 % I~ Lodging 3,138 3,887 23.9%' Food & Beverage 239 339 41.8% Utilities & 15,8,135 158,539 0.3% Other Tota I 214, 392 216, 734 1.1 ___ ~ October 2006 Collections 97,712 29,945 October 2007 SALES TAX TOTAL October October October 2006 2007 Collections Collections Change Retail 238,008 232,097 -25% Lodging ~I 84,010 87,3.01 39% Food & ~, Beverage ~ 1.24,912 161,191 29.8% Utilities & j 1:67,569 16£3,73 0.7°% Other Total ! 614,499 650,372 5.8% ' RETAIL SUMMARY October 2006 Collections October 2007 Collections October % Change FOOD 73,220 71,774 -2.0% LIQUOR 15,047 14,665 -2.5% APPAREL 21,048 23,891 13.5% SPORT 41,477 36,085 -13.0% JEWELRY 7,842 5,576 -28.9% GIFT 3,861 4,571 18.4% GALLERY 1,944 711 -63.4% OTHER 73,039 74,502 2.0% HOME 530 322 -39.2% OCCUPATION TOTAL 238,008 232,097 -2.5% Summer 2007 Sales Tax VAIL VILLAGE Summer Summer Summer 2006. 2007 Collections Collections Change Retail Lodging Food & Beverage Other Total 709,091' 3889552 777,970 3:0,433 722,21:.8. 1.9%° 413,377 6.4% 864, 510 ; 11.1 % 56,858 86.8°% 1,96,046 ;; 2,®55,963 79%, LI®NSWEAD Summer 2006 Collections -- - -- - _ _ Retail 154,84 Lodging 2~2,~i91 Food ~ Beverage 172,76 Other 1.9,590 i Total ~~ 629,929 Summer Summer 2007 Collections Cha~~e 150,52 -2.9"/0 .322,115 14:0%' J 227,56~J 31.7% 32,55 66.2% 732.,682 16.3®/° Summer 2007 Sales Tax CASCADE VILLAGE/EAST VAIL/SANDSTONE/WEST VAIL Summer 2006 Collections Retail ~- Iii 707,587 Lodging ~~~ 294,382 Food & Beverage ~ 321,019 Other 30,628 Summer Summer 2007 Collections Chan e 711,957 06% 296.,145 0.6% 335,:263 4.4% 34,669 13.2°/a Total 1,353,616 1,378,034 1.8% OUT OF TOWN Retail Lodging Food & Beverage Utilities & Other Total Summer Summer Summer 2006 2007 Collections Collections Change 279,638 366,896 31.2% 9, 807 4,847 828,579 1,122, 871 31,377 219.9% 5,500 13.5%a 907,144 95% 1,3109917 16.7°l0 Summer 2007 Sales Tax TOTAL Summer Summer Summer 2006 2007 Collections Collections Change _ Retai I i 1,851,300 1,951;523 5.4% Lodging 975;332 1,063,014 9.Q~°i° Food & Beverage 1,276,1600 1,432,633 12.2% Utilities & 909 230 1 031 226 13..4% Other ~~ Total 5,012,462 ___ 5,478,596 _ 9.3% J a RETAIL .SUMIVIARY Summer 2006 Collections Summer 2007 Collections Summer % Chan e FOOD 539,521 544,924 1.0% LIQUOR 113,982 114,585 .5% APPAREL 230,743 271,037 17.5% SPORT 358,779 334,379 -6.8% JEWEI:RY 90,308 90,279 0.0% GIFT 49,354. 44,727 -9.4% GALLERY 32,027 35,995. 12.4% OTHER 432,569 510,981 18.1% HOME 4,017 4,616 14.9% OCCUPATION TOTAL 1,851,300 1,951,523 5.4% MEMORANDUM November 27, 2007 To: Vail Town Council Stan Zemler Pam Brandmeyer Judy Camp From: Sally Lorton Re: October Sales Tax On the reverse side please find the latest sales tax worksheet. I estimate I'll collect another $29,000.00 in October sales tax to bring October collections to $679,308.00. If so, we will be up 15.7% or $92,375.00 from budget and up 10.6% or $64,912.00 from October 2006. Town of Vail Sales Tax Worksheet 11 /2 7/2007 % Change % Chenga Month 1996 - 7997 1998 1999 2000 2001 2002 2003 20Oq 2005 2006 Budget 2007 CD//BCr10/1S Budget Vedence loom 2006 from Budget . , ~ _ .. z: - y ` January 1,935,782 2,052,569 2,115,359 2,066,459 2,034,529 2,210,547 2,073,481 1,997,091 2,225,841 2,275,967 2,597,985 2,484,585 2,782,458 297,873 7.10°,6 11.994.0 February 1,993,389 2,089,673 2,753,121 2,021,486 2,223,670 2,366,321 2,281,833 2,111,163 2,362,825 2,429,377 2,527,130 2,416,869 2,717,796 300,927 7.54°6 12.45°0 March April May June JuIY 2,240,865 966,993 318,920 594,907 963,717 2,580,992 874,427 329,783 630,366 1,043,637 2,368,077 1,107,334 382,718 633,400 1,107,882 2,415,202 2,545,573 952,843 926,771 370,864 388,127 692,811 721,774 1,130,883 1,235,470 2,568,871 1,043,431 448,234 751,439 1,157,867 2,699,664 870,875 414,248 657,707 1,044,966 2,372,942 871,468 428,919 742,755 1,075,532 2,344,178 992,157 411,595 732,113 1,128,514 2,785,101 915,554 458,770 834,913 ~ 1,166,183 2,852,954 1,280,324 449,283 805,362 1,255,243 2,728,545 1,224,558 429,747 770,187 1,200,524 2,984,716 1,329,916 545,051 95:1,070 1,263,832 256,171 105,358 115,304 182,883 63,308 4.624'0 3.87°,'., 21.32°:. 18.3496 0.689& 9.:19;0 3.G09o 26.83° 23.1596 5.279;, August September October 990,650 630,453 413,573 1,073,430 637;831 472,836 1,183,926 735,606 515,531 1,050,004 1,038,516 806,600 817,313 536,204 547,201 1,124,275 747,766 486,570 1,084,318 713,574 484,425 1,029,446 679,208 508,092 994,445 757,033 532.537 993,985 795,807 566,173 1,055,674 832,549 614,396 1,009,670 796,263 586,933 1,16G,888 904,995 650,308 151,218 108,732 63,375 9.9756 8.70°~ 5.8556 14 a8i6 13.E6°ro 10.80;6 Total 11,049,249 11,785,Ei44 12,302,956 12,043,356 12,47 , ~ 8 12 905,321 1 ~ '.:'I. ~~'=+1 11,816,616 12,481,238 13,221,830 14,270,840 13,647,881 15,293,030 ., 1,645,149 7.1646 12.05°,u ,., , .w,_ November 601,208 707,166 656,596 582,260 691,445 571,783 642,293 591,269 623,646 713,117 799,582 762,393 December 2,068,851 2,254,709 2,070,834 1,883,805 2,062,205 1,933,940 2,139,417 2,171,098 2,362,095 2,549,032 2,771,258 2,639,726 Total 13,719,308 14,747,419 15,030,386 14,509,421 15,232,588 15,41 1,044 15,106,801 14 578,983 15,466,979 16,483,979 17,841,680 17,050,000 Liability Issues for Council, Boards and Commissions Town of Vail, December 4, 2007 Tami Tanoue General Counsel/Claims Manager CIRSA .Depending on the nature of the allegations that may be made against you, you may or may not have. liability protections under: The Governmental Immunity Act • Common law (judge-made) immunities Insurance coverages Your goal: make sure your conduct doesn't cause you to lose your liability protections . Let's see how you're- doing ... . Property/Casualty Pool -.~ 2002-2006 iPehicle ®4,043 $12,582,022 ^ Police Liability ^ 524 $ 7,219,65 • Ernpl®ynlent 244 $ 6,071,335 ® Sewer Backups ^ 720 3 333 190 $ e , ® Negligent 745 $ 1,50,959 Inspect/M~Antenence • Total Top 5: ®6,276 $30,77,164 ^ (68%) (72%) ^ Total PC .Pool ^ 9237 $42,726,331 Town of Vail: PC Losses July 2003 -December 2006 . Vehicle • Slip/Trip/Fall . Med-pay -premises • Sewer backups . All others ®Tot~ I ® 104 ~ 147, 341 ® 29 $ 16,674 ® 3 _ 20, 345 ® 2 ~ 2,254 ® , 30 ~ 1~,4~3 . 168 $ 205,097 Workers' Compensation Pool 2002-2006 • Strains/sprains .1239 . Vehicle .145 • Slips/falls .696 . Struck by .564 . Burns 59 . Total Top 5 .2703 (6i~ro~. ^ Tota I WC Pool 4437 $7,957,339 $6,718,359 $5,716,500 $1,732,888 X577,841 $22,702,927 (84%) $27,065,258 Which boards and commissions need to be concerned about liability? Keep in mind that anyone can sue anybody .for anything, but liabelity is of particular concern if ... Your actions can affect someone`s financial interests . Property rights, right to a license ® Your actions can affect someone's 'good name" or reputation . Personnel matters involving a specific employee Your role is -more than advisory ® Your role is advisory, but you venture out past advisory territory What are my sources of J- liability? ^ .Governmental Immunity Act ® 6 °°waivers" of ir~n~unity • 'Outside the Scope" and ~~willful and wanton" actions . 42 U.S.C. Section 1983 ® Deprivation of constitutions I or other federa I ly protected rights • ®ue process, discrimination . Liberty interest in one's °~good name" What are my legal protections? • Governmental Immunity Act . Notice of Claim o Right to defense Right to have judgment/settlement paid • GIA applies to appointed officials and volunteers as well as elected officials -and employees e NOTE: GIA does not apply to federal law actions • Cornrr~on faw ir~r~nunities . Insurance What key coverages and exclusions do we have? .~: . The Town is a named insured under the CIRSA liability policies • Council, .boards, and commissions, elected and appointed officials, employees, and volunteers are also insureds, but only while acting within the scope and performance of their official duties • Key coverages include: . Auto liability (AL) . Law enforcement liability (LEL) e General liability (GL) . Public o~cials liability (including empBoyment) (POL) fi.-- s ~::; • Key general exclusions include: . A!I actions connected .with principles of eminent domain, condemnation/inverse condemnation . Governmental fines and penalties •• Punitive ®r exemplary damages Issuance of financial obligations, or taxes, fees, assessments, or collection/retention/ expenditure of funds breach of contract (except allegations ~of wrongful termination of employment) What key coverages and exclusions do we have? • Nightmare cases involving personal liability can and do occur Defense/indemnity obligations determined on basis of plaintiff's allegations in complaint • Plaintiffs may have reasons to either ~~plead into" or `°out of" coverage ® Real life examples: ® County official _ $150,000 punitive damages for retaliation on basis of political affiliations ® Mayor - $1m5 million punitive damages for retaliation based on discrimination charges ® City official -allegation of defamation, interference with contractual relationships, personal vendetta against employee of contractor ..: V1/hat do I do to avoid liability? ... . ^ You have personal protection from liability under the Governmental Immunity Act (GIA~ only if you are "within the scope of employment and not acting 'willfully and wantonly.' ^ Concept of "scope of employment"applies to ALL persons covered by the GIA- including elected and ap~omted officials, employees, and authorized vo unteers ^ Means ever~rone needs to know their "job description' ! ^ For council, that's found in a variety of legal sources ^ For boards and commissions, that's primarily the establishing enactment What do I do to avoid liability? ^ Conduct that is outside the scope of employment (SOE) or willful and wanton will result in a loss of governmental immunity. ^ Can also result in loss of coverage under liability insurance policies ^ Can also result in personal liability, including punitive damages ^ You may become responsible for defending yourself and paying any settlement/judgment against you What do I do to avoid liability? ^ Understand your "job description" and stay within it. ^ Before acting, look fora law, ordinance, resolution, or motion that authorizes you to act. ^ Keep in mind you may need to reconcile conflicting and superseding authorities If you can't trace your action to a source of authorization, you may be outside your SOE! - - -----------. ..._..e_...,,,~ you -act prir~narily as a BODY. ^ You exercise your respon~ibiliti~s mainly by VOTING in a Pl16LIC NlEETIIVG. What do I do to avoid liability? ^ ~~V1/e" ... not ~~ I"! If you find yourself thinking in terms of "I" rather than ~~we" ...that's a red flag. • Be particularly cautious once you've voted on a .matter. . The tribe has spoken! ® Get behind the decision, don't undermine. ® If you feel there is ~a need to change it, use proper channels only. ® Recognise that some decisions CANNOT be undone without I iabi I ity. ,J What do I do to avoid liability? • Avoid acting out, of personal motives ® Actin on the basis of persona! motives is I i kely to be outsi e your S®E! - • gay also be willful and wanton ^ If a motivation can be described i n any of these terms, it may be a red flag ! ° Retaliation ° Revenge ® Personal axe to grind ° Out t0 "get" someone ° Single-issue'~agenda" ° Personal benefit -financial ®r otherwise What do I do to avoid liability? ~- ~: ..a ~~ ~ as-_r~ r ® Protect legitimate confidences.. Government is conducted in the open -but there are legitimately confidential ~ matters, including: • Legal advice, litigation issues • Personnel matters • Issues being negotiated ® Comply with the formalities and substance of the open Meetings Law, and maintain executive-session - confidentiality after you complete the executive session . Recent enhancement to CIRSA coverage -executive session limited defense cost coversge for executive sessions held by Council (but not boards and commissions) Other suggestions -use your ! power wisely .. whatever the "official" responsibilities, c®uncil; board, and commission positions carry a perception of "power" ® l.lnderstand that those who come before you may be uncomfortable or feel intimidated • Vou review dozens or hundreds of .issues, but those who come before you may do so only once in their lifetime ® Exercise your responsibilities wisely and humanely •• Ilse courtesy, tact, and diplomacy in .interactions with citizens, applicants® and staff ~_ ~~~ ~~._. ~_ ^ Outside of appropriately confidential matters discussed in a properly convened executive session, ALL matters before a public body are to be discussed AND decided only in a properly noticed public meeting. ^ ®on't hold a private ~~meeting before the meeting" ^ No public "rubber stamping" of decisions already made in private ^ If some or all members have already decided an outcome in private, then the concept of public participation in a public meeting has been effectively destroyed Other suggestions - run a good meeting Other suggestions - run a good meeting ^ Understand the difference between legislative and quasi-judicial matters, and observe the different requirements applicable to each! ^ hoards that need t~ be particularly concerned about this distinction include Council, hoard of Adjustment, Planning Commission ^ In aquasi-judicial hearing, an array of special proceduraB requirements applya ^ Violation of those requirements is a violation of due process - a constitutional/civil rights violation! • An ex parts contact is an "outside the hearin " 9 contact with someone who has a stake or interest in the subject matter of the hearing • The contact is irnperrnissible whether with the applicant, citizens, ®r staff • when your Town A~torne advises a ainst them y g , he is protecting Y®lJ, your ability to participate in the decision-making, and your ultimate decision • Improper ex parts contacts disen'p®wer Y®u as the decision-maker! What's the problem with ex -~-- _ _ __ e contacts, anyway? Ex pane contac~~ are among those actions pert What's the problem with ex - pane contacts, anyway? • A local elected official or board member doesn't wear a robe, and is easily. recognized on the street ... • So how do you avoid ex pane contacts when everyone knows who you are and expects you to be accessible? • Fsrst, make sure that you don't INITIATE any ex pane contacts yourself! •Second, arm yourself with the knowledge and talking points you need to address an ex pane contact initiated by another What's the problem with ex ~ pane contacts, anyway? r- ~ . 5~"" • Some "talking points" ® "I'd love to hear your views, but the. Town Attorne advises that the only evidence we can consider as oard (members is what we actually hear at the hearing. Please plan to attend the hearing on so that I can hear and understand your viewpoint." • "The Town Attorney advises that when I talk to one side or another at any time or place other than at the hearing itself, it really compromises my ability to maintain the reali AND appearance of fairness. Worse case scenario, I cou d end up having to recuse myself from participating in the hearing. I'm sure neither ou nor I want that. Please, please, please come to t e hearing and express your views. Reduce your involvement in Understand and observe the difference between legislative and administrative matters! ® Establish "corporate" values and mission, set overall goals and priorities, and give broad direction, leaving details of execution to staff. ^ Honor the Town Manager format ®gold standard of municipal government ^ "Committee" format can be problematic v and can increase your liability ^ Chances of successfully suing you go way down if you weren't involved ... and way up if you were!. Reduce your involvement in _ administrative rn~tters ^ The legislative-administrative distinction is particularly important in personnel matters. Council's most appropriate role is to stick to the "big picture" issues: • Personnel rules, including selection procedures performance evaluations, disceplanary actions . Town-wide pay plan ® Selection of y®ur °'direct reports" e budget ® ®verall Town-wide and departmental goals and priorities ® Councils, boards, and commission must do their work in public -but some .aspects of personnel management should not be done in public! Reduce your involvement in - administrative matters ^ Your BEST immunities as elected officials are in the legislative and quasi- judicial arena. ^ Courts recognize legislative and quasi- judicial immunities Venture into administration, and you're venturing into" outside the SOE" territory! - -- -Avoid conflicts of interest a In Colorado, ethics scandals- are rare -but happen from time to time B Ethical misjudgments greatly undermine public-confidence in government • Can result, in criminal and civil liability Amendment 41 concerns 'Personal benefit" exclusion from liability coverage! Gaining a personal benefit is outside your scope! ~(--Avoid conflicts of interest • Conflicts are a particular concern in quasi- judicial conte~ -land use approvals, licensing decisions • Aquasi-judicial. vote tainted by conflicts can result in due process violations -civil rights liability B Disclose conflict, DO NOT VOTE, do not influence others, leave the room! ~ Avoid conflicts of interest -t ~._ . __ ~inally ... don't let fear of liabili he engine that drives you! ty be • Don't focus on rules & technicalities, while overlooking basic values • Determine and articulate the basic ~~values" that should influence everything the board or commission does. . Basic motivating principle: "DO THE RIGHT THING." Roles and Responsibilities Of the Town of Vail Boards and Staff The purpose of this document is to clarify the responsibilities of the Town of Vail Design Review Board, Planning & Environmental Commission, Town Council and staff on various applications reviewed by these agencies , Summary of general distinctions between the DRB and the PEC on development Appiicat~ons: Planning and Environmental Commission: The PEC's review of most applications is focused on large-scale issues such as appropriateness of the use, impacts of the development on the development objectives of the Town, economic impacts of proposed uses, impacts on neighborhood, traffic impacts, pedestrian access, general environmental impacts, general impacts of bulk and mass on neighboring sites, and the like. The PEG is not responsible for such things as architectural details, roof pitch, materials, facade treatments, landscaping, etc., as this is the responsibility of the DRB. The PEC shall: • Ensure plan meets the technical requirements of the Zoning Regulations (setbacks, GRFA, density, building height, site coverage) • Evaluate the impacts of the development on adopted TOV policies (Land use plan, Vail Village Master Plan, Lionshead Redevelopment Master Plan, Town of Vail Streetscape Master Plan) • Evaluate the impacts of a development on the neighborhood, traffic, air and light and general bulk and mass (potential off-site impacts) • Evaluate a development's impact on the natural environment • Evaluate impact of the proposed use or structure on the community, traffic, etc. Design Review Board: The DRB's review of applications is focused on only those issues contained in the design guidelines such as ultimate bulk, mass, and articulation of structures, roof pitch, proposed materials, color, landscaping, etc. The DRB is not responsible for issues related to the economics impacts of a development, the proposed use, off-site traffic impacts, mitigation of development impacts on public infrastructure, etc. The DRB shall: • Review the proposal for compliance with Chapter 11 Design Guidelines, Vail Village Urban Design Considerations, Lionshead Redevelopment Master Plan Architectural Design Guidelines, Streetscape Master Plan • Evaluate site layout and on-site circulation • Evaluate building architecture including detailed bulk and mass review based on design guidelines • Evaluate all structure materials, colors, etc. • Evaluate tree and vegetation impacts and proposed landscape plans • Evaluate grading plans • Evaluate lighting and signage plans Division of Responsibilities For Specific Application Types Town CouncilUPEC/DRB/Staff. ®Design Review Application (DRB only) Planning and Environmental Commission: Action: The PEC has NO review authority on a DRB application, but must review any accompanying PEC application as prescribed herein. Design Review Board: ' Action: The DRB is responsible for final approvaUdenial of a DRB application.. The DRB is responsible for evaluating the proposal for: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - The design of parks - Compliance with the architectural design guidelines of the Lionshead Redevelopment Master Plan, the Vail Village Design Considerations, the Vail Streetscape Master Plan Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff may also approve DRB applications of minimal complexity as defined in the Zoning Regulations. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -2- ®250 proposals Planning and Environmental Commission: Action: The PEC has NO review autltority on a 250 application.. Design Review Board: Action: The DRB is responsible for final approvaUdenial of a 2S0 application.. The DRB is responsible for evaluating the proposal for: - Compliance with the minimum landscaping and site development standards required (i.e., landscaping, paved parking, underground utilities, removal of disallowed building materials, compliance with light standards, etc.) - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - The design of parks - Compliance with the design Guidelines of the Lionshead Redevelopment Master Plan, the Vail Village Design Considerations, the Vail Streetscape Master Plan Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff may also approve DRB applications of minimal complexity as defined in the Zoning Regulations. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -3- ®Conditional Use Permit (CUP) Order of Review: Generally, applications will be reviewed first by the PEC for acceptability of use and then by the DRB for compliance of proposed buildings and site planning. Planning and Environmental Commission: Action: The PEC is responsible for ftnal approvaUdenial of CUP. The PEC is responsible for evaluating a proposal for: 1. Relationship and impact of the use on development objectives of the Town. 2. Effect of the use on light and air, distribution of population, transportation facilities, utilities, schools, parks and recreation facilities, and other public facilities and public facilities needs. 3. Effect upon traffic, with particular reference to congestion, automotive and pedestrian safety and convenience, traffic flow and control, access, maneuverability, and removal of snow from the streets and parking areas. 4: Effect upon the character of the area in which the proposed use is to be located, including the scale and bulk of the proposed use in relation to surrounding uses. 5. Such other factors and criteria as the Commission deems applicable to the proposed use. 6. The environmental impact report concerning the proposed use, if an environmental impact report is required by Chapter 12 of this Title. Conformance with development standards of zone district - Lot area - Setbacks - Building Height - Density - GRFA - Site coverage - Landscape area - Parking and loading - Mitigation of development impacts Design Review Board: Action: The DRB has NO review authority on a CUP, but must review any accompanying DRB application. The DRB is responsible for evaluating the DRB proposal for: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - RemovaUPreservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other~building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - The design of parks -4- Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to ,the technical requirements of.the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -5- ®Variance Order of Review: Generally, applications will be reviewed first by the PEC for impacts of the proposed variance and then by the DIZB for compliance of proposed buildings and site planning.. PlanninE and Environmental Commission: Action: The PEC is responsible for ftnal approvaUdenial of a variance. The PEC is responsible for evaluating a proposal for: 1. The relationship of the requested variance to other existing or potential uses and structures in the vicinity. 2. The degree to which relief from the strict or literal interpretation and enforcement of a specified regulation is necessary to achieve compatibility and uniformity of treatment among sites in the vicinity, or to attain the objectives of this Title without grant of special privilege. 3. The effect of the requested variance on light and air, distribution of population, transportation and traffic facilities, public facilities and utilities, and public safety. 4. Such other factors and criteria as the Commission deems applicable to the proposed variance. Design Review Board: Action: The DIZB has NO review authority on a variance, but must review any accompanying D1ZB application. The DRB is responsible for evaluating the DRB proposal for: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading.of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - The design of parks Staff: . The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Towri Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -6- ® Major Exterior Alteration (LMU-1 and LMU-2) Order of Review: Generally, applications will be reviewed first by the PEC for impacts of use/development and then by the D1ZB for compliance of proposed buildings and site planning: Planning and Environmental Commission: Action: The PEC is responsible for final approvaUdenial of a Major Exterior Alteration. The PEC shall review the proposal for: - Conformance with development standards of zone district - Lot area - Setbacks - Building Height - Density - GRFA - Site coverage - Landscape area - Parking and loading - Mitigation of development impacts - Compliance with the goals and requirements of the Lionshead Redevelopment Master Plan (except design guidelines) Design Review Board: Action: The DIZB has NO review authority on a Major Exterior Alteration, but must review any accompanying DRB application. The DRB is responsible for evaluating the proposal for: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - Compliance with the architectural design guidelines of the Lionshead Redevelopment Master Plan Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -7.- ®Major Exterior Alteration (CC1 and CC2) and Minor Exterior alteration (CC1 and CC2) Order of Review: Generally, applications will be reviewed first by the PEC for impacts.of use/development and then by the DRB for compliance of proposed buildings and site planning. Planning and Environmental Commission: Action: The PEC is responsible for final approvaUdenia! of a Major/Minor Exterior Alteration. The PEC shall review the proposal for: - Conformance with development standards of zone district - Lot area - Setbacks - Building Height - Density - GRFA - Site coverage - Landscape area - Parking and loading - Compliance with the goals and requirements of the Vail Village Master Plan, the Streetscape Master Plan, and the Vail Comprehensive Plan - Compliance with the Vail Village Urban Design Guide Plan and Vail Village Design Considerations with respect to the following: - Pedestrianization - Vehicular penetration - Streetscape framework - Street enclosure - Street edge - Building height - Views - Service/delivery - Sunshade analysis - The PEC's approval "shall constitute approval of the basic form and location of improvements including siting, building setbacks, height, building bulk and mass, site improvements and landscaping." Design Review Board: Action: The DRB has NO review aut/tority on a Major or Minor Exterior Alteration, but must review any accompanying DRB application. The DRB is responsible for evaluating the proposal for: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting - Compliance with the Vail Village Urban Design Guide Plan and design considerations -8- Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -9- ®Special Development District and T19[ajor Amendment Order of Review: Generally, applications will he reviewed fast by the PEC for impacts of use/development, then by the DRB for compliance of proposed buildings and site planning, and final approval by the Town Council. Planning and Environmental Commission: Action: The PEC is advisory to the Town Council. The PEC shall review the proposal for and make a recommendation to the Town. Council on the following: • Permitted, accessory, and conditional uses • Evaluation of design criteria as follows (as applicable): A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. B. Relationship: Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. C. Parking And Loading: Compliance with parking and loading requirements as outlined in Chapter 10 of this Title. D. Comprehensive Plan: Conformity with applicable elements of the Vail Comprehensive Plan, Town policies and urban design plans. E. Natural and/or Geologic Hazard: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. F. Design Features: Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize; and preserve natural features, recreation, views and function. Workable Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. - Recommendation on development standards including, lot area, site dimensions, setbacks, height, density control, site coverages, landscaping and parking Design Review Board: Action: The DRB has NO review authority on a SDD proposal, but must review any accompanying DRB application The DRB review of an SDD prior to Town Council approval is purely advisory in nature. The DRB is responsible for evaluating the DRB proposal: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site -10- - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - Provision of outdoor lighting ' - Compliance with the architectural design guidelines of the Lionshead Redevelopment Master Plan Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Action: The Town Council is responsible for final approvaUdenial of an SDD. The Town Council shall review the proposal for the following: • Permitted, accessory, and conditional uses • Evaluation of design criteria as follows (as applicable): A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. B. Relationship: Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. C. Parking And Loading: Compliance with parking and loading requirements as outlined in Chapter 10 of this Title. D. Comprehensive Plan: Conformity with applicable elements of the Vail Comprehensive Plan, Town policies and urban design plans. E. Natural and/or Geologic Hazard: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. F. Design Features: Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views and function. Workable Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. Approval of development standards including, lot area, site dimensions, setbacks, height, density control, site coverages, landscaping and parking ® Special Development District Minor Amendment Staff: Action: The staff shall review and approve, approve with conditions, or deny the proposal and then report decision to'the PEC. Evaluation of design criteria as follows (as applicable): A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. B. Relationship: Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. C. Parking And Loading: Compliance. with parking and loading requirements as outlined in Chapter 10 of this Title. D. Comprehensive Plan: Conformity with applicable elements of the Vail Comprehensive Plan, Town policies and urban design plans. E. Natural and/or Geologic Hazard: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. F. Design Features: Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views and function. Workable Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. Design Review Board: Action: The DRB has NO review authority on a SDD proposal, but must review any accompanying DRI3 application. The DRB is responsible for evaluating the DRB proposal based on the following: - Architectural compatibility with other structures, the land and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - RemovaUPreservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes - . Provision of outdoor lighting - Compliance with the design Guidelines of the Lionshead Redevelopment Master Plan -12- Planning and Environmental Commission: The PEC is informed of the staff approval and may call-up item as it deems necessary. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council.. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision. -13- ®Development Plan (General Use District) Order of Review: Generally, applications will be reviewed first by the PEC for impacts of use/development and then by the DRB for compliance of proposed buildings and site planning. Planning and Environmental Commission: Action: The PEC is responsible for final appr~ovaUdenial of a development plan in a GU district.. The PEC is responsible for prescribing the following development standards: 1. Lot area and site dimensions. 2. Setbacks. 3. Building height. 4. Density control. 5. Site coverage. 6. Landscaping and site development. 7. Parking and loading. Design Review Board: Action: The DRB has NO review aut/torlty on a development plan in a GU district, but must review any accompanying DRB application. The DRB is responsible for evaluating the proposal for: - Architectural compatibility with other structures, the ]and and surroundings - Fitting buildings into landscape - Configuration of building and grading of a site which respects the topography - Removal/Preservation of trees and native vegetation - Adequate provision for snow storage on-site - Acceptability of building materials and colors - Acceptability of roof elements, eaves, overhangs, and other building forms - Provision of landscape and drainage - Provision of fencing, walls, and accessory structures - Circulation and access to a site including parking, and site distances - Location and design of satellite dishes; - Provision of outdoor lighting - The design of parks Staff: The staff is responsible for ensuring that all submittal requirements are provided and plans conform to the technical requirements of the Zoning Regulations. The staff also advises the applicant as to compliance with the design guidelines. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council. Town Council evaluates whether or not the PEC or DRB erred with approvals or denials and can uphold, uphold with modifications, or overturn the board's decision.. -14- ®Zoning/Rezoning Planning and Environmental Commission: Action: The PEC is advisory to the Town Council. The PEC shall review the proposal and make a recommendation to the Town Council on the compatibility of the proposed zoning with surrounding uses, consistency with the Vail Comprehensive Plans, and impact on the general welfare of the community. Design Review Board: Action: The DRB has NO review authority on zoning/rezonings. Staff: The staff is responsible for ensuring that all submittal requirements are provided. The staff advises the applicant as to compliance with the Zoning Regulations. Staff provides a staff memo containing background on the property and provides a staff evaluation of the project with respect to the required criteria and findings, and a recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Action: The Town Council is responsible for final approvaUdenial of a zoning/rezoning. The Town Council shall.review and approve the proposal based on the compatibility of the proposed zoning with surrounding uses, consistency with the Vail Comprehensive Plans, and impact on the general welfare of the community. ® Code Text Amendment Planning and Environmental Commission: Action: The PEC is advisory to the Town Council. The PEC shall review the proposal for and make a recommendation to the Town Council on the compatibility of the proposed text changes for consistency with the Vail Comprehensive Plans and impact on the general welfare of the community. Design Review Board: Action: The DRB has NO review authority on code amendments. Staff: The staff is responsible for ensuring that all submittal requirements are provided. The staff advises the applicant as to compliance with the Zoning Regulations. Staff provides analyses and recommendations to the PEC and Town Council on any text proposal. Town Council: Action: The Town Council is responsible for fr~ral approvaUdenial on code amendments. The Town Council shall review and approve the proposal based on the compatibility of the proposed text changes for consistency with the Vail Comprehensive Plans and impact on the general welfare of the community. File: \\VAIL\DATA\EVERYONE\DOMwIEM099\PECROLES.DOC -15- TOWN OF VAIL REVENUE HIGHLIGHTS November 27, 2007 Sales Tax Sales tax collections for the month of October are expected to be $679,308, up 10.6% from October, 2006. Year-to-date collections of $15.3 million through October continue to exceed last year's year-to-date by 7.2%. For comparison, inflation as measured by the consumer price index was up 3.5% in October compared with the prior year. Construction Permit Fee Revenue Construction permit revenue, which can be considered an indicator of redevelopment activity, continues its strong trend with year-to-date construction permit fees of $2.5 million through November 27, up 24% from the same period last year. Year-to-date permit fees include $1.8 million from major construction projects: 9 Vail Road, the Arrabelle at Vail Square, Cascade, Forest Place, Four Seasons, Front Door, the Landmark, Lodge at LionsHead, Manor Vail, Mountain View (formerly Apollo Park), Ritz Carlton, Solaris, Vail Plaza Hotel, Westhaven Condominiums, and the Willows. Construction permit fees include building, electrical, mechanical, plumbing and sprinkler permits. Recreational Amenities Fees Through November 27, 2007, we have collected a record. $981,707 in recreational amenities fees, compared with $117,501 for the full year 2006. Contributing to this year's high revenue number are Cascade Residences, Four Seasons, Mountain View, Ritz Carlton Residences and The Willows. Recreational amenities fees are applied to new residential square footage and deposited to the Real Estate Transfer Tax Fund to be used for open space, parks, recreation, and environmental sustainability: Real estate Transfer Tax (RETT) Year-to-date RETT collections through November 30, 2007, total $5.1 million compared with $5.4 million for -the same time period last year, a decrease of approximately 6%. Major redevelopment projects including Forest Place, Gore Creek Place, Manor Vail and One Willow Bridge Road contributed $1,081,044 or 21% of the total in 2007 while only $464,500 or 11 % of the total in 2006 consisted of major redevelopment projects. 071204 Revenue Highlights - 1 - I , .1 ~. c:~-w- ~ ~~~ `"~S CORE SITE EMPLOYEE HOUSING AGREEMENT THIS CORE SITE EMPLOYEE HOUSING AGREEMENT ("Agreement") is made as of the day of 2007, by and between the TOWN OF VAIL, a municipal corporation duly organized and existing under and by the Vail Town Charter (the "Town"), and THE VAIL, CORPORATION d/b/a VAIL ASSOCIATES, INC., a Colorado corporation ("Vail Associates"). Recitals: A. Vail Associates, the Town and the Vail Reinvestment Authority (the "Authority"), entered into the Core Site Development Agreement, dated as of November 8, 2004. Initially capitalized terms used but not defined herein shall have the meanings given them under the Core Site Development Agreement. B. All obligations of the Authority and obligations owed to the Authority have been satisfied and the Authority is not a necessary party to this Agreement (as confirmed by the Authority by its execution at the end hereof). C. Paragraph 12 of the Core Site Development Agreement obligated Vail Associates to provide replacement employee housing for the Sunbird Lodge and incremental employee housing for additional development in the Lionshead area of the Town of Vail. The obligation for employee housing is referred to in the Core Site Development Agreement as the "Core Employee Housing Requirements." D. The Core Employee Housing Requirements have been determined to be equivalent to 120 employee housing beds (and the foregoing will be part of the parties' agreement hereunder). E. Paragraph 12 of the Core Site Development provides that provision of the Core Employee Housing Requirements shall be a condition to the issuance of any certificate of occupancy for the Core Site Project (now known as "Arrabelle Project"), and that Vail Associates could provide the employee housing on an interim basis for a period of five years. F. The Arrabelle Project is nearing completion and Vail Associates anticipates applying for a temporary certificate of occupancy in the near future. G. The parties differ on the interpretation of Paragraph 12 of the Core Site Development Agreement and on whether Vail Associates is in compliance with the terms of Paragraph 12. H. In order to resolve the differences between the parties and to avoid litigation, the parties now enter into this Agreement to insure that Vail Associates satisfies the Core Employee Housing Requirements in a timely manner and that necessary certificates of occupancy are issued for~the Arrabelle Project. Deleted: 809082.4 RCFISH T. Agreement: NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements set forth herein, the parties covenant and agree as follows: 1. Vail Associates shall post an irrevocable ~etter_of credit in__the_ amount_of_-------Deleted:st~aby -~ $17,345,789 (the "Letter of Credit"), in a form satisfactory to the Town, with Land Title Guarantee Company to secure the Core Employee Housing Requirements. 2. The amount of the Letter of Credit shall be adjusted on April 1, 2008, and each April 1 thereafter, to an amount consistent with the rates set by the Town Council by resolution for payment of fees in lieu as required by Section 12-23-6 and Section 12-24-6, Vail.Town Code (Chapters 12-23 and 12-24 of the Vail Town Code being referred to hereinafter as the "New Housing Ordinances"). 3. Upon posting of the Letter of Credit, the Core Employee Housing Requirements shall no longer act as a condition to the issuance of a temporary certificate of occupancy for the Arrabelle Project. 4. Vail Associates shall use its best efforts to submit or cause to be submitted to the Town, by ~'ebruary__25,- 2008, a complete__development _ review application _ for a pro~ect_ or _- - - ------ -------- - - projects in the Town of Vail, which proposals shall include not less than 120 newly constructed employee housing beds to comply with the Core Employee Housing Requirements (provided the Town may not require more than 120 beds in the aggregate in relation to the Arrabelle Project), but may. be part of larger mixed use development(s) on the North Day Lot and/or alternative location(s) in the Lionshead Master Plan Area or other location approved by the Town (collectively the "North Day Lot and/or Alternative Project"). The Town .acknowledges and agrees that the North Day Lot and/or Alternative Project may involve direct or indirect ownership interests in favor of Vail Associates (or its affiliates) and/or third parties. The Town shall consider and process the review of such application promptly and in good faith, subject to the application being in compliance with the Vail Town Code, and by reasonable application of the Town's adopted development review requirements that are applicable to the particular site(s) (the "Review Standards"). 5. Vail Associates may amend or alter any North Day Lot and/or Alternative Project development application, or withdraw any such application from consideration by the Town and submit a new application, subject to its obligations in Section 6. 6. Vail Associates and/or any third party developers shall obtain approval of the development review application for the North Day Lot and/or Alternative Project on or before November 5, 2008 and the Town shall work in good faith to provide any approvals by such date for a timely filed application, all in accordance with the Review Standards. 7. Vail Associates and/or such other third party developer shall obtain a building permit for the construction of the North Da~Lot and/or Alternative Proiect and shall commence construction of a North Day Lot and/or Alternative Project no later than May 1, 2009 (subject to extension as hereinafter provided), and shall actively prosecute construction of the North Day Lot and/or Alternative Project obtain a building~ermit for the construction of the North Day Lot c-----------'---- -- Deleted: March 31 Deleted: 809082.4 RCFISH and/or Alternative Project and shall to completion. Upon issuance of a temporary certificate of occupancy for the North Day Lot and/or Alternative Project, the Letter of Credit shall be promptly returned to Vail Associates and Vail Associates shall be deemed to have satisfied the __--.--- Deleted: Resorts ------------ ------------- Core Site Employee Housing Requirements. 8. Any employee housing units provided pursuant to this Agreement shall be permanently restricted by provisions incorporated into the deed or other instrument. Such provisions shall b.e in accordance with Town Code and the deed, as restricted, or other instrument shall be recorded in the records of the Clerk and Recorder of Eagle County. 9. Breach by Vail Associates. A "breach" or default" by Vail Associates under this Agreement shall be defined as: (i) the failure of Vail Associates no later than November 5, 2008, to obtain from the Town a complete development review approval for the North Day Lot and/or Alternative Project; (ii) the failure of Vail Associates, by no later than November 5, 2008, to obtain from the Colorado Department of Transportation (CDOT), if necessary, all necessary approvals by CDOT for the North Day Lot and/or Alternative Project; (iii) the failure of Vail Associates to obtain a building permit for the construction of the North Dav Lot and/or Alternative Proiect and shall commence construction of the North Day Lot and/or or Alternative Project on or before May 1, 2009 (unless this date is extended as hereinafter set forth) or (iv) any failure by Vail Associates to actively pursue construction of the North Day Lot and/or Alternative Project obtain a building permit for the construction of the North Day Lot and/or Alternative Project once construction has commenced. 10. Breach by the Town. A "breach" or "default" by the Town under this Agreement shall be defined as follows: (i) failure by the Town to timely, diligently and in good faith consider and process the development review application for the North Day Lot and/or Alternative Project in accordance with the Review Standards, or (ii) failure of the Town to issue building permits or other requisite approvals for construction if proper application is made therefor under Town Code based on construction documents that conform to the approved development plan. 11. Mandatory Mediation. In the event a Notice of Breach is given by either party, the parties shall retain the services of a mediator, acceptable to both parties, within 15 days of the receipt of the Notice of Breach. In the event the parties are unable to agree on a mediator, the parties may exercise any remedy provided herein. The parties shall engage in mediation for a period not to exceed sixty (60) days from the date of retention of a mediator. Neither party may exercise its Remedy provided for in Paragraphs 12 and 13 below until the completion of the period for mediation. Either party may also cure any default during the mediation period. 12. Remedies for Breach by Vail Associates. The sole and exclusive remedy of the Town for a breach or default by Vail Associates shall be to draw on the Letter of Credit. Any proceeds that the Town may retain shall be applied solely to the Town's procurement in good faith of employee housing units in accordance with Town Code and to the end of furnishing the requisite 120 beds. 13. Remedies for Breach by the Town. The sole and exclusive remedy of Vail Associates for breach by the Town shall be for an extension of the required date for Vail 3 Deleted: 809082.4 RCFISH Associates to begin construction of the North Day Lot and/or Alternative Project (i) for a period of six (6) months from May 1, 2009, or (ii) the date upon which the breach by.the Town ceases (whichever is later). 14. Notices. Any notice required or permitted under the terms of this Agreement shall be in writing, may be given by the parties hereto or such parties' respective legal counsel, and shall be deemed given and received (i) when hand delivered to the intended recipient, by whatever means; (ii) three (3) business days after the same is deposited in the United States mails, with adequate postage prepaid, and sent by registered or certified mail, with return receipt requested; (iii) one (1) business day after the same is deposited with an overnight courier service of national or international reputation having a delivery area encompassing the address of the intended recipient, with the delivery charges prepaid; or (iv) when received via facsimile on the intended recipient's facsimile facilities accessed by the applicable telephone number set forth below (provided such facsimile delivery and receipt is confirmed on the facsimile facilities of the noticing party). Any notice under clause (i), (ii) or (iii) above shall be delivered or mailed, as the case may be, to the appropriate address set forth below. If to Vail Associates: Vail Corporation c/o Vail Resorts Development Company Post Office Box 959 137 Benchmark Road Avon, Colorado 81620 Attention: Keith Fernandez, President Fax No.: (970) 845-2555 Phone: (970) 845-2359 If to the Town or the Authority: Town of Vail Stanley Zemler, Town Manager 75 South Frontage Road Vail, Colorado 81657 Phone: (970) 479-2105 Fax No.: (970) 479-2452 Any party may change its addresses and/or fax numbers for notices pursuant to a written notice which is given in accordance with the terms hereof. 15. Attorneys' Fees. In the event any legal proceeding arises out of this Agreement and is prosecuted to final judgment, the prevailing party shall be entitled to recover from the other party all of the prevailing party's costs and expenses incurred in connection therewith, including reasonable attorneys' fees (and any presiding court will be bound to make this award). 16. Waiver. No failure by either party hereto to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement, or to exercise any right or remedy consequent upon a breach of this Agreement, will constitute a waiver of any such breach or of c----------------------------------------- Deleted: 809082.4 RCFISH such or any other covenant, agreement, term- or condition. Either party by giving notice to the other party may, but will not be required to, waive any of its rights or any conditions to any of its obligations hereunder. No waiver will affect or alter the remainder of this Agreement, but each and every other covenant, agreement, term and condition of this Agreement will continue in full force and effect with respect to any other then existing or subsequent breach. 17. Applicable Law. The laws of the State of Colorado will govern the interpretation and enforcement of this Agreement. 18. Binding Effect. This Agreement will be binding on and inure to the benefit of the parties hereto, and their successors and assigns. 19. Time of Essence. Time is of the essence of this Agreement. The parties will make every reasonable effort to expedite the subject matters hereof and acknowledge that the successful performance of this Agreement requires their continued cooperation. 20. CounterQarts. This Agreement may be executed in counterparts, each of which will be an original and all of which will constitute one and the same instrument: 21. Jointly Drafted Rules of Construction. The parties hereto agree that this Agreement was jointly drafted, and, therefore waive the application of any law, regulation, holding, or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document. 22. Entire Agreement. This Agreement represents the entire agreement between the parties hereto with respect to the subject matter hereof, and all prior or extrinsic agreements, undertakings or negotiations shall be deemed merged herein, superseded hereby, and of no force or effect, and the parties mutually acknowledge and agree that Paragraph 12 of the Core Site Development Agreement is superseded and terminated. [Balance of page intentionally left blank] Deleted: 809082.4 RCFISH -~ IN WITNESS WHEREOF, Vail Associates, the Town and the Authority have made this Agreement as of the day, month and year first above written. STATE OF COLORADO ) ss: COUNTY OF ) VAIL REINVESTMENT AUTHORITY By: The foregoing instrument was acknowledged before me this 2007, by as Authority. Wifiess my hand and official seal. My commission expires: day of of Vail Reinvestment Notary Public [Signature blocks continue on following page] - Deleted: 809082.4 RCFISH c------------------------ ----------------------------------------------------- TOWN OF VAIL By:_ NamE Title: ATTEST: Lorelei Donaldson, Town Clerk STATE OF COLORADO ) ss: COUNTY OF _ ) The foregoing instrument was acknowledged before me this day of , 2007, by as of the Town of Vail. Witness my hand and official seal. My commission expires: Notary Public [Signature blocks continue on following page] c___ Deleted: 809082.4 RCFISH THE VAIL CORPORATION, d/b/a VAIL ASSOCIATES, INC., a Colorado corporation By: STATE OF COLORADO ) ss: COUNTY OF ) Keith Fernandez, President and COO-VRDC The foregoing instrument was acknowledged before me this day of , 2007, by Keith Fernandez, President and COO-VRDC of The Vail Corporation, d/b/a Vail Associates, Inc., a Colorado corporation. Witness my hand and official seal. My commission expires: Notary Public .. Deleted: 809082.4 RCFISH