In their latest attempt to keep the U.S. Olympic Committee from moving its headquarters out of Colorado Springs, city officials Thursday unveiled a revamped, $53 million incentives package to provide the sports organization with new downtown offices and upgrades to its local Olympic Training Center. The agreement is expected to require taxpayers to ante up millions of dollars more while it cuts ties with financially troubled developer LandCo Equity Partners.
The USOC board gave tentative approval Thursday pending review by its management team and the city.
At the same time the revised USOC agreement was announced, the city and LandCo released terms of a settlement of a lawsuit LandCo had filed four months ago in federal court in Denver. The suit alleged the city and USOC hadn’t lived up to terms of the March 2008 deal that called for the developer to provide the sports organization with new facilities. LandCo settled with the USOC in June.
City officials released documents late Thursday afternoon, and several couldn’t be reached for comment. The City Council has scheduled a special 4 p.m. meeting today at City Hall to go over the details, and also plans to take public comment during a regular council meeting Aug. 11 before voting on the revised deal. Vice Mayor Larry Small said Thursday he hopes the council also will schedule a town hall meeting before then to give the public additional time to comment.
“There’s going to be an element (of the public) that doesn’t like it,” Small said. “There was an element that didn’t like the original deal. But I think, by and large in the community, there’s an appreciation of the USOC here and what it brings to the community. They’re going to be disappointed that we are going to have to pay more for it. But I think they’re going to be understanding of the fact that we’re not going to lose them.”
According to a review of the documents, key elements include:
• The agreement approved March 31, 2008, by the city, USOC and LandCo has been jettisoned in favor of a deal between the city and USOC, which would stay for 30 years instead of 25. Several details are similar: the USOC will get five floors of new office space in a six-story downtown building at 27 S. Tejon St., paying only a nominal annual lease; five Olympic national governing bodies also will receive new offices in a remodeled former city utilities building; and $16 million worth of improvements — including 166 housing units (up from 158), a renovated visitors center and upgraded cafeteria — will be made to the training center.
• What’s new, however, is the financing plan. The city had planned to issue about $27 million in certificates of participation — a form of borrowing that doesn’t require voter approval — to fund USOC improvements. Now it will issue about $32 million to $34 million in COPs, Small said. The original deal called for the city to set aside about $1.7 million annually out of its general fund to pay off the debt over 25 years. Now, the annual cost will be about $200,000 more over 30 years, Small said, which is roughly $6 million more over that span.
• Another major change: LandCo no longer will be responsible for the $16 million in OTC improvements. Instead, an initial $13 million phase will be funded by $9.5 million from the city’s COPs, $1.5 million from Springs-based El Pomar Foundation that will be matched by $1.5 million in community donations, and $500,000 from the Colorado Office of Economic Development. The donations must be raised within three months of final approval. The city must come up with the remaining $3 million for the second phase of work, which Small said will come from community donations. Those donations must be in place within 25 months of approval. The USOC will select a developer and contractor.
• A nonprofit city entity will issue the COPs, and pay $18.8 million in proceeds to LandCo to purchase its 27 S. Tejon St. building, whose core and shell will be completed no later than Sept. 30. The nonprofit entity will lease the building to the city, which will sub-lease the top five floors to the USOC for $1 a year. The city will pay $2.7 million to complete the building’s interior by March 31, 2010. A new developer to complete the job hasn’t been selected. LandCo, Small said, will retain ownership of the building’s first floor and basement. The same lease arrangement will hold true for the former utilities building, to be remodeled by Dec. 31; the city will own it, but sub-lease it to the NGBs.
For the financing of the new deal to fall in place, Mayor Lionel Rivera said he’s relying “on not only the city, but also philanthropists in the community to be partners with us. … To lose (the USOC) would be a terrible blow to us from an economic development standpoint and just an image standpoint.”
USOC acting chief executive officer Stephanie Streeter said her organization, which left New York for Colorado Springs in 1978, should OK the deal provided “the agreements stay in their current form. We believe through the public comment period that the citizens of the city will believe this is a good thing, then I think we will move forward.”
If the deal is approved, it would end a messy, months-long flap. Last year, the city had worked with the USOC and LandCo to come up with a deal to keep the sports organization here.
But the March 2008 deal fell apart in the months after it was approved. The city never issued the COPS because LandCo didn’t deliver on the OTC upgrades. The USOC refused to sign a lease for the headquarters building as a result and LandCo sued the USOC and the city in March 2009. Also, Rivera was accused of having a conflict of interest with LandCo Chairman Ray Marshall, a complaint being investigated by a city ethics panel. And, the 4th Judicial District Attorney’s Office has said it’s investigating Marshall, but hasn’t said why.
Here are links to the 12 documents released by the city, which collectively describe the terms of the new agreement with the USOC, as well as terms of a proposed settlement of a lawsuit brought by LandCo: