To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Michael J. Hyman, Town Attorney
Trish Muller, CPA, Finance Director
Title
Resolution of the Town Council of the Town of Castle Rock Expressing the Intent of the Town to be Reimbursed for Certain Expenses Relating to the Construction of a Recreation Center with Associated Amenities and Supporting Public Improvements Needed in Connection Therewith
Body
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Executive Summary
In order for the Town to reimburse itself for any capital expenditures made prior to the issuance of tax-exempt certificates of participation to finance the Castle Rock Sports Center Project, Town Council will need to adopt a resolution expressing its official intent to reimburse such capital expenditures.
History of Past Town Council, Boards & Commissions, or Other Discussions
On February 18, 2025, Town Council voted unanimously to finally adopt Ordinance No. 2025-007 approving the Brickyard Planned Development Plan and Zoning Regulations and Ordinance No. 2025-008 approving the Brickyard Development Agreement.
On March 4, 2025, Town Council voted unanimously to adopt Resolution No. 2025-032 approving the Consolidated Service Plan for Brickyard Metropolitan District Nos. 1-3.
On March 18, 2025, Town Council voted unanimously to adopt Resolution No. 2025-037 approving the letter agreement between CD-Acme, LLC and the Town regarding the early procurement of trade agreements and materials for the Castle Rock Sports Center Project.
Discussion
Town staff has been in negotiations with CD-Acme, LLC (the “Developer”), regarding a proposed Development Agreement for the construction of the Castle Rock Sports Center (the “Rec Center”) within the Brickyard Planned Development. The Rec Center will consist of an approximately 145,177-square foot recreation facility with associated on-site utilities, infrastructure, landscaping, and parking. The Developer will cause the Rec Center to be constructed in accordance with plans and specifications prepared by the Town’s architect on property to be conveyed by the Developer to the Town.
The Town intends to finance approximately $75,000,000 to pay the costs associated with the construction of the Rec Center through a tax-exempt financing that is anticipated to include the issuance of certificates of participation. Town staff has determined that it is necessary to make capital expenditures in connection with the Rec Center prior to the time that the Town arranges for the project financing. When such financing occurs, it is the expectation that these capital expenditures will be reimbursed with the proceeds of the financing.
In order to comply with the provisions of the Internal Revenue Code of 1986, as amended, Town staff recommends that the Town Council adopt a resolution expressing the Council’s “official intent” to reimburse such capital expenditures within the meaning of Treasury Regulation §1.150-2. In order for the Town to comply with the applicable Treasury Regulations, such resolution must be adopted not later than 60 days after the payment of the original capital expenditure.
Budget Impact
The adoption of the resolution will give the Town additional flexibility to finance capital expenditures associated with the Rec Center, including, but not limited to, the early procurement of trade agreements and materials authorized by Resolution No. 2025-037.
Staff Recommendation
Town staff recommends the adoption of the resolution.
Proposed Motion
“I move to approve the Resolution No. 2025-059 as introduced by title.”
“I move to approve Resolution No. 2025-059 as introduced by title, with the following conditions: _______________.”
“I move to continue Resolution No. 2025-059 to the town council meeting on _______________.”
Attachments
Resolution