To: Honorable Mayor and Members of Town Council
From: Jeff Brauer, Director of Parks and Recreation
Title
Discussion / Direction Item: Rueter-Hess Reservoir Recreation Authority
Body
________________________________________________________________________________
Executive Summary
In 2015, Town Council voted unanimously to support a cooperative agreement with the Parker Water and Sanitation District (PWSD), the Town of Parker, the Town of Castle Rock, Douglas County, the City of Lone Tree and the City of Castle Pines to bring water based recreation opportunities to the Rueter-Hess Reservoir. This intergovernmental agreement (IGA) created the Rueter-Hess Recreation Authority. Each of the partner agencies maintain a position on the Authority Board of Directors.
The primary purpose of Rueter-Hess Reservoir is to provide drinking water and water storage to serve the District’s customers. All recreation planning and improvements by the Authority are subordinate to that primary purpose to maintain high quality drinking water.
Rueter-Hess Reservoir is located on Hess Road one mile east of Interstate 25 at the Castle Pines Parkway exit 188. The property encompasses over 1,170 acres. At 109 feet deep, the reservoir currently contains 28,560 acre feet of the projected 75,000 acre feet of water at capacity. The property is a fifteen minute drive from downtown Castle Rock, and will serve as a unique recreational destination.
Each of the partner agencies in the Authority contributed $25,000 to the Professional Services Agreement to develop a master plan for the property, and the $25,000 was budgeted in the 2017 budget. Outstanding local participation in the reservoir’s recreation master planning process has resulted in a preferred concept for the property’s outdoor recreational and educational opportunities.
The Rueter-Hess Recreation Authority is requesting $219,250 from the Town of Castle Rock for capital construction of improvements to Rueter-Hess Reservoir and surrounding area. The request is for a two year budget cycle for years 2017 and 2018. $25,000 has already been appropriated in the 2017 budget, therefore an additional $194,250 is needed to cover the total $219,250 amount. The budget format allows the Authority some security that a partner will not back out. The initial investment will assist in getting the property ready for public use.
Rueter-Hess Recreation Authority
2017 / 2018 Budget - Assessment Details
Amenities provided at the reservoir include non-motorized water based recreation such as canoeing, kayaking, stand up paddle boarding and fishing, trails for hiking and biking, as well as a control gate, entrance station and parking lot. Special events may be offered through the recreation departments or third party providers. The overall mandate from PWSD is to keep the reservoir, “peaceful and serene.” The master plan is consistent with that vision, which was also supported during public meetings, surveys and board hearings.
Future phase improvements are shown on Attachment A. Staff is requesting Council input relating to the improvements identified and the costs associated with the proposed 2017-2018 Budget for Phase One of Rueter-Hess Reservoir.
Notification and Outreach Efforts
PWSD and its regional partners engaged the public for feedback toward developing the Rueter-Hess Reservoir Recreation Master Plan. Two different surveys were posted online, between November 2015 and March 2016, to get input from area residents regarding recreational activities at the reservoir. The online survey conducted gathered more than 4,000 responses across Castle Rock, Lone Tree and Parker.
Castle Rock Parks and Recreation hosted an open house on February 27, 2016 to gain comments to determine which master plan components were most popular. In addition, public meetings and other activities were scheduled to allow for ongoing public feedback as the master plan was developed. Future surveys are anticipated although their schedule is not yet determined.
History of Past Town Council, Boards & Commissions, or Other Discussions
Town Council approval of the Intergovernmental Agreement for the Rueter-Hess Recreation Authority occurred on June 14, 2016.
Parks and Recreation Commission update and discussion of the Rueter-Hess Recreation Authority occurred on June 15, 2016 and on September 21, 2016. On September 21, the Commission’s recommendation was to continue to support the Town’s involvement in the Authority, as long as Castle Rock residents are supportive of the project. Parks and Recreation will need to request the $194,250 difference in funding for the 2017 to 2018 financial commitment as requested by the Authority. There was unanimous support of the idea of providing water-based recreation to residents, but there were also general concerns regarding the cost, the effect on the overall Parks and Recreation budget, the number of residents who would use the reservoir, and the full extent of how residents would benefit from continued involvement in the Authority, i.e. residents could still pay to use the reservoir regardless of the Town’s investment. Commission members were also concerned that funding Rueter-Hess through the Parks and Recreation budget would limit their future ability to fund more localized park improvements and additions based on community need and growth.
Discussion
The primary purpose of Rueter-Hess Reservoir is to provide drinking water and storage to serve the District’s customers. Of the 75,000 acre feet capacity, Rueter Hess Reservoir storage is currently at 28,560 acre-feet and 109 feet deep. Rueter-Hess Reservoir is an important part of the Town's long-term water strategy. The Town owns approximately 8,000 acre-feet of storage space in the reservoir.
Planning and construction of Rueter-Hess Reservoir has been a long term project. There were plans previously prepared for recreation options submitted in the original Environmental Assessment phase of the project, which included active and passive recreation like hiking, fishing and non-motorized boating.
Upon the reservoir opening, the public will be invited to experience what the land has to offer through exploring trails, engaging with the water, and learning in an environment dedicated to providing healthy habitats and a clean water supply. The plan includes places to take an archery class, learn to canoe, and identify native plant and animal species on an accessible prairie walk. Visitors can connect with local history throughout the property via trails and signage. Whether it is on cross-country skis, the incline challenge or the sledding hill, people visiting the property will have a way to interact with their community and enjoy the outdoors year-round.
The Authority Board was originally composed of six current members each with equal voting weight. The Board determined that the Authority IGA should be amended to reflect a differentiation between the large and small financial contributors, allocating the voting weight percentage as follows: Parker Water and Sanitation District (20%), Douglas County (20%), Town of Parker (20%) Town of Castle Rock (20%), City of Lone Tree (10%) and City of Castle Pines (10%). Voting percentages are to be reviewed and reallocated every three years to account for changing contribution levels and potential new members.
If a member entity fails to make its full budgeted contribution, or made a reduced contribution to the Authority in any given year, their voting percentage would be reduced in the following year proportionately (if no contribution made, voting right is relinquished).
The Authority has engaged in discussions centered on mechanisms to ensure financial stability from year to year while avoiding creating a multi-year obligation that would require TABOR approval.
The Board concluded that budgeting/invoicing of members would be done on a one year advanced basis, requiring each member to budget and contribute funds one year in advance of the actual expenditure year. This results in the 2017 Budget including the 2018 proposed budget amounts. The Authority will invoice each of its members (except Parker Water and Sanitation District, which is contributing facility access and management) their budgeted share of Authority expenses from 2017/2018 in 2017. The budgeted amount for 2018 would be held in reserve to be expended in 2018 and going forward, each year’s budget would be produced and collected one year in advance. This advanced budgeting and collection will allow the Authority to contract and undertake projects with funding certainty and will prevent annual shortfalls due to political volatility and potential failure of members to appropriate and contribute budgeted funds.
BBC Research and Consulting has developed a preliminary financial model analysis for these capital investments at Rueter-Hess Reservoir and associated operating revenues and expenditures. This analysis is intended as a starting point for more detailed decisions with the Rueter-Hess Recreation Authority Board. In order to construct a financial model, BBC looked at recreational operating characteristics and budgets of similar reservoirs and parks around the state. Many public parks and open spaces typically operate at a loss. For instance, in 2015 the relatively small Standley Reservoir had a net operating loss of $17,000 while Chatfield State Park expenditures outpaced revenues by $91,000. After incorporating data and assumptions from these and other locations, the initial model predicts an average operating cash flow of negative $35,000 for recreational activities at Rueter-Hess. This estimate is due in part to lower visitation during capital construction and limited revenue opportunities. The recreation fees in this model are based on the average fees for similar activities at other locations. However, Rueter-Hess could choose to charge tiered fees for similar activities in order to generate higher revenues. This analysis included an $8 per vehicle gate fee which is on par with other parks. BBC assumed a relatively low initial baseline visitation of 25,000 per year will increase steadily to a total of 260,000 annual visits by the time capital infrastructure is completed in the final phase. Annual visitation is based on Aurora and Boulder Reservoirs.
Budget Impact
The Rueter-Hess Recreation Authority is requesting $219,250 from the Town of Castle Rock for capital construction of improvements to Rueter-Hess Reservoir and surrounding area. The request is for a two year budget cycle for years 2017 and 2018. The 2017 budget currently has $25,000 appropriated for this project at this time. An additional $194,250 would need to be appropriated to maintain involvement within the Authority.
|
Total Requested From Authority 2017-2018 |
$219,250 |
|
Already budgeted in 2017 |
$25,000 |
|
Addition to 2017 budget |
$194,250 |
Staff Recommendation
Informational purposes only.
Proposed Motion
“None at this time.”
Attachments
Attachment A: 2017-2021 Phasing Plan
Attachment B: Rueter-Hess Master Plan