The sale of the Durango 9-R School District’s former Administration Building to the Durango Fire District has prompted a maelstrom of complaints and accusations, with city officials taking heat from residents who oppose the sale: Why isn’t the city doing something to prevent this? they ask.
But the city had nothing to do with the deal and in fact had no power to exercise over it. The reason dates to much earlier in the millennium, when the Durango Fire Protection District first was created.
At that time, the Hermosa Cliffs, Animas City and City of Durango fire districts were to be combined into the Durango Fire Protection District to reduce duplication of efforts and create a stable and equal funding stream for fire and ambulance services.
However, residents turned down a mill levy increase to fund the joint district in 2006 and 2011.
Stuck between the proverbial rock and a hard place, the workaround City Council arrived at was to withdraw from the district and instead enter into a contract in which the city would pay the district for fire services at a rate equitable to that of the other coverage areas. Money would come from the city’s general fund, sourced from sales taxes. City voters approved the contract.
The drawback is that because the city is not a member of the district, city residents don’t get to elect the board of directors.
The contract also included a provision that the city would contribute $272,000 a year for capital expenditures, and that 75% of that money would be earmarked for building a new Station 2. The contract runs until 2028.
Later mill levy increases have kept payments equitable.
As an entity, the city today is the largest funder of the district, contributing $5.34 million in 2020, not including the capital contribution, according to the fire district budget. All other district contributions total $5.38 million. It’s important to note that the vast majority of the district’s service calls are made in the city.
So, city residents had no direct influence on the fire district board when it came to considering the purchase of the 9-R building for the new fire district headquarters and a new Station 2 – which the city will have paid for, in large part, wherever and whenever it’s built.
One likely unintended consequence of the pending 9-R sale is that the new MidTown Urban Renewal Area will have a deficit of anticipated tax increment funding because the Administration Building is being sold to another public entity that does not pay taxes. Had it been sold to a private developer who would pay property tax, the URA had the potential to garner a significant amount for its projects. URA planning included estimated tax collections from several publicly owned sites likely to be sold soon; 9-R was just one of them, but a big one. Figures were not immediately available, but it is safe to say the sale to the fire district has a deleterious effect on URA financing.
Though the Herald has editorialized against the sale of the building to the fire district, we must concede it looks like the deal will go through.
But the cake hasn’t risen yet. The fire district’s building plans must be approved by the city Planning Department and various advisory groups, including Historic Preservation. The Planning Department, with legitimate reasons, could deny a permit(s) for the project. If it did, the fire district likely could appeal to the City Council. (Let’s play Power Polka!)
Behind closed doors, some say if opposition does not abate, the fire district could opt to sell the 9-R site (assuming the initial purchase goes through) in favor of another site the city or a private owner might proffer. That seems like a reach. Condemnation of property through eminent domain is also a remote possibility that would be politically inadvisable.
The outcome likely won’t be clear for some time. But It’s a cautionary tale and somber reminder that decisions we make today that seem wise can have have far-reaching, significant consequences that someday we might regret.