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TC Council Packet 09-23-2014 TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, SEPTEMBER 23, 2014 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:15 PM AVON TOWN HALL, ONE LAKE STREET Page 1 PRESIDING OFFICIALS MAYOR RICH CARROLL MAYOR PRO TEM JENNIE FANCHER COUNCILORS DAVE DANTAS, CHRIS EVANS, JENNIE FANCHER, ALBERT “BUZ” REYNOLDS, JR., JAKE WOLF MATT GENNETT TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: VIRGINIA EGGER TOWN CLERK: DEBBIE HOPPE ALL REGULAR MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS. GENERAL COMMENTS ARE WELCOME DURING PUBLIC COMMENT, AND COMMENTS ARE ALSO WELCOME ON ANY AGENDA TOPIC. PLEASE VIEW AVON’S WEBSITE, HTTP://WWW.AVON.ORG, FOR MEETING AGENDAS AND MATERIALS. AGENDAS ARE POSTED AT AVON TOWN HALL, AVON RECREATION CENTER, AND AVON LIBRARY. THE AVON TOWN COUNCIL MEETS THE 2ND AND 4THTUESDAYS OF EACH MONTH. ______________________________________________________________________________________________________________ AVON LIQUOR LICENSING AUTHORITY MEETING BEGINS AT 5:00 PM (SEE SEPARATE AGENDA PAGE 3) REGULAR MEETING BEGINS AT 5:15 PM 1. CALL TO ORDER & ROLL CALL 2. APPROVAL OF AGENDA 3. PUBLIC COMMENT MEGAN BURCH, CANDIDATE FOR AVON TOWN COUNCIL 4. ACTION ITEMS 4.1. PUBLIC HEARING AND ACTION ON AMPLIFIED SOUND PERMIT WITH A REQUEST BY AMANDA WILLIAMS & ADAM WILLIAMS TO EXTEND THE HOURS OF AMPLIFIED SOUND IN NOTTINGHAM PARK SEPTEMBER 27 & 28, 2014, FOR THE MAN ON THE CLIFF EVENT - EVENT MANAGER AMANDA WILLIAMS 4.2. ACTION ON APPEAL OF TRANSFER TAX EXEMPTION – LARRY ROSSER (TOWN ATTORNEY ERIC HEIL) 4.3. FIRST READING OF ORDINANCE 14-15, SERIES OF 2014, COMCAST FRANCHISE AGREEMENT (TOWN MANAGER VIRGINIA EGGER) 4.4. APPROVAL OF LETTER OF ENGAGEMENT FOR BOND AND DISCLOSURE COUNSEL SERVICES WITH BUTLER SNOW (ASSISTANT TOWN MANAGER SCOTT WRIGHT) 4.5. FIRST READING OF ORDINANCE 14-16, SERIES 2014, APPROVING A PURCHASE AND SALE AGREEMENT OF PHASE 1B OFFICE BUILDING, MOUNTAIN VISTA RESORT SUBDIVISION AND COMMONLY REFERRED TO AS “THE SKIER BUILDING” FOR USE AS A TOWN HALL (TOWN ATTORNEY ERIC HEIL) 4.6. FIRST READING OF ORDINANCE 14-17, SERIES OF 2014, CERTIFICATE OF PARTICIPATION – PURCHASE AND BUILDING FINISHES FOR “THE SKIER BUILDING” (ASSISTANT TOWN MANAGER SCOTT WRIGHT) 4.7. FIRST READING ON ORDINANCE 14-14, SERIES OF 2014, CERTIFICATES OF PARTICIPATION FOR STREET AND ROAD IMPROVEMENTS (ASSISTANT TOWN MANAGER SCOTT WRIGHT) 4.8. PUBLIC HEARING ON MINOR PUD AMENDMENT APPLICATION FOR LOT 26, BLOCK 3, WILDRIDGE TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, SEPTEMBER 23, 2014 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:15 PM AVON TOWN HALL, ONE LAKE STREET Page 2 SUBDIVISION (TOWN PLANNER BRIAN GARNER) 4.9. APPROVAL OF PROFESSIONAL SERVICES AGREEMENT WITH MOMENTUM TRAILS GROUP FOR THE DEVELOPMENT OF THE WILD WEST RIDGE TRAIL (PLANNING MANAGER MATT PIELSTICKER) 5. WORK SESSION 5.1. BUDGET WORK SESSION: PRESENTATION OF COMMUNITY GRANT REQUESTS, FUNDING RECOMMENDATION AND COUNCIL DIRECTION FOR THE 2015 GENERAL FUND BUDGET (DIRECTOR OF ECONOMIC INITIATIVES SUSAN FAIRWEATHER) 5.2. TRAILS ADVISORY GROUP – PURPOSE, DUTIES AND PROCESS FOR SELECTION (PLANNING MANAGER MATT PIELSTICKER) 5.3. PROCUREMENT POLICY, ACTION OF ANY TO AMEND (ASSISTANT TO THE TOWN MANAGER PRESTON NEILL) 5.4. CONSIDERATION AND DIRECTION TO PROVIDE A RESOLUTION IN SUPPORT OF COLORADO PROPOSITION 105 – GMO LABELING (MAYOR RICH CARROLL) 6. ACTION ITEMS 6.1. PUBLIC HEARING SECOND READING OF ORDINANCE 14-13 APPROVING THE GRANT OF A REVOCABLE ENCROACHMENT LICENSE TO INSTALL, CONSTRUCT AND MAINTAIN PRIVATE IMPROVEMENTS ON TOWN- OWNED RIGHT-OF-WAY AND PROPERTY AT CHRISTY SPORTS FOR DEVELOPMENT OF ADDITIONAL PUBLIC PARKING – CONTINUED FROM SEPTEMBER 9, 2014 MEETING (PLANNING MANAGER MATT PIELSTICKER) 6.2. MINUTES FROM SEPTEMBER 9, 2014 MEETING (TOWN CLERK DEBBIE HOPPE) 7. WRITTEN REPORTS 7.1. REPORT ON HANNEWALD BARN SITE SEARCH AND FUNDING OPPORTUNITIES 7.2. MONTHLY FINANCIALS 8. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 9. COUNCIL COMMENTS 10. MAYOR REPORT AND FUTURE AGENDA ITEMS 11. EXECUTIVE SESSION, IF CALLED (THIS MEETING IS NOT OPEN TO THE PUBLIC) 12. ADJOURNMENT TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, SEPTEMBER 23, 2014 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM AVON TOWN HALL, ONE LAKE STREET Page 3 PRESIDING OFFICIALS CHAIRMAN RICH CARROLL VICE CHAIRMAN TODD GOULDING BOARD MEMBERS DAVE DANTAS, CHRIS EVANS, JENNIE FANCHER ALBERT “BUZ” REYNOLDS, JR., JAKE WOLF MATT GENNETT TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: VIRGINIA EGGER TOWN CLERK: DEBBIE HOPPE ALL LIQUOR BOARD MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS COMMENTS FROM THE PUBLIC ARE WELCOME DURING PUBLIC HEARINGS PLEASE VIEW AVON’S WEBSITE, HTTP://WWW.AVON.ORG, FOR MEETING AGENDAS AND MEETING MATERIALS AGENDAS ARE POSTED AT AVON TOWN HALL AND RECREATION CENTER, AND AVON LIBRARY 1. CALL TO ORDER AND ROLL CALL 2. APPROVAL OF AGENDA 3. PUBLIC COMMENT 4. RENEWAL OF LIQUOR LICENSES 4.1. Applicant: Kruse, Inc. d/b/a Avon Liquors Location: 100 W. Beaver Creek Blvd. Type: Retail Liquor Store Manager: Brian Kruse 4.2. Applicant: Northside Coffee & Kitchen, LLC d/b/a Northside Coffee & Kitchen Location: 20 Nottingham Road, Units A & C Type: Hotel and Restaurant Manager: Jim Pavelich 5. MINUTES FROM SEPTEMBER 9, 2014 6. ADJOURNMENT TOWN OF AVON, COLORADO AVON LIQUOR LICENSING AUTHORITY MEETING MINUTES FOR TUESDAY, SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - ALB 09-09-2014 Minutes Page 1 1. CALL TO ORDER AND ROLL CALL Mayor Carroll called the meeting to order at 5:10 pm. A roll call was taken and Board members present were Dave Dantas, Chris Evans, Jennie Fancher, Matt Gennett, Buz Reynolds and Jake Wolf. Also present were Town Manager Virginia Egger, Town Attorney Eric Heil, Planning Manager Matt Pielsticker, Executive Assistant Preston Neill and Town Clerk Debbie Hoppe as well as members from the public. 2. APPROVAL OF AGENDA There were no changes to the agenda. 3. PUBLIC COMMENT 4. PUBLIC HEARING SPECIAL EVENTS PERMIT 4.1. Applicant Name: Realm of Caring Event Name: Man on the Cliff Event Dates: September 27-28, 2014; 9:30 am until 7 pm Location: Nottingham Park Event Manager: Amanda Williams The application was presented with no concerns for the Special Event application. Board member Fancher moved to approve the Special Event Permit for Realm of Caring for the Man on the Cliff Event; and Board member Dantas seconded the motion and it passed unanimously with those present. 5. RENEWAL OF LIQOUR LICENSES 5.1. Applicant: R & E Enterprise LLC d/b/a Gondola Pizza Location: 240 Chapel Place #13 Type: Hotel and Restaurant Manager: Claudia Popa The application was presented with no concerns for the renewal application. Board member Dantas moved to approve the Hotel and Restaurant Liquor License for R & E Enterprise LLC d/b/a Gondola Pizza; and Board member Evans seconded the motion and it passed unanimously with those present. 6. MINUTES FROM AUGUST 26, 2014 Board member Wolf moved to approve the Minutes from August 26, 2014; Board member Gennett seconded the motion and it passed unanimously with those present. TOWN OF AVON, COLORADO AVON LIQUOR LICENSING AUTHORITY MEETING MINUTES FOR TUESDAY, SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - ALB 09-09-2014 Minutes Page 2 7. Adjournment There being no further business to come before the Board, the meeting adjourned at 5:15 pm. RESPECTFULLY SUBMITTED: ____________________________________ Debbie Hoppe, Town Clerk APPROVED: Rich Carroll ______________________________________ Dave Dantas ______________________________________ Chris Evans ______________________________________ Jennie Fancher ______________________________________ Albert “Buz” Reynolds ______________________________________ Jake Wolf ______________________________________ Matt Gennett ______________________________________ Heil Law & Planning, LLC Office: 303.975.6120 3445 S. Clermont St. Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council members FROM: Eric J. Heil, Town Attorney RE: Larry Rosser RETT Exemption Application Appeal DATE: September 19, 2014 Summary: Attached is an appeal of the Town’s Denial of Mr. Larry Rosser’s Application for Real Estate Transfer Tax Exemption. Mr. Rosser has signed an affidavit stating that he intends to occupy the home as his primary residence within the next year’s time. The Town has not had a prior RETT Exemption Application where we knew the purchaser was not currently a resident but intended to establish residency within a one year timeframe of acquiring the property. The exemption claimed is under 3.12.060(15) which is re-printed below for your convenience. Issues: Per case law in Colorado, local governments have reasonable discretion in the interpretation and application of its regulations to meet the stated purposes of the regulations. The Finance Department’s interpretation has been that occupancy of a residence as a primary residence must occur upon acquisition and not at a later time over the course of a one year period. Per Sub-Section (15)a.2. below a promissory note is required such that the amount RETT exemption approved becomes due and payable if the “. . . applicant shall cease to use the property as his or her primary residence within one (1) year after closing . . .” The purpose and intent of this sub-section was to address the resale of a residence within one (1) year or the renting of the residence without occupancy as a primary residence. This sub-section was not intended to provide up to a one year timeframe to establish residency. Timeframe to Establish Primary Residency: Section 3.12.060(15) does not state a timeframe to occupy and establish primary residence after purchasing a residence. Often times, actual occupancy may not be possible immediately acquiring title or taking possession of the property. This may be especially true if remodeling work is performed on the residence after acquisition. Evidence of Primary Residence: The Avon Municipal Code does not define “primary residency;” however, Colorado law lists a number of factors when making a determination on primary residency for the purposes of voter registration and qualifications of elected and appointed officials. The most definitive acts to establish the location of primary residency are voter registration and driver’s license or official state identification card. If changing the location of residency upon acquiring a residence then a reasonable timeframe to register to vote and obtain a state driver’s license or official state identification is 30 days. The denial letter from Scott Wright explained the Town’s interpretation. Options: 1. Deny the Appeal. Uphold the Assistant Town Manager’s decision. 2. Approve the Appeal. In which case the promissory note would be placed in effect. The Applicant will need to provide proof that the Applicant has established residency and has not ceased to use the residence as a primary residence within 1 year of acquisition. M EMORANDUM & PLANNING, LLC Avon Town Council Larry Rosser Appeal September 19, 2014 Page 2 of 2 Council may also desire to provide direction to Town staff to consider amendments to Section 3.12.060(15) to clarify the interpretation and application of the first time primary residence exemption for the benefit of future applicants. Section 3.12.060(15). (15) The first one hundred sixty thousand dollars ($160,000.00) of the consideration for any sale or conveyance of real property and completed improvements for occupancy as a primary residence, provided the following conditions are met: a. The same applicant has not previously received an exemption pursuant to this Subsection; b. An application for exemption is filed with the Town Manager or his or her designee prior to payment of the tax, which application is accompanied by: 1. An affidavit that the real property is being purchased for use as a primary residence and not for investment or resale; and 2. A promissory note in the amount of the tax otherwise owing, together with interest accruing at the rate hereinafter provided, providing that the tax and the promissory note including accrued interest shall be due and payable in full in the event the applicant shall cease to use the property as his or her primary residence within one (1) year after closing and granting to the Town a lien securing such indebtedness, which lien shall be subordinate to any first mortgage or deed of trust of record. Thank you, Eric ATTACHMENT A: Larry Rosser Appeal ATTACHMENT B: Larry Rosser RETT Exemption Application ATTACHMENT A: Larry Rosser Appeal ATTACHMENT A: Larry Rosser Appeal ATTACHMENT A: Larry Rosser Appeal ATTACHMENT A: Larry Rosser Appeal ATTACHMENT A: Larry Rosser Appeal ATTACHMENT A: Larry Rosser Appeal ATTACHMENT B: Larry Rosser RETT Exemption Application ATTACHMENT B: Larry Rosser RETT Exemption Application ATTACHMENT B: Larry Rosser RETT Exemption Application TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Preston Neill, Executive Assistant to the Town Manager Date: September 18, 2014 Agenda Topic: First Reading Ordinance 14-15 COMCAST Franchise Agreement BACKGROUND: The purpose of a cable Franchise Agreement is to grant to a franchisee, such as COMCAST, the right to access and use Town of Avon public ways (right-of-ways) for the installation and repair of wires and other equipment, such as pedestals, for the operation of a cable system. The Town is compensated for the use of public way through a franchise fee, which is currently 5% of COMCAST’s Gross Revenue within the Town. In addition to important requirements for how business activity is administered in the right-of-way, the Franchise also includes a requirement that two Public Education or Governmental (PEG) Access Channels be provided, with the Town having management authority to designate a provider, and certain requirements for use of the stations. The franchisee collects and provides to the Town a capital support fee for the PEG, which is currently fifty cents ($0.50) per month per individual residential subscriber and 25 cents ($0.25) per month per bulk-billing subscriber. The most recent Franchise Agreement between the Town of Avon and COMCAST of Colorado was a 15- year agreement originally approved with TCI Cablevision of the Rockies, Inc. and later assigned to COMCAST. It expired on December 31, 2010. Pursuant to the Federal Telecommunications Act, the expired Agreement continues on a month-to-month basis until both the Town and COMCAST agree to a new Franchise Agreement. After the expiration, the Town stated it wished to defer the negotiation of a new franchise until such time as Vail completed its review and approval of a new franchise. The Franchise Agreement between the Town of Vail and COMCAST of Colorado was completed in 2012 and commenced on January 1, 2013. PROCESS: A comparative analysis was conducted between the Model Agreement and the Vail-COMCAST Agreement for the purpose of identifying the differences and similarities. The comparative review was shared with COMCAST and COMCAST submitted a response to the Town. The Town Council met in Work Sessions to discuss Franchise Agreement renewal on the following dates: • Tuesday, April 22, 2014 • Tuesday, June 10, 2014 • Tuesday, September 9, 2014 At the September 9, 2014, Town Council meeting, Council provided direction to staff for preparing a franchise renewal with Comcast. Attached is Ordinance 14-15, which reflects Council’s direction. The Ordinance approves the Town of Avon-Comcast Franchise, and grants to COMCAST the right to access and use Town of Avon public ways (right-of-ways) for the installation and repair of wires and other equipment, such as pedestals, for the operation of a cable system. Approval of the Franchise Agreement requires two readings of the attached Ordinance. September 23, 2014, is First Reading. KEY ELEMENTS: Key elements of the Franchise Agreement are as follows: • General Procedures: Where the Model-Vail differences are general procedures, the Franchise Agreement provides for the more beneficial term to remain consistent with the Town of Vail terms. • Definition of Gross Revenue: The Franchise Agreement finds that franchise fees are not a tax and are therefore need to be included in “Gross Revenue”. • Franchise Term: In order to allow the termination date to coincide with the termination date established in the ten (10) year agreement between the Town of Vail and COMCAST of Colorado, the Franchise Agreement has a term of eight (8) years, beginning on the effective date, January 1, 2015. • Franchise Fee: As compensation for the use of public ways, COMCAST shall make quarterly payments as a “Franchise Fee” to the Town an amount equal to five percent (5%) of gross revenue. • PEG Access Channels: Two (2) Public, Educational, or Governmental (PEG) Access Channels will be provided by COMCAST, at no charge. In addition, the Town of Avon would continue to receive from COMCAST, in quarterly payments, a “PEG Fee” in the amount equal to fifty cents ($0.50) per residential subscriber per month as capital support for PEG access. The Franchise Agreement allows increasing the fee up to $0.75 for residential subscribers. For current bulk subscribers, a fee of $0.25 continues, and may be increased to $0.40. Both potential fee increases must be approved by Council through a public hearing process. COMCAST representative Andy Davis is requesting Council consider the following: While the bulk billing subscriber PEG fee is part of Avon’s existing franchise, we have been removing that particular fee in updated agreements. Since the time of the current Avon franchise, the Multiple Dwelling Unit (MDU) market has become increasingly more competitive. We are at a disadvantage vis-à-vis our competitors because we have to pay franchise and PEG fees, and they do not. As noted in my message yesterday, the more the Town-imposed fees increase (which, as discussed in the work session, we attribute on our bills to Town Council’s actions), the more we lose customers, and the Town loses franchise revenue. Thus, we’ve been appealing to communities to eliminate this particular fee, and today, few communities have it. As you’ll note, there is no such fee in the Vail agreement. We would request that we strike the bulk-billing related language in this section. • Access Channel Trigger: No additional access channel (total would be three channels) is included in the Franchise Agreement. Staff discussed this with Channel 5 representative JK Perry, who concurred that the current two channels offered will be adequate through the term of the Franchise Agreement. • Customer Service Standards: Customer Service Standards (CSS) have been added to the Franchise Agreement. These standards establish uniform requirements for the quality of service that COMCAST is expected to offer to customers. In order to ensure the provision of quality customer service, the Town has received the standards created by the Colorado Communications and Utilities Alliance (CCUA) from COMCAST to implement. These standards have been adopted by numerous municipalities throughout Colorado, and include, but are not limited to, 24/7 local telephone access for service/repair requests and billing/service inquiries, 24/7 accessibility to dispatchers and technicians, a complaint procedure and an established window for problem resolution following a customer service call. • Regulatory Changes: Section 14.5 has been added to the Franchise Agreement to anticipate the possibility of any change to the Cable Act during the term of this Agreement which has the effect of increasing a municipality’s rights with regard to: the franchise fee or other fees, required minimum technology standards, minimum public access channels, minim service standards, or regulation of combined or expanded cable based services, including but not limited to phone and internet. In such an event(s), then the Town may initiate re-negotiation of this Agreement to incorporate such changes into this Agreement as may be mutually determined by the parties. MOTION: If Council wishes to proceed with the Agreement and Second Reading, the recommended motion is: I move to approve Ordinance 14-15 on First Reading and refer the Ordinance to a Public Hearing for Second Reading on October 14, 2014. Ordinance 14-15 Approving a Franchise Agreement with Comcast of Colorado Page 1 of 3 TOWN OF AVON ORDINANCE 14-15 SERIES of 2014 AN ORDINANCE APPROVING A FRANCHISE AGREEMENT WITH COMCAST OF COLORADO VI, LLC FOR THE PROVISION OF CABLE SERVICES IN THE TOWN OF AVON WHEREAS, the Town of Avon, Colorado, (“Town”) and TCI Cablevision, the predecessor of Comcast Colorado VI, LLC (“Comcast”), entered into a Franchise Agreement on January 1, 1996, to allow TCI Cablevision to provide cable service to subscribers of such service in the Town of Avon, which Franchise Agreement expired on December 31, 2010, and then continued on a month by month basis in accordance with the Federal Telecommunications Act of 1996; WHEREAS, negotiations for a new Franchise Agreement have been on-going; WHEREAS, during negotiations the performance and technical issues of the expired Franchise Agreement were met within the Town; WHEREAS, no outstanding areas of noncompliance have been identified within the Town; WHEREAS Section 17.6 of the Avon Town Charter authorizes the Town Council to grant a franchise by ordinance and to establish the term, fees, compensation, conditions and any other matters related to the granting of franchises; and, WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply with the requirements of the Avon Home Rule Charter by setting a public hearing in order to provide the public an opportunity to provide public comment on this Ordinance and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO, THAT: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. Section 2. Franchise Agreement Approved. The Franchise Agreement between the Town and Comcast is hereby approved in the form attached hereto, for a term of eight (8) years, commencing on January 1, 2015. Ordinance 14-15 Approving a Franchise Agreement with Comcast of Colorado Page 2 of 3 Section 3. Mayor and Town Clerk Authorized to Execute Documents. The Mayor and Town Clerk are authorized to execute documents approved in this Ordinance and take such other actions as may be reasonably necessary to implement the actions in this Ordinance. Section 4. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 5. Effective Date. This Ordinance shall take effect thirty days after public notice following final passage in accordance with Section 6.4 of the Avon Home Rule Charter. Section 6. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 7. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a copy of the ordinance in full is available for public inspection in the office of the Town Clerk during normal business hours. [Signature page follows] Ordinance 14-15 Approving a Franchise Agreement with Comcast of Colorado Page 3 of 3 INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED POSTED AND REFERRED TO PUBLIC HEARING on September 23, 2014, and setting such public hearing for October 14, 2014, at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado. ____________________________ Rich Carroll, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least six days prior to final action by the Town Council. ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney INTRODUCED, FINALLY APPROVED, AND PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on October 14, 2014. ____________________________ Rich Carroll, Mayor Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: APPROVED AS TO FORM: _______________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney TOWN OF AVON - COMCAST FRANCHISE AGREEMENT October 14, 2014 COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 1 of 34 TABLE OF CONTENTS FRANCHISE AGREEMENT ................................................................................................................................. 5 SECTION 1. DEFINITIONS ..................................................................................................................................... 5 SECTION 2. GRANT OF FRANCHISE ...................................................................................................................... 8 2.1 Grant ...................................................................................................................................................... 8 2.2 Use of Public Ways ................................................................................................................................. 9 2.3 Term ..................................................................................................................................................... 10 2.4 Effective Date ....................................................................................................................................... 10 2.5 Competitive Equity ............................................................................................................................... 10 2.6 Familiarity with Agreement and Acceptance ....................................................................................... 10 SECTION 3. FRANCHISE FEE AND FINANCIAL CONTROLS .................................................................................. 11 3.1 Franchise Fee ....................................................................................................................................... 11 3.2 Payments ............................................................................................................................................. 11 3.3 Audits ................................................................................................................................................... 11 3.4 Additional Commitments Not Franchise Fees ...................................................................................... 11 3.5 Payment on Termination ..................................................................................................................... 12 3.6 Service Packages .................................................................................................................................. 12 3.7 Tax Liability .......................................................................................................................................... 12 SECTION 4. ADMINISTRATION AND REGULATION ............................................................................................ 12 4.1 Rates and Charges ................................................................................................................................ 12 4.2 No Rate Discrimination ........................................................................................................................ 12 4.3 Time Limits Strictly Construed ............................................................................................................. 13 4.4 Performance Evaluations ..................................................................................................................... 13 4.5 Late Fees and Disconnection................................................................................................................ 13 SECTION 5. FINANCIAL AND INSURANCE REQUIREMENTS ............................................................................... 13 5.1 Indemnification .................................................................................................................................... 13 5.2 Indemnification Procedures and Defense ............................................................................................ 14 5.3 Insurance .............................................................................................................................................. 14 COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 2 of 34 5.4 Letter of Credit ..................................................................................................................................... 15 SECTION 6. CUSTOMER SERVICE ....................................................................................................................... 16 6.1 Service Availability ............................................................................................................................... 16 6.2 Customer Service Standards ................................................................................................................ 16 6.3 Customer Privacy ................................................................................................................................. 17 6.4 Customer Service Agreement and Manual .......................................................................................... 17 SECTION 7. RECORDS ......................................................................................................................................... 17 7.1 Required Records ................................................................................................................................. 17 7.2 Proprietary Information ....................................................................................................................... 18 7.3 Copies of Federal and State Reports .................................................................................................... 18 SECTION 8. PROGRAMMING ............................................................................................................................. 19 8.1 Broad Programming Categories ........................................................................................................... 19 8.2 Obscenity ............................................................................................................................................. 19 8.3 Services for the Disabled ...................................................................................................................... 19 8.4 Parental Control Device ....................................................................................................................... 19 8.5 Complimentary Cable Service .............................................................................................................. 19 SECTION 9. ACCESS ............................................................................................................................................ 20 9.1 Access Channels ................................................................................................................................... 20 9.2 Underutilized Access Channels ............................................................................................................ 20 9.3 Access Channel Location ...................................................................................................................... 21 9.4 Access Channel Promotion................................................................................................................... 21 9.5 PEG Fee ................................................................................................................................................ 21 9.6 Return Lines ......................................................................................................................................... 21 SECTION 10. USE OF PUBLIC WAYS ............................................................................................................................ 22 10.1 Construction and Maintenance ........................................................................................................... 22 10.2 Location and Movement of Facilities ................................................................................................... 23 10.3 Acquisition of Facilities ........................................................................................................................ 23 10.4 Reservation of Public Ways .................................................................................................................. 23 COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 3 of 34 10.5 Discontinued Facilities ......................................................................................................................... 24 10.6 Use of Conduit or Ducts ....................................................................................................................... 24 10.7 Undergrounding ................................................................................................................................... 25 10.8 Tree Trimming ...................................................................................................................................... 25 10.9 GIS Mapping ......................................................................................................................................... 25 SECTION 11. CABLE SYSTEM DESIGN AND TECHNICAL STANDARDS ......................................................................... 25 11.1 Technical Performance ........................................................................................................................ 25 11.2 Cable System Performance Testing ...................................................................................................... 25 11.3 Standby Power ..................................................................................................................................... 26 SECTION 12. VIOLATIONS AND REVOCATION ............................................................................................................ 26 12.1 Procedure for Remedying Violations ................................................................................................... 26 12.2 Alternative Remedies ........................................................................................................................... 26 12.3 Liquidated Damages ............................................................................................................................. 27 12.4 Revocation ........................................................................................................................................... 27 12.5 Purchase of the Cable System .............................................................................................................. 28 SECTION 13. TRANSFER .............................................................................................................................................. 28 13.1 Transfer of Ownership or Control ........................................................................................................ 28 SECTION 14. MISCELLANEOUS ................................................................................................................................... 30 14.1 Cumulative Rights ................................................................................................................................ 30 14.2 Costs to be Borne by Comcast ............................................................................................................. 30 14.3 Binding Effect ....................................................................................................................................... 30 14.4 Modification ......................................................................................................................................... 30 14.5 Regulatory Changes ............................................................................................................................. 30 14.6 Governing Law and Venue ................................................................................................................... 30 14.7 No Joint Venture .................................................................................................................................. 31 14.8 Waiver .................................................................................................................................................. 31 14.9 Severability ........................................................................................................................................... 31 14.10 Force Majeure…………………………………………………………………………………………………………………................ 31 COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 4 of 34 14.11 Entire Agreement……………………………………………………………………………………………………………................ 31 14.12 Notices………………………………………………………………………………………………………………………………............. 31 COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 5 of 34 FRANCHISE AGREEMENT This Franchise Agreement ("Agreement") is made between the Town of Avon, Colorado, a Colorado home rule municipality ("Town") and Comcast of Colorado VII, LLC ("Comcast"), on October 14, 2014. WHEREAS, the Town, having determined that the financial, legal, and technical ability of Comcast is reasonably sufficient to provide the services, facilities, and equipment necessary to meet the future cable-related needs of the community, desires to enter into this Agreement with Comcast for the operation and maintenance of a cable system on the terms and conditions set forth herein. NOW THEREFORE, the Town and Comcast agree as follows: SECTION 1. DEFINITIONS For purposes of this Agreement, the following terms shall have the following meanings, provided that terms not defined, or those defined, but not capitalized within the text, shall be given their common and ordinary meaning, and the word "shall" is always mandatory: "Access" includes Public Access, Educational Access and Governmental Access, collectively and means the availability for Noncommercial use by various governmental and educational agencies, institutions and organizations in the community of particular channels on the Cable System to receive and distribute Video Programming to subscribers as permitted under applicable law. "Access Channel" means any Channel designated for Access purposes or otherwise made available to facilitate Access programming. "Affiliate" when used in connection with Comcast means any Person who owns or controls, is owned or controlled by, or is under common ownership or control of Comcast. "Bad Debt" means amounts lawfully owed by a Customer and accrued as revenues on the books of Comcast, but not collected after reasonable efforts by Comcast. "Basic Service" means any Cable Service Tier that includes, at a minimum, the retransmission of local television Broadcast Signals and PEG Access Channels required in this Franchise and any additional programming added by the Town and made available to all Customers in the Franchise Area. "Broadcast Signal" means a television or radio signal transmitted over the air to a wide geographic audience, and received by a Cable System off-the-air by antenna, microwave, satellite dishes or any other means. "Cable Act" means the Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992, as amended by the Telecommunications Act of 1996, and any amendments thereto. "Cable Operator" means any Person or group of Persons, including Comcast, who provides Cable Service over the Cable System and directly or through one or more Affiliates owns a COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 6 of 34 significant interest in such Cable System or who otherwise controls or is responsible for, through any arrangement, the management and operation of the Cable System. "Cable Service" means the one-way transmission to Customers of Video Programming, or other programming service and Customer interaction, if any, that is required for the selection or use of such Video Programming or other programming service. "Cable System" means Comcast's facility, consisting of a set of closed transmission paths and associated signal generation, reception and control equipment, designed to provide Cable Service that includes Video Programming and provided to Customers in the Franchise Area. "Channel" means a portion of the frequency band capable of carrying a Video Programming Service or combination of Video Programming Services, whether by analog or digital signal, on a twenty-four (24) hour per day basis or a portion thereof. "Customer" means a Person who lawfully receives Cable Service from the Cable System with Comcast's express permission. "Designated Access Provider" means an entity designated by the Town to manage or co-manage Public, Educational or Governmental Access Channels and facilities. The Town may be a Designated Access Provider. "Dwelling Unit" means any building or portion thereof that has independent living facilities, including provisions for cooking, sanitation and sleeping, and that is designed for residential occupancy. "Educational Access" means Access where Schools are the primary users having editorial control over programming and services. "Emergency" means any condition constituting a clear and present danger to life or property. "Expanded Basic Service" means cable programming services not included in the Basic Service and excluding premium or pay-per-view services. "FCC" means the Federal Communications Commission or its lawful successor. "Fiber Optic" means a transmission medium of optical fiber cable, along with all associated electronics and equipment capable of carrying electric lightwave pulses. "Franchise Area" means the area within the jurisdictional boundaries of the Town, including any areas hereafter annexed by Town. "Franchise Fee" includes any tax, fee or assessment of any kind imposed by the Town on Comcast or Customers, or both solely because of their status as such, but excluding: (i) any tax, fee or assessment of general applicability (including any such tax, fee, or assessment on both utilities and Cable Operators or their services, but not including a tax, fee, or assessment that is unduly discriminatory against Cable Operators or cable Customers); (ii) capital costs that are required by the Agreement to be incurred by Comcast for Access facilities; (iii) requirements or charges incidental to the awarding or enforcing of the Agreement, including but not limited to, payments for bonds, letters of credit, insurance, indemnification, penalties or liquidated damages; or (iv) any fee imposed under Title l7, United States Code. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 7 of 34 "Governmental Access" means Access where governmental institutions or their designees are the primary users having editorial control over programming and services. "Gross Revenue" means all revenue derived directly or indirectly by Comcast or its Affiliates from the operation of the Cable System in the Franchise Area, including without limitation monthly and other fees charged Customers for Cable Service including Basic Service, Expanded Basic Service, any expanded Tiers of Cable Service, other Tiers of Cable Service, optional Premium Service, pay-per-view and per-program Channels, Cable Service installation, disconnection, reconnection and change-in-service fees, Leased Access Channel fees, remote control rental fees, late fees and administrative fees, consideration received by Comcast from programmers for carriage of Cable Service on the Cable System and recognized as revenue under generally accepted accounting principles ("GAAP"), revenues from rentals of converters or other Cable System equipment, advertising sales revenues (including local, regional and a pro rata share of national advertising carried on the Cable System in the Franchise Area but excluding commissions paid to an unaffiliated agency), revenues from program guides, additional outlet fees, revenue from the sale or carriage of other Cable Service, and revenues from home shopping. Gross Revenue does not include (i) to the extent consistent with GAAP, Bad Debt, provided, however, that any part of such Bad Debt that is written off but subsequently collected shall be included in Gross Revenue in the period collected; or (ii) any taxes on services furnished by Comcast that are imposed directly on any Customer or user by the State, Town or other governmental unit and that are collected by Comcast on behalf of said governmental unit; or (iii) capital costs or contributions required by this Franchise. Franchise Fees are not a tax and are therefore included in Gross Revenue. "Headend" or "Hub" means a facility for signal reception and dissemination on a Cable System, including cable, antennas, wires, satellite dishes, monitors, switchers, modulators, processors for Broadcast Signals or other signals, and all other related equipment and Facilities. "Incremental Costs" means Comcast's direct and actual material and labor cost (excluding profit) of constructing, relocating or placing additional facilities for the Town, excluding the costs that Comcast would otherwise incur to construct, relocate or place facilities for Comcast including, but not limited to, trenching, pipe bedding, backfilling, compacting, restoring the surface, and other charges, costs or expenses. "Interconnect" or "Interconnection" means the provision of Access Channel programming to a geographically contiguous cable system, including technical, engineering, physical, and other necessary components to accomplish, complete and adequately maintain such provisioning. "Late fee" means and includes any assessment, charge, cost, fee or sum, however characterized, that Comcast imposes upon a Customer solely for late payment of a bill is a late fee. "Leased Access Channel" means any Channel or portion of a Channel commercially available for programming in accordance with Section 612 of the Cable Act. "Noncommercial" means, in the context of Access Channels, those particular products and services that are not promoted or sold in order to generate revenue that exceeds the costs of operations for the Town or any Designated Access Provider. This term shall not be interpreted to prohibit an Access Channel operator or programmer from soliciting and receiving contributions COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 8 of 34 used to produce and transmit Video Programming on an Access Channel, or from acknowledging a contribution, in the manner of the Corporation for Public Broadcasting or some similar manner, subject to applicable law. "Person" means any natural person, lawful trustee, successor, assignee, transferee, or personal representative, sole proprietorship, partnership, joint venture, association, or limited liability entity or corporation, or any other form of entity or organization. "Public Access" means Access where any member of the general public may be a programmer on a nondiscriminatory basis, subject to operating rules formulated by the Town or its designee. Such rules shall not be designed to control the content of public access programming. Such rules may also address the extent to which and manner in which members of the general public who are not residents of the Town may be programmers on the Access Channel. "Public Way" means land in the Franchise Area acquired for or dedicated to the public and maintained under public authority, including but not limited to public streets, roads, highways, avenues, lanes, alleys, bridges, sidewalks, easements, and similar public property. "Residential Subscriber" means any Person who receives Cable Service delivered to a Dwelling Unit, excluding such multiple Dwelling Units billed on a bulk-billing basis. "Standard Installation" means a one hundred twenty five (125) foot drop connecting to the exterior demarcation point. "State" means the State of Colorado. "Tier" means a category of Cable Service provided by Comcast for which a separate rate is charged. "Video Programming" means programming provided by, or generally considered comparable to programming provided by, a television broadcast station, or cable programming provider primarily consisting of full motion video and audio. SECTION 2. GRANT OF FRANCHISE 2.1 GRANT (A) The Town hereby grants to Comcast a nonexclusive authorization to make reasonable and lawful use of the Public Ways to construct, operate, maintain, reconstruct, repair and upgrade the Cable System for the purpose of providing Cable Service, subject to this Agreement and applicable law. Comcast shall provide Cable Service, as authorized by this Agreement, in the Franchise Area in accordance with line extension and density provisions as provided herein. The franchise granted by this Agreement is subject to all prior rights, interests, easements, or franchises granted by Town or its predecessors to any Person to any property or Public Way, including the right of the Town to use same for any purpose it lawfully deems fit. This Agreement conveys limited rights and interests in only those Public Ways in which the Town has an actual interest; it is not a warranty of title or interest in any property. (B) Comcast shall comply with the Avon Town Code and the lawful exercise of the Town’s police power. Subject to the Town’s lawful exercise of its police power, in the event of a conflict COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 9 of 34 between the Avon Town Code and the Agreement, the Agreement shall govern. Comcast acknowledges that the Town may enforce or modify its generally applicable regulatory policies by lawful exercise of the Town's police powers throughout the term of this Agreement, and Comcast agrees to comply with such lawful enforcement or modifications. Comcast reserves the right to challenge provisions of any ordinance, rule, regulation or other enactment of the Town that conflicts with its contractual rights under the Franchise, either now or in the future. This Agreement shall not be interpreted to prevent the Town from imposing other conditions, to the extent permitted by law. (C) No rights shall pass to Comcast by implication. Without limiting the foregoing, by way of example and not limitation, this Agreement shall not be a substitute for: any other permit or authorization required for the privilege of transacting and carrying on a business within the Town that is required by the Town; any permit, agreement or authorization required by the Town for Public Way users in connection with operations on or in Public Ways or public property; or any permits or agreements for occupying any other property to which access is not specifically granted by this Agreement. (D) This Agreement is an express authorization to provide Cable Service only. This Agreement is not a bar to the imposition of any lawful conditions on Comcast with respect to non-Cable Service, telecommunications services or information services, whether similar, different or the same as the condition specified herein. This Agreement does not relieve Comcast of any obligation it may have to obtain from the Town an authorization to provide non-Cable Service, telecommunications services or information services or relieve Comcast of its obligation to comply with any such authorization(s) that may be lawfully required. (E) This Agreement shall have no effect on any obligation of Comcast in effect prior to the effective date of this Agreement to indemnify or insure the Town against acts and omissions occurring during the period that the prior franchise agreement was in effect, nor shall it have any affect upon liability to pay Franchise Fees that were due and owed under a prior franchise. 2.2 USE OF PUBLIC WAYS (A) Subject to the Avon Town Code, as amended, Comcast may erect, install, construct, repair, replace, reconstruct, and retain in, on, over, under, upon, across, through, below and along the Public Ways, such wires, cables, conductors, ducts, conduit, vaults, manholes, amplifiers, appliances, pedestals, attachments and other property and equipment as are necessary and appurtenant to the operation of the Cable System. (B) Comcast shall install Cable System facilities in a manner that minimizes interference with the use of the Public Ways by others. To protect public health, safety and welfare, the Town may: require that Cable System facilities be installed at a particular time, at a specific place or in a particular manner as a condition of access to a particular Public Ways; deny access if Comcast is not willing to comply with Town's requirements; remove, or require removal of, any facility that is not installed in compliance with the requirements established by Town, or that is installed without prior Town approval of the time, place or manner of installation and charge Comcast for all the costs associated with removal; and require Comcast to cooperate with others to minimize adverse impacts on the Public Ways through joint trenching and other arrangements. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 10 of 34 2.3 TERM This Agreement shall have a term of eight (8) years, beginning on the Effective Date and shall expire on December 31, 2022, unless the term is reduced by the Town in accordance with Section 14.5 below. 2.4 EFFECTIVE DATE The Effective Date of this Agreement shall be January 1, 2015. 2.5 COMPETITIVE EQUITY (A) Comcast acknowledges and agrees that the Town reserves the right to grant additional franchises to provide Cable Service in the Franchise Area; provided that if any such franchise is granted by the Town which, in the reasonable opinion of Comcast, contains more favorable or less burdensome Material Terms and Conditions than this Agreement, the Town agrees that, within ninety (90) days of Comcast's request, the parties shall amend this Franchise to insure that the regulatory and financial burdens on each entity are materially equivalent. "Material Terms and Conditions" includes without limitation: Franchise Fees; insurance coverage amounts; System build-out requirements; Public, Education and Government Access Channels and support; customer service standards; required reports and related record keeping; and notice and opportunity to cure breaches. The parties agree that this Subsection does not require a word for word identical franchise or authorization for a competitive entity if the regulatory and financial burdens on each entity are materially equivalent. (B) If an application for a new cable franchise is filed with the Town proposing to serve the Franchise Area, in whole or in part, the Town shall make a good faith effort to provide notice of such application upon Comcast prior to acting on the application. (C) Notwithstanding any provisions to the contrary, at any time that a facilities-based Cable Services provider, legally authorized by state or Federal law, makes Cable Services or multiple Channels of Video Programming within the Franchise Area available for purchase by Customers without a franchise or other similar lawful authorization granted by the Town, then Comcast may seek modification pursuant to subsection (A) hereof, or the term of this Franchise shall, upon ninety (90) days written notice from Comcast, be shortened so that the Franchise shall be deemed to expire on a date six (6) months from the first day of the month following the date of Comcast's notice; provided, however, that if the provision of Cable Services or Video Programming by the other facilities-based Cable Services Provider within the Franchise Area is being legally challenged by the Town, the term of this Franchise shall remain unaffected until such legal challenge is concluded. 2.6 FAMILIARITY WITH AGREEMENT AND ACCEPTANCE (A) Comcast acknowledges and warrants that it has carefully read and fully comprehends the terms of this Agreement and that it has fully considered the requirements of this Agreement, and finds that the same are commercially practicable at this time and consistent with all local, State and federal laws and regulations currently in effect. (B) By executing this Agreement, Comcast: (1) acknowledges and accepts the Town's legal right to issue and enforce the Agreement; (2) agrees that it will not oppose the Town's lawful COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 11 of 34 intervention in any legal or regulatory proceeding affecting the Cable System; (3) accepts and agrees to comply with every provision of this Agreement; and (4) agrees that the Agreement was negotiated in compliance with applicable law, and that it will not raise any claim to the contrary. SECTION 3. FRANCHISE FEE AND FINANCIAL CONTROLS 3.1 FRANCHISE FEE As compensation for the use of the Public Ways, Comcast shall pay as a Franchise Fee to Town, for the duration of this Agreement, an amount equal to five percent (5%) of Comcast's Gross Revenue. 3.2 PAYMENTS (A) Franchise Fee payments to Town shall be computed quarterly for the preceding calendar quarter ending March 31, June 30, September 30, and December 31. Each quarterly payment shall be due and payable no later than forty-five (45) days after said dates. For untimely payments, Comcast shall pay, in addition to the payment or sum due, interest from the due date at the rate of eight percent (8%) per annum until the date the Town receives the payment. (B) No acceptance of payment shall be construed as an accord by Town that the amount paid is the correct amount, nor shall an acceptance of payment be construed as a release of any claim Town may have against Comcast. The period of limitation for recovery of Franchise Fees payable hereunder shall be three (3) years from the date on which payment by Comcast was due or such shorter period of time if so provided by law. (C) A report prepared by a representative of Comcast showing the basis for the computation of the Franchise Fees paid during that period shall either accompany the Franchise Fee payment or be provided under separate cover within ten days of the report. 3.3 AUDITS (A) On an annual basis, upon thirty (30) days' prior written notice, the Town may conduct an independent audit of Comcast's financial records necessary to ensure compliance with this Agreement. If Comcast cooperates in making all relevant records available upon request, the Town will in good faith attempt to complete each audit within six (6) months, and the audit period shall not be any greater than the previous three (3) years. (B) Additional amounts due to the Town as a result of the audit shall be paid within sixty (60) days following written notice to Comcast. If a Franchise Fee underpayment is discovered as the result of an audit, Comcast shall pay, in addition to the amount due, interest at the maximum allowed rate as provided under State law calculated from the date the underpayment was originally due until the date the Town receives the payment. (C) If the audit shows that Franchise Fees have been underpaid by five percent (5%) or more in a calendar year, Comcast shall pay the actual cost of the audit in a total amount not to exceed $10,000. 3.4 ADDITIONAL COMMITMENTS NOT FRANCHISE FEES COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 12 of 34 No term of this Agreement shall affect Comcast's obligation to pay Franchise Fees. Although the total sum of Franchise Fee payments and additional commitments set forth elsewhere in this Agreement may total more than five percent (5%) of Gross Revenue in any twelve-month period, Comcast agrees that the additional commitments regarding PEG funding and Access Channels are not Franchise Fees, nor are they to be offset or credited against Franchise Fee payments unless specifically provided by applicable law. 3.5 PAYMENT ON TERMINATION Within one hundred twenty (120) days of termination of this Agreement, Comcast shall file with the Town a financial statement, certified by an independent certified public accountant, showing the Gross Revenue received by Comcast since the end of the previous fiscal year. Within forty- five (45) days of the filing of the certified statement with the Town, Comcast shall pay any unpaid amounts as indicated. If Comcast fails to satisfy its remaining financial obligations as required in this Agreement, the Town may do so by utilizing the funds available in a Letter of Credit or other security provided by Comcast. 3.6 SERVICE PACKAGES If Comcast offers bundled Cable Service and non-Cable Service to Customers, Comcast shall fairly and reasonably allocate revenue with regard to Cable Service. 3.7 TAX LIABILITY The Franchise Fees shall be in addition to all taxes or other levies or assessments now or hereafter required to be paid by businesses by any applicable law including without limitation sales, use, utility and other taxes, and business license fees. SECTION 4. ADMINISTRATION AND REGULATION 4.1 RATES AND CHARGES (A) Comcast's rates and charges for Cable Service shall be subject to regulation by Town to the full extent authorized by applicable federal, State and local laws. Customer billing shall be itemized by service pursuant to FCC Regulation, 47 C.F.R. § 76.1619 or as amended. (B) Comcast will use best efforts to maintain with the Town a current schedule of applicable rates charged for Cable Service provided under this Agreement. The Town recognizes that such rates change periodically, and if the Town clerk has reason to believe that the schedule of rates on file is not up to date, then upon three (3) days advance request, Comcast shall provide the Town with a current and complete schedule of applicable rates and charges for Cable Service provided to Customers in the Town. Nothing in this Subsection shall be construed to require Comcast to file rates and charges under temporary reductions or waivers of rates and charges in conjunction with promotional campaigns. 4.2 NO RATE DISCRIMINATION All Comcast rates and charges shall be published (in the form of a publicly-available rate card), made available to the public, and shall be non-discriminatory as to all Persons of similar classes, under similar circumstances. Nothing herein shall be construed to prohibit: COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 13 of 34 (1) The temporary reduction or waiving of rates or charges in conjunction with promotional campaigns; (2) The offering of reasonable discounts to similarly situated Persons; or (3) The offering of bulk discounts for multiple Dwelling Units. 4.3 TIME LIMITS STRICTLY CONSTRUED When this Agreement sets forth a time for any act to be performed by Comcast, such time shall be deemed to be of the essence, and any failure of Comcast to perform within the allotted time may be considered a breach of this Agreement. 4.4 PERFORMANCE EVALUATIONS Special evaluation sessions may be held at any time upon written request and upon not less than thirty (30) days prior notice by the Town during the term of this Agreement. All such evaluation sessions shall be open to the public. Topics that may be discussed at any evaluation session may include those issues surrounding Comcast's failure to comply with the terms of the Agreement provided that nothing in this Subsection shall be construed as requiring the renegotiation of this Agreement or any term or provision therein and further provided that this Subsection need not be followed before other legal or equitable remedies within this Agreement. 4.5 LATE FEES AND DISCONNECTION Comcast's late fee and disconnection policies and practices shall be nondiscriminatory, and such policies and practices, and any fees imposed pursuant to this Subsection, shall apply equally throughout the Franchise Area without regard to the neighborhood or income level of the Customers. SECTION 5. FINANCIAL AND INSURANCE REQUIREMENTS 5.1 INDEMNIFICATION (A) Comcast, at its own expense, shall indemnify, defend and hold harmless the Town, its officers, officials, boards, commissions, agents, representatives and employees, from any action or claim for injury, damage, loss, liability, settlement, proceeding, judgment, or cost or expense, including court and appeal costs and attorney fees and expenses, arising from any casualty or accident to Person or property, including, without limitation, copyright infringement, defamation, and all other damages in any way arising out of, or by reason of, any construction, excavation, erection, operation, maintenance, repair or reconstruction, or any other act done under this Agreement, by or for Comcast, its authorized agents, or by reason of any neglect or omission of Comcast, its authorized agents or its employees. Comcast shall consult and cooperate with the Town while conducting its defense of the Town. (B) The provisions of this Section 5 shall survive the termination of this Agreement unless superseded by indemnification provisions in a new franchise or in federal or state law. (C) Subject to applicable law, Comcast shall indemnify the Town for any damages, including but not limited to damages incurred as a result of delay, payable by the Town related to COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 14 of 34 Comcast's failure to properly install, remove, adjust or relocate any of its facilities in the Public Ways in accordance with any lawful relocation required by the Town. (D) Comcast shall also indemnify, defend and hold the Town harmless for any claim for injury, damage, loss, liability, cost and expense, including court and appeal costs and attorney fees and expenses in any way arising out of any failure by Comcast to secure consents from the owners, authorized distributors or franchisees/licensors of programs to be delivered by the Cable System, provided however, that Comcast will not be required to indemnify the Town for any claims arising out of the use of Access Channels by the Town or its Designated Access Provider or use by the Town of the emergency alert system. 5.2 INDEMNIFICATION PROCEDURES AND DEFENSE (A) If a claim or action arises, the Town or any other indemnified party shall promptly tender the defense of the claim or action to Comcast, which defense shall be at Comcast's expense. The Town may participate in the defense of a claim and Comcast may not agree to any settlement of claims without the Town's written approval, which shall not be unreasonably withheld. (B) The fact that Comcast carries out any activities under this Agreement through independent contractors shall not constitute an avoidance of or defense to Comcast's duty of defense and indemnification. (C) If separate representation is necessary, such as a conflict of interest between the Town and the counsel selected by Comcast to represent the Town, Comcast shall select other counsel. 5.3 INSURANCE (A) Comcast shall maintain at all times in full force and effect at its own expense each of the following policies of insurance: (1) Commercial General Liability coverage for bodily injury, personal injury, and property damage with limits of no less than one million dollars ($1,000,000) per occurrence. The general aggregate limit shall be no less than two million dollars ($2,000,000). (2) Commercial Automobile Liability Insurance with minimum combined single limits of at least one million dollars ($1,000,000) each occurrence and two million dollars ($2,000,000) aggregate with respect to each of Comcast's owned, hired and non-owned, or any other vehicles assigned to or used in any activities authorized under or used in conjunction with this Agreement. (3) Employer's Liability with limits of at least one million dollars ($1,000,000). (4) Workers' Compensation insurance shall be maintained during the life of this Agreement to comply with State law for all employees. (B) Each policy shall provide that the insurance shall not be canceled or terminated so as to be out of compliance with these requirements without forty-five (45) days' prior written notice, and ten (10) days' notice for nonpayment of any premium. Comcast shall maintain continuous uninterrupted insurance coverage, in at least the amounts required, until all work required to be performed under the terms of this Agreement is satisfactorily completed and, in the case of COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 15 of 34 Commercial General Liability Insurance, for at least one (1) year after termination of this Agreement. A failure of Comcast to comply with any claim reporting provisions or any breach of an insurance policy warranty shall not affect coverage afforded under the policy to protect the Town. However, if coverage is not afforded under these circumstances, Comcast shall indemnify the Town for losses the Town otherwise would have been covered for as an additional insured. (C) All insurance policies, except Workers' Compensation, shall contain a waiver of transfer rights of recovery (subrogation) against the Town, its officers, officials, agents, and employees for any claims arising out of Comcast's work or service. Comcast shall be responsible for deductibles or self-insured retention. (D) All policies shall contain, or shall be endorsed so that: (1) The Town and its officers, officials, boards, commissions, agents, representatives, and employees are to be covered as, and have the rights of, additional insureds with respect to liability arising out of activities performed by, or on behalf of, Comcast under this Agreement or applicable law, or in the construction, operation, upgrade, maintenance, repair, replacement or ownership of the Cable System; (2) Comcast's insurance coverage shall be primary insurance with respect to the Town and its officers, officials, boards, commissions, agents, volunteers and employees. Any insurance or self insurance maintained by the Town or its officers, officials, boards, commissions, agents, representatives, volunteers or employees shall be in excess of Comcast's insurance and shall not contribute to it, provided the occurrence arises out of Comcast's negligence; and (3) Comcast's insurance shall apply separately to each insured against whom a claim is made or lawsuit is brought, except with respect to the limits of the insurer's liability. (E) Comcast shall furnish the Town with certificates of insurance and an endorsement reflecting additional insured status. The certificates for each insurance policy are to be on standard forms or such forms as are consistent with standard industry practices, and are to be received and approved by the Town at the time of acceptance of this Agreement by Comcast with existing insurance coverage to be maintained by Comcast until that date. Comcast hereby warrants that its insurance policies satisfy the requirements of this Agreement. (F) The insurance limits mandated for any insurance coverage required by this Agreement are not intended to be an indication of exposure nor are they limitations on liability or indemnification. 5.4 LETTER OF CREDIT (A) At any time during the term of this Agreement, if there is a claim by the Town of an uncured breach by Comcast of a provision of this Franchise, then the Town may require and Comcast shall establish and provide, as quickly as possible, but no later than thirty (30) days after a request from the Town, a letter of credit from a financial institution satisfactory to the Town in the amount of fifty thousand dollars ($50,000). COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 16 of 34 (B) After completion of the procedures set forth in Section 12.1 or other applicable provisions of this Franchise, the letter of credit may be drawn upon by the Town for purposes that include, but are not limited to the following: (1) Failure of Comcast to pay the Town sums due under this Agreement; (2) Reimbursement of costs borne by the Town to correct violations not corrected by Comcast; and (3) Liquidated damages assessed against Comcast as provided in this Agreement. (C) The Town shall give Comcast written notice of any withdrawal under this Subsection upon such withdrawal. Within ten (10) days following receipt of such notice, Comcast shall restore the letter of credit to the amount required under this Agreement. SECTION 6. CUSTOMER SERVICE 6.1 SERVICE AVAILABILITY (A) Except as otherwise provided herein, Comcast shall provide a standard aerial installation of Cable Service within seven (7) days of a request by any Person in the Franchise Area. Standard Installations shall be done within seven (7) days of a request for service. Comcast shall provide such service: (1) With no extension charge except as specifically authorized by this Agreement; (2) At a non-discriminatory installation charge for a Standard Installation and with additional charges for non-Standard Installations computed according to a non- discriminatory methodology for such installations; and (3) At non-discriminatory monthly rates for all Customers, excepting commercial Customers, Multiple Dwelling Unit Bulk Customers and other lawful exceptions to uniform pricing. (B) No Person shall be refused service arbitrarily. However, for non-Standard Installations or a density of less than twenty five (25) residences per 5280 aerial cable-bearing strand feet of trunk or distribution cable, or sixty (60) residences per 5280 underground trench feet of trunk or distribution cable, Cable Service may be made available on the basis of a capital contribution in aid of construction, including cost of material, labor and easements. Comcast may require that the payment of the capital contribution in aid of construction be borne by such potential Customers and be paid in advance. 6.2 CUSTOMER SERVICE STANDARDS (A) Comcast shall comply with the Customer service standards in 47 C.F.R. §§ 76.309, 76.1602, 76.1603 and 76.1619, and any local standards adopted in accordance with applicable law. Comcast acknowledges the Town's ability to enact customer service standards that exceed those enacted by the FCC and the Town acknowledges Comcast's right to recover the costs associated with complying with such standards. Comcast shall not enter into a contract with any Customer that is in any way inconsistent with the terms of this Agreement, or the requirements of any applicable Customer service standards. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 17 of 34 (B) Comcast shall comply with the Customer Service Standards (CSS) created by the Colorado Communications and Utilities Alliance (CCUA). 6.3 CUSTOMER PRIVACY Comcast shall comply with privacy rights of Customers in accordance with applicable law. 6.4 CUSTOMER SERVICE AGREEMENT AND MANUAL (A) Comcast shall provide to Customers an accurate, comprehensive service agreement and customer installation packet for use in establishing Customer service. This material shall, at a minimum, contain the following: (1) Comcast's procedure for investigation and resolution of Customer complaints; (2) Services to be provided and rates for such services; (3) Billing procedures; (4) Service termination procedure; (5) A complete statement of the Customer's right to privacy; (6) Equipment policy; and, (7) The name, address and phone number of the Customer service department that is responsible for handling questions and complaints for Comcast. (B) A copy of the current installation packet shall be available to each Customer: (1) at the time of initial installation and at any time the packet is requested by the Customer. SECTION 7. RECORDS 7.1 REQUIRED RECORDS (A) Comcast shall at all times maintain: (1) Access to a full and complete set of plans, records and maps showing the location of all Cable System facilities in Public Ways; (2) A copy of all FCC filings on behalf of Comcast, its parent corporations or Affiliates that relate to the operation of the Cable System in the Franchise Area; (3) A list of Comcast's rates and Channel line-ups; and, (4) Financial records as required by Section 3 hereof. (B) The Town, upon reasonable prior written notice to Comcast, may review Comcast's records regarding the operation of the Cable System and the provision of Cable Service in the Franchise Area which are reasonably necessary to monitor and enforce Comcast's compliance with this Agreement, including without limitation any records required to be kept in a public file by Comcast pursuant to FCC rules and regulations. All such records shall be retained by Comcast for at least three (3) years. Comcast shall not deny the Town access to any of Comcast's records on the basis that Comcast's records are under the control of any parent corporation, Affiliate or a third party. The Town may request in writing copies of such records that are reasonably necessary, and Comcast shall provide such copies within thirty (30) days at Comcast's COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 18 of 34 sole expense. If the requested records are too voluminous, or for security reasons cannot be copied or removed, then Comcast may request, in writing within ten (10) days of receipt of such request, that the Town inspect them at Comcast's local offices or at one of Comcast's offices more convenient to Town or its duly authorized agent. If any records of Comcast are not kept in such office and not made available to the Town upon written request, and if the Town determines that an examination of such records is necessary for the enforcement of this Agreement, then all reasonable travel expenses incurred in making such examination shall be paid by Comcast. (C) Comcast shall maintain at its business office, in a file available for public inspection during regular business hours, those documents required pursuant to FCC rules and regulations. (D) Comcast shall keep an accurate and comprehensive compilation of any and all Customer complaints received and Comcast's actions in response to those complaints, in a manner consistent with the privacy rights of Customers. Comcast shall provide an executive summary report to the Town on an annual basis within one hundred twenty (120) days of the end of each year that shall include the following information: (1) Nature, date and type of Customer complaints escalated to Comcast by the Town in writing and date complaints were resolved; (2) Average response time for service calls; (3) Phone activity report; (4) A summary of the previous year's activities regarding the development of the Cable System, including, beginning and ending plant miles constructed; (5) An annual report of the company on Form 10-K that is filed with the U.S. Securities and Exchange Commission; and, (6) A copy of all Comcast's rules and regulations applicable to Customers. 7.2 PROPRIETARY INFORMATION If Comcast provides records to the Town, the Town agrees to keep confidential any proprietary information to the extent permitted by law. Comcast shall be responsible for clearly and conspicuously identifying the work proprietary, and shall provide a brief written explanation as to why such information is confidential and how it may be treated as such under applicable law. 7.3 COPIES OF FEDERAL AND STATE REPORTS Within thirty (30) days of the Town's written request, Comcast shall submit to the Town copies of any pleading, application, notification, communication or document of any kind, submitted by Comcast or an Affiliate to any federal, State or local court, regulatory agency or other government body if such documents relate to the operations of the Cable System. Comcast shall not claim confidential, privileged or proprietary rights to such documents, unless under federal, State, or local law such documents have been determined to be confidential by a court of competent jurisdiction, or a federal or State agency. With respect to all other reports, documents and notifications provided to any federal, State or local regulatory agency as a routine matter in the due course of operating the Cable System, Comcast shall make such documents available to the Town upon the Town's written request. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 19 of 34 SECTION 8. PROGRAMMING 8.1 BROAD PROGRAMMING CATEGORIES (A) Comcast shall provide at least the following initial broad categories of programming to the extent such categories are reasonably available.  Educational programming;  News, weather and information;  Sports;  General entertainment including movies;  Foreign language programming;  Children’s programming;  Family oriented programming;  Arts, culture, performing arts programming;  Science and documentary programming;  National/international news; and  Local/regional news. (B) Comcast shall not delete or so limit as to effectively delete any broad category of programming within its control without prior written notice to the Town. (C) In the event of a modification proceeding under federal law, the mix and quality of Cable Service provided by Comcast shall follow the guidelines of Federal law. 8.2 OBSCENITY Comcast shall not transmit, or permit to be transmitted, over any Channel subject to its editorial control any programming which is obscene under applicable federal, State or local laws. 8.3 SERVICES FOR THE DISABLED In providing Cable Service to the disabled, Comcast shall comply with the Americans With Disabilities Act, as amended. 8.4 PARENTAL CONTROL DEVICE Upon request by any Customer, Comcast shall make available at no charge a parental control device to enable a Customer to control access to both the audio and video portions of any Channels. Comcast shall inform its Customers of the availability of the device at the time of their initial subscription and upon request. 8.5 COMPLIMENTARY CABLE SERVICE Comcast, upon request, shall provide without charge, a Standard Installation and one outlet of Basic Service to those buildings now existing, acquired or hereafter constructed that are either owned and occupied or leased and occupied by the Town, its designee or other governmental entity, including without limitation fire stations, police stations, libraries, schools and the Access studio, provided that they are already served or are within one hundred twenty-five (125) feet of COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 20 of 34 the Cable System. The Cable Service provided shall not be distributed beyond the originally installed outlet without authorization from Comcast, which shall not be unreasonably withheld. In the case of leased facilities, the recipient of service is responsible for securing approval for appropriate right of entry suitable to Comcast in its reasonable discretion. The Cable Service provided shall not extend to areas of Town buildings where the Comcast would normally enter into a commercial contract to provide such Cable Service (e.g., golf courses, airport restaurants and concourses, and recreation center work out facilities) or be used for commercial purposes. For new hookups, Comcast shall not provide an outlet to such buildings where a non-Standard Installation is required, unless the Town or building owner/occupant agrees to pay the cost of the non-Standard Installation. SECTION 9. ACCESS 9.1 ACCESS CHANNELS (A) Comcast shall provide, at no charge, two (2) Public, Educational or Governmental (PEG) Access Channels. (B) The Town may delegate management of the PEG Access Channels to a Designated Access Provider. (C) All PEG Access Channels provided for in this Agreement shall be carried system-wide in the Franchise Area, and shall be provided on the Basic Service tier unless otherwise agreed to by the parties. (D) The technical quality of the PEG Access Channels shall not be lower than the quality of other Channels on the same tier of service, at the same technical quality that programming is provided to Comcast by the Town or its Designated Access Provider. (E) The Town shall establish and enforce rules for use of the PEG Access Channels to assure nondiscriminatory access to the Channels to similarly situated users; and to promote use and viewership of the channels, consistent with applicable law. PEG Access Channels may not be used for commercial purposes. (F) Comcast may not exercise any editorial control over the content of programming on the PEG Access Channels. 9.2 UNDERUTILIZED ACCESS CHANNELS Comcast and the Town agree that it is their mutual goal to fully and efficiently use the Channel capacity of the Cable System, which may include allowing Comcast to use underutilized Access Channels. If Comcast believes that any Access Channel is underutilized, Comcast may file a request with the Town to use that Access Channel. The Town shall in its sole discretion render a decision regarding the matter within six (6) months of receiving the request. Should the Town find that the Access Channel may be used by Comcast, then Comcast may begin using such Channel thirty (30) days after receipt of the decision. In the event the Town determines, in Town’s sole discretion, that Town needs to use an Access Channel or Channels that Town has previously determined that Comcast may use as an underutilized Access Channel, Town may COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 21 of 34 rescind Town’s permission to allow Comcast to utilize an Access Channel or Channels which rescission shall be effective ninety (90) days after tendering written notice Comcast. 9.3 ACCESS CHANNEL LOCATION (A) Comcast shall use its best efforts to minimize the movement of Access Channel assignments. Comcast shall provide to the Town a minimum of ninety (90) days prior written notice, prior to any relocation of its Access Channels, unless the change is required by federal law, in which case Comcast shall give the Town the maximum notice possible. Comcast shall pay the Town two thousand dollars ($2,000) per Access Channel, per move. (B) Comcast, at Comcast's expense, shall include notice of Access Channel changes in its regular monthly billing. 9.4 ACCESS CHANNEL PROMOTION Comcast shall provide the Town the opportunity to include promotional notices on paper and electronic bills on not more than two occasions per year. Comcast shall be provided an opportunity to review all such promotional notices. The Town shall be responsible for any costs associated with the provision of such notices. 9.5 PEG FEE (A) Comcast shall collect and provide to Town a monthly fee as capital support for PEG access ("PEG Fee") in an amount determined by the Town. As of the Effective Date of this Agreement the PEG FEE shall be fifty cents ($0.50) per subscriber per month for individual residential and commercial subscribers, and twenty-five cents ($0.25) per subscriber per month subject to bulk-billing. The PEG Fee shall be used solely for PEG access equipment and facilities. Comcast shall make PEG Fee payments quarterly, no later than forty-five (45) days following the end of the quarter. The Town has the right to reduce or increase to PEG Fee up to a maximum of seventy-five cents ($0.75) per Residential Subscriber, and forty cents ($0.40) per Bulk-Billing Subscriber. The Town shall discuss with Comcast any proposed fee before posting and conducting a required Town public hearing prior to taking action on any increase to the PEG Fee. Town shall provide written notice to Comcast at least forty-five (45) days in advance of such public hearing which notice shall state the proposed PEG Fee increase to be considered. Any PEG Fee increase shall be approved by either ordinance or resolution. (B) To the extent permitted by law, the PEG Fee may be itemized on Customer billing statements and recovered from Customers over the term of this Agreement. Comcast shall not be responsible for paying the PEG Fee with respect to gratis or Bad Debt accounts. 9.6 RETURN LINES (A) Comcast shall continue to maintain the return lines from all existing Access broadcast facilities to the Headend in order to enable the distribution of programming to Customers on the Access Channels. Comcast shall continuously maintain these return lines throughout the term of the Agreement, unless any of these locations are no longer used in the future to originate Access programming. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 22 of 34 (B) Within eighteen (18) months of written request by the Town, Comcast shall construct and maintain additional return lines to other locations in the Franchise Area; provided however, that Comcast's construction costs shall be paid by the Town or its Designated Access Provider. (C) Return Lines shall be maintained by Comcast in the same manner as the rest of the Cable System so that Access Channels may be viewed at the same quality that is provided by the Town or its Designated Access Provider. SECTION 10. USE OF PUBLIC WAYS 10.1 CONSTRUCTION AND MAINTENANCE (A) The Cable System shall be constructed and maintained so as not to interfere with sewers, water pipes, or any other property of Town, or with any other pipes, wires, conduits, pedestals, structures or other facilities installed in Public Ways. (B) In its maintenance and construction of the Cable System, Comcast shall comply with the Avon Town Code. All construction and maintenance of Comcast's facilities within Public Ways shall, regardless of who performs the construction, be and remain Comcast's responsibility. (C) Comcast's contractors and subcontractors shall be licensed and bonded in accordance with the Town's ordinances, regulations and requirements. Work by contractors and subcontractors is subject to the same restrictions, limitations and conditions as if the work were performed by Comcast. Comcast shall be responsible for all work performed by its contractors and subcontractors and others performing work on its behalf as if the work were performed by it, and shall ensure that all such work is performed in compliance with this Agreement and other applicable law, and shall be jointly and severally liable for all damages and correcting all damage caused by them. It is Comcast's responsibility to ensure that contractors, subcontractors or other Persons performing work on Comcast's behalf are familiar with the requirements of this Agreement and other applicable laws governing the work performed by them. (D) Comcast shall give reasonable notice to private property owners of construction work in adjacent Public Ways. (E) If Comcast disturbs, alters, or damages any public or private property, Comcast shall at its own expense replace and restore any such Public Way or property to a condition equal to the condition of the property existing immediately prior to the disturbance. (F) The Town may inspect any of Comcast's facilities or construction upon at least twenty- four (24) hours' notice, or, in case of emergency, without prior notice, and the Town may charge Comcast generally applicable inspection fees therefor. If an unsafe condition is found, the Town, in addition to taking any other action permitted under applicable law, may order Comcast to make necessary repairs and alterations to correct the unsafe condition by a time the Town establishes. The Town may correct, inspect, administer and repair the unsafe condition if Comcast fails to do so, and to charge Comcast therefor. (G) On notice from Town that any work is being conducted contrary to this Agreement, or in violation of the terms of any applicable law or permit, the work may immediately be stopped by Town. The stop work order shall: be in writing; be given to the Person doing the work or posted COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 23 of 34 on the work site; be sent to Comcast by mail; indicate the nature of the alleged violation or unsafe condition; and establish conditions under which work may be resumed. 10.2 LOCATION AND MOVEMENT OF FACILITIES (A) After the Town or any franchisee or permittee of the Town notifies Comcast of a proposed Public Way excavation, or design of any project impacting facilities in the Public Way, Comcast shall, at Comcast's expense, mark on the surface all of its located underground facilities within the area of the proposed excavation in accordance with applicable law. (B) The Town may remove or disconnect Comcast's facilities and equipment located in the Public Way or on any other property of the Town in the case of an emergency. Except in an emergency, the Town shall provide reasonable notice to Comcast prior to taking such action and shall provide Comcast with the opportunity to perform such action. Following notice by the Town, Comcast shall remove, replace, relocate, modify or disconnect any of its facilities in a Public Way or on any other property of the Town, except that the Town shall provide at least ninety (90) days written notice of any major capital improvement project that would require the removal, relocation, replacement, modification or disconnection of Comcast's facilities or equipment. If Comcast fails to complete this work within the time prescribed and to the Town's satisfaction, the Town may cause such work to be done at Comcast's expense. Comcast shall remit payment to Town within thirty (30) days of receipt of an itemized list of those costs. (C) If the Town requires Comcast to relocate its facilities located in a Public Way, the Town shall make a reasonable effort to provide Comcast with an alternate location within the Public Way. If funds are generally made available to users of the Public Way for such relocation, Comcast shall be entitled to its pro rata share of such funds. (C) At the request of any Person holding a valid permit and upon reasonable advance notice, Comcast shall temporarily raise, lower or remove its wires as necessary to permit the moving of a building, vehicle, equipment or other item. The cost of such temporary change may be charged by Comcast to the permit holder, and Comcast may require the estimated payment in advance. Such payment is an exchange between Comcast and the permittee, and the Town will not be the administrator of these transactions. 10.3 ACQUISITION OF FACILITIES Upon Comcast's acquisition of Cable System related facilities in any Public Way, or upon the addition or annexation to the Town of any area in which Comcast owns or operates any facility, such facilities shall be subject to the terms of this Agreement. The Town acknowledges that inclusion of revenue from Customers affected by annexation to the Town will require ninety (90) days to make changes in the billing system affecting those Customers. 10.4 RESERVATION OF PUBLIC WAYS Nothing in this Agreement shall prevent the Town from constructing any public improvement, or from permitting other utilities the use of the Public Ways. If the Cable System interferes with the construction, maintenance or repair of any Public Way or public improvement, the Cable System shall be removed or relocated in the area the Town directs. If the Town requires Comcast to relocate its facilities located within the Public Way, the Town shall make a reasonable effort to COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 24 of 34 provide Comcast with an alternate location within the Public Way. All such removal or relocation shall be preceded by sixty (60) days written notice or such additional time as may be provided by Town. Should Comcast fail to remove, adjust or relocate its facilities by the date established by the Town, the Town may effect such removal, adjustment or relocation at Comcast's sole expense. If funds are generally made available to users of the Public Way for such relocation, Comcast shall be entitled to its pro rata share of such funds. 10.5 DISCONTINUED FACILITIES (A) When Comcast intends to discontinue using any facility within a Public Way, Comcast shall submit to Town a complete description of the facility and the date on which Comcast intends to discontinue using the facility. Comcast may remove the facility or request that the Town allow it to remain in place. Notwithstanding Comcast's request that any such facility remain in place, the Town may require Comcast to remove the facility from the Public Way or modify the facility to protect the public health, welfare, safety and convenience. The Town may require Comcast to perform a combination of modification and removal of the facility. (B) Comcast shall complete such removal or modification in accordance with a schedule set by the Town. Until Comcast removes or modifies the facility as directed by the Town, or until the rights to and responsibility for the facility are accepted by another Person having authority to construct and maintain such facility, Comcast shall be responsible for the facility, as well as maintenance of the Public Way, in the same manner and degree as if the facility were in active use, and Comcast shall retain all liability for such facility. (C) If Comcast abandons any facilities, the Town may choose to use such facilities for any purpose whatsoever. 10.6 USE OF CONDUIT OR DUCTS (A) The Town may install or affix and maintain wires and equipment owned by the Town for Town purposes in or upon any of Comcast's ducts or conduits in the Public Ways, without charge to the Town, to the extent space therein or thereon is reasonably available, and pursuant to all applicable ordinances and codes. For purposes of this Subsection, "Town purposes" includes, but is not limited to, the use of the structures and installations for fire, police, traffic, water, telephone, or signal systems, but not for Cable Service in competition with Comcast. Comcast shall not deduct the value of such use of its facilities from its Franchise Fee payments or from other fees payable to the Town. (B) Comcast acknowledges that the Public Ways have a finite capacity for containing conduit and facilities. Therefore, Comcast agrees that when the Town determines it is impracticable to permit construction of an underground conduit system by any other Person which may at the time have authority to construct or maintain conduits or ducts in the Public Ways, but excluding Persons providing Cable Service in competition with Comcast, the Town may require Comcast to afford to such Person the right to use Comcast's surplus ducts or conduits in common with Comcast, pursuant to the terms and conditions of an agreement for use of surplus ducts or conduits entered into by Comcast and the other Person. Nothing herein shall require Comcast to enter into an agreement with such Person if, in Comcast's reasonable determination, such an agreement will compromise the integrity of the Cable System. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 25 of 34 10.7 UNDERGROUNDING Where electric and telephone utility wiring is underground, all Cable System lines, wiring and equipment shall also be placed underground with other wireline service at no expense to the Town. Related equipment, such as pedestals, shall be placed in accordance with applicable Town requirements. In areas where either electric or telephone utility wiring are aerial, Comcast may install aerial cable, except when a property owner or resident requests underground installation and agrees to bear the additional cost in excess of aerial installation. 10.8 TREE TRIMMING Comcast may prune or cause to be pruned, using proper pruning practices, any tree in any Public Way which interferes with the Cable System. Comcast shall comply with all Town requirements regarding tree trimming. Except in emergencies, Comcast may not prune trees at a point below thirty (30) feet above sidewalk grade without seven (7) days prior written notice to the owner or occupant of the premises abutting the Public Way in or over which the tree is growing. The owner or occupant of the abutting premises may prune such tree at his or her own expense during this one (1) week period. If the owner or occupant fails to do so, Comcast may prune such tree at its own expense. For purposes of this Subsection, emergencies exist when it is necessary to prune to protect the public or Comcast's facilities from imminent danger only. 10.9 GIS MAPPING Comcast shall provide the Town with records of Comcast's trunk and distribution facilities in the Franchise Area in a standard geographic information (GIS) format within thirty (30) days of receipt of written request or longer if agreed to by the parties. SECTION 11. CABLE SYSTEM DESIGN AND TECHNICAL STANDARDS 11.1 TECHNICAL PERFORMANCE The technical performance of the Cable System shall meet or exceed all applicable technical standards authorized or required by law, including FCC technical standards as they may be amended from time to time, regardless of the transmission technology utilized. The Town shall have the authority provided by law to enforce compliance with these technical standards. 11.2 CABLE SYSTEM PERFORMANCE TESTING (A) Comcast shall, at its expense, perform all tests on the Cable System required by the FCC (including FCC required test points located in the Franchise Area) and shall maintain written records of its test results in accordance with FCC requirements. Copies of such test results shall be provided to the Town upon request. (B) All required tests may be witnessed by representatives of the Town. Upon request, Comcast will notify the Town before any required technical proof-of-performance or other testing occurs. (C) Comcast shall promptly take all necessary measures to correct any performance deficiencies and prevent their recurrence. Sites shall be re-tested within five (5) days following correction until correction has been confirmed and satisfactory results are obtained. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 26 of 34 11.3 STANDBY POWER Comcast shall provide standby power generating capacity at the Cable System Headend capable of providing at least twelve (12) hours of emergency operation. Comcast shall maintain standby power supplies that will supply back-up power of at least two (2) hours duration throughout the distribution networks, and four (4) hours duration at all nodes and hubs. SECTION 12. VIOLATIONS AND REVOCATION 12.1 PROCEDURE FOR REMEDYING VIOLATIONS (A) If the Town believes that Comcast has failed to perform any material obligation of this Agreement, the Town shall notify Comcast in writing, stating with specificity, the nature of the alleged violation. Comcast shall have thirty (30) days from the receipt of such notice to: (1) Respond to the Town, contesting the Town's assertion that a violation has occurred, or notifying the Town that violation cannot be cured within thirty (30) days because of the nature of the alleged violation, and requesting a hearing in accordance with Subsection (B), below; or (2) Cure the violation. (B) If Comcast does not cure the violation within thirty (30) days, or denies the violation and requests a hearing, the Town shall set a public hearing on the violation. The Town shall provide not less than seven (7) days prior written notice of the hearing. At the hearing, Comcast shall be provided an opportunity to be heard, to present and question witnesses, and to present evidence in its defense. (C) If, after considering the evidence presented at the public hearing, the Town Council determines that a violation exists, the Town may order Comcast to remedy the violation within fourteen (14) days or within such other reasonable timeframe agreed to by the parties. If Comcast does not remedy the violation within such time to the Town's reasonable satisfaction, the Town may: (1) Assess and collect monetary damages in accordance with this Agreement; (2) Terminate this Agreement; and/or, (3) Pursue any other legal or equitable remedy available under this Agreement or applicable law. 12.2 ALTERNATIVE REMEDIES (A) No provision of this Agreement shall bar the right of either party to seek or obtain judicial relief from a violation of any provision of the Agreement or any rule, regulation, requirement or directive promulgated thereunder. Neither the existence of other remedies identified in this Agreement nor the exercise thereof shall be deemed to bar or otherwise limit the right of either party to recover monetary damages, as allowed under applicable law, or to seek and obtain judicial enforcement of obligations by means of specific performance, injunctive relief or mandate, or any other remedy at law or in equity. COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 27 of 34 (B) The Town does not waive any right, immunity, limitation or protection otherwise available to the Town, its officers, officials, Boards, commissions, agents, or employees under any law, including without limitation Section 635A of the Cable Act. Comcast shall not have any monetary recourse against the Town, or its officers, officials, Board, commissions, agents or employees for any loss, costs, expenses or damages arising out of any provision of this Agreement or the enforcement thereof, subject to applicable law. 12.3 LIQUIDATED DAMAGES (A) The Town and Comcast recognize the delays, expense and unique difficulties involved in proving in a legal proceeding the actual loss suffered by the Town as a result of a violation by Comcast of this Agreement. Accordingly, instead of requiring such proof of actual loss, the Town and Comcast agree that Comcast shall pay to the Town the sums set forth in this Subsection. Such amounts are agreed by both parties to be a reasonable estimate of the actual damages the Town would suffer in the event of Comcast's violation. (B) In addition to any other remedy, the Town in its sole discretion may, after following the procedures as provided in this Section 12.1, charge to and collect from Comcast the following liquidated damages per day, for each day, or part thereof, the violation continues: (1) For failure to provide data, documents, reports or information or to cooperate with the Town during an application process or Cable System review or as otherwise provided herein: one hundred fifty dollars ($150). (2) For failure to make timely PEG Fee or Franchise Fee payments: two hundred fifty dollars ($250). (3) For failure to comply with any other provision of this Agreement or Customer Service Standards or the Avon Town Code: one hundred fifty dollars ($150). (C) Each violation shall be considered a separate violation for which separate liquidated damages can be imposed. In no event shall liquidated damages be imposed for a period greater than 120 days. (D) Comcast shall have thirty (30) days to pay the liquidated damages. If not so paid, the Town may draw on any bond or Letter of Credit. The Town shall give Comcast written notice of any such draw, and within seven (7) days of such notice, Comcast shall restore the bond or Letter of Credit to the amount required under this Agreement. 12.4 REVOCATION (A) The franchise provided by this Agreement may be revoked and all rights and privileges rescinded if a material breach of the Agreement is not cured, or in the event that: (1) Comcast attempts to evade any material provision of this Agreement or to practice any fraud or deceit upon the Town or Customers; (2) Comcast makes a material misrepresentation of fact in the negotiation of this Agreement; (3) Comcast abandons the Cable System, or terminates the Cable System's operations; COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 28 of 34 (4) Comcast fails to restore service to the Cable System after three (3) consecutive days of an outage or interruption in service; except in the case of an emergency or during a force majeure occurrence, or when approval of such outage or interruption is obtained from the Town; or (5) Comcast becomes insolvent, unable or unwilling to pay its debts, or is adjudged bankrupt, there is an assignment for the benefit of Comcast's creditors, or all or part of Cable System is sold under an instrument to secure a debt and is not redeemed by Comcast within thirty (30) days from said sale. (B) Additionally, the franchise granted in this Agreement may be revoked one hundred twenty (120) days after the appointment of a receiver or trustee to conduct the business of Comcast, at the option of the Town and subject to applicable law, whether in a receivership, reorganization, bankruptcy or other action or proceeding, unless directed otherwise by a court of competent jurisdiction. (C) If there is a foreclosure or other involuntary sale of the whole or any part of the plant, property and equipment of Comcast, the Town may serve notice of revocation on Comcast and to the purchaser at the sale, and the rights and privileges of Comcast under this Agreement shall be revoked thirty (30) days after service of such notice, unless: (1) The Town has approved the transfer of the Agreement, in accordance with the procedures set forth in this Agreement and as provided by law; and (2) The transferee has agreed to assume and be bound by all terms of this Agreement. 12.5 PURCHASE OF THE CABLE SYSTEM If at any time this Agreement lawfully terminates, the Town shall have the option to purchase the Cable System; provided that nothing in this Agreement shall limit or expand the Town’s right of eminent domain under State law. SECTION 13. TRANSFER 13.1 TRANSFER OF OWNERSHIP OR CONTROL (A) The Cable System and this Agreement shall not be sold, assigned, transferred, leased or disposed of, either in whole or in part, either by involuntary sale or by voluntary sale, merger or consolidation; nor shall title thereto, either legal or equitable, or any right, interest or property therein pass to or vest in any Person or entity without the prior written consent of the Town, which consent shall be by the Town Council, acting by ordinance or resolution. (B) Comcast shall promptly notify the Town of any actual or proposed change in control of Comcast. The word "control" as used herein is defined as an acquisition of 51% or greater ownership interest in Comcast. Such change of control of Comcast shall make this Agreement subject to cancellation unless and until the Town has consented in writing. (C) The parties to the transfer shall make a written request to the Town for its approval of a sale or transfer or change in control and shall furnish all information required by law. (D) In seeking the Town's consent to any transfer, the proposed transferee or controlling entity shall indicate whether it: COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 29 of 34 (1) Has ever been convicted or held liable for acts involving deceit including any violation of federal, State or local law or regulations, or is currently under an indictment, investigation or complaint charging such acts; (2) Has ever had a judgment in an action for fraud, deceit, or misrepresentation entered against the proposed transferee by any court of competent jurisdiction; (3) Has pending any material legal claim, lawsuit, or administrative proceeding arising out of or involving a Cable System or the provision of Cable Services; (4) Is financially solvent, by submitting financial data including financial statements that are audited by a certified public accountant who may also be an officer of the transferee or controlling entity, along with any other data that is lawfully required; and (5) Has the financial, legal and technical capability to enable it to maintain and operate the Cable System for the remaining term of the Agreement. (E) The proposed transferee shall provide complete information regarding any potential impact of the transaction on Customer rates and service, as well as any other documentation reasonably related to the proposed transaction and consistent with applicable law which, in the reasonable discretion of the Town are necessary to understand the proposed transaction. (F) The Town shall act on the request within one hundred twenty (120) days of receipt of the FCC Form 394 application and all information expressly required by this Agreement and applicable law, provided it has received a complete application. Subject to the foregoing, if the Town fails to render a final decision on the request within one hundred twenty (120) days, such request shall be deemed granted unless the requesting party and the Town agree to an extension of time. (G) Within thirty (30) days of any transfer, Comcast shall file with the Town a copy of the deed, agreement, lease or other written instrument evidencing such transfer, certified correct by Comcast and the transferee, and the transferee shall file its written acceptance agreeing to be bound by all terms of this Agreement, subject to applicable law. In the event of a change in control in which Comcast is not replaced by another entity, Comcast will continue to be bound by all terms of the Agreement, subject to applicable law, and will not be required to file an additional written acceptance. The approval of any transfer shall not waive any rights of Town to subsequently enforce noncompliance issues relating to this Agreement. If a change of control involves an entity that was not an Affiliate prior to the contemplated transaction, the Town's consent shall be required for such change in control. (H) In reviewing a transfer request, the Town may inquire into the legal, technical and financial qualifications of the transferee, and Comcast shall assist the Town in so inquiring. The Town may condition said transfer upon such terms as it deems reasonably appropriate, consistent with applicable law and reasonably related to the qualifications of the prospective transferee to comply with this Agreement or the resolution of outstanding and unresolved issues of noncompliance with this Agreement by Comcast. (I) Notwithstanding anything to the contrary in this Subsection, the prior approval of the Town shall not be required for any sale, assignment or transfer of the Agreement or the Cable COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 30 of 34 System to an intra-company entity controlling, controlled by or under the same common control as Comcast, provided that the proposed assignee or transferee shall show financial responsibility as may be determined necessary by the Town and shall agree in writing to comply with all provisions of the Agreement. Further, Comcast may pledge the assets of the Cable System for the purpose of financing without the consent of the Town; provided that such pledge of assets shall not mitigate Comcast's responsibilities to meet its obligations under this Agreement. SECTION 14. MISCELLANEOUS 14.1 CUMULATIVE RIGHTS Subject to applicable law, all rights and remedies given to the Town or retained by the Town in this Agreement shall be in addition to and cumulative with any and all other rights and remedies, existing or implied, now or hereafter available to the Town, at law or in equity, and such rights and remedies shall not be exclusive, but every right and remedy given by this Agreement or otherwise existing may be exercised as often and in such order as deemed expedient by the Town, and the exercise of one right or remedy shall not be deemed a waiver of the right to exercise at the same time or thereafter any other right or remedy. 14.2 COSTS TO BE BORNE BY COMCAST Comcast shall pay for all costs of publication of this Agreement, and any and all notices prior to any public meeting or hearing provided for pursuant to this Agreement in accordance with the Avon Town Code or Charter. 14.3 BINDING EFFECT This Agreement shall be binding upon the parties hereto, their permitted successors, transferees and assigns. 14.4 MODIFICATION This Agreement may be modified only by written agreement between the parties. 14.5 REGULATORY CHANGES In the event there is any change to the Cable Act during the term of this Agreement which has the effect of increasing a municipality’s rights with regard to: the franchise fee or other fees, required minimum technology standards, minimum public access channels, minim service standards, or regulation of combined or expanded cable based services, including but not limited to phone and internet, then the Town may initiate re-negotiation of this Agreement to incorporate such changes into this Agreement as may be mutually determined by the parties. Town shall initiate re- negotiation by tendering written notice to Comcast, which written notice to Comcast. In the event that Town and Comcast do not successfully conclude a renegotiation by the end of one (1) year after the date of the Town’s written notice to initiate renegotiation, or such longer time for renegotiation as the parties may mutually agree, then the Town may elect to reduce the term of this Agreement, provided that the Town shall provide at least one (1) additional year’s prior written notice to Comcast of the reduced expiration date for this Agreement. 14.6 GOVERNING LAW AND VENUE COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 31 of 34 This Agreement shall be governed, construed and enforced in accordance with the laws of the State of Colorado, the Cable Act, as amended, any applicable rules, regulations and orders of the FCC, as amended, and any other applicable local, State and federal laws, rules, and regulations. The venue for any dispute related to a violation of this Agreement shall be in an appropriate state court of competent jurisdiction in Eagle County, Colorado. 14.7 NO JOINT VENTURE Nothing herein shall be deemed to create a joint venture or principal-agent relationship between the parties, and neither party is authorized to, nor shall either party act toward third persons or the public in any manner that would indicate any such relationship with the other. 14.8 WAIVER The failure of either party at any time to require performance by the other of any provision hereof shall in no way affect the right of the other party hereafter to enforce the same. Nor shall the waiver by either party of any breach of any provision hereof be taken or held to be a waiver of any succeeding breach of such provision, or as a waiver of the provision itself or any other provision. 14.9 SEVERABILITY If any provision of this Agreement is determined to be illegal, invalid or unconstitutional by any court or agency of competent jurisdiction, such determination shall have no effect on the validity of any other provision of this Agreement. 14.10 FORCE MAJEURE Comcast shall not be held in violation of this Agreement for any act caused by circumstances reasonably beyond the ability of Comcast to anticipate and control, including war, riots, civil disturbances, floods, severe adverse weather conditions or other natural catastrophes, labor stoppages or power outages exceeding back-up power supplies. 14.11 ENTIRE AGREEMENT This Agreement represents the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersede all prior oral and written negotiations between the parties. 14.12 NOTICES Each party shall maintain and file with the other a local address for the service of notices by mail. All notices shall be sent to such respective address, and such notices shall be effective upon the date of mailing. On the Effective Date, the following are the addressed on file: COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 32 of 34 Comcast: With a copy to: Comcast Comcast 8000 East Iliff Avenue 281 Metcalf Road, Suite 110 Denver, CO 80231 Avon, CO 81620 Attn: Government Affairs Attn: General Manager Town: With a copy to: Town of Avon Town of Avon 1 Lake Street 1 Lake Street Avon, CO 81620 Avon, CO 81620 Attn: Town Manager Attn: Town Attorney COMCAST OF COLORADO VII, LLC/ TOWN OF AVON ORDINANCE NO. 14-15 Page 33 of 34 IN WITNESS WHEREOF, the parties have executed this Agreement on the date first set forth above. TOWN OF AVON, COLORADO _______________________________ Mayor ATTEST: __________________________________ Town Clerk APPROVED AS TO FORM: __________________________________ Town Attorney COMCAST OF COLORADO VII, LLC __________________________________ By: _______________________________ Its: _______________________________ 1 ATTACHMENT FRANCHISE AGREEMENT ORDINANCE No. 14-15 Colorado Communications and Utility Alliance Customer Service Standards (Revised June 18, 2013) Introduction The Colorado Communications and Utilities Alliance (“CCUA”) has created the following Customer Service Standards (the "Standards") for distribution and adoption by Members. The purpose of the Standards is to establish uniform requirements for the quality of service cable operators are expected to offer their customers in the metropolitan area. The Standards are subject to change from time to time. The Franchise Authority encourages the Cable Operator to exceed these standards in their day-to-day operations and as such, understands that the Cable Operator may modify their operations in exceeding these standards. The Standards incorporate the Customer Service Obligations published by the Federal Communications Commission (Section 76.309), April, 1993 and customer service standards of cable television service providers operating in Colorado. Based upon the CCUA’s assessment of the needs of citizens in its members’ jurisdictions, the CCUA adopted, modified and created standards specially tailored to members of the CCUA communities. The Standards require the cable operator, in certain circumstances, to post a security fund or letter of credit ensuring Customer Service. The security fund is to be used when the cable company fails to respond to a citizen complaint that the franchising authority determines is valid, and to provide a mechanism by which to impose remedies for noncompliance. It is the sincere hope and intention of the CCUA that the security fund will never need to be drawn upon; however, the CCUA believes that some enforcement measures are necessary. COLORADO COMMUNICATIONS AND UTILITIES ALLIANCE CUSTOMER SERVICE STANDARDS I. POLICY The Cable Operator should resolve citizen complaints without delay and interference from the Franchising Authority. Where a given complaint is not addressed by the Cable Operator to the citizen's satisfaction, the Franchising Authority should intervene. In addition, where a pattern of unremedied complaints or noncompliance with the Standards is identified, the Franchising Authority should prescribe a cure and establish a reasonable deadline for implementation of the cure. If the noncompliance is not cured within established deadlines, monetary sanctions should be imposed to encourage compliance and deter future non-compliance. 2 These Standards are intended to be of general application, and are expected to be met under normal operating conditions; however, the Cable Operator shall be relieved of any obligations hereunder if it is unable to perform due to a region-wide natural emergency or in the event of force majeure affecting a significant portion of the franchise area. The Cable Operator is free to exceed these Standards to the benefit of its Customers and such shall be considered performance for the purposes of these Standards. These Standards supercede any contradictory or inconsistent provision in federal, state or local law (Source: 47 U.S.C. § 552(a)(1) and (d)), provided, however, that any provision in federal, state or local law, or in any original franchise agreement or renewal agreement, that imposes a higher obligation or requirement than is imposed by these Standards, shall not be considered contradictory or inconsistent with these Standards. In the event of a conflict between these Standards and a Franchise Agreement, the Franchise Agreement shall control. These Standards apply to the provision of any Cable Service, provided by a Cable Operator over a Cable System, within the City/County/Town/City and County of _______________. II. DEFINITIONS When used in these Customer Service Standards (the "Standards"), the following words, phrases, and terms shall have the meanings given below. "Adoption" shall mean the process necessary to formally enact the Standards within the Franchising Authority's jurisdiction under applicable ordinances and laws. "Affiliate" shall mean any person or entity that is owned or controlled by, or under common ownership or control with, a Cable Operator, and provides any Cable Service or Other Service. “Applicable Law” means, with respect to these standards and any Cable Operator’s privacy policies, any statute, ordinance, judicial decision, executive order or regulation having the force and effect of law, that determines the legal standing of a case or issue. "Cable Operator" shall mean any person or group of persons (A) who provides Cable Service over a Cable System and directly or through one or more affiliates owns a significant interest in such cable system, or (B) who otherwise controls or is responsible for, through any arrangement, the management and operation of such a Cable System. Source: 47 U.S.C. § 522(5). “Cable Service” shall mean (A) the one-way transmission to subscribers of (i) video programming, or (ii) other programming service, and (B) subscriber interaction, if any, which is required for the selection or use of such video programming or other programming service. Source: 47 U.S.C. § 522(6). For purposes of this definition, “video programming” is programming provided by, or generally considered comparable to programming provided by a television broadcast station. Source: 47 U.S.C. § 522(20). “Other programming service” is information that a Cable Operator makes available to all subscribers generally. Source: 47 U.S.C. § 522(14). “Cable System” shall mean a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment that is designed to provide Cable Service which includes video programming and which is provided to multiple subscribers within a community, but such term does not include (A) a facility that serves only to retransmit the televisions signals of one or 3 more television broadcast stations, or (B) a facility that serves subscribers without using any public right of way. Source: 47 U.S.C. § 522(7). "City" ("County") shall mean the City, County or City and County of _______, Colorado. "Colorado Communications and Utilities Alliance" or "CCUA" shall mean an association comprised primarily of local governmental subdivisions of the State of Colorado, or any successor entity. The CCUA may, on behalf of its members, be delegated the authority to review, investigate or otherwise take some related role in the administration and/or enforcement of any functions under these Standards. “Contractor” shall mean a person or entity that agrees by contract to furnish materials or perform services for another at a specified consideration. "Customer" shall mean any person who receives any Cable Service from a Cable Operator. "Customer Service Representative" (or "CSR") shall mean any person employed with or under contract or subcontract to a Cable Operator to assist, or provide service to, customers, whether by telephone, writing service or installation orders, answering customers' questions in person, receiving and processing payments, or performing any other customer service-related tasks. “Escalated complaint” shall mean a complaint that is referred to a Cable Operator by the Franchising Authority. "Franchising Authority" shall mean the City (County or Town). "Necessary" shall mean required or indispensable. "Non-cable-related purpose" shall mean any purpose that is not necessary to render or conduct a legitimate business activity related to a Cable Service or Other Service provided by a Cable Operator to a Customer. Market research, telemarketing, and other marketing of services or products that are not related to a Cable Service or Other Service provided by a Cable Operator to a Customer shall be considered Non-cable-related purposes. “Normal business hours” shall mean those hours during which most similar businesses in the community are open to serve customers. In all cases, “normal business hours” must include at least some evening hours one night per week, and include some weekend hours. Source: 47 C.F.R. § 76.309. “Normal operating conditions” shall mean those service conditions which are within the control of a Cable Operator. Conditions which are not within the control of a Cable Operator include, but are not necessarily limited to, natural disasters, civil disturbances, power outages, telephone network outages, and severe or unusual weather conditions. Conditions which are ordinarily within the control of a Cable Operator include, but are not necessarily limited to, special promotions, pay-per-view events, rate increases, regular peak or seasonal demand periods and maintenance or upgrade to the Cable System. “Other Service(s)” shall mean any wire or radio communications service provided using any of the facilities of a Cable Operator that are used in the provision of Cable Service. 4 "Personally Identifiable Information" shall mean specific information about an identified Customer, including, but not be limited to, a Customer's (a) login information for the use of Cable Service and management of a Customer’s Cable Service account, (b) extent of viewing of video programming or Other Services, (c) shopping choices, (d) interests and opinions, (e) energy uses, (f) medical information, (g) banking data or information, or (h) any other personal or private information. "Personally Identifiable Information" shall not mean any aggregate information about Customers which does not identify particular persons, or information gathered by a Cable Operator necessary to install, repair or service equipment or Cable System facilities at a Customer’s premises. “Service interruption” or “interruption” shall mean (i) the loss or substantial impairment of picture and/or sound on one or more cable television channels. “Service outage” or “outage” shall mean a loss or substantial impairment in reception on all channels. “Subcontractor” shall mean a person or entity that enters into a contract to perform part or all of the obligations of another's contract. "Town" shall mean the Town of _______, Colorado “Writing” or “written” as the term applies to notification shall include electronic communications. Any terms not specifically defined in these Standards shall be given their ordinary meaning, or where otherwise defined in applicable federal law, such terms shall be interpreted consistent with those definitions. III. CUSTOMER SERVICE A. Courtesy Cable Operator employees, contractors and subcontractors shall be courteous, knowledgeable and helpful and shall provide effective and satisfactory service in all contacts with customers. B. Accessibility 1. A Cable Operator shall provide customer service centers/business offices (“Service Centers”) which are conveniently located, and which are open during Normal Business Hours. Service Centers shall be fully staffed with Customer Service Representatives offering the following services to Customers who come to the Service Center: bill payment, equipment exchange, processing of change of service requests, and response to Customer inquiries and request. Unless otherwise requested by the City/County/Town, a Cable Operator shall post a sign at each Service Center, visible from the outside of the Service Center, advising Customers of its hours of operation and of the telephone number at which to contact the Cable Operator if the Service Center is not open at the times posted. The Cable Operator shall use commercially reasonable efforts to implement and promote “self-help” tools and technology, in order to respond to the growing demand of Customers who wish to interact with the Cable Operator on the Customer’s own terms and timeline and at their own convenience, without 5 having to travel to a Service Center. Without limitation, examples of self-help tools or technology may include self-installation kits to Customers upon request; pre-paid mailers for the return of equipment upon Customer request; an automated phone option for Customer bill payments; and equipment exchanges at a Customer’s residence in the event of damaged equipment. A Cable Operator shall provide free exchanges of faulty equipment at the customer's address if the equipment has not been damaged in any manner due to the fault or negligence of the customer. 2. A Cable Operator shall maintain local telephone access lines that shall be available twenty-four (24) hours a day, seven (7) days a week for service/repair requests and billing/service inquiries. 3. A Cable Operator shall have dispatchers and technicians on call twenty-four (24) hours a day, seven (7) days a week, including legal holidays. 4. If a customer service telephone call is answered with a recorded message providing the customer with various menu options to address the customer’s concern, the recorded message must provide the customer the option to connect to and speak with a CSR within sixty (60) seconds of the commencement of the recording. During Normal Business Hours, a Cable Operator shall retain sufficient customer service representatives and telephone line capacity to ensure that telephone calls to technical service/repair and billing/service inquiry lines are answered by a customer service representative within thirty (30) seconds or less from the time a customer chooses a menu option to speak directly with a CSR or chooses a menu option that pursuant to the automated voice message, leads to a direct connection with a CSR. Under normal operating conditions, this thirty (30) second telephone answer time requirement standard shall be met no less than ninety (90) percent of the time measured quarterly. 5. Under normal operating conditions, a customer shall not receive a busy signal more than three percent (3%) of the time. This standard shall be met ninety (90) percent or more of the time, measured quarterly. C. Responsiveness 1. Guaranteed Seven-Day Residential Installation a. A Cable Operator shall complete all standard residential installations or modifications to service requested by customers within seven (7) business days after the order is placed, unless a later date for installation is requested. "Standard" residential installations are those located up to one hundred twenty five (125) feet from the existing distribution system. If the customer requests a nonstandard residential installation, or the Cable Operator determines that a nonstandard residential installation is required, the Cable Operator shall provide the customer in advance with a total installation cost estimate and an estimated date of completion. b. All underground cable drops to the home shall be buried at a depth of no less than twelve inches (12"), or such other depth as may be required by the Franchise Agreement or local code provisions, or if there are no applicable Franchise or code requirements, at such other depths as may be agreed to by the parties if other construction concerns preclude the twelve inch requirement , and within no more than one calendar week from the initial installation, or at a time mutually agreed upon between the Cable Operator and the customer. 2. Residential Installation and Service Appointments 6 a. The “appointment window” alternatives for specific installations, service calls, and/or other installation activities will be either a specific time, or at a maximum, a four (4) hour time block between the hours of 8:00 a.m. and 6:00 p.m., six (6) days per week. A Cable Operator may schedule service calls and other installation activities outside of the above days and hours for the express convenience of customers. For purposes of this subsection “appointment window” means the period of time in which the representative of the Cable Operator must arrive at the customer’s location. b. A Cable Operator may not cancel an appointment with a customer after the close of business on the business day prior to the scheduled appointment, unless the customer’s issue has otherwise been resolved. c. If a Cable Operator is running late for an appointment with a customer and will not be able to keep the appointment as scheduled, the Cable Operator shall take reasonable efforts to contact the customer promptly, but in no event later than the end of the appointment window. The appointment will be rescheduled, as necessary at a time that is convenient to the customer, within Normal Business Hours or as may be otherwise agreed to between the customer and Cable Operator. d. A Cable Operator shall be deemed to have responded to a request for service under the provisions of this section when a technician arrives within the agreed upon time, and, if the customer is absent when the technician arrives, the technician leaves written notification of arrival and return time, and a copy of that notification is kept by the Cable Operator. In such circumstances, the Cable Operator shall contact the customer within forty-eight (48) hours. 3. Residential Service Interruptions a. In the event of system outages resulting from Cable Operator equipment failure, the Cable Operator shall correct such failure within 2 hours after the 3rd customer call is received. b. All other service interruptions resulting from Cable Operator equipment failure shall be corrected by the Cable Operator by the end of the next calendar day. c. Records of Complaints. i. A Cable Operator shall keep an accurate and comprehensive file of any complaints regarding the cable system or its operation of the cable system, in a manner consistent with the privacy rights of customers, and the Cable Operator's actions in response to those complaints. These files shall remain available for viewing by the Franchising Authority during normal business hours at the Cable Operator’s business office, and shall be retained by the Cable Operator for a period of at least three (3) years. ii. Upon written request a Cable Operator shall provide the Franchising Authority an executive summary quarterly, which shall include information concerning customer complaints referred by the Franchising Authority to the Grantee and any other requirements of a Franchise Agreement but no personally identifiable information. These summaries shall be provided within fifteen (15) days after the end of each quarter. Once a request is made, it need not be repeated and quarterly executive summaries shall be provided by the Cable Operator until notified in writing by the Franchising Authority that such summaries are no longer required. 7 iii. Upon written request a summary of service requests, identifying the number and nature of the requests and their disposition, shall also be completed by the Cable Operator for each quarter and submitted to the Franchising Authority by the fifteenth (15th) day of the month after each calendar quarter. Once a request is made, it need not be repeated and quarterly summary of service requests shall be provided by the Cable Operator until notified in writing by the Franchising Authority that such summaries are no longer required. Complaints shall be broken out by the nature of the complaint and the type of Cable service subject to the complaint. d. Records of Service Interruptions and Outages. A Cable Operator shall maintain records of all outages and reported service interruptions. Such records shall indicate the type of cable service interrupted, including the reasons for the interruptions. A log of all service interruptions shall be maintained and provided to the Franchising Authority quarterly, upon written request, within fifteen (15) days after the end of each quarter. Such records shall be submitted to the Franchising Authority with the records identified in Section 3.c.ii above if so requested in writing, and shall be retained by the Cable Operator for a period of three (3) years. e. All service outages and interruptions for any cause beyond the control of the Cable Operator shall be corrected within thirty-six (36) hours, after the conditions beyond its control have been corrected. 4. TV Reception a. A Cable Operator shall provide clear television reception that meets or exceeds technical standards established by the United States Federal Communications Commission (the "FCC"). A Cable Operator shall render efficient service, make repairs promptly, and interrupt service only for good cause and for the shortest time possible. Scheduled interruptions shall be preceded by notice and shall occur during periods of minimum use of the system, preferably between midnight and six a.m. (6:00 a.m.). b. If a customer experiences poor video or audio reception attributable to a Cable Operator's equipment, the Cable Operator shall: i. Assess the problem within one (1) day of notification; ii. Communicate with the customer regarding the nature of the problem and the expected time for repair; iii. Complete the repair within two (2) days of assessing the problem unless circumstances exist that reasonably require additional time. c. If an appointment is necessary to address any video or audio reception problem, the customer may choose a block of time described in Section III.C.2.a. At the customer's request, the Cable Operator shall repair the problem at a later time convenient to the customer, during Normal Business Hours or at such other time as may be agreed to by the customer and Cable Operator. A Cable Operator shall maintain periodic communications with a customer during the time period in which problem ascertainment and repair are ongoing, so that the customer is advised of the status of the Cable Operator’s efforts to address the problem. 8 5. Problem Resolution A Cable Operator's customer service representatives shall have the authority to provide credit for interrupted service, to waive fees, to schedule service appointments and to change billing cycles, where appropriate. Any difficulties that cannot be resolved by the customer service representative shall be referred to the appropriate supervisor who shall contact the customer within four (4) hours and resolve the problem within forty eight (48) hours or within such other time frame as is acceptable to the customer and the Cable Operator. 6. Billing, Credits, and Refunds a. In addition to other options for payment of a customer’s service bill, a Cable Operator shall make available a telephone payment option where a customer without account irregularities can enter payment information through an automated system, without the necessity of speaking to a CSR. b. A Cable Operator shall allow at least thirty (30) days from the beginning date of the applicable service period for payment of a customer's service bill for that period. If a customer's service bill is not paid within that period of time the Cable Operator may apply an administrative fee to the customer's account. The administrative fee must reflect the average costs incurred by the Cable Operator in attempting to collect the past due payment in accordance with applicable law. If the customer's service bill is not paid within forty-five (45) days of the beginning date of the applicable service period, the Cable Operator may perform a "soft" disconnect of the customer's service. If a customer's service bill is not paid within fifty-two (52) days of the beginning date of the applicable service period, the Cable Operator may disconnect the customer's service, provided it has provided two (2) weeks notice to the customer that such disconnection may result. c. The Cable Operator shall issue a credit or refund to a customer within 30 days after determining the customer's entitlement to a credit or refund. d. Whenever the Cable Operator offers any promotional or specially priced service(s) its promotional materials shall clearly identify and explain the specific terms of the promotion, including but not limited to manner in which any payment credit will be applied. 7. Treatment of Property To the extent that a Franchise Agreement does not contain the following procedures for treatment of property, Operator shall comply with the procedures set forth in this Section. a. A Cable Operator shall keep tree trimming to a minimum; trees and shrubs or other landscaping that are damaged by a Cable Operator, any employee or agent of a Cable Operator during installation or construction shall be restored to their prior condition or replaced within seven (7) days, unless seasonal conditions require a longer time, in which case such restoration or replacement shall be made within seven (7) days after conditions permit. Trees and shrubs on private property shall not be removed without the prior permission of the owner or legal tenant of the property on which they are located. This provision shall be in addition to, and shall not supersede, any requirement in any franchise agreement. 9 b. A Cable Operator shall, at its own cost and expense, and in a manner approved by the property owner and the Franchising Authority, restore any private property to as good condition as before the work causing such disturbance was initiated. A Cable Operator shall repair, replace or compensate a property owner for any damage resulting from the Cable Operator's installation, construction, service or repair activities. If compensation is requested by the customer for damage caused by any Cable Operator activity, the Cable Operator shall reimburse the property owner one hundred (100) percent of the actual cost of the damage. c. Except in the case of an emergency involving public safety or service interruption to a large number of customers, a Cable Operator shall give reasonable notice to property owners or legal tenants prior to entering upon private premises, and the notice shall specify the work to be performed; provided that in the case of construction operations such notice shall be delivered or provided at least twenty-four (24) hours prior to entry, unless such notice is waived by the customer. For purposes of this subsection, “reasonable notice” shall be considered: i. For pedestal installation or similar major construction, seven (7) days. ii. For routine maintenance, such as adding or dropping service, tree trimming and the like, reasonable notice given the circumstances. Unless a Franchise Agreement has a different requirement, reasonable notice shall require, at a minimum, prior notice to a property owner or tenant, before entry is made onto that person’s property. iii. For emergency work a Cable Operator shall attempt to contact the property owner or legal tenant in person, and shall leave a door hanger notice in the event personal contact is not made. Door hangars must describe the issue and provide contact information where the property owner or tenant can receive more information about the emergency work. Nothing herein shall be construed as authorizing access or entry to private property, or any other property, where such right to access or entry is not otherwise provided by law. d. Cable Operator personnel shall clean all areas surrounding any work site and ensure that all cable materials have been disposed of properly. D. Services for Customers with Disabilities 1. For any customer with a disability, a Cable Operator shall deliver and pick up equipment at customers' homes at no charge unless the malfunction was caused by the actions of the customer. In the case of malfunctioning equipment, the technician shall provide replacement equipment, hook it up and ensure that it is working properly, and shall return the defective equipment to the Cable Operator. 2. A Cable Operator shall provide either TTY, TDD, TYY, VRS service or other similar service that are in compliance with the Americans With Disabilities Act and other applicable law, with trained operators who can provide every type of assistance rendered by the Cable Operator's customer service representatives for any hearing-impaired customer at no charge. 3. A Cable Operator shall provide free use of a remote control unit to mobility-impaired (if disabled, in accordance with Section III.D.4) customers. 10 4. Any customer with a disability may request the special services described above by providing a Cable Operator with a letter from the customer's physician stating the need, or by making the request to the Cable Operator's installer or service technician, where the need for the special services can be visually confirmed. E. Cable Services Information 1. At any time a customer or prospective customer may request, a Cable Operator shall provide the following information, in clear, concise written form, easily accessible and located on Cable Operator’s website (and in Spanish, when requested by the customer): a. Products and services offered by the Cable Operator, including its channel lineup; b. The Cable Operator's complete range of service options and the prices for these services; c. The Cable Operator's billing, collection and disconnection policies; d. Privacy rights of customers; e. All applicable complaint procedures, including complaint forms and the telephone numbers and mailing addresses of the Cable Operator, and the FCC; f. Use and availability of parental control/lock out device; g. Special services for customers with disabilities; h. Days, times of operation, and locations of the service centers; 2. At a Customer’s request, a Cable Operator shall make available either a complete copy of these Standards and any other applicable customer service standards, or a summary of these Standards, in a format to be approved by CCUA and the Franchising Authority, which shall include at a minimum, the URL address of a website containing these Standards in their entirety; provided however, that if the CCUA or Franchising Authority does not maintain a website with a complete copy of these Standards, a Cable Operator shall be under no obligation to do so; If acceptable to a customer, Cable Operator may fulfill customer requests for any of the information listed in this Section by making the requested information available electronically, such as on a website or by electronic mail. 3. Upon written request, a Cable Operator shall meet annually with the Franchising Authority to review the format of the Cable Operator’s bills to customers. Whenever the Cable Operator makes substantial changes to its billing format, it will contact the Franchising Authority at least thirty (30) days prior to the time such changes are to be effective, in order to inform the Franchising Authority of such changes. 4. Copies of notices provided to the customer in accordance with subsection 5 below shall be filed (by fax or email acceptable) concurrently with the Franchising Authority and the CCUA. 11 5. A Cable Operator shall provide customers with written notification of any change in rates for nondiscretionary cable services, and for service tier changes that result in a deletion of programming from a customer’s service tier, at least thirty (30) days before the effective date of change. For purposes of this section, “nondiscretionary” means the subscribed tier and any other Cable Services that a customer has subscribed to, at the time the change in rates are announced by the Cable Operator. 6. All officers, agents, and employees of the Cable Operator or its contractors or subcontractors who are in personal contact with customers and/or when working on public property, shall wear on their outer clothing identification cards bearing their name and photograph and identifying them as representatives of the Cable Operator. The Cable Operator shall account for all identification cards at all times. Every vehicle of the Cable Operator shall be clearly visually identified to the public as working for the Cable Operator. Whenever a Cable Operator work crew is in personal contact with customers or public employees, a supervisor must be able to communicate clearly with the customer or public employee. Every vehicle of a subcontractor or contractor shall be labeled with the name of the contractor and further identified as contracting or subcontracting for the Cable Operator. 7. Each CSR, technician or employee of the Cable Operator in each contact with a customer shall state the estimated cost of the service, repair, or installation orally prior to delivery of the service or before any work is performed, and shall provide the customer with an oral statement of the total charges before terminating the telephone call or before leaving the location at which the work was performed. A written estimate of the charges shall be provided to the customer before the actual work is performed. F. Customer Privacy 1. Cable Customer Privacy. In addition to complying with the requirements in this subsection, a Cable Operator shall fully comply with all obligations under 47 U.S.C. Section 551. 2. Collection and Use of Personally Identifiable Information. a. A Cable Operator shall not use the Cable System to collect, monitor or observe Personally Identifiable Information without the prior affirmative written or electronic consent of the Customer unless, and only to the extent that such information is: (i) used to detect unauthorized reception of cable communications, or (ii) necessary to render a Cable Service or Other Service provided by the Cable Operator to the Customer and as otherwise authorized by applicable law. b. A Cable Operator shall take such actions as are necessary using then-current industry standard practices to prevent any Affiliate from using the facilities of the Cable Operator in any manner, including, but not limited to, sending data or other signals through such facilities, to the extent such use will permit an Affiliate unauthorized access to Personally Identifiable Information on equipment of a Customer (regardless of whether such equipment is owned or leased by the Customer or provided by a Cable Operator) or on any of the facilities of the Cable Operator that are used in the provision of Cable Service. This subsection F.2.b shall not be interpreted to prohibit an Affiliate from obtaining access to Personally Identifiable Information to the extent otherwise permitted by this subsection F. c. A Cable Operator shall take such actions as are necessary using then-current industry standard practices to prevent a person or entity (other than an Affiliate) from using the facilities of the Cable Operator in any manner, including, but not limited to, sending data or other signals through such facilities, to the extent such use will permit such person or entity unauthorized access to Personally 12 Identifiable Information on equipment of a Customer (regardless of whether such equipment is owned or leased by the Customer or provided by a Cable Operator) or on any of the facilities of the Cable Operator that are used in the provision of Cable Service. 3. Disclosure of Personally Identifiable Information. A Cable Operator shall not disclose Personally Identifiable Information without the prior affirmative written or electronic consent of the Customer, unless otherwise authorized by applicable law. a. A minimum of thirty (30) days prior to making any disclosure of Personally Identifiable Information of any Customer for any Non-Cable related purpose as provided in this subsection F.3.a, where such Customer has not previously been provided the notice and choice provided for in subsection III.F.9, the Cable Operator shall notify each Customer (that the Cable Operator intends to disclose information about) of the Customer's right to prohibit the disclosure of such information for Non-cable related purposes. The notice to Customers may reference the Customer to his or her options to state a preference for disclosure or non-disclosure of certain information, as provided in subsection III.F.10. b. A Cable Operator may disclose Personally Identifiable Information only to the extent that it is necessary to render, or conduct a legitimate business activity related to, a Cable Service or Other Service provided by the Cable Operator to the Customer. c. To the extent authorized by applicable law, a Cable Operator may disclose Personally Identifiable Information pursuant to a subpoena, court order, warrant or other valid legal process authorizing such disclosure. 4. Access to Information. Any Personally Identifiable Information collected and maintained by a Cable Operator shall be made available for Customer examination within thirty (30) days of receiving a request by a Customer to examine such information about himself or herself at the local offices of the Cable Operator or other convenient place within the City/County/City and County/Town designated by the Cable Operator, or electronically, such as over a website. Upon a reasonable showing by the Customer that such Personally Identifiable Information is inaccurate, a Cable Operator shall correct such information. 5. Privacy Notice to Customers a. A Cable Operator shall annually mail or provide a separate, written or electronic copy of the privacy statement to Customers consistent with 47 U.S.C. Section 551(a)(1), and shall provide a Customer a copy of such statement at the time the Cable Operator enters into an agreement with the Customer to provide Cable Service. The written notice shall be in a clear and conspicuous format, which at a minimum, shall be in a comparable font size to other general information provided to Customers about their account as it appears on either paper or electronic Customer communications. b. In or accompanying the statement required by subsection F.5.a, a Cable Operator shall state substantially the following message regarding the disclosure of Customer information: "Unless a Customer affirmatively consents electronically or in writing to the disclosure of personally identifiable information, any disclosure of personally identifiable information for purposes other than to the extent necessary to render, or conduct a legitimate business activity related to, a Cable Service or Other Service, is limited to: 13 i. Disclosure pursuant to valid legal process authorized by applicable law. ii. Disclosure of the name and address of a Customer subscribing to any general programming tiers of service and other categories of Cable Services provided by the Cable Operator that do not directly or indirectly disclose: (A) A Customer's extent of viewing of a Cable Service or Other Service provided by the Cable Operator; (B) The extent of any other use by a Customer of a Cable Service; (C) The nature of any transactions made by a Customer over the Cable System; or (D) The nature of programming or websites that a Customer subscribes to or views (i.e., a Cable Operator may only disclose the fact that a person subscribes to a general tier of service, or a package of channels with the same type of programming), provided that with respect to the nature of websites subscribed to or viewed, these are limited to websites accessed by a Customer in connection with programming available from their account for Cable Services.” The notice shall also inform the Customers of their right to prohibit the disclosure of their names and addresses in accordance with subsection F.3.a. If a Customer exercises his or her right to prohibit the disclosure of name and address as provided in subsection F.3.a or this subsection, such prohibition against disclosure shall remain in effect, unless and until the Customer subsequently changes their disclosure preferences as described in subsection F.9 below. 6. Privacy Reporting Requirements. The Cable Operator shall include in its regular periodic reports to the Franchising Authority required by its Franchise Agreement information summarizing: a. The type of Personally Identifiable Information that was actually collected or disclosed by Cable Operator during the reporting period; b. For each type of Personally Identifiable Information collected or disclosed, a statement from an authorized representative of the Cable Operator certifying that the Personally Identifiable Information collected or disclosed was: (A) collected or disclosed to the extent Necessary to render, or conduct a legitimate business activity related to, a Cable Service or Other Service provided by the Cable Operator; (B) used to the extent Necessary to detect unauthorized reception of cable communications: (C) disclosed pursuant to valid legal process authorized by applicable law; or (D) a disclosure of Personally Identifiable Information of particular subscribers, but only to the extent affirmatively consented to by such subscribers in writing or electronically, or as otherwise authorized by applicable law. c. The standard industrial classification (SIC) codes or comparable identifiers pertaining to any entities to whom such Personally Identifiable Information was disclosed, except that a Cable Operator need not provide the name of any court or governmental entity to which such disclosure was made pursuant to valid legal process authorized by applicable law; d. The general measures that have been taken to prevent the unauthorized access to Personally Identifiable Information by a person other than the Customer or the Cable Operator. A Cable Operator shall meet with Franchising Authority if requested to discuss technology used to prohibit unauthorized access to Personally Identifiable Information by any means. 7. Nothing in this subsection III.F shall be construed to prevent the Franchising Authority from obtaining Personally Identifiable Information to the extent not prohibited by Section 631 of the Communications Act, 47 U.S.C. Section 551 and applicable laws. 14 8. Destruction of Personally Identifiable Information. A Cable Operator shall destroy any Personally Identifiable Information if the information is no longer necessary for the purpose for which it was collected and there are no pending requests or orders for access to such information under subsection 4 of this subsection III.F, pursuant to a court order or other valid legal process, or pursuant to applicable law. 9. Notice and Choice for Customers. The Cable Operator shall at all times make available to Customers one or more methods for Customers to use to prohibit or limit disclosures, or permit or release disclosures, as provided for in this subsection III.F. These methods may include, for example, online website “preference center” features, automated toll-free telephone systems, live toll-free telephone interactions with customer service agents, in-person interactions with customer service personnel, regular mail methods such as a postage paid, self-addressed post card, an insert included with the Customer’s monthly bill for Cable Service, the privacy notice specified in subsection III.F.5, or such other comparable methods as may be provided by the Cable Operator. Website “preference center” features shall be easily identifiable and navigable by Customers, and shall be in a comparable size font as other billing information provided to Customers on a Cable Operator’s website. A Customer who provides the Cable Operator with permission to disclose Personally Identifiable Information through any of the methods offered by a Cable Operator shall be provided follow-up notice, no less than annually, of the Customer’s right to prohibit these disclosures and the options for the Customer to express his or her preference regarding disclosures. Such notice shall, at a minimum, be provided by an insert in the Cable Operator’s bill (or other direct mail piece) to the Customer or a notice or message printed on the Cable Operator’s bill to the Customer, and on the Cable Operator’s website when a Customer logs in to view his or her Cable Service account options. The form of such notice shall also be provided on an annual basis to the Franchising Authority. These methods of notification to Customers may also include other comparable methods as submitted by the Cable Operator and approved by the Franchising Authority in its reasonable discretion. G. Safety A Cable Operator shall install and locate its facilities, cable system, and equipment in compliance with all federal, state, local, and company safety standards, and in such manner as shall not unduly interfere with or endanger persons or property. Whenever a Cable Operator receives notice that an unsafe condition exists with respect to its equipment, the Cable Operator shall investigate such condition immediately, and shall take such measures as are necessary to remove or eliminate any unsafe condition. H. Cancellation of New Services In the event that a new customer requests installation of Cable Service and is unsatisfied with their initial Cable Service, and provided that the customer so notifies the Cable Operator of their dissatisfaction within 30 days of initial installation, then such customer can request disconnection of Cable Service within 30 days of initial installation, and the Cable Operator shall provide a credit to the customer’s account consistent with this Section. The customer will be required to return all equipment in good working order; provided such equipment is returned in such order, then the Cable Operator shall refund the monthly recurring fee for the new customer’s first 30 days of Cable Service and any charges paid for installation. This provision does not apply to existing customers who request upgrades to their Cable Service, to discretionary Cable Service such as PPV or movies purchased and viewed On 15 Demand, or to customer moves and/or transfers of Cable Service. The service credit shall be provided in the next billing cycle. IV. COMPLAINT PROCEDURE A. Complaints to a Cable Operator 1. A Cable Operator shall establish written procedures for receiving, acting upon, and resolving customer complaints, and crediting customer accounts and shall have such procedures printed and disseminated at the Cable Operator's sole expense, consistent with Section III.E.1.e of these Standards. 2. Said written procedures shall prescribe a simple manner in which any customer may submit a complaint by telephone or in writing to a Cable Operator that it has violated any provision of these Customer Service Standards, any terms or conditions of the customer's contract with the Cable Operator, or reasonable business practices. If a representative of the Franchising Authority notifies the Cable Operator of a customer complaint that has not previously been made by the customer to the Cable Operator, the complaint shall be deemed to have been made by the customer as of the date of the Franchising Authority’s notice to the Cable Operator. 3. At the conclusion of the Cable Operator's investigation of a customer complaint, but in no more than ten (10) calendar days after receiving the complaint, the Cable Operator shall notify the customer of the results of its investigation and its proposed action or credit. 4. A Cable Operator shall also notify the customer of the customer's right to file a complaint with the Franchising Authority in the event the customer is dissatisfied with the Cable Operator's decision, and shall thoroughly explain the necessary procedures for filing such complaint with the Franchising Authority. 5. A Cable Operator shall immediately report all customer Escalated complaints that it does not find valid to the Franchising Authority. 6. A Cable Operator's complaint procedures shall be filed with the Franchising Authority prior to implementation. B. Complaints to the Franchising Authority 1. Any customer who is dissatisfied with any proposed decision of the Cable Operator or who has not received a decision within the time period set forth below shall be entitled to have the complaint reviewed by the Franchising Authority. 2. The customer may initiate the review either by calling the Franchising Authority or by filing a written complaint together with the Cable Operator's written decision, if any, with the Franchising Authority. 3. The customer shall make such filing and notification within twenty (20) days of receipt of the Cable Operator's decision or, if no decision has been provided, within thirty (30) days after filing the original complaint with the Cable Operator. 16 4. If the Franchising Authority decides that further evidence is warranted, the Franchising Authority shall require the Cable Operator and the customer to submit, within ten (10) days of notice thereof, a written statement of the facts and arguments in support of their respective positions. 5. The Cable Operator and the customer shall produce any additional evidence, including any reports from the Cable Operator, which the Franchising Authority may deem necessary to an understanding and determination of the complaint. 6. The Franchising Authority shall issue a determination within fifteen (15) days of receiving the customer complaint, or after examining the materials submitted, setting forth its basis for the determination. 7. The Franchising Authority may extend these time limits for reasonable cause and may intercede and attempt to negotiate an informal resolution. C. Security Fund or Letter of Credit A Cable operator shall comply with any Franchise Agreement regarding Letters of Credit. If a Franchise Agreement is silent on Letter of Credit the following shall apply: 1. Within thirty (30) days of the written notification to a Cable Operator by the Franchising Authority that an alleged Franchise violation exists, a Cable Operator shall deposit with an escrow agent approved by the Franchising Authority fifty thousand dollars ($50,000) or, in the sole discretion of the Franchising Authority, such lesser amount as the Franchising Authority deems reasonable to protect subscribers within its jurisdiction. Alternatively, at the Cable Operator’s discretion, it may provide to the Franchising Authority an irrevocable letter of credit in the same amount. A letter of credit or cash deposit, with the approval of the Franchising Authority, may be posted jointly for more than one member of the CCUA, and may be administered, and drawn upon, jointly by the CCUA or drawn upon individually by each member; provided however that if such letter of credit or cash deposit is provided to CCUA on behalf of more than one of its members, the letter of credit or cash deposit may, in the sole discretion of CCUA and its effected members, be required in an amount not to exceed one hundred thousand dollars ($100,000). The escrowed funds or letter of credit shall constitute the "Security Fund" for ensuring compliance with these Standards for the benefit of the Franchising Authority. The escrowed funds or letter of credit shall be maintained by a Cable Operator at the amount initially required, even if amounts are withdrawn pursuant to any provision of these Standards, until any claims related to the alleged Franchise violation(s) are paid in full. 2. The Franchising Authority may require the Cable Operator to increase the amount of the Security Fund, if it finds that new risk factors exist which necessitate such an increase. 3. The Security Fund shall serve as security for the payment of any penalties, fees, charges or credits as provided for herein and for the performance by a Cable Operator of all its obligations under these Customer Service Standards. 17 4. The rights reserved to the Franchising Authority with respect to the Security Fund are in addition to all other rights of the Franchising Authority, whether reserved by any applicable franchise agreement or authorized by law, and no action, proceeding or exercise of a right with respect to same shall in any way affect, or diminish, any other right the Franchising Authority may otherwise have. D. Verification of Compliance A Cable Operator shall establish its compliance with any or all of the standards required through annual reports that demonstrate said compliance, or as requested by the Franchising Authority. E. Procedure for Remedying Violations 1. If the Franchising Authority has reason to believe that a Cable Operator has failed to comply with any of these Standards, or has failed to perform in a timely manner, the Franchising Authority may pursue the procedures in its Franchise Agreement to address violations of these Standards in a like manner as other franchise violations are considered. 2. Following the procedures set forth in any Franchise Agreement governing the manner to address alleged Franchise violations, if the Franchising Authority determines in its sole discretion that the noncompliance has been substantiated, in addition to any remedies that may be provided in the Franchise Agreement, the Franchising Authority may: a. Impose assessments of up to one thousand dollars ($1,000.00) per day, to be withdrawn from the Security Fund in addition to any franchise fee until the non-compliance is remedied; and/or b. Order such rebates and credits to affected customers as in its sole discretion it deems reasonable and appropriate for degraded or unsatisfactory services that constituted noncompliance with these Standards; and/or c. Reverse any decision of the Cable Operator in the matter and/or d. Grant a specific solution as determined by the Franchising Authority; and/or e. Except for in emergency situations, withhold licenses and permits for work by the Cable Operator or its subcontractors in accordance with applicable law. V. MISCELLANEOUS A. Severability Should any section, subsection, paragraph, term, or provision of these Standards be determined to be illegal, invalid, or unconstitutional by any court or agency of competent jurisdiction with regard thereto, such determination shall have no effect on the validity of any other section, subsection, paragraph, term, or provision of these Standards, each of the latter of which shall remain in full force and effect. B. Non-Waiver 18 Failure to enforce any provision of these Standards shall not operate as a waiver of the obligations or responsibilities of a Cable Operator under said provision, or any other provision of these Standards. Revised 6/18/13. Heil Law & Planning, LLC Office: 303.975.6120 3445 S. Clermont St. Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: Dee Wisor Engagement Letter DATE: September 19, 2014 Summary: Attached is an engagement letter with Dee Wisor of Butler Snow to provide public financing advise and serve as bond counsel for the certificate of participation financing to acquire the Skier Building. I have reviewed the engagement letter and it is acceptable to me. The engagement letter is a similar form to past engagement letters presented by Dee Wisor. Mr. Wisor has provided public finance advice and served as bond counsel for many years. The Avon Home Rule Charter requires the Town Council to approve the retention of attorneys that represent the Town. Proposed Motion: “I move to approve the engagement letter dated September 5, 2014, with Butler Snow.” Thank you, Eric ATTACHMENT A: Butler Snow Engagement Letter M EMORANDUM & PLANNING, LLC B U T L E R September 5, 2014 VIA E-MAIL Town Council Town of Avon Avon, CO 80104 Attn: Eric Heil, Town Attorney We are pleased to confirm our engagement as counsel to Town of Avon (the "Town"). We appreciate your confidence in us and will do our best to continue to merit it. In establishing our attorney-client relationship, current practice standards dictate that we set forth in writing (and in some detail) the elements of our mutual understanding. While some of the matters covered in this engagement letter will never be relevant or of concern between us, we hope you will understand that as attorneys and counselors it is our natural function to try to make communication clear and complete, and to anticipate and resolve questions before they arise. We also believe that the performance of our services may require your effort and cooperation. Consequently, the better we each understand our respective roles, responsibilities and contributions, the more efficient, effective and economical our work for you can be. This letter sets forth the role we propose to serve and the responsibilities we propose to assume as bond and disclosure counsel to the Town in connection with the a lease purchase agreement financing in the approximate principal amount of $5,800,000, including the issuance of related certificates of participation (collectively, the "Obligations"). Dee Wisor will be principally responsible for the work performed by Butler Snow LLP on your behalf. Where appropriate, certain tasks may be performed by other attorneys or paralegals. At all times, however, Dee Wisor will coordinate, review, and approve all work completed for the Town. Scope of Employment Bond Counsel is engaged as a recognized expert whose primary responsibility is to render an objective legal opinion with respect to the authorization of securities like the Obligations. As your bond counsel, we will: examine applicable law; consult with the parties Re: Bond and Disclosure Counsel Services - Town of Avon Dear Eric: Personnel 1801 California Street Suite 5100 Denver, CO 80202 DEE P. WISOR 720.330.2357 dee.wisor@butler3now.com T 720.330.2300 F 720.330.2301 www. butlersnow. com BUTI ER SNOW I.LP ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 2 to the transaction prior to the execution of the Obligations; prepare customary authorizing and operative documents, and closing certificates; review a certified transcript of proceedings; and undertake such additional duties as we deem necessary to render the opinion. Subject to the completion of proceedings to our satisfaction, we will render our opinion relating to the validity of the Obligations, the enforceability of the security for the Obligations, and the exclusion of the interest on the Obligations (subject to certain limitations which may be expressed in the opinion) from gross income for federal income tax purposes and for Colorado income tax purposes. We are also being retained by you to act as special counsel to the Town in connection with the Official Statement for the Obligations (the "Official Statement"). As such, we will provide advice to the Town on the applicable legal standards to be used in preparing the Official Statement and meeting the Town's disclosure responsibilities. At the conclusion of the transaction we will deliver a letter to you stating that we have assisted the Town in the preparation of the Official Statement, and that in the course of such assistance, nothing has come to the attention of the attorneys in our firm rendering legal services in connection with our representation which leads us to believe that the Official Statement, as of its date (except for the financial statements, other statistical data and statements of trends and forecasts, and information concerning the bond insurer, if any, and information concerning The Depository Trust Company ("DTC") provided by DTC contained in the Official Statement and its Appendices, as to which we express no view), contains any untrue statement of material fact or omits to state any material fact necessary to make the statements in the Official Statement, in light of the circumstances under which they were made, not misleading. In delivering our opinion and letter, we will rely upon the certified proceedings and other certifications of public officials and other persons furnished to us without undertaking to verify the same by independent investigation. Our opinion and letter will be addressed to the Town and will be executed and delivered by us in written form on the date the Obligations are exchanged for their purchase price (the "Closing"). The opinion and letter will be based on facts and law existing as of their date. Our services are limited to those contracted for explicitly herein; the Town's execution of this letter constitutes an acknowledgment of those limitations. Specifically, but without implied limitation, our responsibilities do not include any representation by Butler Snow LLP in connection with any IRS audit, SEC enforcement action or any litigation involving the Town or the Obligations, or any other matter. Neither do we assume responsibility for the preparation of any collateral documents (e.g., environmental impact statements) which are to be filed with any state, federal or other regulatory agency. Nor do our services include financial advice (including financial advice about the structure of Obligations) or advice on the investment of funds related to the Obligations. ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 3 Representation of the Town In performing our services, the Town will be our client and an attorney-client relationship will exist between us. We will represent the interests of the Town rather than the Town Council or its individual members. We will work closely with the Town's general counsel and will rely on the opinion of the general counsel with regard to specific matters, including pending litigation. We assume that other parties to the transaction will retain such counsel as they deem necessary and appropriate to represent their interests in this transaction. Conflicts of Interest Our firm sometimes represents, in other unrelated transactions, certain of the financial institutions that may be involved in this transaction, such as underwriters, credit enhancers, and banks. We do not believe that any of these representations will materially limit or adversely affect our ability to represent the Town in connection with the Obligations, even though such representations may be characterized as adverse under the Colorado Rules of Professional Conduct (the "Rules"). In any event, during the term of our engagement hereunder, we will not accept a representation of any of these parties in any matter in which the Town is an adverse party. However, pursuant to the Rules, we do ask that you consent to our representation of such parties in transactions that do not directly or indirectly involve the Town. Your execution of this letter will signify the Town's prospective consent to such representations in matters unrelated to the Town while we are serving as bond counsel hereunder. Fee Arrangement Based upon: (i) our current understanding of the terms, structure, size and schedule of the financing, (ii) the duties we will undertake pursuant to this letter, (iii) the time we anticipate devoting to the financing, and (iv) the responsibilities we assume, we estimate that our fee for this engagement will be $50,000. Such fee may vary: (i) if the principal amount of the Obligations actually issued increases significantly, (ii) if material changes in the structure of the financing occur, (iii) if unusual or unforeseen circumstances arise which require a significant increase in our time or our responsibilities or (iv) the Obligations are not delivered by December 31, 2014. If, at any time, we believe that circumstances require an adjustment of our original fee estimate, we will consult with you. Our fees are usually paid at Closing out of proceeds of the Obligations. We customarily do not submit any statement until the Closing, unless there is a substantial delay in completing the financing. We understand and agree that our fees will be paid at Closing out of proceeds. If the financing is not consummated, we understand and agree that we will not be paid. If, for any reason, the financing is completed without our opinion as bond counsel, we will expect to be compensated at our normal hourly rates (currently ranging from ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 4 $640 to $100 depending on personnel) for time actually spent on your behalf, plus disbursements. Termination of Engagement The Town may terminate our engagement, with or without cause, upon 5 days' written notice to us. We may terminate this engagement, upon 45 days' written notice to the Town. Our fees for this engagement contemplate compensation for usual and customary services as bond and disclosure counsel as described above. Upon delivery of the opinion, our responsibilities as bond and disclosure counsel will terminate with respect to this financing, and our representation of the Town and the attorney-client relationship created by this engagement letter will be concluded. Specifically, but without implied limitation, we do not undertake to provide continuing advice to the Town or to any other party to the transaction. Many post-issuance events may affect the Obligations, the tax-exempt status of interest on the Obligations, or liabilities of the parties to the transaction. Such subsequent events might include a change in the project to be financed with proceeds, a failure by one of the parties to comply with its contractual obligations (e.g., rebate requirements, continuing disclosure requirements), an IRS audit, an SEC enforcement action, or a change in federal or state law. Should the Town seek the advice of bond counsel on a post-closing matter or seek other, additional legal services, we would be happy to discuss the nature and extent of our separate engagement at that time. Document Retention At or within a reasonable period after Closing, we will review the file to determine what materials should be retained as a record of our representation and those that are no longer needed. We will provide you with a copy of the customary transcript of documents after Closing and will return any original documents obtained from you (if a copy is not included in the transcript). Our document retention policy is attached hereto. Approval If the other foregoing terms of this engagement are acceptable to you, please so indicate by returning a copy of this letter signed by the officer so authorized, keeping a copy for your files. ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 5 We appreciate this opportunity to serve as your bond counsel and disclosure counsel and look forward to a mutually satisfactory and beneficial relationship. BUTLER SNOW LLP ACCEPTED AND APPROVED: TOWN OF AVON By: Title: Date: DPW/jw Enclosure ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 6 NOTICE TO CLIENTS OF BUTLER SNOW'S RECORD RETENTION & DESTRUCTION POLICY FOR CLIENT FILES Butler Snow maintains its client files electronically. Ordinarily, we do not keep separate paper files. We will scan documents you or others send to us related to your matter to our electronic file for that matter and will ordinarily retain only the electronic version while your matter is pending. Unless you instruct us otherwise, once such documents have been scanned to our electronic file, we will destroy all paper documents provided to us. If you send us original documents that need to be maintained as originals while the matter is pending, we ordinarily will scan those to our client file and return the originals to you for safekeeping. Alternatively, you may request that we maintain such originals while the matter is pending. If we agree to do that, we will make appropriate arrangements to maintain those original documents while the matter is pending. At all times, records and documents in our possession relating to your representation are subject to Butler Snow's Record Retention and Destruction Policy for Client Files. Compliance with this policy is necessary to fulfill the firm's legal and ethical duties and obligations, and to ensure that information and data relating to you and the legal services we provide are maintained in strict confidence at all times during and after the engagement. All client matter files are subject to these policies and procedures. At your request, at any time during the representation, you may access or receive copies of any records or documents in our possession relating to the legal services being provided to you, excluding certain firm business or accounting records. We reserve the right to retain originals or copies of any such records of documents as needed during the course of the representation. Unless you instruct us otherwise, once our work on this matter is completed, we will designate your file as a closed file on our system and will apply our document retention policy then in effect to the materials in your closed files. At that time, we ordinarily will return to you any original documents we have maintained in accordance with the preceding paragraph while the matter was pending. Otherwise, we will retain the closed file materials for our benefit and subject to our own policies and procedures concerning file retention and destruction. Accordingly, if you desire copies of any documents (including correspondence, e-mails, pleadings, contracts, agreements, etc.) related to this matter or generated while it was pending, you should request such copies at the time our work on this matter is completed. You will be notified and given the opportunity to identify and request copies of such items you would like to have sent to you or someone else designated by you. You will have 30 days from the date our notification is sent to you to advise us of any items you would like to receive. You will be billed for the expense of assimilating, copying and transmitting such ATTACHMENT A: Letter of Engagement Town of Avon September 5, 2014 Page 7 records. We reserve the right to retain copies of any such items as we deem appropriate or necessary for our use. Any non-public information, records or documents retained by Butler Snow and its employees will be kept confidential in accordance with applicable rules of professional responsibility. Any file records and documents or other items not requested within 30 days will become subject to the terms of Butler Snow's Record Retention and Destruction Policy for Client Files and will be subject to final disposition by Butler Snow at its sole discretion. Pursuant to the terms of Butler Snow's Record Retention and Destruction Policy for Client Files, all unnecessary or extraneous items, records or documents may be removed from the file and destroyed. The remainder of the file will be prepared for closing and placed in storage or archived. It will be retained for the period of time established by the policy for files related to this practice area, after which it will be completely destroyed. This includes all records and documents, regardless of format. While we will use our best efforts to maintain confidentiality and security over all file records and documents placed in storage or archived, to the extent allowed by applicable law, Butler Snow specifically disclaims any responsibility for claimed damages or liability arising from damage or destruction to such records and documents, whether caused by accident; natural disasters such as flood, fire, or wind damage; terrorist attacks; equipment failures; breaches of Butler Snow's network security; or the negligence of third-party providers engaged by our firm to store and retrieve records. 22493951 vl ATTACHMENT A: Letter of Engagement Heil Law & Planning, LLC Office: 303.975.6120 3445 S. Clermont St. Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council members FROM: Eric J. Heil, Town Attorney RE: Purchase and Sale Agreement for Skier Building DATE: September 18, 2014 SUMMARY: This memorandum provides an overview of Ordinance No. 14-16 Approving the Purchase and Sale Agreement for Lot 4, Mountain Vista Resort Subdivision, Town of Avon, Colorado (“Skier Building”). Attached is a memorandum from Virginia Egger, Town Manager, addressing financing and programming of the Skier Building for Town Hall administrative office use and Ordinance No. 14-16 Approving the Purchase and Sale Agreement. TERMS OF PURCHASE AND SALE AGREEMENT: A Purchase and Sale Agreement (“Purchase Agreement”) has been negotiated with the Seller, Points of Colorado, Inc., which is a wholly owned subsidiary of Starwood Vacation Ownership, Inc. The Purchase Agreement is subject to approval by Ordinance of the Avon Town Council. Both the Town, as Buyer, and the Seller may terminate the Purchase Agreement if the Avon Town Council does not approve second and final reading by October 15, 2014. Specific terms of the Purchase Agreement are highlighted below. Overall, the sale is characterized by a new subdivision plat to create and describe Lot 4 as its own independent parcel and by the exclusion of Lot 4 and Skier Building (“Property”) from the Mountain Vista Resort common interest community. This is for the purpose of creating an autonomous property that is independent from the covenants and governance of the common interest community. The Property would remain subject to the Mountain Vista PUD (aka Tract C, Avon Center at Beaver Creek Development) zoning and development plan, which permits office use for this portion of the PUD development. RECITAL: Property Description, Inclusions and Exclusions: The Property is the Skier Building along with the underlying land and a small strip of land surrounding the building. A subdivision replat will be prepared for Council approval prior to Closing in order to create the 10,840 sq.ft. parcel of land as shown in the Purchase Agreement. The bronze statute of the skier in front of the building is included in the sale. Parking within the Mountain Vista Resort common interest community is excluded from the sale. ¶1.2 Purchase Price. The agreed Purchase Price is $3.2 Million. A deposit of $70,000 has been tendered to the Avon office of Title Company of the Rockies. The deposit of $70,000 may be returned to the Town under the following circumstances: 1. The Avon Town Council does not take final action on an ordinance approving the Purchase Agreement and/or an ordinance approving the certificates of participation to finance acquisition by October 15, 2014 and tenders notice of the Town’s election to terminate the Purchase Agreement no later than October 22, 2014. 2. After final action by the Town Council, a citizens petition for referendum is submitted and the Town Council takes action to reject the ordinance or refers the ordinance to a special election and the voters reject the ordinance. 3. One of the Conditions Precedent for the benefit of the Town as Buyer is not satisfied by the Closing date and the Town and Seller do not extend the Purchase Agreement beyond the Closing date to permit the satisfaction of such condition. M EMORANDUM & PLANNING, LLC Avon Town Council Skier Building Purchase Agreement September 18, 2014 Page 2 of 2 ¶2.1 Inspections by Buyer: The Town has conducted building inspections prior to signing the Purchase Agreement. Buyer’s physical inspection is not a condition of Closing. ¶2.4(a) Permitted Exceptions: The Title Insurance commitment has been reviewed and specific title exceptions have been identified as items to be addressed and deleted from the title commitment or to be included as permitted exceptions. So long as the title matters identified for deletion as a condition precedent to Closing are removed as exclusions to the Buyer’s Title Insurance, the Closing is not subject to further title review. ¶2.4(c) Right of First Refusal: The Seller has a Right of First Refusal for a period of 3 years after the Closing. ¶2.4(d) Lot 4 Easement: The Property will be subject to an easement over, across and beneath Lot 4 for continued pedestrian access, emergency access, fire lane, utilities, shared open space and other matters for the purpose of preventing any negative impact to the development rights on the remainder of the PUD Plan (Lots 1-3 and the re-platted Lot 2C and Lot 5). ¶2.8(h) The Purchase Agreement is subject to approval of the Avon Town Council through the public process required in the Avon Town Charter. This is an important provision for which the Seller has appreciated and accommodated in the terms of the Purchase Agreement. If the Town Council does not take final action on an ordinance to approve the Purchase Agreement then the Town may elect to terminate the Purchase Agreement no later than October 22, 2014 and receive its deposit back. ¶3.1 Closing Date. The Closing Date is scheduled to occur on February 12, 2015. Once the Conditions Precedent are satisfied and the certificates of participation are authorized to be issued, Closing can occur on an earlier date as mutually determined by the parties. This could potentially occur as early as 30 days after final adoption of the ordinance approving the Purchase Agreement and related ordinance approving the certificates of participation. ¶3.3 Conditions Precedent to Closing. This paragraph sets forth certain matters which must be satisfied as a condition precedent to Closing. ¶3.3(c) was a condition precedent that the Avon Town Council approve the Purchase Agreement by ordinance, but that contingency was addressed with language in ¶2.8(h). There are a number of items which must be addressed between approval of the Purchase Agreement and the Closing, including preparing and acting upon a subdivision plat to create Lot 4 as depicted in Exhibit D and certain actions required to address title exceptions and other conditions precedent to Closing. If Council elects to proceed with first reading of the ordinance to approve the Purchase Agreement then work will begin on other items and Council will receive a progress update for each Council meeting. Thank you, Eric ATTACHMENT A: Memorandum from Virginia Egger ATTACHMENT B: Ordinance No. 14-16 and the Purchase and Sale Agreement 1 Realty Advisors 10799 W. Alameda Ave. #150333 Lakewood, CO 80215 720-310-2726 800-400-7986 Fax Date Issued:3/27/2014 File No. 6196 Narrative Appraisal Report Of 140 W Beaver Creek Blvd Avon , CO 81620 Prepared For Heil Law & Planning LLC 2696 S Colorado Blvd #550 Denver, CO 80222 Prepared By Phil A McDonald Certified General Appraiser 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 2 TABLE OF CONTENTS Introduction and Summary ......................................................................................................................................................................... 3 Letter of Transmittal .......................................................................................................................................................................... 3 Certification of the Appraisers ........................................................................................................................................................... 4 General Assumptions and Limiting Conditions ................................................................................................................................. 5 Summary of Salient Facts .................................................................................................................................................................. 9 Scope of Work ................................................................................................................................................................................. 10 Purpose of Analysis ......................................................................................................................................................................... 11 Intended use and user of the report .................................................................................................................................................. 11 Property Description ........................................................................................................................................................................ 12 Property Identification and Site Description .................................................................................................................................... 12 Location Map ................................................................................................................................................................................... 14 Plat Map ........................................................................................................................................................................................... 15 Traffic Count Map ........................................................................................................................................................................... 16 Zoning Map ...................................................................................................................................................................................... 17 Aerial Map ....................................................................................................................................................................................... 18 Description of Improvements ........................................................................................................................................................... 19 Subject Photo Pages ......................................................................................................................................................................... 23 Market Conditions ............................................................................................................................................................................ 35 National Market Conditions ............................................................................................................................................................. 35 Local Market Conditions.................................................................................................................................................................. 42 Highest and Best Use ............................................................................................................................................................................... 46 As Though Vacant ........................................................................................................................................................................... 46 As Improved ..................................................................................................................................................................................... 47 The Appraisal Process .............................................................................................................................................................................. 48 Sales Comparison Approach ................................................................................................................................................................ 49 Conclusions: ..................................................................................................................................................................................... 58 Income Capitalization Approach .......................................................................................................................................................... 59 Indicated Value from Direct Capitalization Analysis ...................................................................................................................... 68 Cost Approach.................................................................................................................................................................................. 69 Cost Approach Conclusion: ............................................................................................................................................................. 72 Reconciliation of Value ........................................................................................................................................................................... 73 Value of Property without Parking .......................................................................................................................................................... 74 Hypothetical Condition and Extraordinary Assumption .................................................................................................................. 74 Income Approach ............................................................................................................................................................................. 75 Sales Comparison Approach ............................................................................................................................................................ 76 Reconciliation of Value ........................................................................................................................................................................... 76 Addendum ................................................................................................................................................................................................ 77 Building Classifications ................................................................................................................................................................... 82 Certification ..................................................................................................................................................................................... 83 Qualifications ................................................................................................................................................................................... 84 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 3 Introduction and Summary Letter of Transmittal Realty Advisors Commercial Appraisal Services Phone 720-310-2726 Fax 800-400-7896 www.bwoo.com Denver, CO 80222 Subject: 140 W Beaver Creek Blvd Avon , CO 81620 27-Mar-14 Eric Heil Heil Law & Planning LLC 2696 S Colorado Blvd #550 Dear Client, Effective Date of Appraisal:3/20/2014 Property Rights Appraised:Fee Simple Market Value on Effective Date:$3,280,000 Respectfully submitted, Realty Advisors By: Phil A. McDonald Colorado Certified General Appraiser CG40004543 Exp. 12/31/2014 In accordance with your request, we have prepared a complete appraisal, communicated in this Narrative Appraisal Report covering the above referenced property for the purpose of estimating its market value. This appraisal report is intended to meet the requirements of the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation, the Standards of Professional Appraisal, the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA), and the Supplemental Standards. Our analyses, opinions, and conclusion are subject to the Assumptions and Limiting Conditions in the report. To reiterate, this is a complete appraisal, summary report. This value estimate is based on the definitions, qualifications, assumptions, limiting conditions, and certifications in the report. This appraisal is not subject to any hypothetical or extraordinary assumptions that would have a material impact on the property value. Based on our inspection of the subject property and surrounding neighborhood, our gathering of relevant data, preparation of the most applicable approach to value, and our analyses, opinions, and conclusions, we estimate the market value as follows. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 4 Certification of the Appraisers I certify that, to the best of my knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions. 3. I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved. 4. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. 5. My engagement in this assignment was not contingent upon developing or reporting predetermined results. 6. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 7. My analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation, the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute, and any supplemental standards. In addition, this report conforms to the requirements of the Financial Institution Reform, Recovery and Enforcement Act (FIRREA). 8. Phil A. McDonald has made a personal inspection of the interior and exterior of the property that is the subject of this report. 9. Tiffany Morris provided significant professional assistance which included and is limited to, research and data entry. No other person provided significant professional assistance to the persons signing this report. 10. Phil A. McDonald has extensive experience in the appraisal/review of similar property types. 11. This appraisal assignment was not based on a requested minimum valuation, a specific valuation, or approval of a loan. Respectfully submitted, Realty Advisors By: Phil A. McDonald Phil A. McDonald Colorado Certified General Appraiser CG40004543 Exp. 12/31/2014 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 5 General Assumptions and Limiting Conditions 1. Any legal description or plats reported herein are assumed to be accurate. Any sketches, surveys, plats, photographs, drawings or other exhibits are included only to assist the intended user to better understand and visualize the subject property, the environs, and the competitive data. We have made no survey of the property and assume no responsibility in connection with such matters. 2. The appraiser has not conducted any engineering or architectural surveys in connection with this appraisal assignment. Information reported pertaining to dimensions, sizes, and areas is either based on measurements taken by the appraiser or the appraiser’s staff or was obtained or taken from referenced sources and is considered reliable. No responsibility is assumed for the costs of preparation or for arranging geotechnical engineering, architectural, or other types of studies, surveys, or inspections that require the expertise of a qualified professional. 3. No responsibility is assumed for matters legal in nature. Title is assumed to be good and marketable and in fee simple unless discussed otherwise in the report. The property is considered to be free and clear of existing liens, easements, restrictions, and encumbrances, except as noted. 4. Unless otherwise noted herein, it is assumed there are no encroachments or violations of any zoning or other regulations affecting the subject property and the utilization of the land and improvements is within the boundaries or property lines of the property described. 5. Realty Advisors assumes there are no private deed restrictions affecting the property which would limit the use of the subject property in any way. 6. It is assumed the subject property is not adversely affected by the potential of floods. 7. It is assumed all water and sewer facilities (existing and proposed) are or will be in good working order and are or will be of sufficient size to adequately serve any proposed buildings. 8. Unless otherwise noted within the report, the depiction of the physical condition of the improvements described herein is based on visual inspection. No liability is assumed for the soundness of structural members since no engineering tests were conducted. No liability is assumed for the condition of mechanical equipment, plumbing, or electrical components, as complete tests were not made. No responsibility is assumed for hidden, unapparent or masked property conditions or characteristics that were not clearly apparent during our inspection. 9. If building improvements are present on the site, no significant evidence of termite damage or infestation was observed during our physical inspection, unless so noted in the report. No termite inspection report was available, unless so noted in the report. No responsibility is assumed for hidden damages or infestation. 10. If noted in the report, any proposed or incomplete improvements included in this report are assumed to be satisfactorily completed in a workmanlike manner or will be thus completed within a reasonable length of time according to plans and specifications submitted. 11. No responsibility is assumed for hidden defects or for conformity to specific governmental requirements, such as fire, building, and safety, earthquake, or occupancy codes, except where specific professional or governmental inspections have been completed and reported in the appraisal report. 12. The property is assumed to be under financially sound, competent and aggressive ownership. 13. The appraisers assume no responsibility for any changes in economic or physical conditions which occur 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 6 following the effective date of this report that would influence or affect the analyses, opinions, or conclusions in the report. Any subsequent changes are beyond the scope of the report. 14. The value estimates reported herein apply to the entire property. Any proration or division of the total into fractional interests will invalidate the value estimates, unless such proration or division of interests is set forth in the report. 15. Any division of the land and improvement values estimated herein is applicable only under the program of utilization shown. These separate valuations are invalidated by any other application. 16. Unless otherwise noted in the report, only the real property is considered, so no consideration is given to the value of personal property or equipment located on the premises or the costs of moving or relocating such personal property or equipment. 17. Unless otherwise stated, it is assumed the rights of ownership exclude subsurface oil, gas, and/or mineral assets. For this reason, contributing value, if any, of rights or whether property is available for subsurface entry to facilitate their exploration and/or extraction have not been considered. 18. Any projections of income and expenses, including the reversion at time of resale, are not predictions of the future. Rather, they are our best estimate of current market thinking of what future trends will be. No warranty or representation is made that these projections will materialize. The real estate market is constantly fluctuating and changing. It is not the task of an appraiser to estimate the conditions of a future real estate market, but rather to reflect what the investment community envisions for the future in terms of expectations of growth in rental rates, expenses, and supply and demand. 19. Unless subsoil opinions based upon engineering core borings were furnished, it is assumed there are no subsoil defects present, which would impair development of the land to its maximum permitted use or would render it more or less valuable. No responsibility is assumed for such conditions or for engineering which may be required to discover them. 20. Realty Advisors representatives are not experts in determining the presence or absence of hazardous substances, defined as all hazardous or toxic materials, wastes, pollutants or contaminants (including, but not limited to, asbestos, PCB, UFFI, or other raw materials or chemicals) used in construction or otherwise present on the property. We assume no responsibility for the studies or analyses which would be required to determine the presence or absence of such substances or for loss as a result of the presence of such substances. Appraisers are not qualified to detect such substances. The client is urged to retain an expert in this field. 21. We are not experts in determining the habitat for protected or endangered species, including, but not limited to, animal or plant life (such as bald eagles, gophers, tortoises, etc.) that may be present on the property. We assume no responsibility for the studies or analyses which would be required to determine the presence or absence of such species or for loss as a result of the presence of such species. 22. No environmental impact studies were either requested or made in conjunction with this analysis. The appraiser hereby reserves the right to alter, amend, revise, or rescind any of the value opinions based upon any subsequent environmental impact studies, research, and investigation. 23. The appraisal is based on the premise that there is full compliance with all applicable federal, state, and local environmental regulations and laws unless otherwise stated in the report; further, that all applicable zoning, building, and use regulations and restrictions of all types have been complied with unless otherwise stated in the report; further, it is assumed that all required licenses, consents, permits, or other legislative or administrative authority, local, state, federal and/or private entity or organization have been or can be obtained 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 7 or renewed for any use considered in the value estimate. 24. Neither all nor any part of the contents of this report or copy thereof, shall be conveyed to the public through advertising, public relations, news, sales, or any other media, without the prior written consent and approval of the appraiser. This limitation pertains to any valuation conclusions, the identity of the analyst or the firm and any reference to the professional organization of which the appraiser is affiliated or to the designations thereof. 25. Although the appraiser has made, insofar as is practical, every effort to verify as factual and true all information and data set forth in this report, no responsibility is assumed for the accuracy of any information furnished the appraiser either by the client or others. If for any reason, future investigations should prove any data to be in substantial variance with that presented in this report, the appraiser reserves the right to alter or change any or all analysis, opinions, or conclusions and/or estimates of value. 26. If this report has been prepared in a so-called “public non-disclosure” state, real estate sales prices and other data, such as rents, prices, and financing, are not a matter of public record. If this is such a “non-disclosure” state, although extensive effort has been expended to verify pertinent data with buyers, sellers, brokers, lenders, lessors, lessees, and other sources considered reliable, it has not always been possible to independently verify all significant facts. In these instances, the appraiser may have relied on verification obtained and reported by appraisers outside of our office. Also, as necessary, assumptions and adjustments have been made based on comparisons and analyses using data in the report and on interviews with market participants. It is suggested the client consider independent verification as a prerequisite to any transaction involving sale, lease, or other significant commitment of funds to the subject property. 27. This report is null and void if used in any connection with a real estate syndicate or syndication, defined as a general or limited partnership, joint venture, unincorporated association, or similar organization formed for or engaged in investment or gain from an interest in real property, including but not limited to a sale, exchange, trade, development, or lease of property on behalf of others or which is required to be registered with the U.S. Securities and Exchange Commission or any Federal or State Agency which regulates investments made as a public offering. 28. The American Disabilities Act of 1990 (ADA) sets strict and specific standards for handicapped access to and within most commercial and industrial buildings. Determination of compliance with these standards is beyond appraisal expertise and, therefore, has not been attempted by the appraisers. For purposes of this appraisal, we are assuming the building is in compliance; however, we recommend an architectural inspection of the building to determine compliance or requirements for compliance. We assume no responsibility for the cost of such determination and our appraisal is subject to revision if the building is not in compliance. 29. This appraisal report has been prepared for the exclusive benefit of our client(s). It may not be used or relied upon by any other party. Any party who uses or relies upon any information in this report, without the preparer's written consent, does so at their own risk. 30. The client agrees to indemnify and hold harmless Realty Advisors and its affiliates, partners, agents, and employees from and against any losses, claims, damages, or liabilities, which may be asserted by any person or entity who may receive our report, except to the extent of any losses, claims, damages or liabilities (or actions in respect thereof) arising by reason of gross negligence or willful misconduct of Realty Advisors in preparing the report and will reimburse Realty Advisors for all expenses (including counsel fees) as they are incurred by Realty Advisors in connection with investigating, preparing, or defending any such action or claim. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 8 31. In any circumstance in which the foregoing indemnification is held by a court to be unavailable to Realty Advisors, our client and Realty Advisors shall contribute to any aggregate losses, claims, damages or liabilities (including the related fees and expenses) to which Our Client and Realty Advisors may be subject in such proportion that Realty Advisors shall be responsible only for that portion represented by the percentage that the fees paid to Realty Advisors for the portion of its services or work product giving rise to the liability bears to the value of the transaction giving rise to such liability. 32. Realty Advisors has completed an inspection of the subject property which consisted of less than inspecting 60% of the interior and exterior of the improvements. Accordingly, Realty Advisors reserves the right to amend the appraised value and appraisal conclusions if engineering reports or other evidence is found, which would materially impact the reported conclusions. 33. The right is reserved by the appraiser to make adjustments to the analyses, opinions, and conclusions set forth in this report as may be required by consideration of additional or more reliable data that may become available. No change of this report shall be made by anyone other than the appraiser or appraisers. The appraiser(s) shall have no responsibility for any unauthorized change(s) to the report. 34. If the client instructions to the appraiser were to inspect only the exterior of the improvements in the appraisal process, the physical attributes of the property were observed from the street(s) as of the inspection date of the appraisal. Physical characteristics of the property were obtained from tax assessment records, available plans, if any, descriptive information, and interviewing the client and other knowledgeable persons. It is assumed the interior of the subject property is consistent with the exterior conditions as observed and that other information relied upon is accurate. 35. The submission of this report constitutes completion of the services authorized. It is submitted on the condition the client will provide reasonable notice and customary compensation, including expert witness fees, relating to any subsequent required attendance at conferences, depositions, and judicial or administrative proceedings. In the event the appraiser is subpoenaed for either an appearance or a request to produce documents, a best effort will be made to notify the client immediately. The client has the sole responsibility for obtaining a protective order, providing legal instruction not to appear with the appraisal report and related work files and will answer all questions pertaining to the assignment, the preparation of the report, and the reasoning used to formulate the estimate of value. Unless paid in whole or in part by the party issuing the subpoena or by another party of interest in the matter, the client is responsible for all unpaid fees resulting from the appearance or production of documents regardless of who orders the work. 36. Acceptance or use of this report constitutes agreement by the client and any other users that any liability for errors, omissions or judgment of appraiser is limited to the amount of the appraisal fee. 37. Use of this appraisal report constitutes acknowledgement and acceptance of the general assumptions and limiting conditions, special assumptions (if any), extraordinary assumptions (if any), and hypothetical conditions (if any) on which this estimate of market value is based. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 9 Summary of Salient Facts Property Name:Skier Building Built Up:90% Property Address:140 W Beaver Creek Blvd Trend:Stabilizing City:Avon Property Values:Stabilizing State:CO Velocity:Slight Increase Zip Code:81620 Rents:Declining Census Tract:5.03 Vacancy:Declining Parcel No.:2105-122-20-008 Population Growth:Stable 2105-122-20-009 Employment:Stable Owner of Record:Points of Colorado Inc Date of Prior Sale:11/12/10 Appraiser Name:Phil McDonald Prior Sale Price:NA Appraiser Certification:CG40004543 Document No.NA Certification Expiration:12/31/2014 Marketing Time:180 Days Certification State:CO Client Name:Heil Law & Planning LLC Parcel Size (Acres):1.151 Client Contact:Eric Heil Zoning:PUD- Planned Unit Develoement - 21 Sheraton Mnt Vista, Lot C, Avon CenterClient Address:2696 S Colorado Blvd #550 Property Type:Office Client City, State, Zip Denver, CO 80222 Flood Zone:X Appraisal File No.6196 Panel:08037C0444D Report Type:Summary Narrative Panel Date:12/4/2007 Interest Appraised:Fee Simple Purpose of Appraisal:Asset Disposition Use of Appraisal:Purchase Decision Tax Year:2012 Appraisal Effective Date:3/20/2014 Actual Value:Date of Report:3/27/2014 Land:$139,380 Hypothetical Conditions:None Building:$1,252,620 Extraordinary Assumptions:None Total Actual Value:$1,392,000 Highest and Best Use Total Assessed Value:$1,392,000 As-If Vacant Hold for Development Taxes $34,046.00 As Improved Current Use Scope of Work Complete Appraisal Sales Approach (SCA):$3,660,000 Income Approach:$3,180,000 Cost Approach:$3,350,000 Final Opinion of Value:$3,280,000 Value Indicators Subject Property Identification Market Conditions: Appraisal Characteristics: Site Characteristics: Taxes 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 10 Scope of Work This Narrative Appraisal Report presents only summary discussion of the data and valuation conclusion. The appraiser retains supporting documentation in his file, and the depth of discussion is specific to your needs and for the intended use. Narrative Appraisal Report. Each approach to value is given consideration and those that are applicable and necessary are developed and reported. If an approach would not produce credible results and is not applicable or necessary, it is not developed and not reported. The Income Approach is a common method used by market participants buying and selling multiple tenant income producing property. The Sales Comparison Approach is typically given secondary consideration for this type of investment property. The Cost Approach is applicable and most reliable when appraising an improved property with newer improvements. The subject property is a newer property and the Cost Approach is applicable and developed. The physical inspection of the subject property includes an inspection of the parcels and improvements. When necessary, each of the comparables used in the appraisal includes an inspection of the exterior of the property which may take place near the effective date of appraisal or prior to the effective date of appraisal, but subsequent to the sale date of the comparable. Market data is researched through commonly used and available data sources for this property type and is confirmed through a secondary data source, and market participants (when available). Adequacy of Scope The appraiser has proposed and the Client has agreed (prior to submission) that the level of development and reporting detailed above is sufficient to address the substantiate criteria of a reasonable Scope of Work within the context of the Intended Users and Intended Use. The appraiser does not anticipate further development or reporting requirements for this assignment. Any additional requests from the Client or any third parties may represent a change in the assignment conditions and require the development of a new assignment. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 11 Purpose of Analysis The purpose of this appraisal report is to estimate the market value of the Fee Simple interest in the above- referenced property. Market Value is defined by the federal financial institutions regulatory agencies as follows: “Market Value means the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) the buyer and seller are typically motivated; (2) both parties are well-informed or well-advised, and acting in what they consider to be their own best interests; (3) a reasonable time is allowed for exposure in the open market; (4) payment is made in terms of cash in United States dollars, or in terms of financial arrangements comparable thereto; and (5) the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.” Source: Office of the Comptroller of the Currency under 12 CFR, Part 34, subpart C-appraisals, 34.42 Definitions (f) Intended use and user of the report The intended users of this report are the client listed on the Summary of Salient Facts page of this report, and their subsidiaries, and/or affiliates for determination of market value. It may be used in connection with the acquisition, disposition, financing, and the sale of the property. The intended user may use and rely upon this report and the reporting organization agrees to cooperate in answering questions by any of the parties in connection with the report. The appraisal report is not to be used by any other entity for any purpose without the written consent of the appraisers. If used, it must only be used in its entirety and not its parts, which could be misleading. The appraisers are not responsible for unauthorized distribution and/or use of this report. As such, it presents only summary discussions of the data, analyses, opinions, and conclusions used in the appraisal process to develop the appraisers’ estimate of market value. Supporting documentation concerning the data, analyses, opinions, and conclusions are retained in the appraisers’ file. The depth of discussion contained in this report is specific to the needs of the client and for the intended use previously stated. The appraisers are not responsible for unauthorized use of this report. As agreed upon with the client prior to the preparation of this appraisal, this report is the result of a full appraisal process, and those approaches to value that are applicable and necessary have been developed. Reading of the request for appraisal services and related attachments; Physical inspection of the subject, neighborhood, and submarket; Researching public records or other sources deemed reliable, relative to the subject; Researching public records or other sources deemed reliable for sales of comparable properties; Presenting the results in this complete appraisal, summary report. The appraisers used only the most applicable approaches to value. Support for the approaches used is discussed in the Valuation Section. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 12 Property Description Property Identification and Site Description Property Address: City: State: Zip Code: Parcel No.: 2105-122-20-008 2105-122-20-009 Legal Description: 2105-122-20-008 2105-122-20-009 Census Tract: Parcel Size (Acres):2105-122-20-008 0.144 2105-122-20-009 1.007 Total 1.151 Zoning: Uses by Right include, but are not Subject Property is a: PUD 21 Legal Conforming Use Street Improvements: Utilities: Flood Hazard:Flood Zone:X Panel:08037C0444D Panel Date:12/4/2007 The subject property is legally described as: All parcels: County of Eagle, State of Colorado 5.03 Site Characteristics Subdivision: Mountain Vista Resort Lot: 5 R921725 MAP 07-06-05 The subject property consists of the following parcel number(s): 140 W Beaver Creek Blvd Avon CO 81620 PUD- Planned Unit Development - 21 Sheraton Mnt Vista, Lot C, Avon Center Subdivision: Mountain Vista Resort Lot: 4 R921725 Map 07-06-05 Lodging, timeshare, retail, restaurants, commercial, office, employee housing. The subject borders Benchmark Rd. Benchmark Rd is paved and improved with curb, gutter and sidewalk. Benchmark Rd fronts the subject and is two lanes. Access from Benchmark Rd to W Beaver Creek Blvd is traffic controlled by a stop sign and allows for turns both east and westbound. All public utilities are available at the subject property and are adequate for the subject property. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 13 Soils Conditions: Hazardous Waste/ Toxic Conditions: Title Report: Comments: Easements and Encroachments: No title report or other source reference was provided with regard to determining any easements that might affect the subject. It is assumed there are no such easements or other restrictions which would have a material impact on the subject. Site Characteristics (continued) The value estimate rendered in this report is predicated on the assumption there is no hazardous material on or in the property that would cause a loss in value. No evidence of hazardous waste or toxic materials was visible. Realty Advisors has no knowledge of the existence of these substances on or in the subject property. However, Realty Advisors is not qualified to detect hazardous waste or toxic material. A title report was not submitted for our review. This report is not intended to render any opinion whatsoever regarding any adverse easements or encroachments that may affect the subject property. Our value estimate is, however, predicted upon there being no adverse title conditions, easements, or encroachments that would cause a loss in value or prohibit development. No responsibility is assumed for any such conditions or for any expertise or knowledge to discover them. Please refer to the ”General Assumption and Limiting Conditions” regarding soils and title conditions and other considerations. A geological engineering report has not been furnished for our review, nor has such a study been commissioned for the purpose of this appraisal. Our physical inspection did not reveal any drainage or topographical problems that would adversely affect the marketability of the subject property. There is no visual evidence of any inadequate soil support or drainage conditions; as such, there appear to be no impediments to reasonable development of the site. For the purpose of this assignment, it is assumed the topsoil and subsoil conditions are stable and adequate to support the existing improvements. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 14 Location Map Location Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 15 Plat Map Plat Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 16 Traffic Count Map Traffic Count Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 17 Zoning Map Zoning Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 18 Aerial Map Aerial Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 19 Description of Improvements Property Type: Year Built: No. Buildings: No. of Stories: Quality: Building Areas:Gross Building Area (GBA) (SF)16,273 Rentable Building Area (RBA) (SF)16,273 Parking: Parking Spaces Total 44 Parking Ratio (Spaces/1,000 SF)2.703865298 Building Location/Three Story Office Building Lot Layout: Building Design and Layout: AOF(SF)10,829 RET (SF)5,444 The areas indicated above are obtained through Eagle County Assessors data and visual observation. Office 2003 One Three Stories Class A Office building with frame and stone exterior, pitched roof with asphalt shingles. Interior finishes are predominately tile and concrete flooring, drywall walls, drywall ceilings, florescent lighting all of good quality. Parking is located in the front and sides of the building on a paved lot and is adequate for the current improvements. The subject property is a three story Office building with a canopy double door entry and is typical in design and layout to other Class A Office buildings in the market. Interior corridors are of adequate width, upper and lower levels are serviced by one elevator. The elevator is located near the building entrance in the lobby. The building lobby is minimal. Each floor has public bathrooms located at the center core near the elevator. The lower level is a shell space w sprinklers, no electrical or HVAC run. This building is located at the center of the subject parcel. The rear of the building has frontage to the adjacent parcel on the north, the side of the building has frontage to Benchmark Rd. (minor collector street) on the west, the front of the building faces the adjacent parcel on the south, and the west side of the building fronts the adjacent parcel. Parking is located on the south side of the building. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 20 Exposure/Visibility: Exposure: Year 2013 3,657 Visibility: Access: The three story Office building is located adjacent to Benchmark Rd. Benchmark Rd is a minor collector street running north/south crossing W Beaver Creek Blvd on the north and Benchmark Rd. on the east. The subject has average exposure located along this major arterial street. Cars per day traffic count near the subject property is as follows: The subject is located on a interior lot between two intersections not traffic controlled. The subject improvements are located adjacent to Benchmark Rd on the west. These specific location factors combined with the average footprint and three story height of the subject property in an area of predominately larger buildings provide the subject with below average visibility.Access to the subject property is from a two cut-outs on Benchmark Rd. available to eastbound traffic only. These access points provide the subject with average access. Description of Improvements (continued) Exposure and Visibility of commercial properties are interrelated in terms of the overall benefit to the property, but are made up of distinctly different elements. Exposure is a function of location and impacted by externalities, as such it is typically not possible for an individual property owner to make changes which would impact exposure. Since it is possible to make modifications to property improvements and signage which may change a properties visibility, it is important that exposure and visibility be given separate consideration.The exposure of a commercial property is an important location consideration. Commercial properties such as office, retail and hospitality benefit significantly from locations with good exposure. It is desirable for these commercial properties to be located with exposure to high traffic counts. Exposure of a commercial property relates to the number of potential viewers of a property. The visibility of these types of commercial properties is of significant importance, and relates to the visibility the property has to the exposure of the property. Visibility of a property relates to the capture of potential viewers (exposure). While it is important to consider the elements that make up exposure and visibility separately, the benefit to a property is from the combination of exposure and visibility. A property with excellent exposure (frontage to high traffic count) and poor visibility does not receive the benefit of excellent exposure. Just as a property with excellent visibility (hard corner lot) at an intersection with very low traffic counts does not have sufficient exposure for the visibility to be of high value. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 21 Functional Utility: Stairwells One- Interior Elevators One Corridor Double Loaded Interior Entry Covered / Double Door Lobby Minimal Landscaping: Condition: Exposure Time: Subject's Exposure Time:180 Days Description of Improvements (continued) The subject's functional utility is typical of other Class A Office buildings in the market. The subject property is professionally landscaped with trees and shrubs in various locations. The subject is in overall good condition with typical wear evident in most areas. Common areas are well maintained and interior office improvement range in condition from good to very good condition or shell condition. The curb appeal of the property is good to very good. The exterior is in good to very good condition. Exposure time is the estimated length of time that the property interest being appraised would have been offered on the market prior to the consummation of a sale at market value on the effective date of the appraisal. Exposure time is a retrospective opinion based on an analysis of past events assuming a competitive and open market. Marketing time differs from exposure time in respect to the period of time preceding and sub-sequent to the effective date of appraisal. Exposure time is always presumed to precede the effective date of the appraisal. Whereas, marketing time is the time it would take an interest in real property to sell on the market sub-sequent to the effective date of the appraisal. Analysis, estimation and reporting of exposure time are consistent with the definition of Market Value. To arrive at an estimated exposure time, the appraiser’s analysis includes consideration of actual days on the market of the comparable sales used in the appraisal and other similar properties within the subject’s market area which have not been included in the final analysis. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 22 Taxes / Assessment:Tax Year:2012 Actual Value: Land:$139,380 Building:$1,252,620 Total Actual Value:$1,392,000 Assessed Value: Land:$139,380 Building:$1,252,620 Total Assessed Value:$1,392,000 Taxes $34,046.00 Transfer History:Owner of Record:Points of Colorado Inc Date of Prior Sale:11/12/10 Prior Sale Price:NA Document No.NA Description of Improvements (continued) 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 23 Subject Photo Pages Subject Photo Page Subject Front Subject Rear and North Side 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 24 Subject Photo Page Subject South Side Subject Street 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 25 Subject Photo Page 1st Floor 1st Floor Lobby from Rear Entrance 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 26 Subject Photo Page Elevators in 1st Floor Lobby 1st Floor Mens Room 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 27 Subject Photo Page 1st Floor Womens Room 2nd Floor 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 28 Subject Photo Page 3rd Floor Stairwell 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 29 Economic Analysis The subject property is located in the Home Rule Municipality of the City of Avon located in Eagle County. As of the 2010 census the approximate population was 6,447 and covers a total area of 8.0 square miles. Avon is the gateway to the Beaver Creek Resort which lies about two miles (3 km) south of the town. It was the previous site of Vail Resorts before the company moved its physical headquarters to Broomfield, CO. in 2006. The town also is the home of Liberty Skis, an independent ski manufacturing company. Avon is located just off Interstate 70 to the west of Denver. Interstate 25 is the main north/south route through Colorado, connecting with Interstate 70, which is the main east/west route through Colorado, in the Denver Metro area. Denver is the capital city of Colorado and is located near the center of the state, approximately 82 miles East of Avon. Colorado is the most populated state in the Rocky Mountain Region and is a regional transportation hub for the nation. Market analysis involves the study of commercial real estate market conditions and the market conditions for a specific type of property. Proper and effective analysis of market conditions is an essential part of the valuation process. The reporting of this analysis provides the reader with insight into the motivation of market participants. Our description of the subject property location above began at the micro level moving outward to the macro level of significance in the larger context of a national scope. This macro level is where we begin our analysis, which provides the background for micro level analysis of the subject’s market area. Significant influences at the macro level typically have a direct bearing on property values at the micro level. National Analysis Changes in Gross Domestic Product (GDP) and total employment have historically shown a strong correlation to demand for commercial real estate. Analysis of these changes provides insight into current demand and expected changes in demand for commercial real estate. Changes in GDP have some correlation to all commercial property types and the correlation is most significant in the industrial and hospitality sector. The industrial sector historically shows an 80% correlation to changes in GDP while the hospitality sector is very near a 1 to 1 ratio. For example a 3.5% increase in GDP translates very well to a 3.5% increase in room demand. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 30 Recent changes in GDP are not significant. 2008 and 2009 reflect a cumulative decline in GDP of 3.8% while 2010 and 2011 reflect a cumulative increase in GDP of 4.7%. This indicates a net increase in GDP of 0.9% since 2007. This annualized increase of 0.225% is insignificant in relation to historical increases ranging from 1.10% to 3.50% annually from 2001 to 2007. This indicates that demand for commercial real estate is near the level of demand in 2007 without a significant increase in demand during a four year period. Increases in the most recent years reflect a change in direction and a tendency toward growth in demand. However, these most recent changes are not significant to indicate a trend toward growth in demand. Recent changes indicate that demand has ceased to decline and the demand for commercial real estate is stabilized at this level. Changes in each quarter through 2011 show increasing gains indicating a tendency toward growth. These increases could indicate the beginning of a trend to an increase in demand for commercial real estate. This data is not significant enough to conclude that the economy has entered a cycle of growth or that demand for commercial real estate is increasing, but indicates that the economy and demand for commercial real estate is stabilized at this level with some indications of future growth. Employment Growth Job growth is the most significant demand generator for all commercial real estate property types. The correlation of job growth to commercial real estate demand ranges from 70% to 90% depending on each property type segment used in the correlation analysis. Office, retail and industrial segments have the strongest correlation to job growth. Job growth is a leading indicator of commercial real estate demand. As job growth begins a pattern of increasing, increased demand for commercial real estate is expected to follow. The following table depicts historical job growth nationwide over the most recent years. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 31 Source: Realty Advisors – Chart, BEA - Data Job growth began to decline after 2007 and until that point had been increasing at a steady rate for several years. Following several years of negative job growth this correlation indicates that current demand for commercial real estate would be below the level of demand in 2007. The sharpest decline in job growth occurred in 2009 followed by a small decline in 2010 and small growth in 2011. These changes are not significant enough to depict a trend however it can be concluded that the decline in job growth has stabilized at this current level and a trend toward job growth can be anticipated, but not forecasted. Regional Analysis The same indications we consider on a national level, changes in GDP and total employment have the same correlation to demand for commercial real estate at the regional level. However, in addition to considering these changes at the state level it is important to consider the state as part of the whole, which is the national economy. We begin our analysis by considering changes in state GDP. Recent changes in state GDP are not significant. 2008 and 2009 reflect a cumulative decline in GDP of 3.8% while 2010 and 2011 reflect a cumulative increase in GDP of 2.0%. This indicates a net decline in GDP of 1.8% since 2007. This annualized decrease of 0.45% indicates demand for commercial real estate is below the level of demand in 2007. While recent years indicate improvements these increases in demand are not significant enough to indicate recovery. Increasing gain in each quarter through 2011 provide indications of economic recovery and the beginning of a trend toward increasing demand for commercial real estate. State GDP and job growth analysis provides greater insight when considered a part of the whole. To accomplish this, the total GDP of the state is considered as a percentage of national GDP. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 32 Percent of National Gross Domestic Product (GDP) State GDP and job growth analysis provides greater insight when considered a part of the whole. To accomplish this, the total GDP of the state is considered as a percentage of national GDP. The GDP growth of Colorado has lagged behind the national GDP growth in recent years. Considering GDP growth in relation to other states provides additional insight. State Gross Domestic Product Growth (GDP) Surrounding states are depicting more significant GDP growth. Texas, Wyoming and North Dakota are significantly outpacing the national GDP growth. Significant GDP growth in these states and to a lesser degree in other nearby states is largely due to oil and gas exploration. More significant GDP growth in nearby states indicates that Colorado is lagging in the economic recovery and as such provides some evidence that the GDP and job growth indicators for Colorado may be understating directional changes or trends. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 33 Job Growth There are clear indicators our job growth is making progress, however a solid foundation of continued labor market stability and growth has not occurred. National In spite of a stagnant economy, and relatively weak GDP growth, national economic indicators are showing signs recovery efforts are improving. Recent data confirms the US added a significant number of new jobs in the fourth quarter, with the national unemployment rate dropping from 9.1% to an encouraging, seasonally adjusted 8.6%. Further analysis reveals that new employment opportunities are spread across a variety of industries, suggesting that optimism for economic stabilization is becoming warranted. Source: CBRE Regional In the fourth quarter, both investment and user sales activity remained low with only a handful of significant sales occurring. However, activity levels are increasing and 2012 is forecasted to yield more transactions than occurred in 2011. Class A properties are maintaining their value more successfully than Class B and C properties. Distressed assets are still a factor in the market; however Colorado commercial properties have a lower debt ratio than many other similar sized markets. Colorado Job Growth Job growth is a leading indicator of commercial real estate demand. As job growth begins a pattern of increasing, increased demand for commercial real estate is expected to follow. The following table depicts historical job growth in Colorado during recent years. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 34 Job growth fell flat in 2008 and declined significantly in 2009. While the rate of decline slowed in 2010, it was not until 2011 that positive job growth returned. While the most recent period indicates modest job growth, cumulative job growth remains 5% below the levels of 2007. Demand for commercial real estate remains below demand levels of 2007. For the third straight quarter, the Denver metro area outpaced national job growth, with the unemployment rate decreasing from 8.5% to rest at 7.8%. The following graph depicts the recent improvements in metro area job growth. Source: Marcus and Millichap Job growth is the driver of demand for commercial real estate. Until significant job growth occurs, there will not be significant demand growth for commercial real estate. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 35 Market Conditions National Market Conditions As the national economy improves some markets are emerging as leading in the recovery stage while others are remaining stagnate. The following table depicts the ranking of the top national markets nationally. The top ranked markets are generally located on the East or West Coast and Texas. Denver is ranked at No. 15 reflecting an improvement from a ranking of No. 19 in 2011. Chicago is ranked at No. 16, and Salt Lake City is ranked at No. 21, however these markets declined from a rank of 13 and 16, respectively in 2011. St. Louis is ranked at No. 30 reflecting a slight improvement from a Rank of 31 in 2011. The Denver office improvement showed greater improvement than other nearby major markets. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 36 Employment Office-related jobs are expected to lead employment growth with the creation of 720,000 jobs in 2012, representing a 30% increase over 2011. The professional and business services sector are expected to reflect the largest increase. National employment trends have experienced a similar pattern to local employment trends. The following chart depicts historical changes in employment on a national level. Office-using employment and total employment growth remained consistent in 2010. Office-using employment has led total employment growth in 2011 and 2012. Many Texas markets have outperformed the nation overall in employment growth during the economic decline and continues to lead in employment growth during the recovery stage. The following chart depicts the markets with the greatest employment growth. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 37 Outside of Texas many of the markets with the highest employment growth are Western U.S. markets. While some markets have emerged as leading economic recovery other remain stagnant and are lagging the national level of employment growth. The following chart depicts the market with the lowest expected employment growth. Many of the markets with the lowest expected employment growth are located in the Mid-West. Construction Construction market with the highest number of completions expected for 2012 Washington DC the between 1.5 million square feet and 2.0 million square feet. The market with the lowest number of expected completions is San Diego with between 0.0 million square feet and 0.5 million square feet. The Midwest markets line between the markets with the highest and lowest. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 38 The market with the lowest number of expected absorptions is Denver with approximately 1 million square feet of absorption. The market with the highest expected absorptions is New York City with roughly over 3 million square feet. Stronger job growth and modest construction lower vacancy and lend traction to rent growth. A forecast doubling in demand to 47 million square feet in 2012 will dwarf the 22 million square feet of new supply, tightening vacancy to 16.6 percent. The chart depicts that the US had a decrease in vacancy in the 90’s with vacancy hitting a low in 2000. Starting in 2000 the chart depicts a rise in vacancy. Completion’s hit a high in 2001 with approximately 140 million square feet. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 39 Vacancy Vacancy fell 30 base points to 17.6 percent for the nation. Stronger job growth and modest construction lower vacancy and lend traction to rent growth. A forecast doubling in demand to 47 million square feet in 2012 will dwarf the 22 million square feet of new supply, tightening vacancy to 16.6 percent. Metro area vacancy rate trends inclined starting in 2008 as of 2010 there was a slight decrease. The US had a similar trend but where Metro was at roughly 14 percent the US was at roughly 21 percent. The charts depict highest and lowest expected vacancy rates. New York City is expected to have the lowest vacancy rate with roughly 10 percent, followed by Washington DC with approximately 12 percent. The market with the highest expected vacancy rates is Detroit with roughly 26 percent, followed by Las Vegas with approximately 25 percent. The US is expected to have a high roughly of 16 percent, and a low of 16 percent. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 40 Rent National asking and effective rents are expected to increase 2.0 and 2.8 percent, respectively, with stronger gains in limited supply, gateway markets. Effective rent gains have been sparked by the decrease in vacancy to 1.6 and 1.9 percent to $27.97 per square foot and $22.51 per square foot, respectively. The chart depicts office rent concession trends, changes from 2010 to 2012 are relatively small for effective rents. Concessions have had the same small changes in trends from 2010 to 2012. Sales In recent quarters, owner-users and value add investors have also been targeting small to mid-size office properties that are not necessarily “distressed” but post elevated vacancy or face near-term lease expirations. The average sale price increased 13.3 percent measured on an annualized basis to approximately $180 per square foot. This trend will persist through 2012 as local businesses take advantage of attractive property prices and still-low interest rates. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 41 Overall, cap rates in Denver average in the high-5 to 7 percent range for Class A assets, with smaller Class B/C deals typically trading between 8 and 9 percent. The office cap rates trends depict office caps rates leveling out as of 2011 while 10 year treasury rates are still declining. The price per square foot dropped starting in 2001 and continued to do so until between 2006 and 2007 where is started to increase. Conclusion As far as Capital Markets in general, lenders continue to be discriminating. Banks remain a source of relatively low-leverage financing for acquisitions of multi-tenant properties, and will also underwrite deals for three- and five-year terms. The income and appreciation potential in secondary markets and timely value-add investments, while significant, still face inherent risks as the limited sales activity outside the “preferred” close-in areas of primary markets has generated price discovery challenges. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 42 Regional Market Conditions The Denver office market is in the recovery stage. Redevelopment of Denver Union Station is a major public infrastructure project having an impact on the Denver office market. The historic Union Station is being redeveloped as the regional transportation hub for public transportation which includes light rail and buses operated by the Regional Transportation District. The project is expected to completed mid- year 2014 and is forecast to accommodate 205,000 daily passenger trips at that time. Initial phases of the project are complete and have produced an economic benefit. With new light rail lines extending into the metro are suburbs new Transit Oriented Development (TOD) projects are planned or recently developed and existing office properties located near rail lines are experiencing an increase in demand. Existing supply of office inventory still exceeds demand during this initial recovery stage. Transaction velocity remains low as a result of many owners continuing to hold properties in anticipation of improving market conditions. Distressed properties are a factor in the market keeping overall appreciation subdued. Demand for Medical office properties is strong in part due to an aging demographic. Employment Denver employment increased by approximately 22,000 jobs in the first half of 2012, which includes approximately 7,200 office-using positions. The financial services sector added roughly 4,000 jobs, business services sector added roughly 3,500 jobs. As the tourism sector has improved, the hospitality industry has increased employment by 5,700 jobs during the first half of 2012 with the majority of new jobs occurring during the second quarter. Overall employment is expected to increase by 34,000 jobs in 2012 which represents a 2.8 percent increase in total payroll. All employment began to increase in 2010 with office-using employment consistent with the increase in total employment growth. In 2011, office-using employment growth led total employment growth and in 2012, total employment growth is leading office employment growth indicating improvements in most sectors. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 43 Construction Denver construction activity is expected to increase when the market conditions warrant it. As it stands office inventory didn’t show a rise in the first half of the year. Despite that developers have two buildings due in the third quarter, which will expand the total office stock by 230,000. In addition, 270,000 square feet of owner- user space is projected to be completed in the third quarter. Developers are expected to bring 286,000 square feet of office space to the market this year, up from the 202,000 square feet that was finalized in 2011. Construction trends 2008 and 2009 completions were at a high, absorption trends were low. 2010 through 2012 completions have seen a considerable drop, with a rise in absorptions. Vacancy During the first six months of 2012 Denver vacancy had a significant drop of 18.6 percent. This is due to renewed leasing in prime corridors spurred by job growth. Stable inventory and expanding employment aided a drop in Class A vacancy to 15.3 percent during the first six months. Supply additions and large space vacations should slow the rate of decline in the second half of the year. The first two quarters of the year Class B/C vacancy dropped to 21.8 percent. Inventory additions during the third quarter will be countered by employment growth in the second half of the year, pushing demand higher. Overall vacancy is expected to end 2012 at 18.4 percent, down from 2011. The following chart depicts historical vacancy rate trends. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 44 Metro area vacancy rate trends inclined starting in 2008 as of 2010 there was a slight decrease. The US had a similar trend but where Metro was at roughly 14 percent the US was at roughly 21 percent. Class A properties as well as Class B/C properties had similar vacancy trends as far as increase and decrease. However Class B/C had higher percentages than Class A properties. Strong leasing activity in the Central Business District pushed vacancy down to 13 percent, a 220-basis points drop year over year. The Submarket ranking for the Denver area show that central business district is ranked one, while northeast is ranked eight. The following table depicts the vacancy rate by sub-market. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 45 Rent Denver asking rents have increased 1 percent to $21.68, while effective rents increased 1.2 percent to $16.70. Class A rents within 3.4 percent of the five-year peak set in 2008. Class B/C asking rents rose 1.2 percent to $18.41 per square foot, as the chart below depicts. Sales Transaction trends show that the prices per square foot increased slightly from 2010 to 2011, followed by a slight decrease from 2011 to 2012. Conclusion Lease rates have stabilized and vacancy rates are beginning to decline. Employment growth drives demand for office space and is increasing with office using jobs leading employment growth. The market is in the beginning of the recovery stage and economic indicator indicate a trend toward lower vacancy and positive rent growth. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 46 Highest and Best Use Highest and best use is defined in the 4th edition of the Dictionary of Real Estate Appraisal (Appraisal Institute, Chicago, 2002) as follows: “The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legally permissible, physically possible, financially feasible, and maximum productivity.” The highest and best use analysis involves three steps: Step 1 Analysis of the site as though vacant. A determination must be made to leave the site vacant or to improve the site. Step 2 If it is concluded that the site should be improved, then the ideal Improvement must be determined. Step 3 A comparisons between the existing improvement and ideal Improvement must be made to determine if the existing improvement should be maintained or modified to conform to the ideal improvement. As Though Vacant Legally Permissible According to the City of Avon, the appraised property is located in the PUD zoned district. This district provides for most office, retail and other similar commercial uses. Physically Possible The subject’s site is large enough to accommodate small commercial uses. The subject’s site is mostly level and is accommodating to construction of these types of improvements. The site could accommodate most of the legally permissible uses. Financially Feasible Surrounding land uses are predominately office and retail. Beaver Creek Blvd is a main commercial corridor with predominately office, retail and hospitality uses located along Beaver Creek Blvd. Office, retail and mixed use properties are all financially feasible. Maximum Productivity The Principle of Conformity indicates that a property tends to reach maximum value when the neighborhood is reasonably homogeneous. Retail requires exposure and the subject property sits away from front to Beaver Creek Blvd. and as such is not ideally suited for retail development. As such, office development would be maximally productive during market conditions that are favorable for new development. Current market conditions are not conducive to new development. Therefore, the maximally productive and Highest and Best Use of the property as if vacant is to hold for future development. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 47 As Improved The final step in the highest and best use analysis is to compare the existing use with the ideal improvements. The appraiser applies the tests of physically possible, legally permissible, and financially feasible to determine if the existing improvements can be modified to resemble the ideal improvements. Legally Permissible The existing improvements comply with the requirements of the zoning classification, and are a legally permissible use. Physically Possible The existing improvements are in overall average to good condition. Modifications to the existing improvements that would more closely conform with the ideal improvements include updating, repair, and renovation. Such modifications to the existing improvements and are physically possible. Financially Feasible Modifications to the existing improvements are financially feasible if they result in a value that is equal to or greater than the cost of the modification. Repair of deferred maintenance items prevent deterioration of existing income streams and are considered financially feasible. Declining rents and increasing vacancy rates does not provide a sufficient increase in income to justify additional renovations or updating to the property at this time. Maximum Productivity The Highest and Best use of the property is the existing use. The subject improvement contributes value to the site in it’s “as is” condition, meaning that the current value of the subject property “as is” exceeds the land value of the subject property “if vacant” less the cost of demolition. Therefore, demolition of the existing improvements to construct the ideal improvements is not financially feasible at this time. Replacement and repair of any deferred maintenance items are the only financially feasible improvements leading to the maximum productivity of the property. The Highest and Best Use “As Improved” is continued use of the “as is” improvements with repair of deferred maintenance items. . 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 48 The Appraisal Process The Sales Comparison Approach is generally the most applicable method of valuation for owner occupied commercial properties and is also considered as a secondary consideration by investors considering income producing properties. Income producing property investors will typically give secondary consideration to the Sales Comparison Approach. Therefore, the Sales Comparison Approach is applicable to the subject property and is developed. The Income Approach is generally the most applicable method of valuation for income producing commercial real estate. Income producing property investors give primary consideration to the Income Approach; Therefore, The Income Approach is applicable for properties such as the subject and is developed. The Cost Approach is most applicable to newer properties without significant depreciation. The underlying assumption and basis for the Cost Approach is that a buyer will pay no more for an existing property than what they could build a new property for of similar functional utility without undue delay. To value is excluded. As a property ages physical and functional depreciation can become so significant that the cost to build a similar property with similar functional utility and no depreciation far exceeds to cost of an existing property with depreciation. When this is the case, a buyer considering an older property with significant depreciation, will not typically consider as an alternative building a new property without depreciation at a significantly higher price. In fact, as the price gap increases substantially, the different pricing tier is such that a buyer in one price tier (higher or lower) would not consider a purchase in the other price tier. The subject property is a newer property with significant unfinished space and a buyer considering the purchase of the subject property would typically consider as an alternative building a new property with similar functional utility. Therefore, Cost Approach is applicable and is developed. Traditionally, the final step in the valuation analysis is the reconciliation of the value indications by the various approaches performed. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 49 SALES COMPARISON APPROACH The comparable sales were confirmed by the following sources: CoStar Comps, Reis Data, Realist property data, Loopnet, County records, and parties involved in the transactions (when possible). The below listed sales reviewed are concluded to be the most indicative of the subject’s market value. The comparable sales are summarized on the table which follows. COMPARABLE SALE SUMMARY TABLE Subject SALE NO. 1 SALE NO. 2 SALE NO. 3 SALE NO. 4 SALE NO. 5 SALE NO. 6 Address 140 W Beaver Creek Blvd 211 Eagle Rd 265 Dillon Ridge Rd 232 S Main St 320 S Main St 1060 W Beaver Creek Blvd20 Eagle Rd City Avon Avon Dillon Breckenridge Breckenridge Avon Avon Proximity See Map See Map See Map See Map See Map See Map Sale Date 18-Dec-13 30-Oct-12 31-Dec-12 12-Sep-13 Active Active Sale Price $4,700,000 $4,395,000 $2,000,000 $2,792,000 $1,175,700 $2,100,000 Doc No.24848 1006831 1012435 1036805 NA NA Buyer Name 211 Eagle Rd LLC Kona LTD LLC Double H LTD Go Holdings LLC NA NA GBA 16,694 11,993 6,158 8,255 4,268 8,865 Land Area 63,598 68,825 6,098 11,326 1,307 40,511 Property Rights Leased Fee Leased Fee Fee Simple Leased Fee Leased Fee Leased Fee Conditions of Sale Cash Equiv.Conv.Conv.Cash Equiv.0 0 Financing Terms NA 58%LTV 51%LTV NA NA NA Lender NA Colorado St Bk & Tr Wells Fargo BK NA NA NA NA Buyer Expenditures None Noted None Noted None Noted None Noted None Noted None Noted Market Conditions No Adjustment No Adjustment No Adjustment No Adjustment Active -10%Active -10% Adj. Sales Price $4,700,000 $4,395,000 $2,000,000 $2,792,000 $1,058,130 $1,890,000 Adj. PPSF $281.54 $366.46 $324.78 $338.22 $247.92 $213.20 Property Type Office Office Office Office Office Office Office Property Class Class C Class C Class C Class C Class C Class C Class C Year Built 2003 1995 5%2008 -3%1895 14%1978 14%1994 5%1978 14% Condition Average Average Average Average Average Average Average Quality Masonry Masonry Masonry Masonry Masonry Masonry Masonry GBA 16,273 16,694 11,993 -10%6,158 -23%8,255 -18%4,268 -27%8,865 -17% Location Avon Avon Dillon Breckenridge Breckenridge Avon Avon Appeal Average Average Average Average Average Average Average Exposure Central Core Central Core Central Core Central Core Central Core Peripheral 25%Peripheral 25% Visibility Interior Interior Interior Corner Interior Interior Corner Access Good Good Good Good Good Good Good Tenancy Multi Multi Multi Single Multi Multi Multi Parking Ratio 2.703865298 2.17 6.83 1.31 0.61 4.76 5.68 Land Size 50,138 63,598 68,825 6,098 11,326 1,307 40,511 Land/Blg Ratio 3.08 3.81 -2%5.74 -8%0.99 7%1.37 5%0.31 9%4.57 5% Adj. Land Use Commercial Commercial Commercial Commercial Commercial Commercial Commercial Net Adjustment 3%-21%-2%1%12%27% Dollar Adjustment $8.45 -$76.96 -$6.50 $3.38 $29.75 $57.56 Adjusted Price/SF $289.98 $289.51 $318.29 $341.60 $277.67 $270.76 Weight 35%15%10%20%10%10% 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 50 Sales Comparison Summary The comparables used reflect the best comparables that are available for the subject property and are similar enough to the subject in all factors that have an impact on value to produce a credible result via the Sales Comparison Approach. Adjustments Applied to Comparable Sales: Market Conditions: Active listings are adjusted to reflect typical negotiations between buyers and sellers. The amount of adjustment is based on analysis of the list to sale price ratios of other similar properties located within the subject’s market area. Age: The effective age of a property can be a significant factor that has an impact on value. Analysis of the comparable sales used in the appraisal indicates an adjustment for differences in effective age is warranted. The amount of adjustment (1.78% per year of actual age), is based on analysis of the comparable sales used in the appraisal. Specifically, secondary paired data analysis of Comparable No. 2 to Comparable No. 5. Comparable No. 3 is a historical property with a significantly different actual age and a similar effective age to that of Comparable No. 4 and a similar adjustment is applied. Gross Building Area: Market data indicates that larger properties typically achieve a lower price per square foot when compared to smaller properties. An adjustment for differences in size is extracted through analysis of the comparable sales used in this appraisal. Specifically, secondary paired data analysis of Comparable No. 1 and Comparable No. 3 indicates an adjustment of 1% for each 2.7% difference in size is warranted. Land/Bldg Ratio: Properties with a significant difference in land to building ratio may have an impact on value as higher land to building ratios often indicate additional development opportunity for expansion and significantly lower land to building ratios may indicate inferior functional utility. Adjustments for land to building ratios are based on analysis of the comparable sales used in the appraisal. Specifically, secondary paired data analysis of Comparable No. 1 and Comparable No. 2. This analysis indicates a 1% adjustment for each 0.32 difference in land/building ratio. Details of each comparable are presented in the following pages. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 51 Improved Sales Location Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 52 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale Features Sale No. 1 Average 211 Eagle Rd 12/18/2013 16,694 1995 See Map $4,700,000 3.81 35% Central Core Average Sale No. 1 is a 19 year old office building. This property features a two story building located on a 1.46 acre lot, 50 parking spaces and a two car garage. This corporate facility amentias include gym, pool, and conference space. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 53 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale 10/30/2012 $4,395,000 Sale No. 2 Features 265 Dillon Ridge Rd See Map 11,993 5.74 2008 Average Central Core Average 15% Sale No. 2 is a 6 year old commercial office building. This property features 11,993 square foot one story building on a 1.58 acre lot. Anchor tenants include The UPS Store, and Noodles. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 54 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale 12/31/2012 $2,000,000 Sale No. 3 Features 232 S Main St See Map 6,158 0.99 1895 Average Central Core Average 10% Sale No. 3 is a 119 year old office building. This property features a 2 story 6,158 square foot building located in a .14 acre lot. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 55 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale 9/12/2013 $2,792,000 Sale No. 4 Features 320 S Main St See Map 8,255 1.37 1978 Average Central Core Average 20% Sale No. 4 is a 36 year old mixed use building. This property feature a 8,255 square foot building located on a .26 acre lot, with parking, the main floor is being used as a retail space. Upstairs features vaulted ceilings, private restrooms and shower, can be used as an office space. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 56 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale Active $1,175,700 Sale No. 5 Features 1060 W Beaver Creek Blvd See Map 4,268 0.31 1994 Average Peripheral Average 10% Sale No. 5 is a 20 year old office building. This property features 4,268 square foot building on a .03 acre lot. The building consist of 6 condo units which can be configured from anywhere 1400 square feet up to the entire building. Featuring conference space, and high end finishes, 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 57 Address Proximity to Subject Sale Date Sale Price GBA Land/Bldg Ratio Year Built Condition Exposure Appeal Weight in Weighted Scale Active $2,100,000 Sale No. 6 Features 20 Eagle Rd See Map 8,865 4.57 1978 Average Peripheral Average 10% Sale No. 6 is a 36 year old office building. This property features a three story 8,865 square foot building on a .93 acre lot. Building features good visibility and parking. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 58 Correlation of Comparable Sales: Comparable No. 1 is the most proximate comparable and is given the greatest consideration. Comparable No. 4 is a recent sale and is given greater consideration. Comparable No. 5 and Comparable No. 6 are active listings and are given the least consideration. Each of the comparable sales is given consideration in the following weighted scale. SALE NO.PRICE/SF WEIGHT INDICATOR 1 $289.98 35%$101.49 2 $289.51 15%$43.43 3 $318.29 10%$31.83 4 $341.60 20%$68.32 5 $277.67 10%$27.77 6 $270.76 10%$27.08 TOTAL 100%$299.91 WEIGHTED SCALE - Price Per Square Foot Conclusions: The comparables used in the analysis all have had tenant finish completed and the subject has no interior tenant finish. Therefore, an additional adjustment for tenant finish must be applied to the value indicated by comparables with tenant finish. The value indication and tenant finish expense calculations are presented below. Square Feet Indicated PPSF Value Indication Rounded 16,273 $299.91 $4,880,479 $4,880,000 Square Feet Indicated PPSF Value Indication Rounded 16,273 $75.00 $1,220,475 $1,220,000 Value Indication Tenant Finish Expense The following table presents the concluded “as is” value of the subject by the Sales Comparison Approach: Finished Value Indication $4,880,000 Less Tenant Finish Expense -$1,220,000 "As Is" Value Indication $3,660,000 Value Indication 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 59 INCOME CAPITALIZATION APPROACH The Income Approach is a method of converting the anticipated economic benefits of owning a property into a value estimate through capitalization or discounting. The principles of anticipation and substitution underlie this approach. Investors recognize the relationship between the income a real property can generate and its value. In order to value the anticipated economic benefits of a particular property, potential income and expenses must be estimated, and the most appropriate capitalization method applied. By the same token, investors will pay no more for a property than it would cost to purchase an acceptable substitute potential income. This investment may be realty or some other commodity. The two most common methods of converting net income into value are direct capitalization and discounted cash flow analysis. In direct capitalization, net operating income is divided by an overall rate extracted from the market to indicate a market value. In the discounted cash flow method, anticipated future net income streams and a reversionary value or refinance are discounted to an estimate of net present value at a chosen yield rate. The direct capitalization method is most appropriate for the subject property. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 60 Analysis of Tenancy The subject property is not occupied. Expense Allocation The market rents for the comparables are typically triple net lease with the tenant responsible for the majority of expenses. Based on this information, the property expenses would typically be allocated as follows: Expense Item Property Owner Expense Tenant Expense Property Taxes 0%100% Insurance 0%100% Utilities 0%100% Maintenance 0%100% Reserves 100%0% Management 100%0% Expense Allocation of Existing Leases Potential Gross Income Market rent comparables have been analyzed to estimate what market rent is for the subject property. Market rent is the basis for estimating the market value of the fee simple estate or interest. Market rent is what a property should rent for based on a study of rental rates of similar, competing properties in the market. Contract rent is used to determine the leased fee interest in a property; market rent is used to determine the fee simple interest in a property. In either case, market rent is estimated to reach a determination if the subject’s contract rent is above, below or at market rates. Summary of Market Rent Comparables The appraisers selected rent comparables most similar to the subject’s space. The comparables reflect market rent for similar space. Several comparable rentals were analyzed, but these were concluded to be the best indicators of market rent for the subject. The rent comparables utilized are summarized and compared to the subject in the following table. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 61 Lease Comparable Adjustment Table Subject COMP NO. 1 COMP NO. 2 COMP NO. 3 COMP NO. 4 COMP NO. 5 COMP NO. 6 Address 140 W Beaver Creek Blvd 70 Benchmark Rd #20570 Benchmark Rd 1060 W Beaver Creek Blvd37347 US Hwy 6 70 Benchmark Rd #102137 Benchmark Rd City Avon Avon Avon Avon Avon Avon Avon Proximity See Map See Map See Map See Map See Map See Map Lease Rate $22.00 $26.00 $16.32 $24.00 $18.00 $17.00 Lease SF 1,335 2,073 4,268 3,596 1,072 23,685 Lease Terms NNN NNN NNN NNN NNN NNN CAM / NNN Adj.$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Effective Rent $22.00 $26.00 $16.32 $24.00 $18.00 $17.00 Free Rent None None None None None None TI's None None None None None None Adj. Rent PSF $22.00 $26.00 $16.32 $24.00 $18.00 $17.00 Adj. RPSF $22.00 $26.00 $16.32 $24.00 $18.00 $17.00 Year Built 2003 1994 1994 1994 1997 1994 1985 Condition Average Average Average Average Average Average Average Property Class Class C Class B Class C Class C Class C Class B Class C Quality Frame Masonry Masonry Masonry Masonry Masonry Masonry Leased Space 12,273 1,335 2,073 4,268 3,596 1,072 23,685 Appeal Average Average Average Average Average Average Average Exposure Arterial Collector Collector Collector Arterial Collector Collector Visbility Good Corner Corner Corner Interior Corner Corner Access Good Average Average Average Average Average Average Adj. Land Use Commercial Commercial Commercial Commercial Commercial Commercial Commercial Net Adjustment 0%0%0%0%0%0% Dollar Adjustment $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Adjusted Rent/SF $22.00 $26.00 $16.32 $24.00 $18.00 $17.00 Weight 20%25%15%20%10%10% 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 62 Rent Comparables Location Map 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 63 Address Lease Rate Condition Visibility Appeal Exposure Address Lease Rate Condition Visibility Appeal Exposure Rent Comparable No. 1 Rent Comparable No. 2 70 Benchmark Rd #205 Average $22.00 Corner Average $26.00 Collector 20%Weight in Weighted Scale Weight in Weighted Scale 25% 70 Benchmark Rd Average Collector Average Corner 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 64 Address Lease Rate Condition Visibility Appeal Exposure Address Lease Rate Condition Visibility Appeal Exposure 37347 US Hwy 6 $24.00 Average Interior Average Arterial Rent Comparable No. 3 Weight in Weighted Scale 20% Weight in Weighted Scale 15% Rent Comparable No. 4 1060 W Beaver Creek Blvd $16.32 Average Corner Average Collector 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 65 Address Lease Rate Condition Visibility Appeal Exposure Rent Comparable No. 5 Weight in Weighted Scale 10% 70 Benchmark Rd #102 $18.00 Average Corner Average Collector Market Rental Summary The comparable rental properties utilized in the appraiser’s analysis are located within the subject’s market area. The adjustment grid presented here arrives at an estimated market rent for the subject property. RENT COMP PRICE/SF WEIGHT INDICATOR 1 $22.00 20%$4.40 2 $26.00 25%$6.50 3 $16.32 15%$2.45 4 $24.00 20%$4.80 5 $18.00 10%$1.80 6 $17.00 10%$1.70 TOTAL 100%$21.65 WEIGHTED SCALE 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 66 Concluded Potential Gross Rental Income As previously discussed, the potential gross rental income is based on market rent in valuing the fee simple estate. Market rent is applied to the subject property to determine the Potential Gross Income of the property as depicted below. Potential Rental Income (Fee Simple)$352,277.90 Plus: Expense Reimbursements $120,946.00 Plus: Other Income $0.00 Total Potential Gross Income $473,223.90 Potential Gross Income Vacancy and Collection Loss Market conditions have softened in recent years; however, properties in the immediate vicinity are in demand. The subject property is encumbered by a long term lease with a national credit tenant; there is no vacancy or collection loss risk during the current term of the lease until the next termination window. Based on our findings and discussions with area brokers, a market vacancy and collection allowance for other similar properties of 10.0% is concluded. This vacancy and collection allowance would typically be applied to an estimate of the fee simple estate or the leased fee estate if a unit is vacant or if the current lease term was short enough in duration to anticipate tenant turnover during a typical holding period of 7- to 10-year. Operating Expenses The comparables are all leased on a triple net basis. Under the terms of a NNN lease the tenant is responsible for all expenses except management and reserves. This is a common lease term for the subject property. Management fees are based on typical management charges for similar properties. Projected operating expenses for the subject are summarized as follows. Broker Guidelines Expense Item Total 16,273 SF $/SF Property Taxes $34,046 $1.00 - $2.50 Insurance $4,200 $0.25 - $1.00 Utilities $42,500 $2.50 - $3.50 Maintenance $25,000 $1.50 - $3.00 Reserves $4,500 $0.20 - $0.50 Janitorial $8,500 $0.50 - $1.00 Administrative $3,200 $0.20 - $0.50 Legal/Accounting $3,500 $0.20 - $0.50 Management $15,853 4% - 7% EGI Total Expenses $141,299 Estimated Expenses $2.09 $0.26 $8.68 $/Sq.Ft. $0.52 $0.20 $0.22 $2.61 $1.54 $0.28 $0.97 Property taxes are based on the actual assessment. All other expenses are based on a consensus of broker guidelines, and on a review of industry standards. The concluded property management expense is based on an industry standard of 5.0% of effective gross rental income. This expense typically ranges from 2% to 6% for similar properties. The subject is in overall average to good condition. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 67 Reimbursed Expenses Each of the rent comparables used to determine the Potential Gross Income indicate market rents reflecting NNN terms. Under a triple net lease, all of the expenses except management and reserves are paid by the tenant. These are depicted as expense reimbursements for purposes of our analysis; however these are paid by the tenant directly. Income and Expense Summary Potential Rental Income (Fee Simple)$352,277.90 Plus: Expense Reimbursements $120,946.00 Plus: Other Income $0.00 Total Potential Gross Income $473,223.90 Less: Vacancy and Collection Loss 10%$47,322.39 Effective Gross Income $425,901.51 Less: Operating Expenses $141,298.51 Net Operating Income $284,603.01 Income and Expense Summary Direct Capitalization The capitalization rate is developed based on appropriate sources. Buildings like the subject are typically purchased by investors. The appraisers’ research includes survey data and analysis of specific market data. MARKET DATA The table below depicts capitalization rates indicated by other similar sales and active listings on the effective date of appraisal, which are most reflective of the alternatives and investor in this property type would consider. Type Sale Date Address City Size Sales $NOI OAR Office Subject 140 W Beaver Creek Blvd Avon 16,273 N/A $3,661 6.50% Office Active 101 W Main St Frisco 22,910 $2,999,000 $143,952 4.80% Office 1/2/2014 555 Corporate Cir Golden 56,753 $14,250,000 $855,000 6.00% Office 1/6/2014 827 Lincoln Ave Steamboat Springs 1,910 $670,000 $40,200 6.00% Office 12/17/2012 10576 W Alameda Pkwy #2 Lakewood 2,476 $267,206 $18,704 7.00% Office 4/30/2013 1113 Washington Ave Golden 9,115 $1,695,000 $129,329 7.63% Office 5/31/2013 320 Interlocken Broomfield 40,723 $5,200,000 $402,480 7.74% Office Active 1625 Miner St Idaho Springs 2,900 $619,900 $49,592 8.00% Office 11/30/2012 500 & 560 Golden Ridge Rd Golden 100,800 $13,650,000 $1,194,375 8.75% Office Active 210 Edwards Village Blvd Edwards 1,000 $275,000 $27,500 10.00% Market Derived Capitalization Rates 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 68 Applied Capitalization Rate The subject is a newer property located in the central core and as such represents a lower level of risk. Therefore, a capitalization rate in the lower half of the range is appropriate. Indicated Value from Direct Capitalization Analysis Direct Capitalization Based on the preceding indications, the indicated market value of the fee simple interest in the subject property is calculated as follows: Subject Net Operating Income Capitalization Rate Value Indication Rounded $284,603 6.50%$4,378,508 $4,400,000 $4,400,000 Less Tenant Finish Costs $1,220,000 Concluded Value by The Income Approach $3,180,000 Indicated Value Indicated Value by The Income Approach 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 69 Cost Approach This approach to value is based on the assumption an informed purchaser would pay no more than the cost of producing a substitute property with the same utility as that of the subject property assuming no undue delay due to construction. The reproduction cost or replacement cost is made herein. The Cost Approach involves the following steps in its application: 1. Estimate land value as if vacant and available for development to its highest and best use; 2. Estimate replacement or reproduction cost new for the proposed improvements; 3. Estimate entrepreneurial profit, if applicable; 4. Estimate the accrued depreciation caused by physical deterioration, functional causes, and/or external influences; 5. Deduct accrued depreciation from the improvement's replacement or reproduction cost new to arrive at the present depreciated cost estimate of the proposed improvements; 6. Add the land value to the depreciated cost estimate to arrive at a value indication by the Cost Approach. Land Valuation The Sales Comparison Approach has been utilized to indicate the value of the subject underlying land "as if vacant.” The subject’s market was researched for transfers of properties purchased for commercial development. Comparable land sales are summarized in the following table: Address City Parcel Size Zoning Sale Date Sales Price PPSF 970 010 Mile Dr Frisco 50,094 Commercial 10/11/2013 $2,300,000 $45.91 266 Continental Ct Breckenridge 25,265 Commercial 12/9/2013 $375,000 $14.84 570 Adams Ave Silverthorne 6,970 Commercial 12/16/2013 $75,000 $10.76 375-385 Warren Ave Silverthorne 165,528 Commercial Active $2,000,000 $12.08 956 W Anemone Tr Dillon 44,431 Commercial Active $699,900 $15.75 Comparable Land Sales Each of the comparable land sales are given consideration in the following weighted scale: Sale No.PPSF Weight Indication 1 $45.91 30%$13.77 2 $14.84 20%$2.97 3 $10.76 15%$1.61 4 $12.08 15%$1.81 5 $15.75 20%$3.15 Indicated PPSF $23.32 Weighted Scale Land Value Conclusion Based on the land sale comparables, the estimated land value is as follows: Subject Lot Size PPSF Land Value 50,138 $23.32 $1,169,192 Rounded $1,169,000 Land Value Conclusion Improvement Valuation 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 70 Improvement costs are based on the Marshall Valuation Service (MVS), a national cost estimating service updated monthly with local and current cost multipliers. Marshall Valuation Service provides estimates of replacement cost. The calculator method is used wherein a base cost per square foot is estimated and adjustment factors are applied. The following items are included in the base cost estimate.  Typical architect's and engineer's fees.  Performance bonds, processing fees, and service charges.  Normal site preparation, back-fill, and finish grading.  All building materials, labor, and supervision.  Sales tax on building materials.  Normal interest on building funds.  Workman's compensation and related insurance.  Utility lines from the structure to the lot line.  Contractor's profit and overhead. Costs not included in the base cost are derived from market data and include site improvement costs, real estate taxes, contingency fees, financing fees, leasing commissions, marketing costs, and entrepreneurial profit. The various components of the Cost Approach are discussed in the following paragraphs. Direct Costs Space classification and base costs per square foot are summarized in the Cost Approach Calculations table. Depreciation parameters are also included in the table. Other Direct Costs: In addition to the above estimated direct building costs there are other direct costs associated with the subject's site improvements. The contributory value of these costs will be included in the summary below. Indirect Costs Indirect costs account for connection fees (impact fees), construction loan fees, construction loan interest, legal and consulting fees, land taxes during construction of the improvements, developer's risk insurance during construction, leasing commissions, marketing costs, and a contingency fee. Entrepreneurial Profit Entrepreneurial profit is not an estimate of general contractor's profit, which has already been accounted for, but instead is an additional amount accruing to the developer for combining the factors of production. Profit margins vary widely, depending on many factors such as supply and demand, financing packages, and the negotiating ability of the developer. Entrepreneurial profit generally ranges from 10% to 25% for typical property developments in “normalized” market conditions. Accrued Depreciation 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 71 In order to estimate the contributory value of the improvements, depreciation must now be subtracted from the replacement cost new. Accrued depreciation accounts for the loss in value between an improvement's replacement cost new and its market value as of the date of the appraisal. There are three basic sources of accrued depreciation. 1. physical deterioration (i.e., deferred maintenance); both curable and incurable 2. functional obsolescence; both curable and incurable; and 3. external obsolescence. Physical Deterioration Curable physical deterioration is a curable defect also known as deferred maintenance. Deferred maintenance was discussed in the property description section of this report and will be incorporated herein. Incurable physical deterioration is that deterioration considered not practical or cost feasible to correct. This depreciation results from normal wear and tear on the improvements due to natural aging. This amount is estimated by the age-life method. The subject’s estimated total physical life, effective age, and resulting incurable physical deterioration are summarized below. Effective Age & Economic Life Chronological Age 11 years Effective Age 4 years Total Economic Life 50 years Remaining Economic Life 46 years Accrued Physical Incurable Depreciation 8.00% Functional Obsolescence Functional obsolescence is the loss in value due to a design flaw and may be curable or incurable. Functional obsolescence is caused by a deficiency or a superadequacy. Since replacement cost estimates the cost new assuming new materials and functional design and layout with good utility, there would not be incurable functional obsolescence. The subject is considered a functional property with no deficiencies or superadequacies. External Obsolescence External obsolescence is the loss in value resulting from negative factors located outside the subject's boundaries and is almost always incurable. The subject is not considered to suffer from external obsolescence. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 72 Cost Approach Conclusion: The following table summarizes the estimated Cost Approach value. For consistency with the analysis in other approaches, tenant improvement costs are depicted, no depreciation is applied to tenant improvement costs and then tenant improvement cost are removed of backed out. Direct Costs Above Grade GBA Base Cost Units Cost/SF Section Cost Total Cost Base Structure 16,273 $64.47 $1,049,120 Exterior Walls 16,273 $17.14 $278,919 Heating and Cooling 16,273 $13.15 $213,990 Elevator 1 $66,500 $66,500 Fire Prevention 16,273 $2.92 $47,517 Basic Structure Cost $1,656,047 Interior Finish Cost Units Cost/SF Section Cost Total Cost Tenant Improvements 16,273 $75.00 $1,220,475 $1,220,475 Total Direct Costs $2,876,522 Indirect Costs % of Hard Cost Hard Cost Soft Cost Soft Costs 8%$2,876,521.64 $230,122 Entrepreneurial Profit 15%$2,876,521.64 $431,478 Total Soft Cost and Entrepreneurial Profit $661,600 Total Replacement $3,538,122 Less Depreciation 8.00%$132,484 Depreciated Value of Improvements $3,405,638 Land Value $1,169,000 Value Indicated by Cost Approach $4,574,638 Less Tenant Finish Cost (backed out)$1,220,475 "As Is" Value Indicated by Cost Approach $3,354,163 Rounded $3,350,000 Cost Approach Calculations The Cost Approach is limited by the subjective method of estimating depreciation, the uncertainty of developer’s profit, and the general method of estimating replacement cost. The estimated value of the subject property by the Cost Approach is: Depreciated Value of Improvements Land Value Value Indication Rounded $2,185,163 $1,169,000 $3,354,163 $3,350,000 $3,350,000 Indicated Value Concluded Value by The Cost Approach 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 73 Reconciliation of Value Indicated values by the Income Capitalization, Cost Approach and Sales Comparison approaches are summarized as follows: Approach Value Sales Comparison Approach $3,660,000 Income Approach $3,180,000 Cost Approach $3,350,000 Concluded Value $3,280,000 Reconcliation of Value The Sales Comparison Approach is predicated on the principle that an investor would pay no more for an existing property than for a comparable property with similar utility. This approach is most often used by potential purchasers intending to utilize a property as owner occupants. The Income Approach is the most applicable method of valuation for investor purchased properties. This approach is predicated on the principles of substitution and anticipated economic benefits. Therefore, it best reflects the income characteristics of the subject and is given greater weight. The Cost Approach is predicated on the Principle of Substitution in that a buyer would consider as an alternative constructing a new property. The subject property would likely be considered by investors making a purchase decision based on the anticipated future income the property will generate. Therefore, the Income Approach to value is considered the better indicator. As a result of the preceding discussion, the market value concluded by this complete appraisal for the fee simple interest in the subject property, as of March 20, 2014, is: “AS IS” VALUE THREE MILLION TWO HUNDRED EIGHTY THOUSAND DOLLARS $3,280,000 The value estimates are based on the definitions, assumptions, limiting conditions, and certification in the report and any hypothetical conditions and/or extraordinary assumptions. By this reference, the Addendum is made an integral part of this report. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 74 Value of Property without Parking The subject’s zoning has a parking requirement of 44 total parking spaces for the subject property and provides allowances for shared parking, off-site parking and parking requirements being met from parking on a different parcel owned by a different owner. The zoning approval provides a variety of options to meet the parking requirement. The appraised value includes the allocation of the required parking spaces located on an adjacent parcel. These spaces are located in the Sheraton parking garage and surface lots. The scope of work off the appraisal includes a value conclusion of the subject property with parking and a value conclusion without parking. A value of the subject property without parking would involve multiple hypothetical conditions. The definition of a hypothetical condition is: That which is contrary to what exists but is supposed for the purpose of analysis. Specific to this assignment to reach a value conclusion of the subject property without parking would involve the following hypothetical conditions. 1. The subject property does not have an allocation of required parking on an adjacent parcel. 2. The subject’s parking requirements do not exist. a. An alternative would be the application of the hypothetical condition that an approval could be achieved for the parking requirements to be waived. Hypothetical condition No. 2 would be required because the subject property without meeting the existing parking requirements would not be permitted to be occupied and would in effect result in an absurd condition in effect rendering the property improvements ineffective. An alternative to the above stated Hypothetical Condition No. 2 would be an extraordinary assumption that the that the parking requirement could be met by the property owner obtaining off-site parking from other parcels which would satisfy existing zoning requirements. Hypothetical Condition and Extraordinary Assumption Based on the analysis which is summarized above the following hypothetical condition and extraordinary assumption are applied to the value conclusion of the subject property without parking. Hypothetical Condition: The subject property does not have an allocation of required parking on an adjacent parcel. Extraordinary Assumption: The parking requirement could be met by the property owner obtaining off-site parking from other parcels which would satisfy existing zoning requirements. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 75 Value of Parking To determine the value of required parking or the cost associated with obtaining the required parking the Income Approach and Sales Comparison Approach are each developed. Due to limited availability of market data each approach will have strengths and weaknesses which is considered in the final reconciliation. Income Approach The potential income generated by parking can be capitalized into a value conclusion. Area parking rates are surveyed along with parking demand to arrive at an annual potential revenue and an appropriate capitalization rate is applied to reach a value conclusion. Available rate information is limited to daily rates which are presented in the following table. Location Daily Westin $20 Westin Non Guest $30 Lionshead $20 Vail Cascade Resort $18 Vail Ski Resort $25 Concluded Daily Rate $20 Area Parking Rates The majority of parking areas have a daily reach which applies during ski season and are free parking during months outside of the ski season. As such a parking space in the subject’s market would only be expected to generate revenue during the ski season. The following table depicts the calculations leading to the number of days in a year a parking space could be expected to achieve the daily rate, the potential annual revenue and the capitalization of revenue arriving at a value per parking space. Paid Parking Days 150 Season Occupancy 75% Occcupied Days 112.5 Daily Rate $20 Annual Revenue $2,250 Capitalization Rate 8.00% Value per Space $28,125.00 Parking Revenue The value per space is applied to the total number of required spaces to arrive at a value conclusion of the subject’s required parking. Value per Space $28,125 Spaces Required 44 Total Value $1,237,500 Land Area Required 17,424 Indicated Value PSF $71.02 Capitalized Income 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 76 Sales Comparison Approach Sales and listing of parking lots and parking spaces within Colorado were analyzed to arrive at a value conclusion via the Sales Comparison Approach. While sales in the local market are not available, daily parking rates in the local market are consistent with daily parking rates in other areas. Indicating that there exists some similarity within the larger regional market. The following table presents sales and active listings of parking lots and spaces. Location Spaces SF Price Price/Space Price/SF 1963 Sherman 29 6,250 $450,000 $15,517.24 $72 1207 Cherokee St 75 18,699 $1,385,000 $18,466.67 $74 2200 Champa St 28,125 950,000 $34 2131 Curtis St 6,267 $500,000 $80 13th & Santa Fe 20,300 $1,300,000 $64 Median $16,991.95 $72 Parking Comparables Analysis of the above sales and listing indicates that a value as concluded below is well supported. SF PPSF Value 17,424 $72 $1,254,528 Spaces PPS Value 44 $17,000 $748,000 Concluded Value $1,250,000 Value Conclusion The price per space information is limited and as a result is not considered the most credible indicator. The price per square foot ifs the more credible indicator. Reconciliation of Value The information used in the Income approach is more specific to the subject’s market and as such is considered the better indicator. The Sales Comparison Approach provides additional support for this conclusion. "As Is" Value with Parking $3,280,000 Less Value of Parking $1,237,500 Concluded Value without Parking $2,042,500 Concluded Value without Parking 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 77 Addendum 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 78 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 79 Glossary Appraisal Report: The written report presented by an appraiser regarding the value of a property; should include a description and summary of the method(s) used to calculate the value of the property Assessed Value: Assessed value applies in ad valorem taxation and refers to the value of a property according to the tax rolls. Assessed value may not conform to market value, but it is usually calculated in relation to a market value base. 1 Capital Expenditure: Investments of cash or the creation of liability to acquire or improve an asset, e.g., land, buildings, building additions, site improvements, machinery, equipment; as distinguished from cash outflows for expense items that are normally considered part of the current period’s operations. 2 Cash Equivalency: The procedure in which the sale prices of comparable properties sold with atypical financing are adjusted to reflect typical market terms. Complete Appraisal: The act or process of developing an opinion of value or an opinion of value developed without invoking the DEPARTURE RULE. 3 Cost Approach: This approach is based on the premise that an informed purchaser would pay no more than the cost of producing a substitute property with the same utility as the subject property. The analysis involves estimating the current cost (including both direct and indirect costs) to construct a replacement for the existing structure and related site improvements, deducting for evidence of accrued depreciation, and adding the estimated land value. Deferred Maintenance: Curable, physical deterioration that should be corrected immediately, although work has not commenced; denotes the need for immediate expenditures, but does not necessarily suggest inadequate maintenance in the past. 4 Economic Life: The period of time over which improvements to real estate contribute to property value. 5 Effective Date of the Appraisal: The date at which the value opinion in an appraisal applies, which may or may not be the date of inspection; the date of the market conditions that provide the context for the value opinion. 6 Effective Gross Revenue Multiplier (EGRM): A factor which reflects the relationship between the gross annual revenue of the real estate and its sale price or value. Effective Rent: 1) The rental rate net of financial concessions such as periods of no rent during a lease term; may be calculated on a discounted basis, reflecting the time value of money, or on a simple, straight-line basis. 7 2) The economic rent paid by the lessee when normalized to account for financial concessions, such as escalation clauses, and other factors. Contract, or normal, rents must be converted to effective rents to form a consistent basis of comparison between comparables. Exposure Time: The estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal; a retrospective estimate based upon an analysis of past events assuming a competitive and open market. Exposure time is different for various types of real estate and under various market conditions. It is noted that the overall concept of reasonable exposure encompasses not only adequate, sufficient and reasonable time but also adequate, sufficient and reasonable effort. The fact that exposure time is always presumed to occur prior to the effective date of the appraisal is substantiated by related facts in the appraisal process: supply/demand conditions as of the effective date of the appraisal; the use of current cost information; the analysis of historical sales information (sold after exposure and after completion of negotiations between the seller and buyer); and the analysis of future income expectancy estimated from the effective date of the appraisal. 8 Extraordinary Assumptions: An assumption, directly related to a specific assignment, which, if found to be false, could alter the appraiser’s opinion or conclusions. 9 Fair Market Share: The ratio of the submarket inventory over the fair market share. Fee Simple Estate: Absolute ownership unencumbered by any other interest or estate subject only to the four powers of government. 10 Floor Area Ratio (FAR): The relationship between the above-ground floor area of a building, as described by the building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area; also called building-to-land ratio. 7 Going Concern Value: Going concern value is the value of a proven property operation. It includes the incremental value associated with the business concern, which is distinct from the value of the real estate only. Going concern value includes an intangible enhancement of the value of an operating business enterprise which is produced by the assemblage of the land, building, labor, equipment, and marketing operation. This process creates an economically viable business that is expected to continue. Going concern value refers to the total value of a property, including both real property and intangible personal property attributed to the business value. 1 Gross Building Area (GBA): The sum of all areas at each floor as measured to the exterior walls. 1 The Appraisal of Real Estate, Eleventh Edition, Appraisal Institute, 1996. 2 The Dictionary of Real Estate Appraisal, Third Edition, 1993, p. 47. 3 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 1. 4 The Dictionary of Real Estate Appraisal, Third Edition, 1993, p. 92. 5 The Appraisal of Real Estate, 10th ed. (Chicago: Appraisal Institute, 1992), p. 344. 6 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 222. 7 The Dictionary of Real Estate Appraisal, Third Edition, 1993. 8 "Uniform Standards of Professional Appraisal Practice" (Washington, D.C.: The Appraisal Foundation, 1996), p. 75. 9 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 3. 10 The Dictionary of Real Estate Appraisal, 3rd ed. (Chicago: Appraisal Institute, 1993), p. 120. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 80 Highest and Best Use: The reasonably probable and legal use of vacant land or an improved property which is physically possible, appropriately supported, financially feasible and that results in the highest value. 11 Hypothetical Condition: That which is contrary to what exists but is supposed for the purpose of analysis. 12 Income Capitalization Approach: This approach derives a value indication for income-producing property by converting anticipated monetary benefits into a property value. This conversion is typically accomplished in two ways: A direct capitalization analysis where one year's income expectancy or an annual average of several years' income expectancies may be capitalized at a market-derived capitalization rate or a capitalization rate that reflects a specified income pattern, return on investment, and change in the value of the investment; secondly, a discounted cash flow analysis where the annual cash flows for the holding period and the reversion may be discounted at a specified yield rate. Insurable Value: Insurable Value is based on the replacement and/or reproduction cost of physical items that are subject to loss from hazards. Insurable value is that portion of the value of an asset or asset group that is acknowledged or recognized under the provisions of an applicable loss insurance policy. This value is often controlled by state law and varies from state to state. 1 Intended Use: The use or uses of an appraiser’s reported appraisal, appraisal review, or appraisal consulting assignment opinions and conclusions, as identified by the appraiser based on communication with the client at the time of the assignment. 13 Intended User: The client and any other party as identified, by name or type, as users of the appraisal, appraisal review, or appraisal consulting report by the appraiser on the basis of communications with the client at the time of the assignment. 14 Internal Rate of Return (“IRR”): The yield rate to the ownership position realized over the term of an investment. Investment Value: Investment value is the value of an investment to a particular investor based on his or her investment requirements. In contrast to market value, investment value is value to an individual, not value in the marketplace. Investment value reflects the subjective relationship between a particular investor and a given investment. When measured in dollars, investment value is the price an investor would pay for an investment in light of its perceived capacity to satisfy his or her desires, needs, or investment goals. To estimate investment value, specific investment criteria must be known. Criteria to evaluate a real estate investment are not necessarily set down by the individual investor; they may be established by an expert on real estate and its value, that is, an appraiser. 1 Leasehold Estate: The right to use and occupy real estate for a stated term and under certain conditions; conveyed by a lease. 15 Leased Fee Estate: An ownership interest held by a landlord with the rights of use and occupancy conveyed by lease to others. The rights of the lessor (the leased fee owner) and the leased fee are specified by contract terms contained within the lease. 16 Limited Appraisal: The act or process of developing an opinion of value or an opinion of value developed under and resulting from invoking the DEPARTURE RULE. 17 Load Factor: The amount added to usable area to calculate the rentable area. It is also referred to as a “rentable add-on factor” which, according to BOMA, “is computed by dividing the difference between the usable square footage and rentable square footage by the amount of the usable area. Convert the figure into a percentage by multiplying by 100”. Market Value: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specific date and the passing of title from seller to buyer under conditions whereby: (1) Buyer and seller are typically motivated; (2) Both parties are well informed or well advised, and acting in what they consider their own best interests; (3) A reasonable time is allowed for exposure in the open market; (4) Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and (5) The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale." 18 Market Value "As If Complete" On The Appraisal Date: Market value as if complete on the appraisal date is an estimate of the market value of a property with all construction, conversion, or rehabilitation hypothetically completed, or under other specified hypothetical conditions as of the date of the appraisal. With regard to properties wherein anticipated market conditions indicate that stabilized occupancy is not likely as of the date of completion, this estimate of value should reflect the market value of the property as if complete and prepared for occupancy by tenants. Market Value "As Is" On The Appraisal Date: Market value “as is” on the appraisal date is an estimate of the market value of a property in the condition observed upon inspection and as it physically and legally exists without hypothetical conditions, assumptions, or qualifications as of the date of appraisal. Marketing Period: The time it takes an interest in real property to sell on the market subsequent to the date of an appraisal. 7 11 The Dictionary of Real Estate Appraisal, 3rd ed. (Chicago: Appraisal Institute), p. 171. 12 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 3. 13 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 3. 14 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 3. 15 The Dictionary of Real Estate Appraisal, 3rd ed. (Chicago: Appraisal Institute, 1993), p. 177. 16 The Dictionary of Real Estate Appraisal, 3rd ed. (Chicago: Appraisal Institute, 1993), p. 204. 17 "Uniform Standards of Professional Appraisal Practice" (The Appraisal Foundation, 2003 Edition), p. 1. 18 "Uniform Standards of Professional Appraisal Practice" (Washington, D.C.: The Appraisal Foundation, 1996), p. 10. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 81 Net Lease: Lease in which all or some of the operating expenses are paid directly by the tenant. The landlord never takes possession of the expense payment. In a Triple Net Lease all operating expenses are the responsibility of the tenant, including property taxes, insurance, interior maintenance, and other miscellaneous expenses. However, management fees and exterior maintenance are often the responsibility of the lessor in a triple net lease. A modified net lease is one in which some expenses are paid separately by the tenant and some are included in the rent. Net Rentable Area (NRA): 1) The area on which rent is computed. 2) The Rentable Area of a floor shall be computed by measuring to the inside finished surface of the dominant portion of the permanent outer building walls, excluding any major vertical penetrations of the floor. No deductions shall be made for columns and projections necessary to the building. Include space such as mechanical room, janitorial room, restrooms, and lobby of the floor. 19 Penetration Rate: The ratio of the actual market share of a submarket over the fair market share of a submarket. Principle of Substitution: This principle affirms that no prudent buyer would pay more for a property than the cost to acquire a similar site and construct improvements of equal desirability and utility without undue delay. Reconciliation: The strengths and weaknesses of the individual approaches to value may vary based on the quality and quantity of data available in each instance. The final value conclusion is based on the appraisers' judgment with respect to the appropriateness of each approach as it applies to the property being appraised. Replacement Cost: The estimated cost to construct, at current prices as of the effective appraisal date, a building with utility equivalent to the building being appraised, using modern materials and current standards, design, and layout. Sales Comparison Approach: This approach derives a value indication by comparing the subject property to similar properties that have recently sold, applying appropriate units of comparison and making adjustments, based on the elements of comparison, to the sale prices of the comparables. Analysis of properties currently listed for sale is also useful in setting the upper limit of value. The overriding premise of this approach is that an informed purchaser would pay no more than the cost of acquiring an equally desirable substitute. Scope of the Appraisal: Extent of the process in which data are collected, confirmed, and reported. 20 Use Value: Use value is a concept based on the productivity of an economic good. Use value is the value a specific property has for a specific use. Use value focuses on the value the real estate contributes to the enterprise of which it is a part, without regard to the property’s highest and best use or the monetary amount that might be realized upon its sale. 1 19 1990 BOMA Experience Exchange Report, Income/Expense Analysis for Office Buildings (Building Owners and Managers Association, 1990) 20 The Dictionary of Real Estate Appraisal, Third Edition, 1993, p. 322. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 82 Building Classifications The Building Owners and Managers Association International (BOMA) classifies commercial space as: Class A, Class B, and Class C. Class A buildings have the "most prestigious buildings competing for premier office users with rents above average for the area” with "high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence." Class B buildings compete "for a wide range of users with rents in the average range for the area." Class C buildings are aimed towards "tenants requiring functional space at rents below the average for the area." The Urban Land Institute classifies commercial space as: Class A space can be characterized as buildings that have excellent location and access and attract high quality tenants. Building materials are high quality and rents are competitive with other new buildings. Class B buildings have good locations, management, and construction, and tenant standards are high. Class C buildings are typically 15 to 25 years old but are maintaining steady occupancy. Professional organizations have provided definitions to classify quality of space, as depicted above. However, differences in opinion in regards to proper classification of commercial space exist among commercial real estate professionals. For purposes of this appraisal classification of commercial space is as follows: Class A: This classification is reserved for those properties which represent the best in class for a property type. In addition to the level of quality presented in the above definitions a Class A property has a very strong identity of location and is considered to be a landmark property. This is an elite class of property and as such, there are few Class A properties. It is accepted in some circles that Class A would represent the best in class for a particular market, however this view dilutes the characteristics and definition of a Class A property. In fact, many markets and even more sub-markets do not have any Class A properties. The only market specific variation for purposes of this appraisal is that Class A properties located in Gateway Cities exceed what is generally accepted as Class A properties in the top 25 markets. Some Class A properties located in Gateway Cities could be better classified as “World Class” properties. It is common that tertiary markets will not contain Class A properties, however exceptions do exist. Class B: This classification represents most quality commercial properties with good market appeal and a relatively low effective age. Class B properties appeal to national credit tenants and while not landmark properties have favorable location features and/or good identity of location. Class C: This classification represents a large inventory of commercial properties which meet or exceed market standards for the property type. While some properties with a relatively low effective age are categorized as Class C, the bulk of this category includes property with an effective age exceeding 15 to 20 years. A property of low quality or more commonly poor location features with a low effective age is categorized as a Class C property. Unclassified: The minimum criteria for a property to classified as a Class C property is that it meets or exceeds market standards for the property type. Many commercial properties have deficiencies which do not meet market standards. While these properties may remain financial viable and have a remaining economic life, they are considered substandard properties and are therefore unclassified. 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 83 Certification Certification 140 W Beaver Creek Blvd, Avon, CO 81620 March 20, 2014 84 Qualifications Page 1 Starwood Vacation Ownership, Inc. Valuation of Mountain Vista Lot 4 Located in Avon, Colorado As of February 28, 2014 DRAFT Page 2 April 4, 2014 PRIVATE Ms. Vicky Carter Senior Vice President Starwood Vacation Ownership, Inc. 9002 San Marco Court Orlando, FL 32819 Dear Ms. Carter: We have appraised the fee simple interest of a retail/office building located at 140 W Beaver Creek Blvd, Avon, Colorado(Subject or Subject Property) as of February 28, 2014 (“Appraisal Date”) on an “as-is” and “with- parking” basis as requested by Starwood Vacation Ownership, Inc. (“SVO”). The Subject Property consists of a 0.21-acre site improved with 16,273 square feet of commercial retail and office space constructed in 2003. As of the Appraisal Date, the Subject Property is owned in fee simple estate by SVO and is unoccupied. This transmittal letter is accompanied by a restricted appraisal report. This report only includes a summary of the cost approach. The purpose of the appraisal report is to estimate the market value of the fee simple interest in the Subject Property on an “as-is” and “with-parking” basis. The intended user of this appraisal is SVO and its representatives. The intended use of this appraisal is to assist SVO with internal planning. This is a restricted appraisal, therefore opinions and conclusions set forth in the report may not be understood properly without additional information in our work files. This appraisal report is communicated in a Restricted Appraisal Report format under the requirements of the Uniform Standards of Professional Appraisal Practice (“USPAP”) of the Appraisal Foundation. The report provided under this engagement letter is not intended to be used, nor should be used, in connection with any tax matter. In the event Starwood Vacation Ownership uses this report for or in any relation to any tax matter, the report is not intended to be used, and cannot be used by a Starwood Vacation Ownership, Inc. or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to any other party any matters addressed herein. We appreciate the opportunity to prepare this restricted appraisal report for SVO. If you have any questions, please contact Brian Tankersley at (949) 885-5578. Respectfully submitted, KPMG LLP KPMG 20 Pacifica Suite 700 Irvine, CA 92618 Telephone 949 885 5578 Email btankersley@kpmg.com Page 3 COST APPROACH The cost approach includes the valuation of the land associated with the Subject Property in addition to the contributory value of the building and site improvements. Under the hypothetical condition that parking is included with the Subject Property, additional contributory value is related to 44 underground parking spaces at the Sheraton Mountain Vista. Valuation of Land The land portion of the valuation is based on the sales comparison approach. The Subject Property consists of 9,062 square feet or 0.21 acres of land. Under the premise that the highest and best use of the Subject includes parking, KPMG valued the adjacent parking structure. The parking structure consists of 16,720 square feet or 0.38 acres of land. Land Sale Comparables A search of transactions related to vacant land in the Subject Market and occurring within the two years prior to the valuation date. A total of one listing and four sales were determined to be comparable. The following chart includes a summary of the comparable land sales. Land Sale Comparables Analysis The comparable sales were analyzed and adjusted to the Subject Property based on market supported elements of comparison. The adjusted comparables were compared to the Subject on a price per square foot of land area. The following chart includes a summary of land adjustments. SaleAddressSaleSaleLand Area (sf)Price per sf No.City, StateDatePriceLand Area (ac)Price per acZoningComments 38388 Highway 6 & 24Listing $2,999,999188,615 $15.91Com Avon, CO 4.33 $692,840 970-980 SummitApr-13 $2,300,000101,800 $22.59Com Frisco, CO 2.34 $984,165 3 308 N FrenchSep-13 $460,0008,276 $55.58ComSale of residential/commercial Breckenridge, CO 0.19 $2,421,170 4 591 Blue River PkyFeb-13 $625,00033,924 $18.42C1Sale of commercial land. Silverthorne, CO 0.78 $802,529 5 120 S Fourth StAug-12 $1,099,00019,166 $57.34ComSale of potential mixed use Frisco, CO 0.44 $2,497,779 Sale PriceAcresPPSFPPA High $2,999,9994.33$57.34$2,497,779 Avg 1,496,8001.6233.971,479,697 Low 460,0000.1915.91692,840 Land Comparables 1 Sale of commercial land. 2 Sale of commercial land. Page 4 Land Valuation Conclusion Before adjustments, the comparable land sales ranged from $15.91 to $57.34 per square foot. After adjustments, the land comparable sales ranged from $19.88 to $91.75 per square foot. There is a lack of land sales near the Subject. All comparables were considered to be inferior to the Subject. Therefore, KPMG concluded on a value of $75.00 per square foot for both the land associated with the Subject Property and the land associated with the parking garage. Sale No.12345Subject Address38388 Highway 6 & 970-980 Summit308 N French591 Blue River Pky120 S Fourth St140 W Beaver Creek City, State, Zip Avon, COFrisco, COBreckenridge, COSilverthorne, COFrisco, COAvon, CO Sale DateListingApr-13Sep-13Feb-13Aug-12 Sales Price$2,999,999 $2,300,000 $460,000 $625,000 $1,099,000 Land Size (Square Feet)188,615101,8008,27633,92419,166 Land Size (Acres)4.332.340.190.780.44 Sales Price per Square Foot$15.91$22.59$55.58$18.42$57.34 Property Rights Conveyed0%0%0%0%0% Sales Price per Square Foot $15.91$22.59$55.58$18.42$57.34 Financing Terms0%0%0%0%0% Sales Price per Square Foot $15.91$22.59$55.58$18.42$57.34 Conditions of Sale0%0%0%0%0% Sales Price per Square Foot $15.91$22.59$55.58$18.42$57.34 Expenditures Immediately After Purchase (p $0$0$0$0$0 Sales Price per Square Foot $15.91$22.59$55.58$18.42$57.34 Market Conditions0%0%0%0%0% Sales Price per Square Foot $15.91$22.59$55.58$18.42$57.34 Location0%50%20%50%50% Size25%20%0%15%10% Shape0%0%0%0%0% Utilities/Topography0%0%0%0%0% Non-Realty Components0%0%0%0%0% Total Other Adjustments25%70%20%65%60% Overall ComparabilityInferiorInferiorSimilarInferiorInferior Average Sales Price per Square Foot$19.88$38.41$66.70$30.40$91.75 $49.43 Source: MLS Estimated Land Price (Per SF)Subject Land Area (SF)Total $759,062$679,631 Value Conclusion Rounded$680,000 OFFICE - CONCLUDED LAND VALUE Estimated Land Price (Per SF)Subject Land Area (SF)Total $7516,720$1,254,000 Value Conclusion Rounded$1,250,000 PARKING - CONCLUDED LAND VALUE Page 5 Building and Site Improvements In determining the fair value of the owned buildings at the Valuation Date under the cost approach, we have relied on the RCNLD method as outlined by Marshall Valuation Service, a nationally recognized construction cost guide. Under the RCNLD method, the RCN is based on the cost of constructing a facility that provides the same function as the Subject facility but is modern in its utility and design. Once RCN was determined, we considered adjustments to account for the age and all of the infirmities, inefficiencies, and obsolescence to the extent that any existed in the Subject at the Valuation Date. These deductions or adjustments are generally referred to as depreciation. Depreciation can be subdivided into its various forms, or categories, of physical depreciation (incurable and curable), operating functional obsolescence, and economic obsolescence. These forms of depreciation, if applicable, must be determined and deducted from the RCN in order to arrive at the RCNLD. We utilized this approach to value the site improvements and buildings. Page 6 Cost Approach Conclusion Based on the analysis of cost new as well as depreciation through the breakdown method, the cost approach indicates a market value as of the Appraisal Date of $4,120,000 for the Subject Property without the parking garage, and $7,075,000 under the hypothetical condition that the parking garage is included with the Subject. Office Underground Parking Total Attributes Land Square Feet9,062 16,720 25,782 Number of Parking Spaces0 44 44 Building Square Feet16,273 16,720 32,993 Replacement Cost Analysis Building Base Cost New (PSF)$116 $51 Square Foot Refinements$16 $8 Height and Size Refinements1.02 1.03 Location Refinements1.20 1.26 Total Base Building Cost (PSF)$161 $77 Total Base Building Cost$2,625,542 $1,288,711 $3,914,253 Soft Costs (10%)$262,554 $128,871 $391,425 Developer Profit (20%)$577,619 $283,516 $861,136 Building Replacement Cost New$3,465,716 $1,701,098 $5,166,814 Building Replacement Cost New (PSF)$213 $102 $157 Depreciation %3%4% Depreciation$115,524 $68,044 $183,568 Market Value$3,350,192 $1,633,055 $4,983,246 Market Value (rd)$3,350,000 $1,630,000 $4,980,000 Land Value (PSF)$75 $75 Fair Market Value Land680,000$ 1,250,000$ 1,930,000$ Site Improvements90,000 - 90,000 Building Improvements3,350,000 1,630,000 4,980,000 Skier Statue75,000 - 75,000 Total4,195,000$ 2,880,000$ 7,075,000$ Mountain Vista Lot 4 Cost Approach Summary Page 7 SUMMARY OF RESTRICTED APPRAISAL Intended User: SVO and its representatives Intended Use: SVO’s internal use Subject Property: Commercial Retail/Office Space Location: 140 W Beaver Creek Blvd Legal Lot 4, Avon, Colorado Interest Appraised: Fee Simple Definition of Value: The definition of Market Value defined in The Appraisal of Real Estate, Thirteenth Edition, as used in this appraisal is: “The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self- interest, and assuming that neither is under undue duress.” Effective Date of Value: February 28, 2014 (Appraisal Date) Date of Report: April 4, 2014 Site Area: 9,062 square feet (0.21 acres) Zoning: PUD – Planned Unit Development (City of Avon) Improvements: Commercial retail/Office building and landscaping Year Built: 2003 Building Area: 16,273 square feet Gross Rentable Area: 16,273 square feet Extraordinary Assumptions: None Hypothetical Conditions: The appraisal analysis includes a scenario with additional subterranean parking spaces not part of the Subject Property Page 8 CERTIFICATION OF APPRAISERS The signers of these appraisal reports do by their signature on this certification, certify that to the best of their knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions and are our personal, unbiased professional analyses, opinions and conclusions. 3. We have not provided any services regarding the Subject Property within the three year period immediately preceding acceptance of this assignment, as an appraiser or in any other capacity. 4. We have no present or prospective interest in the property that is the subject of this report and we have no personal interest with respect to the parties involved. 5. We have no bias with respect to the property that is the subject of this report or to the parties involved in this assignment. 6. Our engagement in this assignment was not contingent upon developing or reporting predetermined results. 7. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 8. Our analyses, opinions and conclusions were developed and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP). 9. Brian Tankersley has made personal inspections of the real property that is the subject of this report on February 7, 2012. 10. No one provided significant real property appraisal assistance to the person(s) signing this certification. 11. Brian Tankersley has previously appraised the property in March, 2012 for financial reporting purposes. Respectfully submitted, Thomas C. Harmening, MAI CO CG100037480 Brian Tankersley, MAI Page 9 LIMITING ASSUMPTIONS 1. Nature of Opinion. Neither our opinion nor our report are to be construed as a fairness opinion as to the fairness of an actual or proposed transaction, a solvency opinion, or an investment recommendation, but, instead, are the expression of our determination of the fair [market] value of the Subject Assets between a hypothetical willing buyer and a hypothetical willing seller in an assumed transaction on an assumed valuation date. For various reasons, the price at which the Subject Assets might be sold in a specific transaction between specific parties on a specific date might be significantly different from the fair [market] value expressed in our report. 2. Going Concern Assumption. No Undisclosed Contingencies. Our analysis (i) assumes that as of the Valuation Date the Company and its assets will continue to operate as configured as a going concern; (ii) is based on the past and present financial condition of the Company and its assets as of the Valuation Date; and (iii) assumes that the Company had no undisclosed real or contingent assets or liabilities, no unusual obligations or substantial commitments, other than in the ordinary course of business, nor had any litigation pending or threatened that would have a material effect on our analysis. 3. Reliance on Forecasted Data. Any use of management’s projections or forecasts in our analysis does not constitute an examination or compilation of prospective financial statements in accordance with standards established by the American Institute of Certified Public Accountants (“AICPA”). We do not express an opinion or any other form of assurance on the reasonableness of the underlying assumptions or whether any of the prospective financial statements, if used, are presented in conformity with AICPA presentation guidelines. Further, there will usually be differences between prospective and actual results because events and circumstances frequently do not occur as expected and those differences may be material. 4. Verification of Legal Description or Title. We have made no investigation of legal description or title and have assumed that owner(s) claims to property are valid. No consideration will be given to liens or encumbrances which may be against the property except as specifically stated as part of the financial statements you provide to us as part of this engagement. Full compliance with all applicable federal, state and local zoning, environmental, and similar laws and regulations is assumed, unless otherwise stated, and responsible ownership and competent management are assumed. 5. Verification of Hazardous Conditions. We will not investigate the extent of any hazardous substances that may exist as we are not qualified to test for such substances or conditions. If the presence of such substances, such as asbestos, urea formaldehyde foam insulation or other hazardous substances or environmental conditions may affect the value of the property, the value will be estimated predicated on the assumption that there is no such condition on or in the property or in such proximity thereto that it would cause a loss in value. No responsibility will be assumed for any such conditions, or for any expertise or engineering knowledge required to discover them. 6. Condition of Property. We assume no liability whatsoever with respect to the condition of the subject property for hidden or unapparent conditions, if any, of the subject property, subsoil or structures, and further assume no liability or responsibility whatsoever with respect to the correction of any defects which may now exist or which may develop in the future. Equipment components considered, if any, were assumed to be adequate for the needs of the property’s improvements, and in good working condition, unless otherwise reported. 7. Zoning. It is assumed that all public and private zoning and use restrictions and regulations had been complied with, unless nonconformity was stated, defined and considered in the report. 8. The Americans with Disabilities Act (“ADA”). The ADA became effective January 26, 1992. We will not make a specific compliance survey and analysis of this property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property, together with a detailed analysis of the requirements of the ADA, could reveal that the property is not in compliance with one or more requirements of the ADA. If so, this fact could have a negative effect upon the value of the property. Since we have no direct evidence relating to this issue, we will not consider possible non- compliance with the requirements of the ADA in estimating the value of the property. Usable Area Required # Spaces Position Square Feet Subtotal Town Manager 160 1 120 1 100 1 100 1 HR Assistant 100 1 100 1 Administration 100 1 Town Attorney 100 1 Town Clerk 120 1 Finance Director 144 1 100 1 Payroll Clerk 100 1 100 1 100 1 Budget Analyst 100 1 Subtotal 1,644 15 150 1 250 1 Storage 200 1 Subtotal 600 4 Subtotal 2244 19 269 Total 2513 19 IT Administrator 144 1 IT Technician 100 1 Subtotal 244 2 400 1 Switch Closet 70 1 125 1 Subtotal 595 3 Subtotal 839 101 Total 940 5 120 1 160 1 Town Planner 120 1 APPENDIX 3: Town of Avon - Spatial Needs Assessment Department FINANCE & ADMINISTRATION Personnel Spaces Executive Asst. to Town Manager Human Resource Generalist Municipal Court Clerk Community Relations Officer Finance Manager Accounts Receivable Accounts Payable Departmental Spaces HR Work Room & File Storage Floor - Shared Conference Room 12% Building Factor IT Personnel Spaces Departmental Spaces IT Data Server Room IT Other Space Requirements 12% Building Factor COMMUNITY DEVELOPMENT Personnel Spaces Chief Building Official Planning Manager 144 1 120 1 CD Admin 100 1 Subtotal 764 6 250 1 250 1 100 1 Subtotal 600 3 Subtotal 1364 164 Total 1528 9 Town Engineer 144 1 Project Engineer 120 1 Town Electrician 100 1 Subtotal 364 3 150 1 Subtotal 150 Subtotal 514 1 62 Total 576 4 1500 1 300 1 150 1 120 1 200 1 2270 5 272 2542 5 400 1 250 1 400 1 450 1 100 1 200 1 300 2 200 2 200 2 2500 11 300 Economic Development Director E.D. Special Events Supervisor Departmental Spaces Floor - Shared Conference Room Plans & Plats File Room Customer Service Lobby & Plans Counter 12% Building Factor ENGINEERING Personnel Spaces Departmental Spaces Engineering Plans Storage 12% Building Factor TOWN COUNCIL Departmental Spaces C.Chambers - Divisible Community Space Council Exec Work Room Judge/Prosecuter Office A/V Room Storage Subtotal 12% Building Factor Total OTHER CATEGORY Break Room/Kitchen - 1 per 2 floors First Floor Reception First Floor Community Meeting Room General Building Storage Electical Communications Room Janitor Supply Room RESTROOMS - PUBLIC (1st Floor) RESTROOMS - STAFF (2nd Floor) RESTROOMS - STAFF (3rd Floor) Subtotal 12% Building Factor 2800 11 SQ FT TOTAL SPACES 10,899 53 FUTURE TYPES OF DEMAND In-house Attorney 144 144 First Floor Community Meeting Room 250 250 Research Data Sources: 1. Sera Architects Consulting for the City of Oswego, OR: Space Program Assessment 2. BKV Group Consulting for the City of West St. Paul, MN: Architectural Space Program Report 3. OfficeFinder.com 4. Reinhardt Associates Consulting for the Town of East Longmeadow, MA 5. Internal Staff Floor 1 - Net SF 4,590 Floor 2 - Net SF 9,370 Floor 3 - Net SF 14,150 Total Net SF 14,150 Total CURRENT DEMAND Mountain Vista Lot 4 Floor Space 4,590 4,780 4,780 14,150 Ord. No 14-16 Approving a Purchase and Sale Agreement September 18, 2014 Page 1 of 3 TOWN OF AVON ORDINANCE 14-16 SERIES of 2014 AN ORDINANCE APPROVING THE PURCHASE AND SALE AGREEMENT FOR LOT 4, MOUNTAIN VISTA RESORT SUBDIVISION, TOWN OF AVON, COLORADO WHEREAS, the Town of Avon and Points of Colorado, Inc., have mutually signed a Purchase and Sale Agreement, with an effective date of September 17, 2014, (“Purchase and Sale Agreement”) for the acquisition and sale of property in Avon, Colorado, described as Lot 4, Mountain Vista Resort Subdivision, Town of Avon, Colorado, according to the Replat of Lots 2C, 4 and 5, Mountain Vista Resort Subdivision, Town of Avon, Colorado (“Property”); WHEREAS, Section 2.1 of the Avon Home Rule Charter provides that the Town Council may acquire real property interests and Colorado Revised Statutes section 31-15-101(1)(d) provides that municipalities may acquire and hold real property; WHEREAS, Paragraph 2.8(h) of the Purchase and Sale Agreement provides that the Town of Avon may terminate the Purchase and Sale Agreement by October 22, 2014 if the Avon Town Council does not adopt an ordinance approving the Purchase and Sale Agreement by October 15, 2014; WHEREAS, the Town Council finds that acquisition of this Property supports the Avon West Town Center District Plan, including K. TOWN HALL, which states, “The existing Town Hall is too small for the current Town needs, is outdated and lacks a high level of energy efficiency.” and which depicts the location of a new Town Hall facility on the “Main Street” (the Avon pedestrian mall); WHEREAS, the Town Council finds that acquisition of the Property shall promote the health, safety, prosperity, convenience and general welfare of the Avon community by providing administrative facilities to meet current and projected future needs of the Town; and, WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply with the requirements of the Avon Home Rule Charter by setting a public hearing in order to provide the public an opportunity to provide public comment on this Ordinance and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO, the following: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. ATTACHMENT B: Ordinance No. 14-16 Ord. No 14-16 Approving a Purchase and Sale Agreement September 18, 2014 Page 2 of 3 Section 2. Purchase and Sale Approved. The Purchase and Sale Agreement attached as Exhibit A: Purchase and Sale Agreement is hereby approved and, subject to the terms and conditions precedent set forth in the Purchase and Sale Agreement, the Town Council approves the acquisition of the Property. Section 3. Mayor and Town Clerk Authorized to Execute Documents. The Mayor and Town Clerk are authorized to execute and attest to documents related to acquisition and encumbrance of the Property in accordance with the terms set forth in the Purchase and Sale Agreement approved in this Ordinance and take such other actions as may be reasonably necessary to implement the actions in this Ordinance. The Mayor, Town Manager and Town Attorney may collectively review and approve the documents contemplated in the Purchase and Sale Agreement, extend deadlines contemplated in the Purchase and Sale Agreement, and correct typos, grammatical errors, cross-reference errors, and revisions which do not alter the substantive terms of the Purchase and Sale Agreement approved in this Ordinance. Section 4. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 5. Effective Date. This Ordinance shall take effect thirty days after the date of final passage in accordance with Section 6.4 of the Avon Home Rule Charter. Section 6. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 7. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title only in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a copy of the Ordinance in full is available for public inspection in the office of the Town Clerk during normal business hours. [Signature page follows] ATTACHMENT B: Ordinance No. 14-16 Ord. No 14-16 Approving a Purchase and Sale Agreement September 18, 2014 Page 3 of 3 INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED POSTED AND REFERRED TO PUBLIC HEARING and setting such public hearing for October 14, 2014 at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado, on September 23, 2014. ____________________________ Rich Carroll, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least six days prior to final action by the Town Council. ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney INTRODUCED, FINALLY APPROVED, AND PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on October 14, 2014. ____________________________ Rich Carroll, Mayor Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: APPROVED AS TO FORM: _______________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney ATTACHMENT B: Ordinance No. 14-16 EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT EXHIBIT A: PURCHASE AND SALE AGREEMENT Heil Law & Planning, LLC Office: 303.975.6120 3445 S. Clermont St. Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council members FROM: Eric J. Heil, Town Attorney RE: Ord. No. 14-17 Approving Certificates of Participation for Acquisition of Skier Building and Interior Finish DATE: September 18, 2014 SUMMARY: This memorandum provides an overview of Ordinance No. 14-17 Approving Certificates of Participation to finance acquisition and interior finishing of Lot 4, Mountain Vista Resort Subdivision, Town of Avon, Colorado (“Skier Building”). Attached Ordinance No. 14-17, the form of a Site Lease, the form of a Lease, the form of a Continuing Disclosure Certificate. CERTIFICATES OF PARTICIPATION: Certificates of Participation is a form of financing whereby the Town’s obligation to pay the annual debt service payment is subject to annual budget and appropriation. If the Town fails to pay the annual debt service payment then the Town would lose possession of the Skier Building during the remaining term of the Site Lease. Ordinance 14-17 authorizes the execution and delivery of Certificates of Participations, Series 2014A and sets forth certain parameters and restrictions, delegates the authority to execute agreements, and approves the form the attached documents. Site Lease and Lease: In order to secure the financing for acquisition and interior finish, the Certificates of Participation are arranged such that the Town acquires the Skier Building, then leases the Skier Building to UMB Bank, N.A. (“Trustee”) through the Site Lease, then the Trustee leases the Skier Building back to the Town through the Lease. Through this arrangement, the Trustee has a secured right to take possession of the Skier Building if the Town fails to pay the annual debt service payment. Ordinance 14-17 authorizes the Site Lease to extend through 2050. Financing Authorization: Attachment F: Sources and Uses of Funds sets forth the anticipated debt schedule and receipt of funds in the amount of $5,840,600.70 for building acquisition and interior finish. Ordinance No. 14-17 authorizes annual repayment costs not to exceed $500,000, and authorizes payment of a net effective interest rate not to exceed 5.00%. The anticipated budget for use of the funds is more fully explained in Virginia Egger’s memorandum accompanying Ordinance No. 14-16. Thank you, Eric ATTACHMENT A: Ordinance No. 14-17 ATTACHMENT B: Form of Site Lease ATTACHMENT C: Form of Lease ATTACHMENT D: Form of Disclosure Certificate ATTACHMENT E: Form of Certificate Purchase Agreement ATTACHMENT F: Sources and Uses of Funds M EMORANDUM & PLANNING, LLC Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 1 of 11 TOWN OF AVON, COLORADO ORDINANCE NO. 14-17 SERIES OF 2014 AN ORDINANCE AUTHORIZING THE FINANCING OF CERTAIN PUBLIC IMPROVEMENTS OF THE TOWN, AND IN CONNECTION THEREWITH AUTHORIZING THE LEASING OF CERTAIN TOWN PROPERTY AND THE EXECUTION AND DELIVERY BY THE TOWN OF A SITE AND IMPROVEMENT LEASE, A LEASE PURCHASE AGREEMENT, A DISCLOSURE CERTIFICATE, A PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS AND MATTERS RELATING TO CERTAIN CERTIFICATES OF PARTICIPATION, SERIES 2014A; SETTING FORTH CERTAIN PARAMETERS AND RESTRICTIONS WITH RESPECT TO THE FINANCING; AUTHORIZING OFFICIALS OF THE TOWN TO TAKE ALL ACTION NECESSARY TO CARRY OUT THE TRANSACTIONS CONTEMPLATED HEREBY; RATIFYING ACTIONS PREVIOUSLY TAKEN; AND PROVIDING OTHER MATTERS RELATED THERETO. WHEREAS, the Town of Avon, Eagle County, Colorado (the “Town”) is a duly organized and existing home rule municipality of the State of Colorado, created and operating pursuant to Article XX of the Constitution of the State of Colorado and the home rule charter of the Town (the “Charter”); and WHEREAS, pursuant to Chapter XIV of the Charter, the Town is authorized to enter into one or more leases or lease-purchase agreements for land, buildings, equipment and other property for governmental or proprietary purposes; and WHEREAS, the Town is authorized by Article XX, Section 6 of the Colorado Constitution, its Charter, and part 8 of Article 15 of title 31, Colorado Revised Statutes (“C.R.S.”), to enter into rental or leasehold agreements in order to provide necessary land, buildings, equipment and other property for governmental or proprietary purposes; and WHEREAS, for the functions or operation of the Town, it is necessary that the Town finance the acquisition of certain real property and all buildings and improvements located thereon for Town purposes, and as authorized by law (collectively, the “Project”); and WHEREAS, the Town owns, or will own, in fee title, the Site and the premises, buildings and improvements located thereon (the “Leased Property”), as further described in the Site Lease and the Lease (hereinafter defined); and WHEREAS, the Town Council of the Town (the “Town Council”) has determined, and now hereby determines, that it is in the best interest of the Town and its inhabitants that the Town lease the Leased Property to UMB Bank, n.a., as trustee under the Indenture (the “Trustee”) pursuant to a Site Lease between the Town, as lessor, and the Trustee, as lessee (the “Site Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 2 of 11 Lease”), and lease back the Trustee’s interest in the Leased Property pursuant to the terms of a Lease Agreement (the “Lease”) between the Trustee, as lessor, and the Town, as lessee; and WHEREAS, pursuant to the Lease, and subject to the right of the Town to terminate the Lease and other limitations as therein provided, the Town will pay certain Base Rentals and Additional Rentals (as such terms are defined in the Lease) in consideration for the right of the Town to use the Leased Property; and WHEREAS, the Town’s obligation under the Lease to pay Base Rentals and Additional Rentals shall be from year to year only; shall constitute currently budgeted expenditures of the Town; shall not constitute a mandatory charge or requirement in any ensuing budget year; and shall not constitute a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, charter, statutory limitation or requirement concerning the creation of indebtedness or multiple fiscal year financial obligation, nor a mandatory payment obligation of the Town in any ensuing fiscal year beyond any fiscal year during which the Lease shall be in effect; and WHEREAS, the Trustee will enter into an Indenture of Trust (the “Indenture”) pursuant to which there is expected to be executed and delivered certain certificates of participation (the “2014A Certificates”) dated as of their date of delivery that shall evidence proportionate interests in the right to receive certain Revenues (as defined in the Lease), shall be payable solely from the sources therein provided and shall not directly or indirectly obligate the Town to make any payments beyond those appropriated for any fiscal year during which the Lease shall be in effect; and WHEREAS, the net proceeds of the 2014A Certificates are expected to be used to finance the Project; and WHEREAS, there has also been presented to this meeting of the Town Council the form of Continuing Disclosure Certificate (the “Continuing Disclosure Certificate”); and WHEREAS, there will be executed and distributed in connection with the sale of the 2014A Certificates an Official Statement (the “Official Statement”) in substantially the form of the Preliminary Official Statement (the “Preliminary Official Statement”) relating to the 2014A Certificates as approved by the Finance Director of the Town; and WHEREAS, Section 11-57-204 of the Supplemental Public Securities Act, constituting Title 11, Article 57, Part 2, Colorado Revised Statutes, as amended (the “Supplemental Act”), provides that a public entity, including the Town, may elect in an act of issuance to apply all or any of the provisions of the Supplemental Act; and WHEREAS, there has been presented to the Town Council and are on file at the Town offices the following: (i) the proposed form of the Site Lease; (ii) the proposed form of the Lease; and (iii) the proposed form of the Continuing Disclosure Certificate to be provided by the Town (the “Disclosure Certificate”); and Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 3 of 11 WHEREAS, capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Lease; and, WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply with the requirements of the Avon Home Rule Charter by setting a public hearing in order to provide the public an opportunity to provide public comment on this Ordinance and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO the following: Section 1. Short Title. This ordinance shall be known and may be cited by the short title “2014A COP Ordinance.” Section. 2. Ratification and Approval of Prior Actions. All action heretofore taken (not inconsistent with the provisions of this Ordinance) by the Town Council or the officers, agents or employees of the Town Council or the Town relating to the Site Lease, the Lease, the acquisition, construction, installation or improvement of the Project, and the execution and delivery of the 2014A Certificates is hereby ratified, approved and confirmed. Section 3. Finding of Best Interests. The Town Council hereby finds and determines, pursuant to the Constitution, the laws of the State of Colorado and the Charter, that the acquisition, construction, and installation of the Project, and the financing of the costs thereof pursuant to the terms set forth in the Site Lease and the Lease are necessary, convenient, and in furtherance of the Town’s purposes and are in the best interests of the inhabitants of the Town and the Town Council hereby authorizes and approves the same. Section 4. Supplemental Act; Parameters. The Town Council hereby elects to apply all of the Supplemental Act to the Site Lease and the Lease and in connection therewith delegates to each of the Mayor, the Town Manager or the Finance Director the authority to make any determination delegable pursuant to § 11-57-205(1)(a-i) of the Colorado Revised Statutes, as amended, in relation to the Site Lease and the Lease, and to execute a sale certificate (the “Sale Certificate”) setting forth such determinations, including without limitation, the term of the Site Lease, the rental amount to be paid by the Trustee pursuant to the Site Lease, the term of the Lease, and the rental amount to be paid by the Town pursuant to the Lease, subject to the following parameters and restrictions: (a) the term of the Site Lease shall not extend beyond December 31, 2050; (b) the aggregate principal amount of the Base Rentals payable by the Town pursuant to the Lease shall not exceed $6,300,000; (c) the Lease Term shall not extend beyond December 31, 2040; Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 4 of 11 (d) the maximum annual repayment cost of the Base Rentals under the Lease shall not exceed $500,000, and the total repayment cost shall not exceed $12,500,000; and (e) the maximum net effective interest rate on the interest component of the Base Rentals relating to the 2014A Certificates shall not exceed 5.00%. Pursuant to § 11-57-205 of the Supplemental Act, the Town Council hereby delegates to each of the Mayor, the Town Manager or the Finance Director the authority to sign a contract for the purchase of the 2014A Certificates or to accept a binding bid for the 2014A Certificates and to execute any agreement or agreements in connection therewith. In addition, each of the Mayor, the Town Manager or the Finance Director is hereby authorized to determine if obtaining an insurance policy for all or a portion of the 2014A Certificates is in the best interests of the Town, and if so, to select an insurer to issue an insurance policy, execute a commitment relating to the same and execute any related documents or agreements required by such commitment. Each of the Mayor, the Town Manager or the Finance Director is also hereby authorized to determine if obtaining a reserve fund insurance policy for the 2014A Certificates is in the best interests of the Town, and if so, to select a surety provider to issue a reserve fund insurance policy and execute any related documents or agreements required by such commitment. The Town Council hereby agrees and acknowledges that the proceeds of the 2014A Certificates will be used to finance the costs of the Project and to pay other costs of issuance. Section 5. Approval of Documents. The Site Lease, the Lease, and the Disclosure Certificate, in substantially the forms presented to the Town Council and on file with the Town, are in all respects approved, authorized and confirmed, and the Mayor or Mayor Pro Tem of the Town is hereby authorized and directed for and on behalf of the Town to execute and deliver the Site Lease, the Lease, and the Disclosure Certificate in substantially the forms and with substantially the same contents as presented to the Town Council, provided that such documents may be completed, corrected or revised as deemed necessary by the parties thereto in order to carry out the purposes of this Ordinance. Section 6. Approval of Official Statement. A Preliminary Official Statement and a final Official Statement, in substantially the form of the Official Statement relating to the 2010 Certificates of Participation, which such updates and revisions as hereafter approved by the Mayor, the Town Manager or the Finance Director, and as hereafter presented to the Town Council and on file with the Town, is in all respects approved and authorized. The Mayor is hereby authorized and directed, for and on behalf of the Town, to execute and deliver the final Official Statement in substantially the form and with substantially the same content as the Preliminary Official Statement, with such changes as may be approved by the Town Manager or the Finance Director. The distribution of the Preliminary Official Statement and the final Official Statement to all interested persons in connection with the sale of the 2014A Certificates is hereby ratified, approved and authorized. Section 7. Authorization to Execute Collateral Documents. No provision of this ordinance, the Site Lease, the Lease, the Indenture, or the 2014A Certificates, shall be construed as creating or constituting a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or home rule Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 5 of 11 charter provision, nor a mandatory charge or requirement against the Town in any ensuing fiscal year beyond the then current fiscal year. The Town shall have no obligation to make any payment with respect to the 2014A Certificates except in connection with the payment of the Base Rentals (as defined in the Lease) and certain other payments under the Lease, which payments may be terminated by the Town in accordance with the provisions of the Lease. Neither the Lease nor the 2014A Certificates shall constitute a mandatory charge or requirement of the Town in any ensuing fiscal year beyond the then current fiscal year or constitute or give rise to a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter debt limitation and shall not constitute a multiple fiscal year direct or indirect debt or other financial obligation whatsoever. No provision of the Site Lease, the Lease or the 2014A Certificates shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Sections 1 or 2 of Article XI of the Colorado Constitution. Neither the Lease nor the 2014A Certificates shall directly or indirectly obligate the Town to make any payments beyond those budgeted and appropriated for the Town’s then current fiscal year. Section 8. No General Obligation Debt. No provision of this Ordinance, the Site Lease, the Lease, the Indenture, the 2014A Certificates, the Preliminary Official Statement, or the final Official Statement shall be construed as creating or constituting a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter provision, nor a mandatory charge or requirement against the Town in any ensuing fiscal year beyond the then current fiscal year. The Town shall have no obligation to make any payment with respect to the 2014A Certificates except in connection with the payment of the Base Rentals (as defined in the Lease) and certain other payments under the Lease, which payments may be terminated by the Town in accordance with the provisions of the Lease. Neither the Lease nor the 2014A Certificates shall constitute a mandatory charge or requirement of the Town in any ensuing fiscal year beyond the then current fiscal year or constitute or give rise to a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter debt limitation and shall not constitute a multiple fiscal year direct or indirect debt or other financial obligation whatsoever. No provision of the Site Lease, the Lease or the 2014A Certificates shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Sections 1 or 2 of Article XI of the Colorado Constitution. Neither the Lease nor the 2014A Certificates shall directly or indirectly obligate the Town to make any payments beyond those budgeted and appropriated for the Town’s then current fiscal year. Section 9. Reasonableness of Rentals. The Town Council hereby determines and declares that the Base Rentals due under the Lease, in the maximum amounts authorized pursuant to Section 3 hereof, constitute the fair rental value of the Leased Property and do not exceed a reasonable amount so as to place the Town under an economic compulsion to renew the Lease or to exercise its option to purchase the Trustee’s leasehold interest in the Leased Property pursuant to the Lease. The Town Council hereby determines and declares that the period during which the Town has an option to purchase the Trustee’s leasehold interest in the Leased Property (i.e., the entire maximum term of the Lease) does not exceed the useful life of the Leased Property. Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 6 of 11 The Town Council hereby further determines that the amount of rental payments to be received by the Town from the Trustee pursuant to the Site Lease is reasonable consideration for the leasing of the Leased Property to the Trustee for the term of the Site Lease as provided therein. Section 10. No Recourse against Officers and Agents. Pursuant to § 11-57-209 of the Supplemental Act, if a member of the Town Council, or any officer or agent of the Town acts in good faith, no civil recourse shall be available against such member, officer, or agent for payment of the principal, interest or prior redemption premiums on the 2014A Certificates. Such recourse shall not be available either directly or indirectly through the Town Council or the Town, or otherwise, whether by virtue of any constitution, statute, rule of law, enforcement of penalty, or otherwise. By the acceptance of the 2014A Certificates and as a part of the consideration of their sale or purchase, any person purchasing or selling such 2014A Certificate specifically waives any such recourse. Section 11. Repealer. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are hereby 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, heretofore repealed. Section 12. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 13. Interpretation. This Ordinance shall be so interpreted and construed as to effectuate its general purpose. Section 14. Charter Controls. Pursuant to Article XX of the State Constitution and the Charter, all State statutes that might otherwise apply in connection with the provisions of this Ordinance are hereby superseded to the extent of any inconsistencies or conflicts between the provisions of this Ordinance and the Sale Certificate authorized hereby and such statutes. Any such inconsistency or conflict is intended by the Town Council and shall be deemed made pursuant to the authority of Article XX of the State Constitution and the Charter. Section 15. Effective Date, Recording, and Authentication. This Ordinance shall be in full force and effect thirty days after the date of final passage in accordance with Section 6.4 of the Charter. This Ordinance shall be numbered and recorded in the official records of the Town kept for that purpose, and shall be authenticated by the signatures of the Mayor and Mayor Pro-Tem and Town Clerk, and published in accordance with law. Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 7 of 11 Section 16. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 17. Publication. The Town Clerk is ordered to publish this Ordinance in full after adoption on first reading, and such publication shall include the day, hour and place at which Council shall hold a public hearing on said ordinance. The Ordinance shall be published in full after final passage pursuant to the Charter. INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED PUBLISHED IN FULL AND REFERRED TO PUBLIC HEARING, and setting such public hearing for October 14, 2014, at 5:30 p.m., at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado, on September 23, 2014. TOWN OF AVON, COLORADO ____________________________ Rich Carroll, Mayor ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney INTRODUCED, FINALLY APPROVED, PASSED ON SECOND READING, AND ORDERED PUBLISHED IN FULL on October 14, 2014. ____________________________ Rich Carroll, Mayor ATTEST: __________________________ Debbie Hoppe, Town Clerk Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 1 of 11 STATE OF COLORADO ) ) COUNTY OF EAGLE ) SS. ) TOWN OF AVON ) I, Debbie Hoppe, the Town Clerk of the Town of Avon, Colorado (the “Town”), do hereby certify: I, the duly elected, qualified, and acting Town Clerk of the Town of Avon, Colorado (the “Town”), do hereby certify that: (1) The foregoing pages are a true, correct and complete copy of an ordinance (the “Ordinance”) that was introduced, approved on first reading and ordered published in full in accordance with the Town Charter (the “Charter”) by the Town Council at a regular meeting thereof held on September 23, 2014, and was introduced, approved on second and final reading, and ordered published in full in accordance with the Charter on October 14, 2014, which Ordinance has not been revoked, rescinded or repealed and is in full force and effect on the date hereof. (2) The Ordinance was duly moved and seconded, and the Ordinance was approved on first reading, at the meeting of September 23, 2014, by an affirmative vote of a majority of the membership of the entire Town Council as follows: Councilmember Voting “Yes” Voting “No” Absent Abstaining Rich Carroll Jennie Fancher David Dantas Chris Evans Matt Gennett Buz Reynolds Jake Wolf (3) The Ordinance was duly moved and seconded, and the Ordinance was approved on second and final reading, at the meeting of October 14, 2014, by an affirmative vote of a majority of the membership of the entire Town Council as follows: Ord. No. 14-17 Approving Certificates of Participation September 23, 2014 Page 2 of 11 Councilmember Voting “Yes” Voting “No” Absent Abstaining Rich Carroll Jennie Fancher David Dantas Chris Evans Matt Gennett Buz Reynolds Jake Wolf (4) The members of the Town Council were present at such meetings and voted on the passage of such Ordinance as set forth above. (5) The Ordinance was authenticated by the signature of the Mayor, sealed with the Town seal, attested by the Town Clerk, and recorded in the minutes of the Town Council. (6) There are no bylaws, rules or regulations of the Town Council that might prohibit the adoption of the Ordinance. (7) Notices of the meetings of September 23, 2014, and October 14, 2014, in the forms attached hereto as Exhibit A were posted at the Town Hall not less than 24 hours prior to each meeting in accordance with law. (8) On September __, 2014, and October __, 2014, the Ordinance was published in full in the Vail Daily, a newspaper of general circulation in the Town, in accordance with the Charter. Affidavits of publication are attached hereto as Exhibit B. WITNESS my hand and the seal of the Town affixed this ____ day of October, 2014. [ S E A L ] _______________________________________ Town Clerk A-1 EXHIBIT A (Attach Notices of Meetings of September 23, 2014 and October 14, 2014) B-1 EXHIBIT B (Affidavits of Publication) AFTER RECORDATION PLEASE RETURN TO: Butler Snow LLP 1801 California Street, Suite 5100 Denver, Colorado 80202 Attention: Dee P. Wisor, Esq. Pursuant to Section 39-13-104(1)(j), Colorado Revised Statutes, this Site and Improvement Lease is exempt from the documentary fee. SITE AND IMPROVEMENT LEASE DATED AS OF [________], 2014 BETWEEN TOWN OF AVON, COLORADO AS LESSOR AND UMB BANK, N.A., SOLELY IN ITS CAPACITY AS TRUSTEE UNDER THE INDENTURE, AS LESSEE ATTACHMENT B: Form of Site Lease 1 This SITE AND IMPROVEMENT LEASE, dated as of [________], 2014 (this “Site Lease”), is by and between the TOWN OF AVON, COLORADO, a home rule municipality duly organized and validly existing under the Constitution and laws of the State of Colorado (the “Town”), as lessor, and UMB BANK, N.A., Denver, Colorado, a national banking association duly organized and validly existing under the laws of the United States of America, solely in its capacity as trustee under the Indenture (the “Trustee”), as lessee. PREFACE Unless the context otherwise requires, capitalized terms used herein shall have the meanings ascribed to them herein and in the Lease Purchase Agreement, dated as of [________], 2014 (the “Lease”), between the Trustee, as lessor, and the Town, as lessee. RECITALS 1. The Town has been duly organized and is validly existing as a home rule municipality under the Constitution of the State of Colorado and the Charter of the Town (the “Charter”). 2. Pursuant to Article XIV of the Charter and Article XX of the Colorado Constitution, the Town is authorized to purchase, sell, exchange or dispose of any interest in real property, and the Council by ordinance may lease, for such a term as the Council shall determine any real property to any person, firm or corporation, public or private. 3. The Town is authorized pursuant to Section 14.9 of the Charter to enter into long term rental installment purchase contracts and rental or leasehold agreements. 4. The Council has determined it is necessary that the Town finance the acquisition, of certain real property and the buildings and improvements located thereon for Town purposes (the “Project”). 5. The Council has determined that it is in the best interests of the Town and its inhabitants to provide for the financing the Project by entering into this Site Lease and the Lease. 6. The Town owns, or will, contemporaneously with the execution and delivery hereof, own, in fee title, the Site (the “Site”) and the premises, buildings and improvements located thereon, (as more particularly described in Exhibit A attached hereto, the “Leased Property”). To accomplish the Project, the Trustee will acquire a leasehold interest in the Site by leasing the Site from the Town pursuant to this Site Lease and will lease the Site back to the Town pursuant to the Lease. 7. The Council has determined that it is in the best interest of the Town and its residents and inhabitants to provide for the financing of the Project by entering into this Site Lease and the Lease, and by leasing the Project from the Trustee pursuant to the terms of the Lease, and subleasing the Site from the Trustee pursuant to the Lease. ATTACHMENT B: Form of Site Lease 2 8. The Trustee and the Town intend that this Site Lease set forth their entire understanding and agreement regarding the terms and conditions upon which the Trustee is leasing the Leased Property from the Town. 9. Contemporaneously with the execution and delivery of this Site Lease and the Lease, the Trustee will execute and deliver an Indenture of Trust (the “Indenture”) pursuant to which there is expected to be executed and delivered certain certificates of participation (the “Certificates”) dated as of their date of delivery that shall evidence proportionate interests in the right to receive certain Revenues (as defined in the Lease), shall be payable solely from the sources therein provided and shall not directly or indirectly obligate the Town to make any payments beyond those appropriated for any fiscal year during which the Lease shall be in effect. 10. The proceeds of the Certificates will be utilized for the Project, as well as for the payment of the costs of execution and delivery of the Certificates. 11. The Town proposes to enter into this Site Lease with the Trustee as material consideration for the Trustee’s agreement to lease the Leased Property to the Town pursuant to the Lease. The Trustee shall prepay in full its rental payments due under this Site Lease which rental payments shall be used by the Town to effect the Project, all pursuant to this Site Lease, the Lease and the Indenture. NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows; Section 1. Site Lease and Terms. The Town hereby demises and leases to the Trustee and the Trustee hereby leases from the Town, on the terms and conditions hereinafter set forth, the Site, subject to Permitted Encumbrances as described in Exhibit B hereto. The term of this Site Lease shall commence on the date hereof and shall end on December 31, 20[__] (the “Site Lease Termination Date”), unless such term is sooner terminated as hereinafter provided. If, prior to the Site Lease Termination Date, the Trustee has transferred and conveyed the Trustee’s leasehold interests in the Site pursuant to Article 12 of the Lease as a result of the Town’s payment of (a) the applicable Purchase Option Price thereunder; or (b) all Base Rentals and Additional Rentals, all as further provided in Section 12.2 of the Lease, then the term of this Site Lease shall end in connection with such transfer and conveyance. The term of any sublease of the Site or any portion thereof, or any assignment of the Trustee’s interest in this Site Lease, pursuant to Section 5 hereof, the Lease and the Indenture, shall not extend beyond December 31, 20[__]. At the end of the term of this Site Lease, all right, title and interest of the Trustee, or any sublessee or assignee, in and to the Site, shall terminate. Upon such termination, the Trustee and any sublessee or assignee shall execute and deliver to the Town any necessary documents releasing, assigning, transferring and conveying the Trustee’s, sublessee’s or assignees’ respective interests in the Site. Section 2. Rental. The Trustee has paid to the Town and the Town hereby acknowledges receipt from the Trustee as and for rental hereunder, paid in advance, the sum of $[___________], as and for all rent due hereunder, and other good and valuable consideration, the sufficiency of which are hereby acknowledged, to have and to hold for the term of this Site ATTACHMENT B: Form of Site Lease 3 Lease as provided herein. The Town hereby determines that such amount is reasonable consideration for the leasing of the Leased Property to the Trustee for the term of this Site Lease. Section 3. Purpose. The Trustee shall use the Site solely for the purpose of leasing the Site back to the Town pursuant to the Lease and for such purposes as may be incidental thereto; provided, that upon the occurrence of an Event of Nonappropriation or an Event of Lease Default and the termination of the Lease, the Town shall vacate the Leased Property, as provided in the Lease, and the Trustee may exercise the remedies provided in this Site Lease, the Lease and the Indenture. Section 4. Owner in Fee. The Town represents that (a) it is the owner in fee of the Leased Property, subject only to Permitted Encumbrances as described in Exhibit B hereto, and (b) the Permitted Encumbrances do not and shall not interfere in any material way with the Leased Property. The Trustee acknowledges that it is only obtaining a leasehold interest in the Leased Property and pursuant to this Site Lease. Section 5. Sales, Assignments and Subleases. Unless an Event of Nonappropriation or an Event of Lease Default shall have occurred and except as may otherwise be provided in the Lease, the Trustee may not sell or assign its rights and interests under this Site Lease or sublet all or any portion of the Leased Property, without the written consent of the Town. In the event that (a) the Lease is terminated for any reason and (b) this Site Lease is not terminated, the Trustee may sublease the Leased Property or any portion thereof, or sell or assign the Trustee’ leasehold interests in this Site Lease, pursuant to the terms of the Lease and the Indenture, and any purchasers from or sublessees or assignees of the Trustee may sell or assign its respective interests in the Leased Property, subject to the terms of this Site Lease, the Lease and the Indenture. The Town and the Trustee (or any purchasers from or assignees or sublessees of the Trustee) agree that, except as permitted by this Site Lease, the Lease and the Indenture and except for Permitted Encumbrances (including purchase options under the Lease), neither the Town, the Trustee, nor any purchasers from or sublessees or assignees of the Trustee will sell, mortgage or encumber the Leased Property or any portion thereof during the term of this Site Lease. Section 6. Right of Entry. The Town reserves the right, so long as no Event of Nonappropriation or Event of Lease Default shall have occurred, for any of its duly authorized representatives to enter upon the Leased Property at any reasonable time to inspect the same or to make any repairs, improvements or changes necessary for the preservation thereof. Section 7. Termination. The Trustee agrees, upon the termination of this Site Lease, to quit and surrender all of the Leased Property, and agrees that any permanent improvements and structures existing upon the Leased Property at the time of the termination of this Site Lease shall remain thereon and title thereto shall vest in the Town. Section 8. Default. In the event the Trustee shall be in default in the performance of any obligation on its part to be performed under the terms of this Site Lease, which default continues for 30 days following notice and demand for correction thereof to the Trustee, the Town may exercise any and all remedies granted by law, except that no merger of this Site Lease ATTACHMENT B: Form of Site Lease 4 and of the Lease shall be deemed to occur as a result thereof and that so long as any Certificates are Outstanding and unpaid under the Indenture, the Base Rentals due under the Lease shall continue to be paid to the Trustee except as otherwise provided in the Lease. In addition, so long as any of the Certificates are Outstanding, this Site Lease shall not be terminated except as described in Section 1 hereof. Section 9. Quiet Enjoyment and Acknowledgment of Ownership. The Trustee at all times during the term of this Site Lease shall peaceably and quietly have, hold and enjoy the Leased Property, subject to the provisions of the Lease and the Indenture, and the Town hereby acknowledges that the Trustee shall have a leasehold interest in all improvements or additions to be built on the Leased Property subject to this Site Lease, the Lease and the Indenture. Section 10. Trustee’s Disclaimer. It is expressly understood and agreed that (a) this Site Lease is executed by UMB Bank, n.a. solely in its capacity as Trustee under the Indenture, and (b) nothing herein shall be construed as creating any liability on UMB Bank, n.a. other than in its capacity as Trustee under the Indenture. All financial obligations of the Trustee under this Site Lease, except those resulting from its willful misconduct or negligence, are limited to the Trust Estate. Section 11. Taxes; Maintenance; Insurance. During the Lease Term of the Lease and in accordance with the provisions of the Lease, including Sections 9.1 and 9.3 thereof, the Town covenants and agrees to pay any and all taxes, assessments or governmental charges due in respect of the Leased Property and all maintenance costs and utility charges in connection with the Leased Property. In the event that (a) the Lease is terminated for any reason, (b) this Site Lease is not terminated, and (c) the Trustee subleases all or any portion of the Leased Property or sells or assigns its interests in this Site Lease, the Trustee, or any purchaser, sublessee or assignee of the Leased Property (including the leasehold interests of the Trustee resulting from this Site Lease) shall pay or cause to be paid when due, all such taxes, assessments or governmental charges and maintain the Leased Property in good condition and working order. Any such payments that are to be made by the Trustee shall be made solely from (a) the proceeds of such sale, subleasing or assignment, (b) from the Trust Estate, or (c) from other moneys furnished to the Trustee under Section 8.02(m) of the Indenture, and in the absence of available moneys identified in the preceding clauses (a) through (c), the Trustee shall be under no obligation to pay or cause to be paid when due, all such taxes, assessments or governmental charges and maintain the Leased Property in good condition and working order. The provisions of the Lease shall govern with respect to the maintenance of insurance hereunder during the Lease Term of the Lease. In the event that (a) the Lease is terminated for any reason, (b) this Site Lease is not terminated, and (c) the Trustee subleases all or any portion of the Leased Property or sells or assigns its interest in this Site Lease, the Trustee, or any sublessee, purchaser or assignee of the Leased Property shall obtain and keep in force, (i) commercial general liability insurance against claims for personal injury, death or damage to property of others occurring on or in the Leased Property in an amount not less than $990,000 and (ii) property insurance in an amount not less than the full replacement value of the improvements and structures constituting the Leased Property. Any such insurance that is to be obtained by the Trustee shall be paid for solely from (a) the proceeds of such sale, subleasing or assignment, (b) the Trust Estate, or (c) other moneys furnished to the Trustee under Section ATTACHMENT B: Form of Site Lease 5 8.02(m) of the Indenture and in the absence of available moneys identified in the preceding clauses (a) through (c), the Trustee shall be under no obligation to obtain or keep in force such insurance coverages. All such insurance shall name the Trustee, any sublessee, purchaser or assignee and the Town as insureds and shall name the Trustee as loss payee. The Town and the Trustee shall waive any rights of subrogation with respect to the Trustee, any sublessee, purchaser or assignee, and the Town, and their members, directors, officers, agents and employees, while acting within the scope of their employment and each such insurance policy shall contain such a waiver of subrogation by the issuer of such policy. Nothing in the preceding paragraphs or in this Site Lease shall be interpreted or construed to require the Trustee to sublease all or any portion of the Leased Property or sell or assign its interests in this Site Lease, in the event that the Lease is terminated for any reason and this Site Lease is not terminated. Section 12. Damage, Destruction or Condemnation. The provisions of the Lease shall govern with respect to any damage, destruction or condemnation of the Leased Property during the Lease Term of the Lease. In the event that (a) the Lease is terminated for any reason and (b) this Site Lease is not terminated, and either (i) the Leased Property or any portion thereof is damaged or destroyed, in whole or in part, by fire or other casualty, or (ii) title to or use of the Leased Property or any part thereof shall be taken under the exercise of the power of eminent domain, the Town and the Trustee, or any sublessee, purchaser or assignee of the Leased Property from the Trustee shall cause the Net Proceeds of any insurance claim or condemnation award to be applied in accordance with the provisions of Article 10 of the Lease. Section 13. Hazardous Substances. Except for customary materials necessary for operation, cleaning and maintenance of the Leased Property, none of the Town, the Trustee or any sublessee, purchaser or assignee of the Leased Property from the Trustee shall cause or permit any Hazardous Substance to be brought upon, generated at, stored or kept or used in or about the Leased Property without prior written notice to the Town and the Trustee and all Hazardous Substances, including customary materials necessary for construction, operation, cleaning and maintenance of the Leased Property, will be used, kept and stored in a manner that complies with all laws regulating any such Hazardous Substance so brought upon or used or kept on or about the Leased Property. If the presence of Hazardous Substance on the Leased Property caused or permitted by the Town, the Trustee or any sublessee, purchaser or assignee of the Leased Property from the Trustee, as the case may be, results in contamination of the Leased Property, or if contamination of the Leased Property by Hazardous Substance otherwise occurs for which the Town, the Trustee or any sublessee or assignee of the Leased Property, as the case may be, is legally liable for damage resulting therefrom, then the Town, the Trustee or any sublessee, purchaser or assignee of the Leased Property from the Trustee, as the case may be, shall reimburse the other party for its reasonable and necessary legal expenses to defend the parties hereto or assignees hereof that have not caused or permitted such contamination and are not so legally liable with respect to this Site Lease from claims for damages, penalties, fines, costs, liabilities or losses; provided that the cost of such defense, (a) in the case of the Trustee, shall be payable solely from the Trust Estate, or (b) in the case of the Town, shall be payable only if the cost of such defense has been annually appropriated by the Town. This duty to reimburse legal expenses is not an indemnification. It is expressly understood that none of the Town, the Trustee or any sublessee, purchaser or assignee is indemnifying any other person with ATTACHMENT B: Form of Site Lease 6 respect to this Site Lease. Without limiting the foregoing, if the presence of any Hazardous Substance on the Leased Property caused or permitted by: (a) the Trustee or any sublessee, purchaser or assignee of the Leased Property from the Trustee, as the case may be, results in any contamination of the Leased Property, the Trustee or any sublessee, purchaser or assignee of the Leased Property from the Trustee, as the case may be, shall provide prior written notice to the Town and the Trustee and promptly take all actions, solely at the expense of the Trust Estate as are necessary to effect remediation of the contamination in accordance with legal requirements; or (b) the Town, results in any contamination of the Leased Property, the Town shall provide prior written notice to the Trustee and promptly take all actions, solely at the expense of the Town, which expenses shall constitute Additional Rentals, as are necessary to effect remediation of the contamination in accordance with legal requirements. Section 14. Third Party Beneficiaries. It is expressly understood and agreed that the Owners of the outstanding Certificates are third party beneficiaries to this Site Lease and enforcement of the terms and conditions of this Site Lease, and all rights of action relating to such enforcement, shall be strictly reserved to the Town, as Lessor, and the Trustee, as Lessee, and their respective successors and assigns, and to the Owners of the Certificates. Except as hereinafter provided, nothing contained in this Site Lease shall give or allow any such claim or right of action by any other or third person on this Site Lease. It is the express intention of the Town and the Trustee that any person other than the Town, the Trustee or the Owners of the Certificates receiving services or benefits under this Site Lease shall be deemed to be an incidental beneficiary only. Section 15. Partial Invalidity. If any one or more of the terms, provisions, covenants or conditions of this Site Lease shall to any extent be declared invalid, unenforceable, void or voidable for any reason whatsoever by a court of competent jurisdiction, the finding or order or decree of which becomes final, none of the remaining terms, provisions, covenants and conditions of this Site Lease shall be affected thereby, and each provision of this Site Lease shall be valid and enforceable to the fullest extent permitted by law. Section 16. No Merger. The Town and the Trustee intend that the legal doctrine of merger shall have no application to this Site Lease and that neither the execution and delivery of the Lease by the Trustee and the Town nor the exercise of any remedies under this Site Lease or the Lease shall operate to terminate or extinguish this Site Lease or the Lease, except as specifically provided herein and therein. Section 17. Amendments. This Site Lease may only be amended, changed, modified or altered as provided in the Indenture. Section 18. Notices. All notices, statements, demands, consents, approvals, authorizations, offers, designations, requests or other communications hereunder by either party to the other shall be in writing and shall be sufficiently given and served upon the other party if ATTACHMENT B: Form of Site Lease 7 delivered personally or if mailed shall be made by United States registered mail, return receipt requested, postage prepaid, at the addresses indicated in the Lease, or to such other addresses as the respective parties may from time to time designate in writing, or in such other manner as authorized by the Town or the Trustee, as the case may be. Section 19. Recitals. The Recitals set forth in this Site Lease are hereby incorporated by this reference and made a part of this Site Lease. Section 20. Section Headings. All section headings contained herein are for convenience of reference only and are not intended to define or limit the scope of any provision of this Site Lease. Section 21. Execution. This Site Lease may be executed in any number of counterparts, each of which shall be deemed to be an original but all together shall constitute but one and the same Site Lease. Section 22. Electronic Transactions. The parties hereto agree that the transactions described herein may be conducted and related documents may be stored by electronic means. Copies, telecopies, facsimiles, electronic files and other reproductions of original executed documents shall be deemed to be authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit in the appropriate court of law. Section 23. Governing Law. This Site Lease shall be governed by and construed in accordance with the law of the State of Colorado without regard to choice of law analysis. Section 24. No Waiver of Governmental Immunity. No provision of this Site Lease shall act or be deemed to be a waiver by the Town of the Colorado Governmental Immunity Act, CRS 24-10-101,et seq. ATTACHMENT B: Form of Site Lease 8 IN WITNESS WHEREOF, the Town and the Trustee have caused this Site Lease to be executed by their respective officers thereunto duly authorized, all as of the day and year first above written. TOWN OF AVON, COLORADO, as Lessor UMB BANK, N.A., solely in its capacity as Trustee under the Indenture, as Lessee By: By: Rich Carroll, Mayor Vice President [SEAL] ATTEST: ____________________________________ Debbie Hoppe, Town Clerk ATTACHMENT B: Form of Site Lease 9 STATE OF COLORADO ) ) COUNTY OF EAGLE ) SS. ) TOWN OF AVON ) The foregoing instrument was acknowledged before me this ___ day of ___________, 2014, by Rich Carroll and Debbie Hoppe, as Mayor and Town Clerk, respectively, of Town of Avon, Colorado. WITNESS my hand and official seal. (SEAL) ____________________________________ Notary Public My commission expires: ************************ STATE OF COLORADO ) ) ss. CITY AND COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this _____ day of ___________, 2014, by ______________, as Vice President of UMB Bank, n.a., as Trustee. WITNESS my hand and official seal. (SEAL) ____________________________________ Notary Public My commission expires: ATTACHMENT B: Form of Site Lease A-1 EXHIBIT A DESCRIPTION OF THE LEASED PROPERTY: The Leased Property consists of the real property and the buildings and improvements located thereon as set forth below, as amended from time to time. [insert legal description] Description of the Project: [describe] ATTACHMENT B: Form of Site Lease B-1 EXHIBIT B PERMITTED ENCUMBRANCES “Permitted Encumbrances” means, as of any particular time: (a) liens for taxes and assessments not then delinquent, or liens which may remain unpaid pending contest pursuant to the provisions of the Lease; (b) this Site Lease, the Lease, the Indenture and any related fixture filing and any liens arising or granted pursuant to the Lease or the Indenture; (c) utility, access and other easements and rights of way, licenses, permits, party wall and other agreements, restrictions and exceptions which the Mayor or the Town Representative certifies will not materially interfere with or materially impair the Leased Property, including rights or privileges in the nature of easements, licenses, permits and agreements as provided in the Lease; and (d) the easements, covenants, restrictions, liens and encumbrances (if any) to which title to the Leased Property was subject when leased to the Trustee pursuant to this Site Lease, as shown below and which do not interfere in any material way with the Leased Property. The easements, covenants, restrictions, liens and encumbrances (if any) to which title to the Leased Property was subject when leased to the Trustee pursuant to this Site Lease are as follows: 1. Liens for ad valorem taxes and special assessments not then delinquent, if applicable. 2. This Site Lease. 3. The Lease. 4. All other encumbrances appearing of record on the date hereof. 22507344 v1 ATTACHMENT B: Form of Site Lease AFTER RECORDATION PLEASE RETURN TO: Butler Snow LLP 1801 California Street, Suite 5100 Denver, Colorado 80202 Attention: Dee P. Wisor, Esq. Pursuant to Section 39-13-104(1)(j), Colorado Revised Statutes, this Lease Purchase Agreement is exempt from the documentary fee L EASE PURCHASE AGREEMENT DATED AS OF [________], 2014 BETWEEN UMB BANK, N.A., SOLELY IN ITS CAPACITY AS TRUSTEE UNDER THE INDENTURE IDENTIFIED HEREIN, AS LESSOR AND TOWN OF AVON, COLORADO, AS LESSEE ATTACHMENT C: Form of Lease i This Table of Contents is not a part of this Lease and is only for convenience of reference. TABLE OF CONTENTS ARTICLE 1 DEFINITIONS ........................................................................................................... 3 Section 1.1 Certain Funds and Accounts. .............................................................................. 3 Section 1.2 Definitions........................................................................................................... 3 ARTICLE 2 REPRESENTATIONS AND COVENANTS ............................................................ 9 Section 2.1 Representations and Covenants of the Town. ..................................................... 9 Section 2.2 Representations and Covenants of the Trustee. ................................................ 10 Section 2.3 Nature of Lease. ................................................................................................ 11 Section 2.4 Town Acknowledgment of Certain Matters. .................................................... 11 Section 2.5 Relationship of Town and Trustee. ................................................................... 11 ARTICLE 3 LEASE OF THE LEASED PROPERTY ................................................................ 13 ARTICLE 4 LEASE TERM ......................................................................................................... 14 Section 4.1 Duration of Lease Term. ................................................................................... 14 Section 4.2 Termination of Lease Term. ............................................................................. 15 ARTICLE 5 ENJOYMENT OF THE LEASED PROPERTY ..................................................... 16 Section 5.1 Trustee’s Covenant of Quiet Enjoyment. .......................................................... 16 Section 5.2 Town’s Need for the Leased Property; Determinations as to Fair Value and Fair Purchase Price. .................................................................................................. 16 ARTICLE 6 PAYMENTS BY THE TOWN ................................................................................ 17 Section 6.1 Payments to Constitute Currently Budgeted Expenditures of the Town. ......... 17 Section 6.2 Base Rentals, Purchase Option Price and Additional Rentals. ......................... 17 Section 6.3 Manner of Payment. .......................................................................................... 18 Section 6.4 Nonappropriation. ............................................................................................. 19 Section 6.5 Holdover Tenant. .............................................................................................. 20 Section 6.6 Prohibition of Adverse Budget or Appropriation Modifications. ..................... 21 ARTICLE 7 RESERVED ............................................................................................................. 22 ARTICLE 8 TITLE TO LEASED PROPERTY; LIMITATIONS ON ENCUMBRANCES ...... 23 Section 8.1 Title to the Leased Property; Title Insurance. ................................................... 23 Section 8.2 No Encumbrance, Mortgage or Pledge of the Leased Property. ....................... 23 ATTACHMENT C: Form of Lease ii ARTICLE 9 MAINTENANCE; TAXES; INSURANCE AND OTHER CHARGES ................. 25 Section 9.1 Maintenance of the Leased Property by the Town. .......................................... 25 Section 9.2 Modification of the Leased Property; Installation of Furnishings and Machinery of the Town. ...................................................................................................... 25 Section 9.3 Taxes, Other Governmental Charges and Utility Charges. ............................... 25 Section 9.4 Provisions For Liability and Property Insurance. ............................................. 26 Section 9.5 Advances. .......................................................................................................... 27 Section 9.6 Granting of Easements. ..................................................................................... 27 ARTICLE 10 DAMAGE, DESTRUCTION AND CONDEMNATION; USE OF NET PROCEEDS .................................................................................................................................. 28 Section 10.1 Damage, Destruction and Condemnation. ........................................................ 28 Section 10.2 Obligation to Repair and Replace the Leased Property. ................................... 28 Section 10.3 Insufficiency of Net Proceeds. .......................................................................... 29 Section 10.4 Cooperation of the Trustee. ............................................................................... 30 ARTICLE 11 DISCLAIMER OF WARRANTIES; OTHER COVENANTS ............................. 31 Section 11.1 Disclaimer of Warranties. ................................................................................. 31 Section 11.2 Further Assurances and Corrective Instruments. .............................................. 31 Section 11.3 Compliance with Requirements. ....................................................................... 31 Section 11.4 Partial Release and Substitution of Leased Property. ....................................... 31 Section 11.5 Tax Covenants. ................................................................................................. 32 Section 11.6 Undertaking to Provide Ongoing Disclosure. ................................................... 33 Section 11.7 Covenant to Reimburse Legal Expenses. .......................................................... 33 Section 11.8 Access to the Leased Property; Rights to Inspect Books. ................................. 33 ARTICLE 12 PURCHASE OPTION ........................................................................................... 35 Section 12.1 Purchase Option. ............................................................................................... 35 Section 12.2 Conditions for Purchase Option. ....................................................................... 35 Section 12.3 Manner of Conveyance. .................................................................................... 35 ARTICLE 13 ASSIGNMENT AND SUBLEASING .................................................................. 37 Section 13.1 Assignment by the Trustee; Replacement of the Trustee. ................................ 37 Section 13.2 Assignment and Subleasing by the Town. ........................................................ 37 ARTICLE 14 EVENTS OF LEASE DEFAULT AND REMEDIES ........................................... 38 Section 14.1 Events of Lease Default Defined. ..................................................................... 38 Section 14.2 Remedies on Default. ........................................................................................ 38 Section 14.3 Limitations on Remedies. ................................................................................. 39 Section 14.4 No Remedy Exclusive. ...................................................................................... 40 Section 14.5 Waivers. ............................................................................................................ 40 Section 14.6 Agreement to Pay Attorneys’ Fees and Expenses. ........................................... 40 ATTACHMENT C: Form of Lease iii Section 14.7 Waiver of Appraisement, Valuation, Stay, Extension and Redemption Laws. 40 ARTICLE 15 MISCELLANEOUS .............................................................................................. 41 Section 15.1 Sovereign Powers of Town. .............................................................................. 41 Section 15.2 Notices. ............................................................................................................. 41 Section 15.3 Third Party Beneficiaries. ................................................................................. 41 Section 15.4 Binding Effect. .................................................................................................. 41 Section 15.5 Amendments. .................................................................................................... 41 Section 15.6 Amounts Remaining in Funds. ......................................................................... 42 Section 15.7 Triple Net Lease. ............................................................................................... 42 Section 15.8 Computation of Time. ....................................................................................... 42 Section 15.9 Payments Due on Holidays. .............................................................................. 42 Section 15.10 Severability. ...................................................................................................... 42 Section 15.11 Execution in Counterparts. ................................................................................ 42 Section 15.12 Electronic Transactions. .................................................................................... 43 Section 15.13 Applicable Law. ................................................................................................ 43 Section 15.14 The Trustee Is Independent of the Town. ......................................................... 43 Section 15.15 Governmental Immunity. .................................................................................. 43 Section 15.16 Recitals. ............................................................................................................. 43 Section 15.17 Captions. ........................................................................................................... 43 Section 15.18 Trustee’s Disclaimer. ........................................................................................ 43 ATTACHMENT C: Form of Lease iv EXHIBIT A: DESCRIPTION OF LEASED PROPERTY ....................................................... A-1 EXHIBIT B: PERMITTED ENCUMBRANCES .....................................................................B-1 EXHIBIT C: BASE RENTALS SCHEDULE ..........................................................................C-1 EXHIBIT D: FORM OF NOTICE OF LEASE RENEWAL ................................................... D-1 ATTACHMENT C: Form of Lease 1 This LEASE PURCHASE AGREEMENT, dated as of [________], 2014 (this “Lease”), is by and between UMB BANK, N.A., Denver, Colorado, a national banking association duly organized and validly existing under the laws of the United States of America, solely in its capacity as trustee under the Indenture (the “Trustee”), as lessor, and the TOWN OF AVON, COLORADO, a Colorado home rule municipality (the “Town”), as lessee. PREFACE All capitalized terms used herein will have the meanings ascribed to them in Article 1 of this Lease. RECITALS 1. The Town has been duly organized and is validly existing as a home rule municipality under the Constitution of the State of Colorado and the Charter of the Town (the “Charter”). 2. Pursuant to Article XIV of the Charter and Article XX of the Colorado Constitution, the Town is authorized to purchase, sell, exchange or dispose of any interest in real property, and the Council by ordinance may lease, for such a term as the Council shall determine any real property to an person, firm or corporation, public or private. 3. The Town Council of the Town (the “Council”) has determined that it is in the best interests of the Town and its inhabitants and public interest and necessity to execute the Lease to finance the acquisition of certain real property for Town purposes, as authorized by law (the “Project”). 4. The Council has determined that it is in the best interest of the Town and its inhabitants to provide for the financing of the Project by entering into the Site Lease and this Lease. 5. The Town owns, or will, contemporaneously with the execution and delivery of this Lease, own, in fee title, the Site and the premises, buildings and improvements located thereon (as more particularly described in Exhibit A attached hereto, the “Leased Property”). To accomplish the Project, the Trustee, solely in its capacity of Trustee under the Indenture, will acquire a leasehold interest in the Leased Property by leasing the Leased Property from the Town pursuant to the Site Lease and the Trustee will lease the Leased Property to the Town pursuant to this Lease. 6. The payment by the Town of Base Rentals and Additional Rentals hereunder in any future Fiscal Year is subject to specific Appropriations and the renewal by the Council of this Lease for such future Fiscal Year. The Base Rentals and Additional Rentals payable by the Town under this Lease shall constitute current expenditures of the Town. 7. Neither this Lease nor the payment by the Town of Base Rentals or Additional Rentals hereunder shall be deemed or construed as creating an indebtedness of the Town within the meaning of any provision of the Colorado constitution, the Charter or the laws of the State of Colorado concerning or limiting the creation of indebtedness by the Town, and shall not ATTACHMENT C: Form of Lease 2 constitute a multiple fiscal year direct or indirect debt or other financial obligation of the Town within the meaning of Article X, Section 20(4) of the Colorado constitution or a mandatory charge or requirement against the Town in any ensuing Fiscal Year beyond the then current Fiscal Year. The obligation of the Town to pay Base Rentals and Additional Rentals hereunder shall be from year to year only, shall constitute currently budgeted expenditures of the Town, shall not constitute a mandatory charge or requirement in any ensuing budget year, nor a mandatory payment obligation of the Town in any ensuing Fiscal Year beyond any Fiscal Year during which this Lease shall be in effect. In the event that this Lease is not renewed, the sole security available to the Trustee, as lessor hereunder, shall be the Leased Property. 8. The Trustee is executing this Lease solely in its capacity as trustee under the Indenture, and subject to the terms, conditions and protections provided for therein. 9. The Trustee and the Town intend that this Lease set forth their entire understanding and agreement regarding the terms and conditions upon which the Town is leasing the Leased Property from the Trustee. NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the Trustee and the Town agree as follows: ATTACHMENT C: Form of Lease 3 ARTICLE 1 DEFINITIONS Section 1.1 Certain Funds and Accounts. All references herein to any funds and accounts shall mean the funds and accounts so designated which are established under the Indenture. Section 1.2 Definitions. All capitalized terms used herein and not otherwise defined shall have the meanings given to them in the Indenture, unless the context otherwise requires. Capitalized terms used herein shall have the following meanings under this Lease: “Additional Certificates” means Additional Certificates which may be executed and delivered pursuant to the Indenture. “Additional Rentals” means the payment or cost of all: (a) (i) reasonable expenses and fees of the Trustee related to the performance or discharge of its responsibilities under the provisions of this Lease, the Site Lease or the Indenture, including the reasonable fees and expenses of any person or firm employed by the Town to make rebate calculations under the provisions of Section 3.05 of the Indenture and the expenses of the Trustee in respect of any policy of insurance obtained in respect of the Certificates executed and delivered with respect to the Lease, (ii) the cost of insurance premiums and insurance deductible amounts under any insurance policy reasonably deemed necessary by the Trustee to protect the Trustee from any liability under this Lease, approved by the Town Representative, which approval shall not be unreasonably withheld, (iii) reasonable legal fees and expenses incurred by the Trustee to defend the Trust Estate or the Trustee from and against any legal claims, and (iv) reasonable expenses and fees of the Trustee incurred at the request of the Town Representative; (b) taxes, assessments, insurance premiums, utility charges, maintenance, upkeep, repair and replacement with respect to the Leased Property and as otherwise required under the Lease; (c) payments into the Rebate Fund for rebate payments as provided in this Lease; and (d) all other charges and costs (together with all interest and penalties that may accrue thereon in the event that the Town shall fail to pay the same, as specifically set forth in this Lease) which the Town agrees to assume or pay as Additional Rentals under this Lease. Additional Rentals shall not include Base Rentals. “Appropriation” means the action of the Council in annually making moneys available for all payments due under this Lease, including the payment of Base Rentals and Additional Rentals. ATTACHMENT C: Form of Lease 4 “Approval of Special Counsel” means an opinion of Special Counsel to the effect that the matter proposed will not adversely affect the excludability from gross income for federal income tax purposes of the Interest Portion of the Base Rentals paid by the Town under this Lease. “Base Rentals” means the rental payments payable by the Town during the Lease Term, which constitute payments payable by the Town for and in consideration of the right to possess and use the Leased Property as set forth in Exhibit C (Base Rentals Schedule) hereto. Base Rentals does not include Additional Rentals. “Base Rentals Payment Dates” means the Base Rentals Payment Dates set forth in Exhibit C (Base Rentals Schedule) hereto. “Business Day” means any day, other than a Saturday, Sunday or legal holiday or a day (a) on which banks located in Denver, Colorado are required or authorized by law or executive order to close or (b) on which the Federal Reserve System is closed. “Certificates” means the “Certificates of Participation, Series 2014A, Evidencing Proportionate Interests in the Base Rentals and other Revenues under an annually renewable Lease Purchase Agreement dated as of [________], 2014, between UMB Bank, n.a., solely in its capacity as trustee under the Indenture, as lessor, and the Town of Avon, Colorado, as lessee” dated as of their date of delivery, executed and delivered pursuant to the Indenture. “Charter” means the home rule charter of the Town, and any amendments or supplements thereto. “Continuing Disclosure Certificate” means the certificate executed by the Town of even date herewith which constitutes an undertaking pursuant to Rule 15c2-12 promulgated by the Securities and Exchange Commission. “Costs of Execution and Delivery” means all items of expense directly or indirectly payable by the Trustee related to the authorization, execution and delivery of the Site Lease and this Lease and related to the authorization, sale, execution and delivery of the Certificates, as further defined in the Indenture. “Council” means the Town Council of the Town or any successor to its functions. “Counsel” means an attorney at law or law firm (who may be counsel for the Trustee) who is satisfactory to the Town. “CRS” means Colorado Revised Statutes. “Event(s) of Lease Default” means any event as defined in Section 14.1 of this Lease. “Event of Nonappropriation” means the termination and non-renewal of this Lease by the Town, determined by the Council’s failure, for any reason, to appropriate by the last day of each Fiscal Year, (a) sufficient amounts to be used to pay Base Rentals due in the next Fiscal Year and (b) sufficient amounts to pay such Additional Rentals as are estimated to become due in the next Fiscal Year, as provided in Section 6.4 of this Lease. An Event of Nonappropriation may ATTACHMENT C: Form of Lease 5 also occur under certain circumstances described in Section 10.3(c) of this Lease. The term also means a notice under this Lease of the Town’s intention to not renew and therefore terminate this Lease or an event described in this Lease relating to the exercise by the Town of its right to not appropriate amounts due as Additional Rentals in excess of the amounts for which an Appropriation has been previously effected. “Finance Director” means the Finance Director of the Town or his or her successor in functions, if any. “Fiscal Year” means the Town’s fiscal year, which begins on January 1 of each calendar year and ends on December 31 of the same calendar year, or any other twelve month period which the Town or other appropriate authority hereafter may establish as the Town’s fiscal year. “Force Majeure” means, without limitation, the following: acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders or restraints of any kind of the government of the United States of America, the State of Colorado or any of their departments, agencies or officials or any civil or military authority; insurrection; riots; landslides; earthquakes; fires; storms; droughts; floods; explosions; breakage or accidents to machinery, transmission pipes or canals; or any other cause or event not within the control of the Town in its capacity as lessee hereunder or the Trustee. “Hazardous Substance” means and includes: (a) the terms “hazardous substance,” “release” and “removal” which, as used herein, shall have the same meaning and definition as set forth in paragraphs (14), (22) and (23), respectively, of Title 42 U.S.C. §9601 and in Colorado law, provided, however, that the term “hazardous substance” as used herein shall also include “hazardous waste” as defined in paragraph (5) of 42 U.S.C. §6903 and “petroleum” as defined in paragraph (8) of 42 U.S.C. §6991; (b) the term “superfund” as used herein means the Comprehensive Environmental Response, Compensation and Liability Act, as amended, being Title 42 U.S.C. §9601 et seq., as amended, and any similar State of Colorado statute or local ordinance applicable to the Leased Property, including, without limitation, Colorado rules and regulations promulgated, administered and enforced by any governmental agency or authority pursuant thereto; and (c) the term “underground storage tank” as used herein shall have the same meaning and definition as set forth in paragraph (1) of 42 U.S.C. §6991. “Indenture” means the Indenture of Trust, dated as of [________], 2014, entered into by the Trustee, as the same may be amended or supplemented. “Initial Term” means the period which commences on the date of delivery of this Lease and terminates on December 31, 2014. “Interest Portion” means the portion of each Base Rentals payment that represents the payment of interest set forth in Exhibit C (Base Rentals Schedule) hereto. “Lease” means this Lease Purchase Agreement, dated as of [________], 2014, between the Trustee, as lessor, and the Town, as lessee, as the same may hereafter be amended. ATTACHMENT C: Form of Lease 6 “Lease Balance” means the Total Aggregate Principal Portion of the Base Rentals under this Lease set forth on Exhibit C (Base Rentals Schedule) hereto, less the aggregate amount of Principal Portions of Base Rentals paid or prepaid by the Town pursuant to this Lease. “Lease Remedy” or “Lease Remedies” means any or all remedial steps provided in this Lease whenever an Event of Lease Default or an Event of Nonappropriation has happened and is continuing, which may be exercised by the Trustee as provided in this Lease and in the Indenture. “Lease Term” means the Initial Term and any Renewal Terms as to which the Town may exercise its option to renew this Lease by effecting an Appropriation of funds for the payment of Base Rentals and Additional Rentals hereunder, as provided in and subject to the provisions of this Lease. “Lease Term” refers to the time during which the Town is the lessee of the Leased Property under this Lease. “Leased Property” means the Site and the premises, buildings and improvements situated thereon, including all fixtures attached thereto, as more particularly described in Exhibit A to this Lease, together with any and all additions and modifications thereto and replacements thereof and any New Facility. “Net Proceeds” means the proceeds of any performance or payment bond, or proceeds of insurance, including self-insurance, required by this Lease or proceeds from any condemnation award, or proceeds derived from the exercise of any Lease Remedy or otherwise following termination of this Lease by reason of an Event of Nonappropriation or an Event of Lease Default, allocable to the Leased Property, less (a) all related expenses (including, without limitation, attorney’s fees and costs) incurred in the collection of such proceeds or award; and (b) all other related fees, expenses and payments due to the Town and the Trustee. “New Facility” means any real property, buildings or equipment leased by the Town to the Trustee pursuant to a future amendment to the Site Lease and leased back by the Town from the Trustee pursuant to a future amendment to this Lease in connection with the execution and delivery of Additional Certificates. “Owners” means the registered owners of any Certificates and Beneficial Owners. “Permitted Encumbrances,” with respect to the Leased Property, means, as of any particular time: (a) liens for taxes and assessments not then delinquent, or liens which may remain unpaid pending contest pursuant to the provisions of this Lease; (b) the Site Lease, this Lease, the Indenture and any related fixture filing and any liens arising or granted pursuant to the Site Lease, this Lease or the Indenture; (c) utility, access and other easements and rights of way, licenses, permits, party wall and other agreements, restrictions and exceptions which the Town Representative certifies will not materially interfere with or materially impair the Leased Property, including rights or privileges in the nature of easements, licenses, permits and agreements as provided in this Lease (d) any sublease of the Leased Property that are permitted pursuant to the terms and provisions of Section 13.2 hereof; and (e) the easements, covenants, restrictions, liens and encumbrances (if any) to which title to the Leased Property was subject ATTACHMENT C: Form of Lease 7 when leased to the Trustee pursuant to the Site Lease, as shown on Exhibit B hereto and which do not interfere in any material way with the Leased Property. “Prepayment” means any amount paid by the Town pursuant to the provisions of this Lease as a prepayment of the Base Rentals due hereunder. “Principal Portion” means the portion of each Base Rentals payment that represents the payment of principal set forth in Exhibit C (Base Rentals Schedule) hereto. “Project” means, to the extent financed with the proceeds of the Certificates, the acquisition of certain real property and any improvements located thereon for Town purposes. “Purchase Option Price” means the amount payable on any date, at the option of the Town, to prepay Base Rentals, terminate the Lease Term and purchase the Trustee’s leasehold interest in the Leased Property, as provided herein. “Renewal Term” means any portion of the Lease Term commencing on January 1 of any calendar year and terminating on or before December 31 of such calendar year as provided in Article 4 of this Lease. “Revenues” means (a) all amounts payable by or on behalf of the Town or with respect to the Leased Property pursuant to this Lease including, but not limited to, all Base Rentals, Prepayments, the Purchase Option Price and Net Proceeds, but not including Additional Rentals; (b) any portion of the proceeds of the Certificates deposited into the Base Rentals Fund created under the Indenture; (c) any moneys which may be derived from any insurance in respect of the Certificates; and (d) any moneys and securities, including investment income, held by the Trustee in the Funds and Accounts established under the Indenture (except for moneys and securities held in the Rebate Fund or any defeasance escrow account). “Site” means the real property owned by the Town and leased by the Town to the Trustee under the Site Lease and subleased by the Trustee to the Town under this Lease, the legal description of which is set forth in Exhibit A hereto, or an amendment or supplement hereto. “Site Lease” means the Site and Improvement Lease, dated as of [________], 2014, between the Town, as lessor, and the Trustee, as lessee, as the same may hereafter be amended. “Special Counsel” means any counsel experienced in matters of municipal law and listed in the list of municipal bond attorneys, as published semiannually by The Bond Buyer, or any successor publication. So long as the Lease Term is in effect, the Town shall have the right to select Special Counsel. “Tax Certificate” means the Tax Certificate entered into by the Town with respect to this Lease. “Tax Code” means the Internal Revenue Code of 1986, as amended, and all regulations and rulings promulgated thereunder. “Town” means the Town of Avon, Colorado. ATTACHMENT C: Form of Lease 8 “Town Manager” means the Town Manager of the Town or his or her successor in function. “Town Representative” means the Mayor, the Town Manager or the Finance Director or such other person at the time designated to act on behalf of the Town for the purpose of performing any act under this Lease, the Site Lease or the Indenture by a written certificate furnished to the Trustee containing the specimen signature of such person or persons and signed on behalf of the Town by the Mayor. “Trustee” means UMB Bank, n.a., acting in the capacity of trustee pursuant to the Indenture, and any successor thereto appointed under the Indenture. ATTACHMENT C: Form of Lease 9 ARTICLE 2 REPRESENTATIONS AND COVENANTS Section 2.1 Representations and Covenants of the Town. The Town represents and covenants to the Trustee, to the extent allowed by law and subject to renewal of this Lease and Appropriation as set forth in Article 6 hereof, as follows: (a) The Town is a home rule municipality duly organized and existing within the State under the Constitution and laws of the State and its Charter. The Town is authorized to enter into this Lease and the Site Lease and to carry out its obligations under this Lease and the Site Lease. The Town has duly authorized and approved the execution and delivery of this Lease, the Site Lease and all other documents related to the execution and delivery of this Lease and the Site Lease. (b) The Town owns the Leased Property and the Trustee has a leasehold interest in the Leased Property pursuant to the Site Lease. (c) The leasing of the Leased Property by the Town to the Trustee pursuant to the Site Lease, and the implementation and completion of the Project by the Town and the Trustee under the terms and conditions provided for in this Lease, are necessary, convenient and in furtherance of and is in the best interests of the citizens of the Town. The Town will apply the net proceeds derived from the proceeds of the Certificates to the financing of the Project. (d) Neither the execution and delivery of this Lease and the Site Lease, nor the fulfillment of or compliance with the terms and conditions of this Lease and the Site Lease, nor the consummation of the transactions contemplated hereby or thereby, conflicts with or results in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Town is now a party or by which the Town or its property is bound, or violates any statute, regulation, rule, order of any court having jurisdiction, judgment or administrative order applicable to the Town, or constitutes a default under any of the foregoing, or results in the creation or imposition of any lien or encumbrance whatsoever upon any of the property or assets of the Town, except for Permitted Encumbrances. (e) The Town agrees that, except for non-renewal and nonappropriation as set forth in Article 6 hereof, if the Town fails to perform any act which the Town is required to perform under this Lease, the Trustee may, but shall not be obligated to, perform or cause to be performed such act, and any reasonable expense incurred by the Trustee in connection therewith shall be an obligation owing by the Town (from moneys for which an Appropriation has been effected) to the Trustee shall be a part of Additional Rentals, and the Trustee shall be subrogated to all of the rights of the party receiving such payment. (f) There is no litigation or proceeding pending against the Town affecting the right of the Town to execute this Lease or the Site Lease or the ability of the Town to make the payments required hereunder or to otherwise comply with the obligations ATTACHMENT C: Form of Lease 10 contained herein, or which, if adversely determined, would, in the aggregate or in any case, materially adversely affect the property, assets, financial condition or business of the Town or materially impair the right or ability of the Town to carry on its operations substantially as now conducted or anticipated to be conducted in the future. (g) Except for customary materials necessary for construction, operation, cleaning and maintenance of the Leased Property, the Town shall not cause or permit any Hazardous Substance to be brought upon, generated at, stored or kept or used in or about the Leased Property without prior written notice to the Trustee, and all Hazardous Substances, including, customary materials necessary for construction, operation, cleaning and maintenance of the Leased Property, will be used, kept and stored in a manner that complies with all laws regulating any such Hazardous Substance so brought upon or used or kept in or about the Leased Property. If the presence of any Hazardous Substance on the Leased Property caused or permitted by the Town results in contamination of the Leased Property, or if contamination of the Leased Property by any Hazardous Substance otherwise occurs for which the Town is legally liable for damage resulting therefrom, then the Town shall include as an Additional Rental any amount necessary to reimburse the Trustee for legal expenses incurred to defend (to the extent that an Appropriation for the necessary moneys has been effected by the Town) the Trustee from claims for damages, penalties, fines, costs, liabilities or losses. The reimbursement of the Trustee’s legal expenses is not an indemnification. It is expressly understood that the Town is not indemnifying the Trustee and expenses of such defense shall constitute Additional Rentals. Without limiting the foregoing, if the presence of any Hazardous Substance on the Leased Property caused or permitted by the Town results in any contamination of the Leased Property, the Town shall provide prior written notice to the Trustee and promptly take all actions at its sole expense (which expenses shall constitute Additional Rentals) as are necessary to effect remediation of the contamination in accordance with legal requirements. (h) The Town covenants and agrees to comply with any applicable covenants and requirements of the Town set forth in the Tax Certificate. Section 2.2 Representations and Covenants of the Trustee. The Trustee represents and covenants as follows: (a) So long as no Event of Indenture Default has occurred and is then continuing or existing, except as specifically provided in the Site Lease or the Lease or as necessary to transfer the Trust Estate to a successor Trustee, the Trustee shall not pledge or assign the Trustee’s right, title and interest in and to (i) the Lease or the Site Lease, (ii) the Base Rentals, other Revenues and collateral, security interests and attendant rights and obligations which may be derived under the Lease or the Site Lease and/or (iii) the Leased Property and any reversion therein or any of its or the Trustee’s other rights under the Lease or the Site Lease or assign, pledge, mortgage, encumber or grant a security interest in its or the Trustee’s right, title and interest in, to and under the Lease or the Site Lease or the Leased Property except for Permitted Encumbrances. ATTACHMENT C: Form of Lease 11 (b) Neither the execution and delivery of the Lease and the Site Lease or the Indenture by the Trustee, nor the fulfillment of or compliance with the terms and conditions thereof and hereof, nor the consummation of the transactions contemplated thereby or hereby conflicts with or results in a breach of the terms, conditions and provisions of any restriction or any agreement or instrument to which the Trustee is now a party or by which the Trustee is bound, or constitutes a default under any of the foregoing. (c) To the Trustee’s knowledge, there is no litigation or proceeding pending against the Trustee affecting the right of the Trustee to execute the Lease and the Site Lease or to execute the Indenture, and perform its obligations thereunder or hereunder, except such litigation or proceeding as has been disclosed in writing to the Town on or prior to the date the Indenture is executed and delivered. Section 2.3 Nature of Lease. The Town and the Trustee acknowledge and agree that the Base Rentals and Additional Rentals hereunder shall constitute currently budgeted and appropriated expenditures of the Town and may be paid from any legally available funds. The Town’s obligations under this Lease shall be subject to the Town’s annual right to terminate this Lease (as further provided herein), and shall not constitute a mandatory charge or requirement in any ensuing Fiscal Year beyond the then current Fiscal Year. No provision of this Lease shall be construed or interpreted as creating a general obligation, multiple fiscal year financial obligation, or other indebtedness of the Town within the meaning of any constitutional, home rule charter or statutory debt limitation. No provision of this Lease shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Article XI, Sections 1 or 2 of the Colorado constitution. Neither this Lease nor the execution and delivery of the Certificates shall directly or indirectly obligate the Town to make any payments beyond those duly budgeted and appropriated for the Town’s then current Fiscal Year. The Town shall be under no obligation whatsoever to exercise its option to purchase the Trustee’s leasehold interest in the Leased Property. No provision of this Lease shall be construed to pledge or to create a lien on any class or source of Town moneys, nor shall any provision of this Lease restrict the future issuance of any Town bonds or obligations payable from any class or source of Town moneys (provided, however, certain restrictions in the Indenture shall apply to the issuance of Additional Certificates). In the event that this Lease is not renewed by the Town, the sole security available to the Trustee, as lessor hereunder, shall be the Leased Property. Section 2.4 Town Acknowledgment of Certain Matters. The Town acknowledges the Indenture and the execution and delivery by the Trustee of the Certificates pursuant to the Indenture. The Town also acknowledges the Trustee’s authority to act on behalf of the Owners of the Certificates with respect to all rights, title and interests of the Trustee in, to and under this Lease, the Site Lease and the Leased Property. Section 2.5 Relationship of Town and Trustee. The relationship of the Town and the Trustee under this Lease is, and shall at all times remain, solely that of lessee and lessor; and the Town neither undertakes nor assumes any responsibility or duty to the Trustee or to any third party with respect to the Trustee’s obligations relating to the Leased Property; and the Trustee does not undertake or assumes any responsibility or duty to the Town or to any third party with respect to the Town’s obligations relating to the Leased Property. Notwithstanding any other ATTACHMENT C: Form of Lease 12 provisions of this Lease: (a) the Town and the Trustee are not, and do not intend to be construed to be, partners, joint ventures, members, alter egos, managers, controlling persons or other business associates or participants of any kind of either of the other, and the Town and the Trustee do not intend to ever assume such status; and (b) the Town and the Trustee shall not be deemed responsible for, or a participant in, any acts, omissions or decisions of either of the other. ATTACHMENT C: Form of Lease 13 ARTICLE 3 LEASE OF THE LEASED PROPERTY The Trustee demises and leases the Leased Property to the Town and the Town leases the Leased Property from the Trustee, in accordance with the provisions of this Lease, subject only to Permitted Encumbrances, to have and to hold for the Lease Term. The Town and the Trustee acknowledge that the Town owns the Leased Property and the Town has leased the Leased Property to the Trustee pursuant to the Site Lease; and the Town and the Trustee intend that there be no merger of the Town’s interests as sublessee under this Lease and the Town’s ownership interest in the Leased Property so as to cause the cancellation of the Site Lease or this Lease, or an impairment of the leasehold and subleasehold interest intended to be created by the Site Lease and this Lease. ATTACHMENT C: Form of Lease 14 ARTICLE 4 LEASE TERM Section 4.1 Duration of Lease Term. The Lease Term shall commence as of the date hereof. The Initial Term shall terminate on December 31, 2014. This Lease may be renewed, solely at the option of the Town, for the number of Renewal Terms represented in Exhibit C (Base Rentals Schedule) attached hereto. The Town hereby finds that the maximum Lease Term hereunder does not exceed the weighted average useful life of the Leased Property. The Town further determines and declares that the period during which the Town has an option to purchase the Trustee’s leasehold interest in the Leased Property (i.e. the entire maximum Lease Term) does not exceed the useful life of the Leased Property. The Finance Director or other officer of the Town at any time charged with the responsibility of formulating budget proposals for the Town is hereby directed to include in the annual budget proposals submitted to the Council, in any year in which this Lease shall be in effect, items for all payments required for the ensuing Renewal Term under this Lease until such time, if any, as the Town may determine to not renew and terminate this Lease. Notwithstanding this directive regarding the formulation of budget proposals, it is the intention of the Town that any decision to effect an Appropriation for the Base Rentals and Additional Rentals shall be made solely by the Council in its absolute discretion and not by any other official of the Town, as further provided in the following paragraph. During the Lease Term, the Town shall in any event, whether or not the Lease is to be renewed, furnish the Trustee with copies of its annual budget promptly after the budget is adopted. Not later than December 15 of the then current Initial Term or any Renewal Term the Town Representative shall give written notice (in substantially the form set forth in Exhibit D attached hereto) to the Trustee that either: (a) the Town has effected or intends to effect on a timely basis an Appropriation for the ensuing Fiscal Year which includes (1) sufficient amounts authorized and directed to be used to pay all of the Base Rentals and (2) sufficient amounts to pay such Additional Rentals as are estimated to become due, all as further provided in Sections 6.2, 6.3 and 6.4 of this Lease, whereupon, this Lease shall be renewed for the ensuing Fiscal Year; or (b) the Town has determined, for any reason, not to renew this Lease for the ensuing Fiscal Year. Subject to the provisions of Section 6.4(a) hereof, the failure to give such notice shall not constitute an Event of Lease Default, nor prevent the Town from electing not to renew this Lease, nor result in any liability on the part of the Town. The Town’s option to renew or not to renew this Lease shall be conclusively determined by whether or not the applicable Appropriation has been made on or before December 31 of each Fiscal Year, all as further provided in Article 6 of this Lease. ATTACHMENT C: Form of Lease 15 The terms and conditions hereof during any Renewal Term shall be the same as the terms and conditions hereof during the Initial Term, except that the Purchase Option Price and the Base Rentals shall be as provided in Article 12 and Exhibit C (Base Rentals Schedule) hereof. Section 4.2 Termination of Lease Term. The Lease Term shall terminate upon the earliest of any of the following events: (a) the expiration of the Initial Term or any Renewal Term during which there occurs an Event of Nonappropriation pursuant to Section 4.1 and Article 6 of this Lease (provided that the Lease Term will not be deemed to have been terminated if the Event of Nonappropriation is cured as provided in Section 6.4 hereof); (b) the occurrence of an Event of Nonappropriation under this Lease (provided that the Lease Term will not be deemed to have been terminated if the Event of Nonappropriation is cured as provided in Section 6.4 hereof); (c) the conveyance of the Trustee’s leasehold interest in the Leased Property under this Lease to the Town upon payment of the Purchase Option Price or all Base Rentals and Additional Rentals, for which an Appropriation has been effected by the Town for such purpose, as provided in Section 12.2(a) or (b) of this Lease; or (d) an uncured Event of Lease Default and termination of this Lease under Article 14 of this Lease by the Trustee. Except for an event described in subparagraph (c) above, upon termination of this Lease, the Town agrees to peacefully deliver possession of the Leased Property to the Trustee. Termination of the Lease Term shall terminate all unaccrued obligations of the Town under this Lease, and shall terminate the Town’s rights of possession under this Lease (except to the extent of the holdover provisions of Sections 6.5 and 14.2(d)(i) hereof, and except for any conveyance pursuant to Article 12 of this Lease). All obligations of the Town accrued prior to such termination shall be continuing until the Trustee gives written notice to the Town that such accrued obligations have been satisfied. Upon termination of the Lease Term any moneys received by the Trustee in excess of the amounts necessary to terminate and discharge the Indenture, shall be paid to the Town. The Town shall not have the right to terminate this Lease due to a default by the Trustee under this Lease. ATTACHMENT C: Form of Lease 16 ARTICLE 5 ENJOYMENT OF THE LEASED PROPERTY Section 5.1 Trustee’s Covenant of Quiet Enjoyment. The Trustee hereby covenants that the Town shall, during the Lease Term, peaceably and quietly have, hold and enjoy the Leased Property without suit, trouble or hindrance from the Trustee. The Trustee shall not interfere with the quiet use and enjoyment of the Leased Property by the Town during the Lease Term so long as no Event of Lease Default shall have occurred. The Trustee shall, at the request of the Town and at the cost of the Town, join and cooperate fully in any legal action in which the Town asserts against third parties its right to such possession and enjoyment, or which involves the imposition of any taxes or other governmental charges on or in connection with the Leased Property. In addition, the Town may at its own expense join in any legal action affecting its possession and enjoyment of the Leased Property and shall be joined in any action affecting its liabilities hereunder. The provisions of this Article 5 shall be subject to the Trustee’s right to inspect the Leased Property and the Town’s books and records with respect thereto as provided in Section 11.8 hereof. Section 5.2 Town’s Need for the Leased Property; Determinations as to Fair Value and Fair Purchase Price. The Town has determined and hereby determines that it has a current need for the Leased Property. It is the present intention and expectation of the Town that this Lease will be renewed annually until the Trustee’s interests in the Site Lease are released and unencumbered title to the Leased Property is acquired by the Town pursuant to this Lease; but this declaration shall not be construed as contractually obligating or otherwise binding the Town. The Town has determined and hereby determines that the Base Rentals under this Lease during the Lease Term for the Leased Property represent the fair value of the use of the Leased Property and that the Purchase Option Price for the Leased Property will represent the fair purchase price of the Trustee’s leasehold interest in the Leased Property at the time of the exercise of the option. The Town has determined and hereby determines that the Base Rentals do not exceed a reasonable amount so as to place the Town under an economic compulsion to renew this Lease or to exercise its option to purchase the Trustee’s leasehold interest in the Leased Property hereunder. In making such determinations, the Town has given consideration to the estimated current value of the Leased Property, the uses and purposes for which the Leased Property will be employed by the Town, the benefit to the citizens and inhabitants of the Town by reason of the use and occupancy of the Leased Property pursuant to the terms and provisions of this Lease, the Town’s option to purchase the Trustee’s leasehold interest in the Leased Property and the expected eventual vesting of unencumbered title to the Leased Property in the Town. The Town hereby determines and declares that the period during which the Town has an option to purchase the Trustee’s leasehold interest in the Leased Property (i.e., the entire maximum Lease Term for the Leased Property) does not exceed the weighted average useful life of the Leased Property. ATTACHMENT C: Form of Lease 17 ARTICLE 6 PAYMENTS BY THE TOWN Section 6.1 Payments to Constitute Currently Budgeted Expenditures of the Town. The Town and the Trustee acknowledge and agree that the Base Rentals, Additional Rentals and any other obligations hereunder shall constitute currently budgeted expenditures of the Town, if an Appropriation has been effected for such purpose. The Town’s obligations to pay Base Rentals, Additional Rentals and any other obligations under this Lease shall be from year to year only (as further provided in Article 4 and Sections 6.2 and 6.4 hereof), shall extend only to moneys for which an Appropriation has been effected by the Town, and shall not constitute a mandatory charge, requirement or liability in any ensuing Fiscal Year beyond the then current Fiscal Year. No provision of this Lease shall be construed or interpreted as a delegation of governmental powers or as creating a multiple fiscal year direct or indirect debt or other financial obligation whatsoever of the Town or a general obligation or other indebtedness of the Town within the meaning of any constitutional, home rule charter provision or statutory debt limitation, including without limitation Article X, Section 20 of the Colorado constitution. No provision of this Lease shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Sections 1 or 2 of Article XI of the Constitution of the State. Neither this Lease nor the Certificates shall directly or indirectly obligate the Town to make any payments beyond those for which an Appropriation has been effected by the Town for the Town’s then current Fiscal Year. The Town shall be under no obligation whatsoever to exercise its option to purchase the Trustee’s leasehold interest in the Leased Property. No provision of this Lease shall be construed to pledge or to create a lien on any class or source of Town moneys, nor shall any provision of this Lease restrict the future issuance of any Town bonds or obligations payable from any class or source of Town moneys (provided, however, that certain restrictions in the Indenture shall apply to the issuance of Additional Certificates). Section 6.2 Base Rentals, Purchase Option Price and Additional Rentals. (a) The Town shall pay Base Rentals for which an Appropriation has been effected by the Town, directly to the Trustee during the Initial Term and any Renewal Term, on the Base Rentals Payment Dates and in the “Total Base Rentals” amounts set forth in Exhibit C (Base Rentals Schedule) attached hereto and made a part hereof. For federal and State income tax purposes, a portion of each payment of Base Rentals for the Certificates is designated and will be paid as interest, and Exhibit C (Base Rentals Schedule) hereto sets forth the Interest Portion of each payment of Base Rentals for the Certificates. The Town shall receive credit against its obligation to pay Base Rentals to the extent moneys are held by the Trustee on deposit in the Base Rentals Fund created under the Indenture and are available to pay Base Rentals. The Town acknowledges that upon receipt by the Trustee of each payment of Base Rentals, the Trustee, pursuant to the terms of the Indenture, is to deposit the amount of such Base Rentals in the Base Rentals Fund. The Base Rentals set forth in Exhibit C shall be recalculated in the event of the execution and delivery of Additional Certificates as provided in the Indenture and shall also be recalculated in the event of a partial redemption of the Certificates. ATTACHMENT C: Form of Lease 18 (b) The Town may, on any date, pay the then applicable Purchase Option Price for the purpose of terminating this Lease and the Site Lease in whole and purchasing the Trustee’s leasehold interest in the Leased Property as further provided in Article 12 of this Lease. The Town may also, at any time during the Lease Term, (1) prepay any portion of the Base Rentals due under this Lease and (2) in connection with such Prepayment, recalculate the Base Rentals set forth in Exhibit C (Base Rentals Schedule). Any such revised Exhibit C (Base Rentals Schedule) shall be prepared by the Town Representative and delivered to the Trustee. The Town shall give the Trustee notice of its intention to exercise either of such options not less than forty- five (45) days in advance of the date of exercise and shall deposit with the Trustee by not later than the date of exercise an amount equal to the Purchase Option Price due on the date of exercise or the applicable amount of Base Rentals to be prepaid. If the Town shall have given notice to the Trustee of its intention to prepay Base Rentals but shall not have deposited the amounts with the Trustee on the date specified in such notice, the Town shall continue to pay Base Rentals which have been specifically appropriated by the Council for such purpose as if no such notice had been given. The Trustee may waive the right to receive forty-five (45) days advance notice and may agree to a shorter notice period. (c) All Additional Rentals shall be paid by the Town on a timely basis directly to the person or entity to which such Additional Rentals are owed. Additional Rentals shall include, without limitation, the reasonable fees and expenses of the Trustee, reasonable expenses of the Trustee in connection with the Leased Property and for the cost of taxes, insurance premiums, utility charges, maintenance and repair costs and all other expenses expressly required to be paid hereunder, including any amounts due to the insurer of any of the Certificates, and any Rebate Fund payments required pursuant to this Lease and the Indenture. All of the payments required by this paragraph are subject to Appropriation by the Town; provided, however, a failure by the Town to budget and appropriate moneys for any of the payments required by this paragraph shall constitute an Event of Nonappropriation. If the Town’s estimates of Additional Rentals for any Fiscal Year are not itemized in the budget required to be furnished to the Trustee under Section 4.1 of this Lease, the Town shall furnish an itemization of such estimated Additional Rentals to the Trustee on or before the 15th day preceding such Fiscal Year. Section 6.3 Manner of Payment. The Base Rentals, for which an Appropriation has been effected by the Town, and, if paid, the Purchase Option Price, shall be paid or prepaid by the Town to the Trustee at its corporate trust office by wire transfer of federal funds, certified funds or other method of payment acceptable to the Trustee in lawful money of the United States of America to the Trustee at its corporate trust office. The obligation of the Town to pay the Base Rentals and Additional Rentals as required under this Article 6 and other sections hereof in any Fiscal Year for which an Appropriation has been effected by the Town for the payment thereof shall be absolute and unconditional and payment of the Base Rentals and Additional Rentals in such Fiscal Years shall not be abated through accident or unforeseen circumstances, or any default by the Trustee under this Lease, or under any other agreement between the Town and the Trustee, or for any other reason including without limitation, any acts or circumstances that may constitute failure of consideration, destruction of or damage to the Leased Property, commercial frustration of purpose, or failure of ATTACHMENT C: Form of Lease 19 the Trustee, to perform and observe any agreement, whether expressed or implied, or any duty, liability or obligation arising out of or connected with this Lease, it being the intention of the parties that the payments required by this Lease will be paid in full when due without any delay or diminution whatsoever, subject only to the annually renewable nature of the Town’s obligation hereunder as set forth in Section 6.1 hereof, and further subject to the Town’s rights under Section 9.3 hereof. Notwithstanding any dispute between the Town and the Trustee, the Town shall, during the Lease Term, make all payments of Base Rentals and Additional Rentals in such Fiscal Years and shall not withhold any Base Rentals or Additional Rentals, for which an Appropriation has been effected by the Town, pending final resolution of such dispute (except to the extent permitted by Sections 8.2 and 9.3 hereof with respect to certain Additional Rentals), nor shall the Town assert any right of set-off or counterclaim against its obligation to make such payments required hereunder. No action or inaction on the part of the Trustee shall affect the Town’s obligation to pay all Base Rentals and Additional Rentals, for which a specific Appropriation has been effected by the Town for such purpose, in such Fiscal Years subject to this Article (except to the extent provided by Sections 8.2 and 9.3 hereof with respect to certain Additional Rentals). Section 6.4 Nonappropriation. In the event that the Town gives notice that it intends to not renew this Lease as provided by Section 4.1 hereof or the Town shall not effect an Appropriation, on or before December 31 of each Fiscal Year, of moneys to pay all Base Rentals and reasonably estimated Additional Rentals coming due for the next ensuing Renewal Term as provided in Section 4.1 hereof and this Article, or in the event that the Town is proceeding under the provisions of Section 10.3(c) hereof (when applicable), an Event of Nonappropriation shall be deemed to have occurred; subject, however, to each of the following provisions: (a) In the event the Trustee does not receive the written notice provided for by Section 4.1 hereof or evidence that an Appropriation has been effected by the Town on or before December 31 of a Fiscal Year, then the Trustee shall declare an Event of Nonappropriation on the first Business Day of the February following such Fiscal Year or such declaration shall be made on any earlier date on which the Trustee receives official, specific written notice from the Town that this Lease will not be renewed. In order to declare an Event of Nonappropriation, the Trustee shall send written notice thereof to the Town. (b) The Trustee shall waive any Event of Nonappropriation which is cured by the Town, within 30 days of the receipt by the Town of notice from the Trustee as provided in (a) above, by a duly effected Appropriation to pay all Base Rentals and sufficient amounts to pay reasonably estimated Additional Rentals coming due for such Renewal Term. (c) Pursuant to the terms of the Indenture, the Trustee may waive any Event of Nonappropriation which is cured by the Town within a reasonable time after notice from the Trustee as provided in (a) above. In the event that during the Initial Term or any Renewal Term, any Additional Rentals shall become due which were not included in a duly effected Appropriation and moneys are not specifically budgeted and appropriated or otherwise made available to pay such Additional ATTACHMENT C: Form of Lease 20 Rentals within 60 days subsequent to the date upon which such Additional Rentals are due, an Event of Nonappropriation shall be deemed to have occurred, upon notice by the Trustee to the Town to such effect (subject to waiver by the Trustee as hereinbefore provided). If an Event of Nonappropriation occurs, the Town shall not be obligated to make payment of the Base Rentals or Additional Rentals or any other payments provided for herein which accrue after the last day of the Initial Term or any Renewal Term during which such Event of Nonappropriation occurs; provided, however, that, subject to the limitations of Sections 6.1 and 14.3 hereof, the Town shall continue to be liable for Base Rentals and Additional Rentals allocable to any period during which the Town shall continue to occupy, use or retain possession of the Leased Property. Subject to Section 6.5 hereof, the Town shall in all events vacate or surrender possession of the Leased Property by March 1 of the Renewal Term in respect of which an Event of Nonappropriation has occurred. After March 1 of the Renewal Term in respect of which an Event of Nonappropriation has occurred, the Trustee may proceed to exercise all or any Lease Remedies. The Town acknowledges that, upon the occurrence of an Event of Nonappropriation (a) the Trustee shall be entitled to all moneys then being held in all funds created under the Indenture (except the Rebate Fund, and any defeasance escrow accounts) to be used as described therein and (b) all property, funds and rights then held or acquired by the Trustee upon the termination of this Lease by reason of an Event of Nonappropriation are to be held by the Trustee in accordance with the terms of the Indenture. Section 6.5 Holdover Tenant. If the Town fails to vacate the Leased Property after termination of this Lease, whether as a result of the occurrence of an Event of Nonappropriation or an Event of Lease Default as provided in Section 14.2(a) hereof, with the written permission of the Trustee it will be deemed to be a holdover tenant on a month-to-month basis, and will be bound by all of the other terms, covenants and agreements of this Lease. Any holding over by the Town without the written permission of the Trustee shall be at sufferance. The amount of rent to be paid monthly during any period when the Town is deemed to be a holdover tenant will be equal to (a) one-sixth of the Interest Portion of the Base Rentals coming due on the next succeeding Base Rentals Payment Date plus one-twelfth of the Principal Portion of the Base Rentals coming due on the next succeeding Base Rentals Payment Date on which a Principal Portion of the Base Rentals would have been payable with appropriate adjustments to ensure the full payment of such amounts on the due dates thereof in the event termination occurs during a Renewal Term plus (b) Additional Rentals as the same shall become due. ATTACHMENT C: Form of Lease 21 Section 6.6 Prohibition of Adverse Budget or Appropriation Modifications. To the extent permitted by law, the Town shall not, during any Fiscal Year of the Lease Term, make any budgetary transfers or other modifications to its then existing budget and appropriation measures relating to the Leased Property or this Lease which would adversely affect the Town’s ability to meet its obligation to pay Base Rentals and duly budgeted and appropriated Additional Rentals hereunder. ATTACHMENT C: Form of Lease 22 ARTICLE 7 RESERVED ATTACHMENT C: Form of Lease 23 ARTICLE 8 TITLE TO LEASED PROPERTY; LIMITATIONS ON ENCUMBRANCES Section 8.1 Title to the Leased Property; Title Insurance. Title to the Leased Property shall remain in the Town, subject to the Site Lease, this Lease, the Indenture and any other Permitted Encumbrances notwithstanding any provisions to the contrary in the Site Lease, this Lease or the Indenture. Except personal property purchased by the Town at its own expense pursuant to Section 9.2 of this Lease, title to the Trustee’s leasehold interest in the Leased Property and any and all additions and modifications thereto and replacement thereof shall be held in the name of the Trustee, subject to this Lease, the Site Lease and the Indenture, until liquidated, conveyed or otherwise disposed of as provided in Section 7.02 of the Indenture or Article XII of this Lease, or until the termination of the Site Lease, notwithstanding (i) the occurrence of an Event of Nonappropriation as provided in Section 6.4 of this Lease or one or more Events of Default as defined in Section 14.1 of this Lease; (ii) the occurrence of any event of damage, destruction, condemnation or construction defect or title defect, as provided in Article X of this Lease; or (iii) the violation by the Trustee (or by the Trustee as assignee of the Lessor pursuant to the Indenture) of any provision of this Lease. Concurrently with the execution and delivery of this Lease, the Trustee shall be provided with one or more commitments for one or more standard Leasehold Owner’s title insurance policies issued to the Trustee, insuring the Trustee’s leasehold interest in the Leased Property, subject only to Permitted Encumbrances, in an aggregate amount not less than the aggregate principal amount of the Certificates less any amounts deposited in the Reserve Fund concurrently with the issuance of the Certificates, or such lesser amount as shall be the maximum insurable value of the Leased Property. The Town shall have no right, title or interest in the Leased Property, or any additions and modifications to or replacements of any portion thereto, except as expressly set forth in this Lease. The Trustee shall not in any way be construed as the owner of the Leased Property. Section 8.2 No Encumbrance, Mortgage or Pledge of the Leased Property. Except as may be permitted by this Lease, the Town shall not permit any mechanic’s or other lien to be established or remain against the Leased Property; provided that, if the Town shall first notify the Trustee of the intention of the Town to do so, the Town may in good faith contest any mechanic’s or other lien filed or established against the Leased Property, and in such event may permit the items so contested to remain undischarged and unsatisfied during the period of such contest and any appeal therefrom unless the Trustee shall notify the Town that, in the opinion of Counsel, by nonpayment of any such items the Trustee’s leasehold interest in the Leased Property will be materially endangered, or the Leased Property or any part thereof will be subject to loss or forfeiture, in which event the Town shall promptly pay and cause to be satisfied and discharged all such unpaid items (provided, however, that such payment shall not constitute a waiver of the right to continue to contest such items). The Trustee will cooperate in any such contest. Except as may be permitted by this Lease, the Town shall not directly or indirectly create, incur, assume or suffer to exist any mortgage, pledge, lien, charge, encumbrance or claim on or with respect to the Leased Property, except Permitted Encumbrances. The Town shall ATTACHMENT C: Form of Lease 24 promptly, at its expense, take such action as may be necessary to duly discharge any such mortgage, pledge, lien, charge, encumbrance or claim not excepted above. ATTACHMENT C: Form of Lease 25 ARTICLE 9 MAINTENANCE; TAXES; INSURANCE AND OTHER CHARGES Section 9.1 Maintenance of the Leased Property by the Town. Subject to its right to not appropriate and as otherwise provided in Section 10.3 hereof, the Town agrees that at all times during the Lease Term, the Town will maintain, preserve and keep the Leased Property or cause the Leased Property to be maintained, preserved and kept, in good repair, working order and condition, and from time to time make or cause to be made all necessary and proper repairs, including replacements, if necessary. The Trustee shall have no responsibility in any of these matters or for the making of any additions, modifications or replacements to the Leased Property. Section 9.2 Modification of the Leased Property; Installation of Furnishings and Machinery of the Town. The Town shall have the privilege of making substitutions, additions, modifications and improvements to the Leased Property, at its own cost and expense, as appropriate and any such substitutions, additions, modifications and improvements to the Leased Property shall be the property of the Town, subject to the Site Lease, this Lease and the Indenture and shall be included under the terms of the Site Lease, this Lease and the Indenture; provided, however, that such substitutions, additions, modifications and improvements shall not in any way damage the Leased Property or cause the Leased Property to be used for purposes other than lawful governmental functions of the Town (except to the extent of subleasing permitted under Section 13.2 hereof) or cause the Town to violate its tax covenant in Section 11.5 hereof; and provided that the Leased Property, as improved or altered, upon completion of such substitutions, additions, modifications and improvements, shall be of a value not less than the value of the Leased Property immediately prior to such making of substitutions, additions, modifications and improvements. The Town may also, from time to time in its sole discretion and at its own expense, install machinery, equipment and other tangible property in or on the Leased Property. All such machinery, equipment and other tangible property shall remain the sole property of the Town in which the Trustee shall have no interests; provided, however, that title to any such machinery, equipment and other tangible property which becomes permanently affixed to the Leased Property shall be included under the terms of the Site Lease, this Lease and the Indenture, that such Leased Property would be damaged or impaired by the removal of such machinery, equipment or other tangible property. The Town shall have the right to make substitutions to the Leased Property upon compliance with the provisions set forth in Section 11.4 hereof. Section 9.3 Taxes, Other Governmental Charges and Utility Charges. In the event that the Leased Property shall, for any reason, be deemed subject to taxation, assessments or charges lawfully made by any governmental body, the Town shall pay the amount of all such taxes, assessments and governmental charges then due, as Additional Rentals. With respect to special assessments or other governmental charges which may be lawfully paid in installments over a period of years, the Town shall be obligated to provide for Additional Rentals only for such installments as are required to be paid during the upcoming Fiscal Year. Except for Permitted Encumbrances, the Town shall not allow any liens for taxes, assessments or governmental charges to exist with respect to the Leased Property (including, without limitation, ATTACHMENT C: Form of Lease 26 any taxes levied upon the Leased Property which, if not paid, will become a charge on the rentals and receipts from the Leased Property, or any interest therein, including the leasehold interests of the Trustee), or the rentals and revenues derived therefrom or hereunder. The Town shall also pay as Additional Rentals, as the same respectively become due, all utility and other charges and fees and other expenses incurred in the operation, maintenance and upkeep of the Leased Property. The Town may, at its expense, in good faith contest any such taxes, assessments, utility and other charges and, in the event of any such contest, may permit the taxes, assessments, utility or other charges so contested to remain unpaid during the period of such contest and any appeal therefrom unless the Trustee shall notify the Town that, in the opinion of Counsel, by nonpayment of any such items the value of the Leased Property will be materially endangered or the Leased Property will be subject to loss or forfeiture, or the Trustee will be subject to liability, in which event such taxes, assessments, utility or other charges shall be paid forthwith (provided, however, that such payment shall not constitute a waiver of the right to continue to contest such taxes, assessments, utility or other charges). Section 9.4 Provisions For Liability and Property Insurance. Upon the execution and delivery of this Lease, the Town shall, at its own expense, cause casualty and property insurance to be carried and maintained with respect to the Leased Property in an amount equal to the estimated replacement cost of the Leased Property. Such insurance policy or policies may have a deductible clause in an amount not to exceed $250,000. The Town may, in its discretion, insure the Leased Property under blanket insurance policies which insure not only the Leased Property, but other buildings as well, as long as such blanket insurance policies comply with the requirements hereof. If the Town shall insure against similar risks by self-insurance, the Town may, at its election provide for casualty and property damage insurance with respect to the Leased Property, partially or wholly by means of a self-insurance fund. If the Town shall elect to self-insure, the Town Representative shall annually furnish to the Trustee a certification of the adequacy of the Town’s reserves. The Trustee shall be named additional insured and loss payee on any casualty and property insurance. Upon the execution and delivery of this Lease, the Town shall, at its own expense, cause public liability insurance to be carried and maintained with respect to the activities to be undertaken by and on behalf of the Town in connection with the use of the Leased Property, in an amount not less than the limitations provided in the Colorado Governmental Immunity Act (Article 10, Title 24, Colorado Revised Statutes, as heretofore or hereafter amended). Such insurance may contain deductibles and exclusions deemed reasonable by the Council. The public liability insurance required by this Section may be by blanket insurance policy or policies. If the Town shall insure against similar risks by self-insurance, the Town, at its election may provide for public liability insurance with respect to the Leased Property, partially or wholly by means of a self-insurance fund. If the Town shall elect to self-insure, the Town Representative shall annually furnish to the Trustee a certification of the adequacy of the Town’s reserves. The Trustee shall be named as additional insured and loss payee on any public liability insurance. Any casualty and property damage insurance policy required by this Section shall be so written or endorsed as to make payments under such insurance policy payable to the Town and the Trustee. Each insurance policy provided for in this Section shall contain a provision to the ATTACHMENT C: Form of Lease 27 effect that the insurance company shall not cancel the policy without first giving written notice thereof to the Town at least 30 days in advance of such cancellation. All insurance policies issued pursuant to this Section, or certificates evidencing such policies, shall be deposited with the Trustee. No agent or employee of the Town shall have the power to adjust or settle any loss with respect to the Leased Property in excess of $25,000, whether or not covered by insurance, without the prior written consent of the Trustee. Upon the initial execution and delivery of this Lease, the Town shall provide the Trustee with evidence that the insurance required pursuant to this Section 9.4 is in effect. A certification by the Town Representative that such insurance is in effect shall be sufficient evidence of insurance. A certificate of insurance from the Town or the Town’s insurance agent will also be acceptable evidence of insurance. The Trustee shall annually request evidence of insurance from the Town on or about October 1 in each year and upon receipt of such written request, the Town shall provide annual certification that the insurance required pursuant to this Section 9.4 is in effect. Section 9.5 Advances. If the Town fails to pay any Additional Rentals during the Lease Term as such Additional Rentals become due, the Trustee may (but shall not be obligated to) pay such Additional Rentals and the Town agrees to reimburse the Trustee to the extent permitted by law and subject to Appropriation as provided under Article 6 hereof. Section 9.6 Granting of Easements. As long as no Event of Nonappropriation or Event of Lease Default shall have happened and be continuing, the Trustee, shall upon the request of the Town, (a) grant or enter into easements, permits, licenses, party wall and other agreements, rights-of-way (including the dedication of public roads) and other rights or privileges in the nature of easements, permits, licenses, party wall and other agreements and rights of way with respect to any property or rights included in this Lease (whether such rights are in the nature of surface rights, sub-surface rights or air space rights), free from this Lease and any security interest or other encumbrance created hereunder or thereunder; (b) release existing easements, permits, licenses, party wall and other agreements, rights-of-way, and other rights and privileges with respect to such property or rights, with or without consideration; and (c) execute and deliver any instrument necessary or appropriate to grant, enter into or release any such easement, permit, license, party wall or other agreement, right-of-way or other grant or privilege upon receipt of: (i) a copy of the instrument of grant, agreement or release and (ii) a written application signed by the Town Representative requesting such grant, agreement or release and stating that such grant, agreement or release will not materially impair the effective use or materially interfere with the operation of the Leased Property. ATTACHMENT C: Form of Lease 28 ARTICLE 10 DAMAGE, DESTRUCTION AND CONDEMNATION; USE OF NET PROCEEDS Section 10.1 Damage, Destruction and Condemnation. If, during the Lease Term, (a) the Leased Property shall be destroyed (in whole or in part), or damaged by fire or other casualty; or (b) title to, or the temporary or permanent use of, the Leased Property or the estate of the Town or the Trustee in the Leased Property is taken under the exercise of the power of eminent domain by any governmental body or by any person, firm or entity acting under governmental authority; or (c) a breach of warranty or a material defect in the construction, manufacture or design of the Leased Property becomes apparent; or (d) title to or the use of all or a portion of the Leased Property is lost by reason of a defect in title thereto. then the Town shall be obligated to continue to pay Base Rentals and Additional Rentals (subject to Article 6 hereof). Section 10.2 Obligation to Repair and Replace the Leased Property. The Town and the Trustee, to the extent Net Proceeds are within their respective control, shall cause such Net Proceeds of any insurance policies, performance bonds or condemnation awards to be deposited in a separate trust fund. All Net Proceeds so deposited shall be applied to the prompt repair, restoration, modification, improvement or replacement of the Leased Property by the Town, upon receipt of requisitions by the Trustee signed by the Town Representative stating with respect to each payment to be made: (a) the requisition number; (b) the name and address of the person, firm or entity to whom payment is due; (c) the amount to be paid; and (d) that each obligation mentioned therein has been properly incurred, is a proper charge against the separate trust fund and has not been the basis of any previous withdrawal and specifying in reasonable detail the nature of the obligation. The Town and the Trustee shall agree to cooperate and use their best reasonable efforts subject to the terms of the Indenture to enforce claims which may arise in connection with material defects in the construction, manufacture or design of the Leased Property or otherwise. If there is a balance of any Net Proceeds allocable to the Leased Property remaining after such repair, restoration, modification, improvement or replacement has been completed, this balance shall be used by the Town, to: ATTACHMENT C: Form of Lease 29 (e) add to, modify or alter the Leased Property or add new components thereto, or (f) prepay the Base Rentals with a corresponding adjustment in the amount of Base Rentals payable under Exhibit C (Base Rentals Schedule) to this Lease or (g) accomplish a combination of (a) and (b). Any repair, restoration, modification, improvement or replacement of the Leased Property paid for in whole or in part out of Net Proceeds allocable to the Leased Property shall be the property of the Town, subject to the Site Lease, this Lease and the Indenture and shall be included as part of the Leased Property under this Lease. Section 10.3 Insufficiency of Net Proceeds. If the Net Proceeds (plus any amounts withheld from such Net Proceeds by reason of any deductible clause) are insufficient to pay in full the cost of any repair, restoration, modification, improvement or replacement of the Leased Property required under Section 10.2 of this Lease, the Town may elect to: (a) complete the work or replace such Leased Property (or portion thereof) with similar property of a value equal to or in excess of such portion of the Leased Property and pay as Additional Rentals, to the extent amounts for Additional Rentals which have been specifically appropriated by the Town are available for payment of such cost, any cost in excess of the amount of the Net Proceeds allocable to the Leased Property, and the Town agrees that, if by reason of any such insufficiency of the Net Proceeds allocable to the Leased Property, the Town shall make any payments pursuant to the provisions of this paragraph, the Town shall not be entitled to any reimbursement therefor from the Trustee, nor shall the Town be entitled to any diminution of the Base Rentals and Additional Rentals, for which a specific Appropriation has been effected by the Town for such purpose, payable under Article 6 of this Lease; or (b) apply the Net Proceeds allocable to the Leased Property to the payment of the Purchase Option Price in accordance with Article 12 of this Lease, or an appropriate portion thereof. In the event of an insufficiency of the Net Proceeds for such purpose, the Town shall, subject to the limitations of Section 6.1 hereof, pay such amounts as may be necessary to equal that portion of the Purchase Option Price which is attributable to the Leased Property for which Net Proceeds have been received (as certified to the Trustee by the Town); and in the event the Net Proceeds shall exceed such portion of the Purchase Option Price, such excess shall be used as directed by the Town in the same manner as set forth in Section 10.2 hereof; or (c) if the Town does not timely budget and appropriate sufficient funds to proceed under either (a) or (b) above, an Event of Nonappropriation will be deemed to have occurred and, subject to the Town’s right to cure, the Trustee may pursue remedies available to it following an Event of Nonappropriation. The above referenced election shall be made by the Town within 90 days of the occurrence of an event specified in Section 10.1 of this Lease. It is hereby declared to be the Town’s present intention that, if an event described in Section 10.1 hereof should occur and if ATTACHMENT C: Form of Lease 30 the Net Proceeds shall be insufficient to pay in full the cost of repair, restoration, modification, improvement or replacement of the Leased Property, the Town would use its best efforts to proceed under either paragraph (a) or paragraph (b) above; but it is also acknowledged that the Town must operate within budgetary and other economic constraints applicable to it at the time, which cannot be predicted with certainty; and accordingly the foregoing declaration shall not be construed to contractually obligate or otherwise bind the Town. Section 10.4 Cooperation of the Trustee. The Trustee shall cooperate fully with the Town in filing any proof of loss with respect to any insurance policy or performance bond covering the events described in Section 10.1 of this Lease and in the prosecution or defense of any prospective or pending condemnation proceeding with respect to the Leased Property and the enforcement of all warranties relating to the Leased Property. So long as no Event of Lease Default or Event of Nonappropriation has occurred and is then existing, the Trustee shall not voluntarily settle, or consent to the settlement of, any proceeding arising out of any insurance claim performance or payment bond claim, prospective or pending condemnation proceeding with respect to the Leased Property without the written consent of the Town. ATTACHMENT C: Form of Lease 31 ARTICLE 11 DISCLAIMER OF WARRANTIES; OTHER COVENANTS Section 11.1 Disclaimer of Warranties. THE TRUSTEE HAS NOT MADE AND WILL NOT MAKE ANY WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR FITNESS FOR USE OF THE LEASED PROPERTY OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE LEASED PROPERTY. THE TOWN HEREBY ACKNOWLEDGES AND DECLARES THAT THE TOWN IS SOLELY RESPONSIBLE FOR THE MAINTENANCE AND OPERATION OF THE LEASED PROPERTY, AND THAT THE TRUSTEE HAS NO RESPONSIBILITY THEREFOR. THE TRUSTEE HAS NOT MADE AND WILL NOT MAKE ANY WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR FITNESS FOR USE OF THE LEASED PROPERTY OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE LEASED PROPERTY. THE TOWN HEREBY ACKNOWLEDGES AND DECLARES THAT THE TOWN IS SOLELY RESPONSIBLE FOR THE MAINTENANCE AND OPERATION OF THE LEASED PROPERTY, AND THAT THE TRUSTEE HAS NO RESPONSIBILITY THEREFOR. For the purpose of enabling the Town to discharge such responsibility, the Trustee constitutes and appoints the Town as its attorney in fact for the purpose of asserting and enforcing, at the sole cost and expense of the Town, all manufacturer’s warranties and guaranties, express or implied, with respect to the Leased Property, as well as any claims or rights the Trustee may have in respect of the Leased Property against any manufacturer, supplier, contractor or other person. Except as otherwise provided in this Lease, the Trustee shall not be liable for any direct or indirect, incidental, special, punitive or consequential damage in connection with or arising out of this Lease or the existence, furnishing, functioning or use by the Town of any item, product or service provided for herein except that nothing shall relieve the Trustee’s liability for any claims, damages, liability or court awards, including costs, expenses and attorney fees, relating to or arising from the Trustee’s actions or omissions that result from the negligence, bad faith or intentional misconduct of the Trustee or its employees. Section 11.2 Further Assurances and Corrective Instruments. The Trustee and the Town agree that they will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such amendments hereof or supplements hereto and such further instruments as may reasonably be required for correcting any inadequate or incorrect description of the Leased Property. Section 11.3 Compliance with Requirements. During the Lease Term, the Town and the Trustee shall observe and comply promptly to the extent possible with all current and future orders of all courts having jurisdiction over the Leased Property, provided that the Town and the Trustee may contest or appeal such orders so long as they are in compliance with such orders during the contest or appeal period, and all current and future requirements of all insurance companies writing policies covering the Leased Property. Section 11.4 Partial Release and Substitution of Leased Property. So long as no Event of Lease Default or Event of Nonappropriation shall have occurred and be continuing, the ATTACHMENT C: Form of Lease 32 Trustee shall release any portion of the Leased Property, and shall execute all documents necessary or appropriate to reconvey or release such portion of the Leased Property to the Town, free of all restrictions and encumbrances imposed or created by the Site Lease, this Lease or the Indenture, upon receipt by the Trustee of the following: (a) a written request of the Town Representative for such release, describing the portion of the Leased Property to be released; (b) a certificate of the Town Representative certifying (i) the fair market value of the portion of the Leased Property to be released and of any real property to be substituted for the portion of the Leased Property to be released; (ii) the disposition to be made of the portion of the Leased Property to be released and the consideration, if any, to be received therefor; (iii) that the disposition of the portion of the Leased Property to be released and the substitution therefor of the real property to be substituted for the portion of the Leased Property to be released (if any) will not materially adversely affect the ability of the Town to operate the Leased Property or to fulfill its obligations under this Lease; (iv) that any real property to be substituted for the portion of the Leased Property to be released is necessary or useful to the operation of the Leased Property; and (v) that the fair market value of any real property to be substituted for the portion of the Leased Property to be released, together with cash to be paid by the Town to the Trustee, if any, is at least equal to the fair market value of the portion of the Leased Property to be released; (c) appraisals of the fair market value of the portion of the Leased Property to be released and any real property to be substituted for the portion of the Leased Property to be released, respectively, by a member of the American Institute of Real Estate Appraisers (MAI); and (d) supplements and amendments to the Site Lease, this Lease and the Indenture and any other documents necessary to subject any real property to be substituted for the portion of the Leased Property to be released to the lien of the Indenture. The Town agrees that any cash paid to the Trustee pursuant to the provisions of this Section 10.4 shall be deposited into the Base Rentals Fund. Section 11.5 Tax Covenants. The Town acknowledges that the moneys in all funds and accounts expected to be created under the Indenture are to be invested or deposited by the Trustee, at the written direction of the Town. The Town covenants for the benefit of the Owners of the Certificates that it will not take any action or omit to take any action with respect to the Certificates, the proceeds thereof, any other funds of the Town or any facilities financed or refinanced with the proceeds of the Certificates (except for the possible exercise of the Town’s right to terminate this Lease as provided herein) if such action or omission (i) would cause the interest on the Certificates to lose its exclusion from gross income for federal income tax purposes under Section 103 of the Tax Code, or (ii) would cause interest on the Certificates to lose its exclusion from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code, except to the extent such interest is required to be included in adjusted current earnings adjustment applicable to corporations under Section 56 of the Tax Code in calculating corporate alternative minimum taxable income, or (iii) would cause interest on the Certificates to lose its exclusion from Colorado taxable income or to lose its exclusion from Colorado alternative minimum taxable income under present Colorado law. Subject to the Town’s right to terminate this Lease as provided herein, the foregoing covenant shall remain in full force and effect, notwithstanding the payment in full or defeasance of the Certificates, until the date on which all obligations of the Town in fulfilling the above covenant under the Tax Code and Colorado law have been met. ATTACHMENT C: Form of Lease 33 In addition, the Town covenants that its direction of investments pursuant to Article 5 of the Indenture shall be in compliance with the procedures established by the Tax Certificate to the extent required to comply with its covenants contained in the foregoing provisions of this Section. The Town hereby agrees that, to the extent necessary, it will, during the Lease Term, pay to the Trustee such sums as are required for the Trustee to pay the amounts due and owing to the United States Treasury as rebate payments. Any such payment shall be accompanied by directions to the Trustee to pay such amounts to the United States Treasury. Any payment of Town moneys pursuant to the foregoing sentence shall be Additional Rentals for all purposes of this Lease. The Town is to execute the Tax Certificate in connection with the execution and delivery of this Lease, which Tax Certificate shall provide further details in respect of the Town’s tax covenants herein. For the purpose of Section 265(b)(3)(B) of the Code, the Town hereby designates the Certificates as qualified tax-exempt obligations. Section 11.6 Undertaking to Provide Ongoing Disclosure. The Town covenants for the benefit of the Owners of the Certificates to comply with the terms of the Continuing Disclosure Certificate, provided that a failure of the Town to do so shall not constitute an Event of Lease Default. The Trustee shall have no power or duty to enforce this Section. Unless otherwise required by law, no Certificate owner shall be entitled to damages for the Town’s non- compliance with its obligations under this Section; however, the Certificate Owners may enforce specific performance of the obligations contained in this Section by any judicial proceedings available. Section 11.7 Covenant to Reimburse Legal Expenses. To the extent permitted by law, the Town shall defend and hold harmless the Trustee against claims arising from the alleged negligent acts or omissions of the Town’s public employees, which occurred or are alleged to have occurred during the performance of their duties and within the scope of their employment, unless such acts or omissions are, or are alleged to be, willful and wanton. Such claims shall be subject to the limitations of the Colorado Governmental Immunity Act, C.R.S. 24-10-101 to 24- 10-120. The Town shall include as Additional Rentals, the reimbursement of reasonable and necessary expenses incurred by the Trustee to defend the Trustee from and against all claims, by or on behalf of any person, firm, corporation or other legal entity arising from the conduct or management of the Leased Property or from any work or thing done on the Leased Property during the Lease Term requested by the Town, or from any condition of the Leased Property caused by the Town. This duty to reimburse the Trustee’s legal expenses is not an indemnification and it is expressly understood that the Town is not indemnifying the Trustee and, as previously stated, is limited to Net Proceeds and moneys, if any, in excess of such Net Proceeds, for which an Appropriation has been effected. Section 11.8 Access to the Leased Property; Rights to Inspect Books. The Town agrees that the Trustee shall have the right at all reasonable times to examine and inspect the Leased Property (subject to such regulations as may be imposed by the Town for security purposes) and all of the Town’s books and records with respect thereto, but the Trustee has no duty to inspect the Leased Property books or records. The Town further agrees that the Trustee ATTACHMENT C: Form of Lease 34 shall have such rights of access to the Leased Property as may be reasonably necessary to cause the proper maintenance of the Leased Property in the event of failure by the Town to perform its obligations under this Lease but the Trustee has no duty to cause the proper maintenance of the Leased Property under this Lease. The Indenture allows the Town to have the right at all reasonable times to examine and inspect all of the Trustee’s books and records with respect to the Leased Property and all funds and accounts held under the Indenture. The Town and its representatives shall have the right to examine and inspect the books and records of the Trustee relating to the Leased Property at all reasonable times from the date of this Lease and until three years after the termination date of this Lease. ATTACHMENT C: Form of Lease 35 ARTICLE 12 PURCHASE OPTION Section 12.1 Purchase Option. The Town shall have the option to prepay Base Rentals in whole or in part and to purchase the Trustee’s leasehold interest in all or a portion of the Leased Property at any time, but only if an Event of Lease Default or an Event of Nonappropriation has not occurred and is then continuing. All of the Leased Property shall be released from the provisions of the Site Lease and this Lease upon compliance with Section 12.2 hereof. The Town shall give the Trustee notice of its intention to exercise its option to prepay Base Rentals in whole or in part not less than forty-five (45) days in advance of the date of such prepayment and shall deposit the required moneys with the Trustee on or before the date selected to prepay the Base Rentals. The Trustee may waive such notice or may agree to a shorter notice period. If the Town shall have given notice to the Trustee of its intention to prepay Base Rentals, in whole or in part, to purchase the Trustee’s leasehold interest in all or a portion of the Leased Property, but shall not have deposited the amounts with the Trustee on the date specified in such notice, the Town shall continue to pay Base Rentals, which have been specifically appropriated by the Town for such purpose, as if no such notice had been given. Section 12.2 Conditions for Purchase Option. The Trustee shall transfer and release the Trustee’s leasehold interests in the Leased Property to the Town in the manner provided for in Section 12.3 of this Lease; provided, however, that prior to such transfer and release, either: (a) the Town shall have paid the then applicable Purchase Option Price which shall equal the sum of the amount necessary to defease and discharge the Indenture as provided therein (i.e., provision for payment of all principal and interest portions of any and all Certificates which may have been executed and delivered pursuant to the Indenture shall have been made in accordance with the terms of the Indenture) plus any fees and expenses then owing to the Trustee; or (b) the Town shall have paid all Base Rentals set forth in Exhibit C (Base Rentals Schedule) hereto, for the entire maximum Lease Term, and all then current Additional Rentals required to be paid hereunder. At the Town’s option, amounts then on deposit in any fund held under the Indenture (except the Rebate Fund and excluding any defeasance escrow funds) may be credited toward the Purchase Option Price. Section 12.3 Manner of Conveyance. At the closing of the purchase or other conveyance of all of the Trustee’s leasehold interest in the Leased Property pursuant to Section 12.2 of this Lease, the Trustee shall release and terminate the Site Lease, this Lease and the Indenture and execute and deliver to the Town any necessary documents releasing, assigning, transferring and conveying the Trustee’s leasehold interest in the Leased Property, as they then exist, subject only to the following: ATTACHMENT C: Form of Lease 36 (a) Permitted Encumbrances, other than the Site Lease, this Lease and the Indenture; (b) all liens, encumbrances and restrictions created or suffered to exist by the Trustee as required or permitted by the Site Lease, this Lease or the Indenture or arising as a result of any action taken or omitted to be taken by the Trustee as required or permitted by the Site Lease, this Lease or the Indenture; (c) any lien or encumbrance created or suffered to exist by action of the Town; and (d) those liens and encumbrances (if any) to which title to the Leased Property was subject when leased to the Trustee. ATTACHMENT C: Form of Lease 37 ARTICLE 13 ASSIGNMENT AND SUBLEASING Section 13.1 Assignment by the Trustee; Replacement of the Trustee. Except as otherwise provided in this Lease and the Indenture, this Lease may not be assigned by the Trustee for any reason other than to a successor by operation of law or to a successor trustee under the Indenture or with the prior written consent of the Town which consent shall not be unreasonably withheld. The Trustee will notify the Town of any assignment to a successor by operation of law. If an Event of Lease Default or Event of Nonappropriation has occurred and is continuing, the Trustee may act as herein provided, including exercising the remedies set forth in Section 14.2, without the prior written direction of the Town. Section 13.2 Assignment and Subleasing by the Town. This Lease may not be assigned by the Town for any reason other than to a successor by operation of law. However, the Leased Property may be subleased, as a whole or in part, by the Town, without the necessity of obtaining the consent of the Trustee or any owner of the Certificates subject to each of the following conditions: (a) The Leased Property may be subleased, in whole or in part, only to an agency or department of, or a political subdivision of, the State, or to another entity or entities with Approval of Special Counsel; (b) This Lease, and the obligations of the Town hereunder, shall, at all times during the Lease Term remain obligations of the Town, and the Town shall maintain its direct relationships with the Trustee, notwithstanding any sublease; (c) The Town shall furnish or cause to be furnished to the Trustee a copy of any sublease agreement; (d) No sublease by the Town shall cause the Leased Property to be used for any purpose which would cause the Town to violate its tax covenant in Section 11.5 hereof; and (e) Any sublease of the Leased Property shall provide that it shall automatically terminate upon a termination of this Lease. ATTACHMENT C: Form of Lease 38 ARTICLE 14 EVENTS OF LEASE DEFAULT AND REMEDIES Section 14.1 Events of Lease Default Defined. Any one of the following shall be Events of Lease Default under this Lease: (a) failure by the Town to pay any Base Rentals or Additional Rentals, which have been specifically appropriated by the Town for such purpose, during the Initial Term or any Renewal Term, within five (5) Business Days of the date on which they are due; or (b) subject to the provisions of Section 6.5 hereof, failure by the Town to vacate or surrender possession of the Leased Property by March 1 of any Renewal Term in respect of which an Event of Nonappropriation has occurred; or (c) failure by the Town to observe and perform any covenant, condition or agreement on its part to be observed or performed hereunder, other than as referred to in (a) or (b), for a period of 30 days after written notice, specifying such failure and requesting that it be remedied shall be received by the Town from the Trustee, unless the Trustee shall agree in writing to an extension of such time prior to its expiration; provided that if the failure stated in the notice cannot be corrected within the applicable period, the Trustee shall not withhold its consent to an extension of such time if corrective action can be instituted by the Town within the applicable period and diligently pursued until the default is corrected; or (d) failure by the Town to comply with the terms of the Site Lease. The foregoing provisions of this Section 14.1 are subject to the following limitations: (i) the Town shall be obligated to pay the Base Rentals and Additional Rentals, which have been specifically appropriated by the Town for such purpose, only during the then current Lease Term, except as otherwise expressly provided in this Lease; and (ii) if, by reason of Force Majeure, the Town or the Trustee shall be unable in whole or in part to carry out any agreement on their respective parts herein contained other than the Town’s agreement to pay the Base Rentals and Additional Rentals due hereunder, the Town or the Trustee shall not be deemed in default during the continuance of such inability. The Town and the Trustee each agree, however, to remedy, as promptly as legally and reasonably possible, the cause or causes preventing the Town or the Trustee from carrying out their respective agreements; provided that the settlement of strikes, lockouts and other industrial disturbances shall be entirely within the discretion of the Town. Section 14.2 Remedies on Default. Whenever any Event of Lease Default shall have happened and be continuing beyond any applicable cure period, the Trustee may, or shall at the request of the owners of a majority in aggregate principal amount of the Certificates then Outstanding and upon indemnification as to costs and expenses as provided in the Indenture, ATTACHMENT C: Form of Lease 39 without any further demand or notice, take one or any combination of the following remedial steps: (a) terminate the Lease Term and give notice to the Town to vacate and surrender possession of the Leased Property, which vacation and surrender the Town agrees to complete within sixty (60) days from the date of such notice; provided, in the event the Town does not vacate and surrender possession on the termination date, the provisions of Section 6.5 hereof shall apply; (b) lease or sublease the Leased Property or sell or assign any interest the Trustee has in the Leased Property, including the Trustee’s leasehold interest in the Leased Property; (c) recover from the Town: (i) the portion of Base Rentals and Additional Rentals, for which a specific Appropriation has been effected by the Town for such purpose, which would otherwise have been payable hereunder, during any period in which the Town continues to occupy, use or possess the Leased Property; and (ii) Base Rentals and Additional Rentals, for which a specific Appropriation has been effected by the Town for such purpose, which would otherwise have been payable by the Town hereunder during the remainder, after the Town vacates and surrenders possession of the Leased Property, of the Fiscal Year in which such Event of Lease Default occurs. (d) take whatever action at law or in equity may appear necessary or desirable to enforce its rights in and to the Leased Property under the Site Lease, this Lease and the Indenture. Upon the occurrence of an Event of Nonappropriation, the Trustee shall be entitled to recover from the Town the amounts set forth in Section 14.2(c)(i) hereof if the Town continues to occupy the Leased Property after December 31 of the Fiscal Year in which such Event of Nonappropriation occurs. The Trustee shall also be entitled, upon any Event of Lease Default, to any moneys in any funds or accounts created under the Indenture (except the Rebate Fund or any defeasance escrow accounts). Section 14.3 Limitations on Remedies. The remedies in connection with an Event of Lease Default shall be limited as set forth in this Section. A judgment requiring a payment of money may be entered against the Town by reason of an Event of Lease Default only as to the Town’s liabilities described in paragraph (c) of Section 14.2 hereof. A judgment requiring a payment of money may be entered against the Town by reason of an Event of Nonappropriation only to the extent that the Town fails to vacate and surrender possession of the Leased Property as required by Section 6.4 of this Lease, and only as to the liabilities described in paragraph (c)(i) ATTACHMENT C: Form of Lease 40 of Section 14.2 hereof. The remedy described in paragraph (c)(ii) of Section 14.2 of this Lease is not available for an Event of Lease Default consisting of failure by the Town to vacate and surrender possession of the Leased Property by March 1 following an Event of Nonappropriation. Section 14.4 No Remedy Exclusive. Subject to Section 14.3 hereof, no remedy herein conferred upon or reserved to the Trustee, is intended to be exclusive, and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Trustee to exercise any remedy reserved in this Article 14, it shall not be necessary to give any notice, other than such notice as may be required in this Article 14. Section 14.5 Waivers. The Trustee may waive any Event of Lease Default under this Lease and its consequences. In the event that any agreement contained herein should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. Payment of Base Rentals or Additional Rentals by the Town shall not constitute a waiver of any breach or default by the Trustee hereunder. Section 14.6 Agreement to Pay Attorneys’ Fees and Expenses. In the event that either party hereto shall default under any of the provisions hereof and the nondefaulting party shall employ attorneys or incur other expenses for the collection of Base Rentals or Additional Rentals, or the enforcement of performance or observance of any obligation or agreement on the part of the defaulting party herein contained, the defaulting party agrees that it shall on demand therefor pay to the nondefaulting party, to the extent permitted by law, the reasonable fees of such attorneys and such other reasonable expenses so incurred by the nondefaulting party. Notwithstanding the foregoing, any such fees and expenses owed by the Town hereunder shall constitute Additional Rentals for all purposes of this Lease and shall be subject to Appropriation. Section 14.7 Waiver of Appraisement, Valuation, Stay, Extension and Redemption Laws. To the extent permitted by law, in the case of an Event of Nonappropriation or an Event of Lease Default neither the Trustee nor the Town nor any one claiming through or under either of them shall or will set up, claim or seek to take advantage of any appraisement, valuation, stay, extension or redemption laws now or hereafter in force in order to prevent or hinder the enforcement of the Indenture; and the Trustee and the Town, for themselves and all who may at any time claim through or under either of them, each hereby waives, to the full extent that it may lawfully do so, the benefit of all such laws. Notwithstanding the foregoing, it is expressly understood that the Town cannot and does not hereby waive its right to set up, claim or seek to take advantage of its police powers or its Colorado constitutional or statutory right of eminent domain. ATTACHMENT C: Form of Lease 41 ARTICLE 15 MISCELLANEOUS Section 15.1 Sovereign Powers of Town. Nothing in this Lease shall be construed as diminishing, delegating, or otherwise restricting any of the sovereign powers or immunities of the Town. Nothing in this Lease shall be construed to require the Town to occupy and operate the Leased Property other than as lessee, or to require the Town to exercise its right to purchase the Leased Property as provided in Article 12 hereof. Section 15.2 Notices. All notices, certificates or other communications to be given hereunder shall be sufficiently given and shall be deemed given when delivered or mailed by certified or registered mail, postage prepaid, addressed as follows: if to the Trustee, UMB Bank, n.a. 1670 Broadway Denver, CO 80202 Attention: Corporate Trust and Escrow Services if to the Town, Town of Avon, Colorado 1 Lake Street P. O. Box 975 Avon, Colorado 81620 Attention: Finance Director The Town and the Trustee may, by written notice, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Section 15.3 Third Party Beneficiaries. It is expressly understood and agreed that the Owners of the outstanding Certificates are third party beneficiaries to this Lease and enforcement of the terms and conditions of this Lease, and all rights of action relating to such enforcement, shall be strictly reserved to the Town, as lessee and the Trustee, as lessor, and their respective successors and assigns, and to the Owners of the Certificates. Except as hereinafter provided, nothing contained in this Lease shall give or allow any such claim or right of action by any other or third person on this Lease. It is the express intention of the Town and the Trustee that any person other than the Town, the Trustee, or the Owners of the Certificates receiving services or benefits under this Lease shall be deemed to be an incidental beneficiary only. Section 15.4 Binding Effect. This Lease shall inure to the benefit of and shall be binding upon the Trustee and the Town and their respective successors and assigns, subject, however, to the limitations contained in Article 13 of this Lease. Section 15.5 Amendments. This Lease may only be amended, changed, modified or altered as provided in the Indenture. ATTACHMENT C: Form of Lease 42 Section 15.6 Amounts Remaining in Funds. It is agreed by the parties hereto that any amounts remaining in the Base Rentals Fund, the Costs of Execution and Delivery Fund, or any other fund or account created under the Indenture (except the Rebate Fund or any defeasance escrow account), upon termination of the Lease Term, and after payment in full of the Certificates (or provision for payment thereof having been made in accordance with the provisions of this Lease and the Indenture) and fees and expenses of the Trustee in accordance with this Lease and the Indenture, shall belong to and be paid to the Town by the Trustee, as an overpayment of Base Rentals. Section 15.7 Triple Net Lease. This Lease shall be deemed and construed to be a “triple net lease” and, subject to the prior Appropriation requirements hereof, the Town shall pay absolutely net during the Lease Term, the Base Rentals, the Additional Rentals and all expenses of, or other payments in respect of, the Leased Property as required to be paid by the Town under this Lease, for which a specific Appropriation has been effected by the Town for such purpose, free of any deductions, and without abatement, deduction or setoff (other than credits against Base Rentals expressly provided for in this Lease). Section 15.8 Computation of Time. In computing a period of days, the first day is excluded and the last day is included. If the last day of any period is not a Business Day, the period is extended to include the next day which is a Business Day. If a number of months is to be computed by counting the months from a particular day, the period ends on the same numerical day in the concluding month as the day of the month from which the computation is begun, unless there are not that many days in the concluding month, in which case the period ends on the last day of that month. Notwithstanding the foregoing, Base Rentals shall be recalculated in the event of any Prepayment of Base Rentals as provided in Section 6.2(b) hereof. Section 15.9 Payments Due on Holidays. If the date for making any payment or the last day for performance of any act or the exercising of any right, as provided in this Lease, shall be a day other than a Business Day, such payment may be made or act performed or right exercised on the next succeeding Business Day, with the same force and effect as if done on the nominal date provided in this Lease. Section 15.10 Severability. Except for the requirement of the Town to pay Base Rentals for which a specific Appropriation has been effected by the Town for such purpose and the requirement of the Trustee to provide quiet enjoyment of the Leased Property and to convey the Trustee’s leasehold interest in the Leased Property to the Town under the conditions set forth in Article 11 of this Lease (which, if held invalid or unenforceable by any court of competent jurisdiction, may have the effect of invalidating or rendering unenforceable the other provisions of this Lease), in the event that any other provision of this Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 15.11 Execution in Counterparts. This Lease may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. ATTACHMENT C: Form of Lease 43 Section 15.12 Electronic Transactions. The parties hereto agree that the transactions described herein may be conducted and related documents may be stored by electronic means. Copies, telecopies, facsimiles, electronic files and other reproductions of original executed documents shall be deemed to be authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit in the appropriate court of law. Section 15.13 Applicable Law. This Lease shall be governed by and construed in accordance with the law of the State of Colorado. Section 15.14 The Trustee Is Independent of the Town. Neither the Trustee nor any agent or employee of the Trustee shall be or shall be deemed to be an agent or employee of the Town. The Trustee acknowledges that the Trustee and its employees are not entitled to unemployment insurance benefits of the Town unless the Trustee or a third party otherwise provides such coverage and that the Town does not pay for or otherwise provide such coverage. The Trustee shall have no authorization, express or implied, to bind the Town to any agreements, liability or understanding except as expressly set forth herein. The Trustee shall provide and keep in force workers’ compensation (and provide proof of such insurance when requested by the Town) and unemployment compensation insurance in the amounts required by law and shall be solely responsible for the acts of the Trustee, its employees and agents. Section 15.15 Governmental Immunity. Notwithstanding any other provisions of this Lease to the contrary, no term or condition of this Lease shall be construed or interpreted as a waiver, express or implied, of any of the immunities, rights, benefits, protections or other provisions of the Colorado Governmental Immunity Act, Section 24-10-101, et. seq., C.R.S., as now or hereafter amended. Section 15.16 Recitals. The Recitals set forth in this Lease are hereby incorporated by this reference and made a part of this Lease. Section 15.17 Captions. The captions or headings herein are for convenience only and in no way define, limit or describe the scope or intent of any provisions or Sections of this Lease. Section 15.18 Trustee’s Disclaimer. It is expressly understood and agreed that (a) the Lease is executed by UMB Bank, n.a. solely in its capacity as Trustee under the Indenture, and (b) nothing herein shall be construed as creating any liability on UMB Bank, n.a. other than in its capacity as Trustee under the Indenture. All financial obligations of the Trustee under this Lease, except those resulting from its willful misconduct or negligence, are limited to the Trust Estate. ATTACHMENT C: Form of Lease 44 IN WITNESS WHEREOF, the parties have executed this Lease Purchase Agreement as of the day and year first above written. TOWN OF AVON, COLORADO, as Lessee UMB BANK, N.A., solely in its capacity of Trustee under the Indenture, as Lessor By: ________________________________ By: ________________________________ Rich Carroll, Mayor ______________, Vice President Attest: By:_____________________________ Debbie Hoppe, Town Clerk [TOWN SEAL] ATTACHMENT C: Form of Lease 45 STATE OF COLORADO ) ) ss. TOWN OF AVON ) ) COUNTY OF EAGLE ) The foregoing instrument was acknowledged before me this ____ day of _______, 2014, by Rich Carroll and Debbie Hoppe, as Mayor and Town Clerk, respectively, of the Town of Avon, Colorado. WITNESS my hand and official seal. (SEAL) ____________________________________ Notary Public My commission expires: **************** STATE OF COLORADO ) ) ss. CITY AND COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this ____ day of ______, 2014, by __________, as Vice President of UMB Bank, n.a., as Trustee. WITNESS my hand and official seal. (SEAL) ____________________________________ Notary Public My commission expires: ATTACHMENT C: Form of Lease A-1 EXHIBIT A DESCRIPTION OF LEASED PROPERTY The Leased Property consists of the Site and the premises, buildings and improvements located thereon (with the exceptions noted below) as set forth below, as amended from time to time. Site: [insert legal. Address: [insert addres] Description of Project: [describe] ATTACHMENT C: Form of Lease B-1 EXHIBIT B PERMITTED ENCUMBRANCES “Permitted Encumbrances” as defined in Section 1.2 of this Lease and the following: (1) Liens for ad valorem taxes and special assessments not then delinquent, if applicable. (2) The Site Lease. (3) This Lease. (4) All other encumbrances appearing of record on the date hereof. ATTACHMENT C: Form of Lease C-1 EXHIBIT C BASE RENTALS SCHEDULE (1) Date Base Rentals Principal Component Base Rentals Interest Component Total Base Rentals Annual Base Rentals TOTAL ________________ Footnotes on following page: ATTACHMENT C: Form of Lease C-2 __________________ (1) With respect to Certificates that were sold in the initial offering at a discount, the difference between the stated redemption price of such Certificates at maturity and the initial offering price of those Certificates to the public will be treated as “original issue discount” for federal income tax purposes and will constitute interest on the Certificates. The following portions of principal shall be treated as interest on the Certificates maturing on the following dates: Maturity Date Portion of Principal Component that is also Interest on Certificates (OID) Base Rental payments are due on May 15 and November 15 of each year during the Lease Term. The Base Rentals have been calculated on the basis of a 360-day year of twelve 30-day months and any recalculation of Base Rentals under Section 6.2(b) hereof shall be done on the same basis. If Base Rentals are stated to be due on any date that is not a Business Day, such Base Rentals shall be due on the next day that is a Business Day without the accrual of interest on Base Rentals between such dates. Statement Regarding the Leased Property The duration of the Lease, throughout the maximum Lease Term, does not exceed the weighted average useful life of the Leased Property and, to the extent that the Leased Property constitutes items of personal property, such items are considered paid from the first Base Rentals described above. ATTACHMENT C: Form of Lease D-1 EXHIBIT D FORM OF NOTICE OF LEASE RENEWAL To: UMB Bank, n.a., as Trustee Attention: Corporate Trust Services The undersigned is the Town Representative of the Town of Avon, Colorado (the “Town”). The Town is the lessee under that certain Lease Purchase Agreement, dated as of [________], 2014 (the “Lease”), between the Town and UMB Bank, n.a., solely in its capacity of Trustee under the Indenture, as the lessor thereunder. I am familiar with the facts herein certified and am authorized and qualified to certify the same. The undersigned hereby states and certifies: (a) the Town has effected or intends to effect on a timely basis an Appropriation for the ensuing Fiscal Year which includes (1) sufficient amounts authorized and directed to be used to pay all the Base Rentals and (2) sufficient amounts to pay such Additional Rentals as are estimated to become due, all as further provided in Sections 6.2, 6.3 and 6.4 of the Lease, whereupon, the Lease shall be renewed for the ensuing Fiscal Year; _______________ Initial or (b) the Town has determined not to renew the Lease for the ensuing Fiscal Year. _______________ Initial TOWN OF AVON, COLORADO By: Town Representative Date:____________________________________________ ATTACHMENT C: Form of Lease F-1 ATTACHMENT C: Form of Lease G-1 22507421 v1 ATTACHMENT C: Form of Lease TOWN OF AVON, COLORADO CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (this “Disclosure Certificate”) is executed and delivered by the Town of Avon, Colorado (the “Town”), in connection with its authorization, execution and delivery of a Lease Purchase Agreement, dated as of [________], 2014 (the “Lease”), between UMB Bank, n.a., solely in its capacity as trustee under the Indenture described herein (the “Trustee”), as lessor, and the Town, as lessee, and the execution and delivery of the Certificates of Participation, Series 2014 (the “Certificates”) in the aggregate principal amount of $[_______], evidencing proportionate interests in the base rentals and other revenues under the Lease. The Certificates are being executed and delivered pursuant to an Indenture of Trust, dated as of [________], 2014 (the “Indenture”), by the Trustee. The Town covenants and agrees as follows: SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Town for the benefit of the holders and beneficial owners of the Certificates and in order to assist the Participating Underwriter in complying with Rule 15c2- 12(b)(5) of the Securities and Exchange Commission (the “SEC”). SECTION 2. Definitions. In addition to the definitions set forth in the Indenture or parenthetically defined herein, which apply to any capitalized terms used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: “Annual Report” shall mean any Annual Report provided by the Town pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Dissemination Agent” shall mean, initially, the Town, or any successor Dissemination Agent designated in writing by the Town and which has filed with the Town a written acceptance of such designation. “Material Events” shall mean any of the events listed in Section 5 of this Disclosure Certificate. “MSRB” shall mean the Municipal Securities Rulemaking Board. As of the date hereof, the MSRB’s required method of filing is electronically via its Electronic Municipal Market Access (EMMA) system available on the Internet at http://emma.msrb.org. “Participating Underwriter” shall mean the original underwriter of the Certificates required to comply with the Rule in connection with an offering of the Certificates. “Rule” shall mean Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time. SECTION 3. Provision of Annual Reports. a. The Town shall, or shall cause the Dissemination Agent to, not later than nine (9) months following the end of the Town’s fiscal year of each year, commencing nine (9) months ATTACHMENT D: Form of Continuing Disclosure Certificate 2 following the end of the Town’s fiscal year ending December 31, 2014, provide to the MSRB (in an electronic format as prescribed by the MSRB), an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than five (5) business days prior to said date, the Town shall provide the Annual Report to the Dissemination Agent (if other than the Town). The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Town may be submitted separately from the balance of the Annual Report. b. If the Town is unable to provide to the MSRB an Annual Report by the date required in subsection (a), the Town shall file or cause to be filed with the MSRB a notice in substantially the form attached as Exhibit “A.” c. The Dissemination Agent shall: (1) determine each year prior to the date for providing the Annual Report the appropriate electronic format prescribed by the MSRB; (2) if the Dissemination Agent is other than the Town, send written notice to the Town at least 45 days prior to the date the Annual Report is due stating that the Annual Report is due as provided in Section 3(a) hereof; and (3) if the Dissemination Agent is other than the Town, file a report with the Town certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the entities to which it was provided. SECTION 4. Content of Annual Reports. The Town’s Annual Report shall contain or incorporate by reference the following: a. A copy of its annual financial statements prepared in accordance with generally accepted accounting principles audited by a firm of certified public accountants. If audited annual financial statements are not available by the time specified in Section 3(a) above, unaudited financial statements will be provided as part of the Annual Report and audited financial statements will be provided when and if available. b. An update of the type of information identified in Exhibit “B” hereto, which is contained in the tables in the Official Statement with respect to the Certificates. Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues of the Town or related public entities, which are available to the public on the MSRB’s Internet Web Site or filed with the SEC. The Town shall clearly identify each such document incorporated by reference. SECTION 5. Reporting of Material Events. The Town shall file or cause to be filed with the MSRB, in a timely manner not in excess of ten business days after the occurrence of the event, notice of any of the events listed below with respect to the Certificates: ATTACHMENT D: Form of Continuing Disclosure Certificate 3 a. Principal and interest payment delinquencies; b. Non-payment related defaults, if material; c. Unscheduled draws on debt service reserves reflecting financial difficulties; d. Unscheduled draws on credit enhancements reflecting financial difficulties; e. Substitution of credit or liquidity providers or their failure to perform; f. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701- TEB) or other material notices or determinations with respect to the tax status of the Certificates, or other material events affecting the tax status of the Certificates; g. Modifications to rights of bondholders, if material; h. Bond calls, if material, and tender offers; i. Defeasances; j. Release, substitution or sale of property securing repayment of the Certificates, if material; k. Rating changes; l. Bankruptcy, insolvency, receivership or similar event of the obligated person;1 m. The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and n. Appointment of a successor or additional trustee or the change of name of a trustee, if material. 1 For the purposes of the event identified in subparagraph (b)(5)(i)(C)(12) of the Rule, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governing body and official or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person. ATTACHMENT D: Form of Continuing Disclosure Certificate 4 SECTION 6. Format; Identifying Information. All documents provided to the MSRB pursuant to this Disclosure Certificate shall be in the format prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB. As of the date of this Disclosure Certificate, all documents submitted to the MSRB must be in portable document format (PDF) files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. In addition, such PDF files must be word- searchable, provided that diagrams, images and other non-textual elements are not required to be word-searchable. SECTION 7. Termination of Reporting Obligation. The Town’s obligations under this Disclosure Certificate shall terminate upon the earliest of: (i) the date of legal defeasance, prior redemption or payment in full of all of the Certificates; (ii) the date that the Town shall no longer constitute an “obligated person” within the meaning of the Rule; or (iii) the date on which those portions of the Rule which require this written undertaking are held to be invalid by a court of competent jurisdiction in a non-appealable action, have been repealed retroactively or otherwise do not apply to the Certificates. SECTION 8. Dissemination Agent. The Town may, from time to time, appoint or engage a Dissemination Agent to assist the Town in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. SECTION 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Town may amend this Disclosure Certificate and may waive any provision of this Disclosure Certificate, without the consent of the holders and beneficial owners of the Certificates, if such amendment or waiver does not, in and of itself, cause the undertakings herein (or action of any Participating Underwriter in reliance on the undertakings herein) to violate the Rule, but taking into account any subsequent change in or official interpretation of the Rule. The Town will provide notice of such amendment or waiver to the MSRB. SECTION 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Town from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Material Event, in addition to that which is required by this Disclosure Certificate. If the Town chooses to include any information in any Annual Report or notice of occurrence of a Material Event in addition to that which is specifically required by this Disclosure Certificate, the Town shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Material Event. SECTION 11. Default. In the event of a failure of the Town to comply with any provision of this Disclosure Certificate, any holder or beneficial owner of the Certificates may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Town to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default ATTACHMENT D: Form of Continuing Disclosure Certificate 5 under the Lease, and the sole remedy under this Disclosure Certificate in the event of any failure of the Town to comply with this Disclosure Certificate shall be an action to compel performance. SECTION 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Town, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the Certificates, and shall create no rights in any other person or entity. DATE: [________], 2014 TOWN OF AVON, COLORADO By _______________________________________ Mayor ATTACHMENT D: Form of Continuing Disclosure Certificate A-1 EXHIBIT “A” NOTICE OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: Town of Avon, Colorado Name of Bond Issue: $[_______] aggregate principal amount of Certificates of Participation, Series 2014, Evidencing Proportionate Interests in the Right to Receive Base Rentals and Other Revenues Under a Lease Purchase Agreement between UMB Bank, n.a., as lessor, and the Town, as lessee. Date of Issuance: [________], 2014. NOTICE IS HEREBY GIVEN that the District has not provided an Annual Report with respect to the Certificates as required by Section 11.6 of the Lease Purchase Agreement, dated as of [________], 2014, and the Continuing Disclosure Certificate executed on [________], 2014, by the Town. The Town anticipates that the Annual Report will be filed by _____________ ___, 20___. Dated: ______________, _____ TOWN OF AVON, COLORADO By: Mayor ATTACHMENT D: Form of Continuing Disclosure Certificate EXHIBIT “B” INDEX OF OFFICIAL STATEMENT TABLES TO BE UPDATED ATTACHMENT D: Form of Continuing Disclosure Certificate CERTIFICATE PURCHASE AGREEMENT $[________] CERTIFICATES OF PARTICIPATION SERIES 2014 Evidencing Proportionate Interests in the Base Rentals and other Revenues under a Lease Purchase Agreement dated as of [________], 2014 between UMB Bank, n.a., as lessor, and the Town of Avon, Colorado, as lessee March 5, 2014 UMB Bank, n.a. acting solely in its capacity as Trustee Ladies and Gentlemen: On the basis of the representations, warranties, covenants and conditions contained in this Certificate Purchase Agreement (this “Agreement”), the undersigned, Piper Jaffray & Co. (the “Underwriter”), hereby offers to purchase all, but not less than all, of the above-captioned Certificates of Participation, Series 2014, in the aggregate principal amount of $[________] (the “Certificates”). The Certificates evidence proportionate interests in the base rentals and other revenues under a Lease Purchase Agreement, dated as of [________], 2014 (the “Lease”), between UMB Bank, n.a., solely in its capacity as trustee under the hereinafter defined Indenture (the “Trustee”), as lessor, and the Town of Avon, Colorado, as lessee (the “Town”). The Certificates will be executed and delivered pursuant to an Indenture of Trust, dated as of [________], 2014 (the “Indenture”), by the Trustee. The Underwriter has been duly authorized to execute and deliver this Agreement and to act hereunder. All capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Lease and the Indenture, unless the context clearly indicates otherwise. The Underwriter agrees to purchase the Certificates at a price of $[_______] (the “Purchase Price”), being the par amount of the Certificates of $[________], plus net original issue premium of $[__________], and less the Underwriter’s discount of $[_________]. The Certificates will be executed and delivered pursuant to the Indenture, under the conditions set forth herein and therein, and the Purchase Price shall be deposited with the Trustee as provided in the Indenture. The Certificates shall be executed and delivered, be secured, be subject to redemption, and contain such other terms as provided in the Indenture. The Certificates shall ATTACHMENT E: Form of Certificate of Purchase Agreement 2 mature on the dates and in the amounts and shall bear interest at the rates of interest set forth in Exhibit A to this Purchase Agreement. All capitalized terms used but not defined herein shall have the meanings given such terms in the Lease and the Indenture, unless the context clearly indicates otherwise. Section 1. Trustee’s Representations, Warranties and Agreements. The Trustee hereby represents and warrants to, and agrees with, the Underwriter as follows: (a) the Trustee is a national banking association, duly organized and validly existing under the laws of the United States of America and is in good standing under the laws of the United States of America; (b) the Trustee has full power and authority to consummate all transactions contemplated by the Site Lease, the Lease, and the Indenture (collectively, the “Principal Documents”); (c) the Trustee has, or prior to the Closing Time will have, duly authorized and taken all necessary action to be taken by it for: (i) the execution and delivery of the Certificates upon the terms set forth herein; (ii) the execution, delivery, receipt and due performance of the Principal Documents and any and all other documents, agreements and instruments that may be required to be executed, delivered, received or performed by the Trustee in order to carry out, give effect to and consummate the transactions contemplated by the Principal Documents; and (iii) the carrying out, giving effect to and consummation of the transactions contemplated by the Principal Documents; (d) the Principal Documents and all other documents, agreements and instruments that may be required to be executed, delivered, received or performed by the Trustee in order to carry out, give effect to and consummate the transactions contemplated by the Principal Documents shall, at the Closing Time, have been duly authorized, executed, received and delivered by the Trustee and, assuming their enforceability against the other parties thereto, constitute valid, legal and binding obligations of the Trustee, enforceable in accordance with their terms, subject only to bankruptcy, insolvency, moratorium or other laws affecting creditors’ rights generally and equitable principles, whether considered at law or in equity; (e) the execution, delivery, receipt and due performance by the Trustee of the Principal Documents and the Certificates, and the consummation of the transactions contemplated by the Principal Documents do not conflict with or result in a breach of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Trustee is now a party or by which the Trustee is bound, or constitute a default under any of the foregoing or, except as specifically provided in the Principal Documents, result in the creation or imposition of a lien or encumbrance whatsoever upon any of the property or assets of the Trustee; (f) to the knowledge of the Trustee, there is no litigation or proceeding pending or threatened against the Trustee or any other person affecting the right of the Trustee to execute and deliver any of the Principal Documents or the ability of the Trustee otherwise to comply with its obligations under the Principal Documents or the Certificates; and ATTACHMENT E: Form of Certificate of Purchase Agreement 3 (g) any certificate signed by any of the Trustee’s authorized officers and delivered to the Underwriter shall be deemed a representation and warranty by the Trustee to the Underwriter as of the Closing Time as to the statements made therein. Section 2. The Closing. On the basis of the representations, and subject to the terms and conditions, set forth in this Purchase Agreement, at the Closing Time the Underwriter agrees to pay the Purchase Price for the Certificates and the Trustee agrees to take all action reasonably necessary to cause the Certificates to be executed and delivered to the Underwriter for the Purchase Price. The Certificates shall be delivered to The Depository Trust Company for the account of the Underwriter, and the Underwriter shall accept delivery of and pay the Purchase Price for the Certificates in immediately available funds payable to the order of the Town or the Trustee, as indicated in the Indenture, at 9:00 a.m., Denver time, on [________], 2014, or at such other time or date as shall be mutually agreed upon by the Underwriter, the Trustee, and the Town. The delivery of and payment for the Certificates is referred to herein as the “Closing,” the date of such delivery and payment is referred to herein as the “Closing Date,” and the hour and date of such delivery and payment is referred to herein as the “Closing Time.” Section 3. Closing Conditions. The Underwriter has entered into this Purchase Agreement in reliance upon the representations, warranties and agreements herein and the performance by the Trustee with its obligations hereunder at or prior to the Closing Time. The Underwriter’s obligations under this Purchase Agreement are and shall be subject to the following further conditions being satisfied at or prior to the Closing Time: (a) the Principal Documents, the Certificates, and the Official Statement relating to the Certificates (the “Official Statement”) shall have been duly authorized, executed, authenticated, delivered and received by the respective parties thereto in the form approved by the Underwriter with only such changes as shall be mutually agreed upon by the respective parties thereto and the Underwriter; (b) the Underwriter shall have received evidence satisfactory to the Underwriter that the Trustee has taken all action reasonably necessary to cause the Certificates to be executed and delivered to the Underwriter; (c) at the Closing, the Underwriter shall receive the following documents, each dated as of the Closing Date (other than the final Official Statement and the rating letters required by (xi) below, which are not dated as of the Closing Date) and in form and substance satisfactory to the Underwriter: (i) a copy of the ordinance of the Town (the “Ordinance”) authorizing the execution and delivery of the Principal Documents to which it is a party and other matters related thereto; (ii) executed copies of each of the Principal Documents, the Official Statement, and the Continuing Disclosure Certificate; ATTACHMENT E: Form of Certificate of Purchase Agreement 4 (iii) opinions of Butler Snow LLP, as special counsel to the Town (“Special Counsel”), in form and substance satisfactory to the Underwriter, dated as of the Closing Date and addressed to the Town, relating to: (A) the valid execution and delivery of the Site Lease and the Lease and the enforceability thereof; and (B) the tax treatment under federal and State of Colorado law of the portion of the Base Rentals which is designated in the Lease as interest and paid by the Trustee as interest with respect to each series of Certificates; (iv) a letter from Special Counsel, in form and substance satisfactory to the Underwriter, dated as of the Closing Date and addressed to the Town, stating, in substance, that nothing came to the attention of the attorneys at Butler Snow LLP rendering legal services in connection with such firm’s representation of the Town that the Official Statement (except for any financial statements, demographic, economic, engineering, financial, or statistical data and any statements of trends, forecasts, estimates, projections, assumptions, or any expressions of opinion and information concerning The Depository Trust Company and its procedures contained in the Official Statement and its appendices, as to which no view is expressed) contained any untrue statement of a material fact or omitted any material fact required to be stated therein or necessary to make the statements in the Official Statement, in light of the circumstances under which they were made, not misleading; (v) an opinion of the Town Attorney relating to (A) the due organization of the Town, (B) the due authorization, execution and delivery of the Principal Documents by the Town, (C) the enforceability of the Principal Documents against the Town, (D) the information respecting the Town in certain sections of the Official Statement, (E) the absence of any material litigation involving the Town, and (F) such other matters as may be reasonably required; (vi) a certificate of the Town signed by duly authorized officials of the Town relating to (A) the due organization of the Town, (B) the absence of any material litigation against the Town, (C) the due authorization, execution, and delivery of the Principal Documents by the Town, and (D) the validity and enforceability of the Ordinance and the Principal Documents to which it is a party against the Town; together with a certificate executed by one or more officers of the Town, to the effect that the Official Statement, as then amended or supplemented, neither contains an untrue statement of any material fact nor omits to state any material fact necessary to make the statements made in the Official Statement, in light of the circumstances in which they are made, not misleading; (vii) a general certificate of the Trustee, dated the Closing Date, in form and substance acceptable to the Underwriter and to Special Counsel; (viii) an owner’s policy of title insurance issued to the Trustee, insuring the Town’s fee simple interest in the Site and the Trustee’s leasehold interest in the Site, subject only to Permitted Encumbrances, in an aggregate amount not less than the aggregate principal amount of the Certificates or such lesser amount as shall be the maximum insurable value of the Site; (ix) evidence satisfactory to the Underwriter that the Certificates have been assigned an underlying rating of “[___]” by [__________]; ATTACHMENT E: Form of Certificate of Purchase Agreement 5 (x) such additional certificates and documents as the Underwriter may reasonably request to evidence performance of or compliance with the provisions hereof and the transactions contemplated by the Principal Documents and by the Official Statement. (d) All proceedings and related matters in connection with the Principal Documents shall have been satisfactory to Special Counsel, and Special Counsel shall have been furnished with all papers, certificates and information as it may have reasonably requested to enable it to pass upon the matters referred to in its opinions. If any condition stated in this Section 3 is not satisfied at or prior to the Closing Time, this Purchase Agreement may be terminated by the Underwriter by notifying the Trustee in writing and, in that event, neither the Underwriter nor the Trustee shall have any further obligation under this Purchase Agreement, except for the obligations of the parties to pay expenses as specified in Section 6 hereof. The Underwriter may waive compliance with any condition stated in this Section 3 or extend the time for performance of any one or more of the conditions stated in this Section 3; and, by accepting delivery of the Certificates, shall be deemed to have waived compliance by the Trustee with any condition stated in this Section 4 that has not been complied with. Section 4. Underwriter’s Right to Terminate Agreement. The Underwriter shall have the right to terminate its obligations under this Purchase Agreement to purchase the Certificates by notifying the Town and the Trustee in writing of its election to do so, if any of the following events occur prior to the scheduled Closing Time: (a) a tentative decision with respect to legislation shall be reached by a committee of the House of Representatives or the Senate of the Congress of the United States of America, or legislation shall be favorably reported by such a committee or be introduced by amendment or otherwise, in, or be passed by, the House of Representatives or the Senate, or recommended to the Congress of the United States of America for passage by the President of the United States of America, or be enacted by the Congress of the United States of America, or a decision by a court established under Article III of the Constitution of the United States, or the Tax Court of the United States, shall be rendered, or a ruling, regulation or order of the Treasury Department of the United States of America or the Internal Revenue Service shall be made or proposed, having the purpose or effect of imposing federal income taxation, or any other event shall have occurred which results in the imposition of federal income taxation, upon revenues or other income of the general character to be derived by the Town or by any similar body or upon interest received on obligations of the general character of the Certificates, which, in the Underwriter’s reasonable opinion, materially adversely affects the market price of the Certificates; (b) any legislation, ordinance, rule or regulation shall be introduced in or be enacted by any governmental body, department or agency in the State or a decision by any court of competent jurisdiction within the State shall be rendered which, in the Underwriter’s reasonable opinion, materially adversely affects the market price of the Certificates; ATTACHMENT E: Form of Certificate of Purchase Agreement 6 (c) a stop order, ruling, regulation or official statement by, or on behalf of, the Securities and Exchange Commission or any other governmental agency having jurisdiction over the subject matter shall be issued or made to the effect that the execution and delivery, offering or sale of obligations of the general character of the Certificates, or the execution and delivery, offering or sale of the Certificates, including all the underlying obligations, as contemplated by the Principal Documents or by the Official Statement, is in violation or would be in violation of any provision of the federal securities laws, including the Securities Act of 1933, as amended and as then in effect, the Securities Exchange Act of 1934, as amended and as then in effect, or the Trust Indenture Act of 1939, as amended and as then in effect; (d) legislation shall be introduced in or enacted by the Congress of the United States of America, or a decision by a court established under Article III of the Constitution of the United States, or the Tax Court of the United States, shall be rendered, or a ruling, regulation or official statement of the Securities and Exchange Commission or other governmental agency having jurisdiction of the subject matter shall be made or proposed, to the effect that obligations of the general character of the Certificates, or the Certificates, including all of the underlying obligations, are not exempt from registration under or from other requirements of the Securities Act of 1933, as amended and as then in effect, or the Securities Exchange Act of 1934, as amended and as then in effect, or that the Indenture is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended and as then in effect; (e) any event shall have occurred, or information become known, which, in the Underwriter’s opinion, makes untrue in any material respect any statement or information contained in the Official Statement or has the effect that the Official Statement contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading; (f) additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange; (g) the New York Stock Exchange or any national securities exchange, or any governmental authority, shall have imposed, as to the Certificates or obligations of the general character of the Certificates, any material restrictions not now in force or being enforced, or increase materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, the Underwriter; (h) a general banking moratorium shall have been established by federal or State of Colorado authorities; (i) the rating of any of the Town’s securities shall have been downgraded or withdrawn by a national rating service, which, in the Underwriter’s opinion, materially and adversely affects the market price of the Certificates; or trading in any of the Town’s securities shall have been suspended on any national securities exchange; or any ATTACHMENT E: Form of Certificate of Purchase Agreement 7 proceeding shall be pending or threatened by the Securities and Exchange Commission against the Town; or (j) a war involving the United States of America shall have been declared, or any conflict involving the armed forces of the United States of America shall have escalated, or any other national emergency relating to the effective operation of government or the financial community shall have occurred, which, in the Underwriter’s opinion, materially adversely affects the market price of the Certificates. Section 5. Conditions of the Obligations of the Trustee. The Trustee’s obligations under this Purchase Agreement are subject to the Underwriter’s due performance of its obligations and agreements to be performed under this Purchase Agreement at or prior to the Closing Time; and are also subject to the execution and delivery by the Town of the documents, certificates of the Town and opinions of counsel to the Town and to the delivery of all other documents (except those documents to be delivered by the Trustee or by counsel to the Trustee), as provided in Section 3 above; and are also subject to the following conditions being satisfied at the Closing Time: (a) there shall be no legal or governmental actions, suits, proceedings, inquiries or investigations pending, or to the Town’s or the Trustee’s knowledge threatened, in which an unfavorable decision, ruling or finding would adversely affect (i) the validity or enforceability of any of the Principal Documents or the transactions contemplated by the Principal Documents; (ii) the existence or power of the Town or the Trustee; or (iii) the right to use the proceeds of the Certificates as provided in the Indenture and the Lease; and (b) all opinions, certificates and other documents relating to the Town’s and the Trustee’s participation in the transactions contemplated by the Principal Documents shall be satisfactory in form and substance to the Trustee. The Trustee may waive compliance by the Underwriter with or extend the time for performance of any one or more of the conditions stated in this Section 5; and, by accepting payment for the Certificates, shall be deemed to have waived compliance by the Underwriter with any condition stated in this Section 5 that has not been complied with. Section 6. Payment of Expenses. All expenses incident to the execution and delivery of the Certificates shall be paid from proceeds of the Certificates. Such expenses shall include, but shall not be limited to (a) the cost of preparing, printing or otherwise reproducing and distributing the Certificates, the Principal Documents, the Preliminary Official Statement and the Official Statement with any amendment or supplement thereto; (b) the cost of preparing and executing the definitive Certificates; (c) the fees and expenses of Special Counsel, general counsel to the Town, counsel to the Trustee, independent auditors and any other experts and consultants retained in connection with the execution and delivery of the Certificates; (d) the initial fees and expenses of the Trustee; (e) fees charged by investment rating agencies for the rating of the Certificates, and all other expenses incurred by the Underwriter in connection with its purchase, offering and distribution of the Certificates; and (f) fees of obtaining insurance for the payment of the principal of and interest on the Certificates, if any, and (g) fees of obtaining ATTACHMENT E: Form of Certificate of Purchase Agreement 8 title insurance for the Leased Property. All out-of-pocket expenses of the Underwriter, including travel and other expenses, shall be paid by the Underwriter. Section 7. Survival of Representation, Warranties and Agreements. All of the Trustee’s representations, warranties and agreements set forth in this Purchase Agreement shall remain operative and in full force and effect, regardless of any investigation made by the Underwriter or on its behalf, and shall survive delivery of the Certificates to the Underwriter. Section 8. Entire Agreement; Parties in Interest. This Purchase Agreement when accepted by the Trustee in writing as heretofore specified shall constitute the entire agreement between the Underwriter and the Trustee and is made solely for the benefit of the Underwriter and the Trustee (including their successors, if any), and no other person shall acquire or have any right hereunder or by virtue hereof. Section 9. Counterparts. This Purchase Agreement may be executed in several counterparts, which together shall constitute one and the same instrument. Section 10. Effectiveness. This Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the Trustee. Section 11. Governing Law; No Assignment. The validity, interpretation and performance of this Purchase Agreement shall be governed by the laws of the State of Colorado. This Purchase Agreement shall not be assigned by the Underwriter or the Trustee. Section 12. No Personal Liability. None of the members of the Board of Directors of the Trustee, nor any officer, agent or employee of the Trustee, shall be charged personally or in his or her official capacity by the Underwriter with any liability, or held liable to the Underwriter under any term or provision of this Purchase Agreement, or because of its execution or attempted execution, or because of any breach, or attempted or alleged breach, of this Purchase Agreement. Section 13. Time of Essence. Time shall be of the essence in this Purchase Agreement. ATTACHMENT E: Form of Certificate of Purchase Agreement 9 Very truly yours, PIPER JAFFRAY & CO., as the Underwriter By:_________________________________ Authorized Representative Accepted and agreed to as of the date set forth above: TOWN OF AVON, COLORADO By: Finance Director Time of Acceptance: UMB BANK, N.A., solely in its capacity as trustee under the Indenture described herein By:_________________________________ Vice President ATTACHMENT E: Form of Certificate of Purchase Agreement EXHIBIT A CERTIFICATES MATURITY SCHEDULE Schedule of Base Rentals Calendar Year Principal Component Interest Component Total Base Rentals ATTACHMENT E: Form of Certificate of Purchase Agreement Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. TABLE OF CONTENTS Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** Report Page Sources and Uses of Funds ............................1 Bond Pricing ..................................2 Bond Summary Statistics .............................4 Bond Debt Service ................................6 Bond Solution .................................7 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 1 SOURCES AND USES OF FUNDS Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** Dated Date10/31/2014Delivery Date10/31/2014 Sources: Bond Proceeds: Par Amount5,690,000.00Premium150,600.70 5,840,600.70 Uses: Project Fund Deposits: Project Fund5,720,000.00 Delivery Date Expenses:Cost of Issuance 70,000.00Underwriter's Discount 48,365.00 118,365.00 Other Uses of Funds: Additional Proceeds2,235.70 5,840,600.70 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 2 BOND PRICING Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** MaturityYield toBond ComponentDateAmountRateYieldPriceMaturity Serial Bond:12/01/2015135,0002.000%0.520%101.596 12/01/2016160,0002.000%0.800%102.47412/01/2017160,0002.000%1.150%102.567 12/01/2018165,0002.000%1.500%101.97212/01/2019170,0002.000%1.880%100.578 12/01/2020170,0003.000%2.270%104.12412/01/2021175,0003.000%2.500%103.226 12/01/2022180,0003.000%2.720%102.018 12/01/2023185,0003.000%2.870%101.03112/01/2024190,0003.000%2.970%100.258 1,690,000 Term Bond: 12/01/2025200,0004.000%3.610%103.269C3.715%12/01/2026205,0004.000%3.610%103.269C3.715% 12/01/2027215,0004.000%3.610%103.269C3.715%12/01/2028220,0004.000%3.610%103.269C3.715% 12/01/2029230,0004.000%3.610%103.269C3.715% 1,070,000 Term Bond:12/01/2030240,0004.250%3.940%102.556C4.062% 12/01/2031250,0004.250%3.940%102.556C4.062%12/01/2032260,0004.250%3.940%102.556C4.062% 12/01/2033270,0004.250%3.940%102.556C4.062% 12/01/2034285,0004.250%3.940%102.556C4.062%1,305,000 Term Bond:12/01/2035295,0004.500%4.130%103.023C4.302% 12/01/2036310,0004.500%4.130%103.023C4.302%12/01/2037325,0004.500%4.130%103.023C4.302% 12/01/2038340,0004.500%4.130%103.023C4.302%12/01/2039355,0004.500%4.130%103.023C4.302% 1,625,000 5,690,000 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 3 BOND PRICING Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** Dated Date10/31/2014Delivery Date10/31/2014 First Coupon06/01/2015 Par Amount5,690,000.00 Premium150,600.70 Production 5,840,600.70102.646761%Underwriter's Discount -48,365.00-0.850000% Purchase Price 5,792,235.70101.796761% Accrued Interest Net Proceeds 5,792,235.70 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 4 BOND SUMMARY STATISTICS Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** Dated Date 10/31/2014Delivery Date 10/31/2014 Last Maturity 12/01/2039 Arbitrage Yield 3.609708% True Interest Cost (TIC)3.924564%Net Interest Cost (NIC)4.025599% All-In TIC 4.037826%Average Coupon 4.145460% Average Life (years)14.990 Duration of Issue (years)10.977 Par Amount 5,690,000.00 Bond Proceeds 5,840,600.70Total Interest 3,535,868.92 Net Interest 3,433,633.22Total Debt Service 9,225,868.92 Maximum Annual Debt Service 371,787.50Average Annual Debt Service 367,768.00 Underwriter's Fees (per $1000) Average Takedown Other Fee 8.500000 Total Underwriter's Discount 8.500000 Bid Price 101.796761 Par AverageAveragePV of 1 bpBond Component ValuePriceCouponLife change Serial Bond 1,690,000.00101.9612.745%5.823 902.75 Term Bond 1,070,000.00103.2694.000%13.156 920.20Term Bond 1,305,000.00102.5564.250%18.170 1,096.20 Term Bond 1,625,000.00103.0234.500%23.178 1,365.00 5,690,000.00 14.990 4,284.15 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 5 BOND SUMMARY STATISTICS Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** All-In ArbitrageTICTICYield Par Value 5,690,000.005,690,000.005,690,000.00 + Accrued Interest + Premium (Discount)150,600.70 150,600.70 150,600.70 - Underwriter's Discount -48,365.00 -48,365.00 - Cost of Issuance Expense -70,000.00 - Other Amounts Target Value 5,792,235.705,722,235.705,840,600.70 Target Date 10/31/2014 10/31/2014 10/31/2014Yield3.924564%4.037826%3.609708% ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 6 BOND DEBT SERVICE Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** PeriodEndingPrincipalInterestDebt Service 12/01/2015135,000232,631.42367,631.4212/01/2016160,000211,487.50371,487.50 12/01/2017160,000208,287.50368,287.5012/01/2018165,000205,087.50370,087.50 12/01/2019170,000201,787.50371,787.5012/01/2020170,000198,387.50368,387.50 12/01/2021175,000193,287.50368,287.5012/01/2022180,000188,037.50368,037.50 12/01/2023185,000182,637.50367,637.50 12/01/2024190,000177,087.50367,087.5012/01/2025200,000171,387.50371,387.50 12/01/2026205,000163,387.50368,387.5012/01/2027215,000155,187.50370,187.50 12/01/2028220,000146,587.50366,587.5012/01/2029230,000137,787.50367,787.50 12/01/2030240,000128,587.50368,587.5012/01/2031250,000118,387.50368,387.50 12/01/2032260,000107,762.50367,762.50 12/01/2033270,00096,712.50366,712.5012/01/2034285,00085,237.50370,237.50 12/01/2035295,00073,125.00368,125.0012/01/2036310,00059,850.00369,850.00 12/01/2037325,00045,900.00370,900.0012/01/2038340,00031,275.00371,275.00 12/01/2039355,00015,975.00370,975.00 5,690,0003,535,868.929,225,868.92 ATTACHMENT F: Sources and Uses of Funds Sep 2, 2014 5:17 pm Prepared by Piper Jaffray & Co. Page 7 BOND SOLUTION Town of Avon, ColoradoCertificates of Participation, Series 2014*************************************************** PreliminaryBank Qualified A+ Rated Rates as of September 2, 2014 *************************************************** Period ProposedProposedTotal AdjRevenueUnusedDebt ServEndingPrincipalDebt ServiceDebt ServiceConstraintsRevenuesCoverage 12/01/2014 150,238150,23812/01/2015 135,000367,631367,631465,00097,369126.48538% 12/01/2016 160,000371,488371,488465,00093,513125.17245%12/01/2017 160,000368,288368,288465,00096,713126.26005% 12/01/2018 165,000370,088370,088465,00094,913125.64596%12/01/2019 170,000371,788371,788465,00093,213125.07145% 12/01/2020 170,000368,388368,388465,00096,613126.22578%12/01/2021 175,000368,288368,288465,00096,713126.26005% 12/01/2022 180,000368,038368,038465,00096,963126.34582% 12/01/2023 185,000367,638367,638465,00097,363126.48329%12/01/2024 190,000367,088367,088465,00097,913126.67280% 12/01/2025 200,000371,388371,388465,00093,613125.20615%12/01/2026 205,000368,388368,388465,00096,613126.22578% 12/01/2027 215,000370,188370,188465,00094,813125.61202%12/01/2028 220,000366,588366,588465,00098,413126.84557% 12/01/2029 230,000367,788367,788465,00097,213126.43170%12/01/2030 240,000368,588368,588465,00096,413126.15729% 12/01/2031 250,000368,388368,388465,00096,613126.22578% 12/01/2032 260,000367,763367,763465,00097,238126.44030%12/01/2033 270,000366,713366,713465,00098,288126.80233% 12/01/2034 285,000370,238370,238465,00094,763125.59506%12/01/2035 295,000368,125368,125465,00096,875126.31579% 12/01/2036 310,000369,850369,850465,00095,150125.72665%12/01/2037 325,000370,900370,900465,00094,100125.37072% 12/01/2038 340,000371,275371,275465,00093,725125.24409%12/01/2039 355,000370,975370,975465,00094,025125.34537% 5,690,0009,225,8699,225,86911,775,2382,549,369 ATTACHMENT F: Sources and Uses of Funds PUBLIC HEARING – 4290 Wildridge Road West - Minor PUD Amendment Page | 1 TOWN COUNCIL REPORT To: Mayor and Town Council From: Brian Garner, Town Planner Date: September 23, 2014 Agenda Topic: PUBLIC HEARING – Resolution 14-24 Case #PUD14004 Minor PUD Amendment for Lot 26, Block 3, Wildridge Subdivision Introduction Dominic Mauriello, the Applicant, representing WR 4290 LLC, the Property Owner, is requesting a Planned Unit Development (PUD) Amendment (the Application) to modify the allowed building type for Lot 26, Block 3, Wildridge Subdivision (the Property). The current entitlement allows two (2) dwelling units in the form of a single-family-detached structure or single-family-attached structure (duplex) as established by the Wildridge PUD Zone Document. The Application requests the ability to subdivide the Property to develop two (2) single-family-detached structures, and is being processed as a Minor PUD Amendment accordingly. Attached to this report is a Vicinity Map (Attachment A) and the Application (Attachment B) materials. The Application was heard by the Planning and Zoning Commission (PZC) at a Public Hearing on September 2, 2014. After input from neighboring property owners (Attachment C), PZC recommended approval of this Minor PUD Amendment. A draft Resolution is also attached to this report (Attachment D) reflecting the PZC recommendation. Process Minor PUD Amendment Process This application is processed under §7.16.060(h), Amendments to a Final PUD, AMC. Subsection (1)(ii), sets forth criteria for a Minor Amendment, while subsection (2)(ii) sets forth the review procedures for the same process. The application, as submitted, meets the criteria for a Minor Amendment and is processed as such. Public Notification In order to comply with the Public Hearing and noticing requirements, a mailed notice was provided to all property owners within 300’ of the property for the PZC hearing and Council hearing. Additionally, a notice was published in the Vail Daily newspaper. Written comments were received and considered by PZC (Attachment C). Public comment included general concerns with perceived increased density by breaking the home into two structures. Overall, staff received three (3) letters in opposition and two (2) letters of support of the proposed PUD amendment. Public Hearings The September 2, 2014 meeting completed the public hearing requirements with the PZC. Council will make the final decision on this Application through a Resolution after holding one more public hearing. PUBLIC HEARING – 4290 Wildridge Road West - Minor PUD Amendment Page | 2 Proposal The Property is zoned PUD and is located in the Wildridge Subdivision. The Wildridge Subdivision and PUD Plat includes a Land Use Summary table, which breaks down the number of units for each individual lot and summarizes the construction type permitted on each property. Below (Exhibit 1) is an excerpt from the Wildridge PUD, with the specific Property information highlighted in yellow. The Property is currently entitled to construct two (2) units in the form of either one (1) single-family-detached structure or one (1) single-family-attached (duplex) structure. Exhibit 1 – Wildridge Subdivision and PUD Land Use Summary The Application (Attachment B) includes a narrative, response to the mandatory review criteria, and preliminary site and building design plans showing a likely development scenario. This Application is requesting to create two (2) separate lots of record that each would be permitted one (1) single-family-detached structure. Approval of this request would supersede the existing entitlement of a duplex on the lot and would only allow one (1) single-family-detached structure on each new lot. The Application proposes to keep standard Wildridge easements: ten (10) foot front Snow Storage, Maintenance Easement, and seven and one-half (7.5) foot side yard drainage and utility Easements. Setbacks would also be consistent with the current PUD standards: 1) twenty-five (25) foot front setback and ten (10) foot side and rear setback). The building height would also match existing zoning at thirty-five (35) feet. If the Council approved this Application, a Minor Subdivision application would be required prior to building permit submittal(s). Staff Analysis The proposal to allow two separate single-family-detached structures in lieu of the entitled attached-single-family (duplex) does not change the density and will have a nominal effect on the mass and scale of the PUBLIC HEARING – 4290 Wildridge Road West - Minor PUD Amendment Page | 3 developed property. By separating the duplex into two structures, the massing is minimized revealing increased building articulation, and allows light and air between units. After reviewing the PUD review criteria below, Staff finds the Application is in conformance with the purpose of the Development Code, review criteria, and there appears to be no negative impact to neighboring properties. The development pattern in this portion of Wildridge is mainly duplexes with some single-family structures; the proposed Application will help provide variety in building forms and create a more diverse development pattern. PUD Review Criteria Pursuant to §7.16.060(e)(4), Review Criteria, AMC, the PZC shall consider the following criteria when forming the basis of a recommendation: (i) The PUD addresses a unique situation, confers a substantial benefit to the Town, and/or incorporates creative site design such that it achieves the purposes of this Development Code and represents an improvement in quality over what could have been accomplished through strict application of the otherwise applicable district or development standards. Such improvements in quality may include, but are not limited to: improvements in open space provision and access; environmental protection; tree/vegetation preservation; efficient provision of streets, roads, and other utilities and services; or increased choice of living and housing environments. Staff Response: The stated purposes of §7.04, Development Code, AMC, and §7.16.060, PUD, AMC, includes statements regarding the implementation of the Comprehensive Plan; regulating intensity of use; avoiding increased demands on public services and facilities; and providing for compatibility with the surrounding area, among other statements. The proposed amendment does not increase demands on public services, and provides compatible building layouts with the surrounding area. It should be noted that all other applicable development standards (parking, design standards, access requirements) would remain intact. (ii) The PUD rezoning will promote the public health, safety, and general welfare; Staff Response: The Application does not appear to negatively affect the public health, safety and welfare. The inclusion of single-family structures on the Property is compatible with the adjacent single-family and duplex residential uses. (iii) The PUD rezoning is consistent with the Avon Comprehensive Plan, the purposes of this Development Code, and the eligibility criteria outlined in §7.16.060(b); Staff Response: The proposed PUD amendment is part of an established PUD, and is therefore not subject to the eligibility criteria or Public Benefit requirements outlined in §7.16.060(b). Consistency with the Comprehensive Plan is required and analysis is provided below. The Comprehensive Plan includes this property within District 24: Wildridge Residential District. The planning principals specific to this property include the following: • Site buildings of varying sizes along the street to maximize sun exposure, protect views, be compatible with existing surrounding development, and break up building bulk. The majority of the Wildridge District planning principles deal with enhancing and promoting open space connectivity. Approval of this Application would result in a greater diversity in building sizes. The break from a single duplex structure into two smaller structures has the potential to maximize sun exposure and break up building ‘bulk’. PUBLIC HEARING – 4290 Wildridge Road West - Minor PUD Amendment Page | 4 (iv) Facilities and services (including roads and transportation, water, gas, electric, police and fire protection, and sewage and waste disposal, as applicable) will be available to serve the subject property while maintaining adequate levels of service to existing development; Staff Response: The PUD amendment has no incremental impact on public facilities or services; therefore, the existing services can adequately serve the property. (v) Compared to the underlying zoning, the PUD rezoning is not likely to result in significant adverse impacts upon the natural environment, including air, water, noise, storm water management, wildlife, and vegetation, or such impacts will be substantially mitigated; Staff Response: When compared to the existing duplex zoning, the proposed Minor PUD Amendment will not result in any adverse impacts upon the natural environment, wildlife, vegetation, or air. Storm water management is improved with more opportunities for storm water runoff between the buildings. (vi) Compared to the underlying zoning, the PUD rezoning is not likely to result in significant adverse impacts upon other property in the vicinity of the subject tract; and Staff Response: As discussed herein, the approval of the PUD amendment would not result in significant adverse impacts upon other property in the vicinity. The proposed PUD Amendment maintains building setbacks and utility/drainage easements. (vii) Future uses on the subject tract will be compatible in scale with uses or potential future uses on other properties in the vicinity of the subject tract. Staff Response: Single-family uses would be compatible in scale with current and potential uses on other properties in the vicinity of the Property. PZC Recommendation After considering public comments and written public input, the PZC recommended approval of the Application. The PZC recommendation included the following findings and conditions. Findings: (1) The Application was processed in accordance with §7.16.060(h), Amendment to a Final PUD, which allowed the application to be processed as a minor amendment pursuant to §7.16.060(h)(1)(ii), Minor Amendment, and utilized the review criteria set forth in §7.16.060(e)(4), Preliminary PUD Review Criteria; and, (2) The Application is in substantial compliance with §7.16.060(e)(4), Preliminary PUD Review Criteria, AMC; and, (3) The Application is not likely to result in adverse impacts upon the natural environment, including air, water, noise, storm water management, wildlife, and vegetation, or such impacts will be substantially mitigated with building footprint maximums; and, (4) Approval of the Application would reduce building massing compared to the existing underlying zoning, allowing for an improvement in quality over what could have been accomplished through the existing zoning designations; and, (5) Building impacts on-site are reduced by adding restrictions that are currently not in effect including: building footprint restriction of 2,400 sq. ft.; and, (6) The Application is in conformance with policy recommendations in the Avon Comprehensive Plan, including “siting buildings of varying sizes along the street to maximize sun exposure, protect views, be compatible with surrounding development, and break up building bulk.” PUBLIC HEARING – 4290 Wildridge Road West - Minor PUD Amendment Page | 5 Condition: (1) Restrict the maximum building footprint to 2,400 square feet for each structure. Staff Recommendation Staff recommends that the Council conduct a public hearing, consider public comments, and approve Resolution 14-24, thereby approving the Minor PUD Amendment application for Lot 26, Block 3, Wildridge Subdivision Attachments A: Vicinity Map B: Application Materials C: Written Comments D: Draft Resolution 14-24 W IL D R I D G E R D W W I L D R I D G E R D E JUNE PT 0270135 FeetThis map was produced by the Community Development Department. Use of this map should be for general purposes only. Town of Avon does not warrant the accuracy of the data contained herein. Created by Community Development Department I Property Boundaries Lot 26, Block 3 Wildridge Subdivision Vicinity Map   Submitted: August 15, 2014 Rev. August 28, 2014 PUD Amendment 4290 Wildridge Road West Lot 26, Block 3, Wildridge Subdivision 4290 Residences A. INTRODUCTION The applicant, WR 4290 LLC, represented by Mauriello Planning Group and Martin Manley Architects, is requesting a Minor PUD Amendment for 4290 Wildridge Road West / Lot 26, Block 3, Wildridge Subdivision. The Wildridge PUD currently in effect identiﬁes Lot 26 as a 2 unit lot, allowing for a total of 2 dwelling units in the form of a duplex on the property. The applicant is requesting the Town of Avon allow for 2 single family dwelling units on the property, maintaining the existing density allowed by the Wildridge PUD. Because the lot is located within the Wildridge PUD, a minor amendment to the PUD is required. Similar applications have recently been approved by the Town of Avon. The property is .62 acres and is relatively ﬂat compared to most development sites in Wildridge. Because the property is located at the switchback of Wildridge Road, there lot is affected by substantial street frontage. In fact, approximately 436 linear ft. of this lot fronts on a road, with only approximately 178 linear ft. of adjacent to another residential lot. Allowing for two single family units creates a unique opportunity to design dwelling units which, while still impacted by the road frontage, can allow for more privacy and minimize the effects of the road. Due to the impact of the road frontage, the site has been designed with 2 curb cuts. This layout has been reviewed and found acceptable by the Town Engineer. The lot is proposed to be platted to create two, single-family lots, by a future application should the PUD Amendment be approved. Below is a conceptual design of the lot and building layout: B. BACKGROUND The Town of Avon was incorporated in 1978 and Benchmark Properties created the Wildridge and Wildwood Subdivisions shortly thereafter. The Wildridge Subdivision was subsequently completely replatted in 1981. Lot 26 was platted as 0.62 acres/27,007 sq. ft. as indicated on a portion of the 1981 plat provided below: C. ZONING ANALYSIS Development Standard Existing Proposed Density:2 units (in duplex format)2 units (in single family format) Setbacks:25 ft. from the road 10 ft. from Lot 25 25 ft. from the road Approx 40 ft. from Lot 25 property line Approx. 35 ft. internal distance between units Height:35 ft.35 ft. D. CRITERIA FOR REVIEW Section 7.16.060.4 establishes the criteria for review of a PUD amendment. Section 7.16.060.4 states: Review Criteria. The PZC and Town Council shall consider the following criteria as the basis for a recommendation or decision to rezone a property to PUD Overlay, and approve a preliminary PUD plan, or process a PUD amendment: (i)The PUD addresses a unique situation, confers a substantial beneﬁt to the Town, and/or incorporates creative site design such that it achieves the purposes of this Development Code and represents an improvement in quality over what could have been accomplished through strict application of the otherwise applicable district or development standards. Such improvements in quality may include, but are not limited to: improvements in open space provision and access; environmental protection; tree/vegetation preservation; efﬁcient provision of streets, roads, and other utilities and services; or increased choice of living and housing environments. Applicant Response: The proposed amendment to the Wildridge PUD to allow for 2 single family homes allows for a creative site design that is an improvement over the existing duplex development scenario. Being on the inside of the switchback creates a lot where the majority of the property is adjacent to road frontage. Allowing for 2 single family units allows for a more creative design where the impacts of the road on the property can be minimized. It allows for a greater separation between the buildings, increasing opportunities for landscaping and green space and reduced appearance of bulk and mass. Two curb cuts allows for design that responds well to the existing grades, and allow for each home to be situated into the lot and respond more appropriately to the natural topography. (ii)The PUD rezoning will promote the public health, safety, and general welfare; Applicant Response: Because there is no increase in the number of proposed dwelling units, there is no increase in the estimated number of trips generated by the project. As a result, the proposal promotes the public health, safety, and welfare. (iii)The PUD rezoning is consistent with the Avon Comprehensive Plan, the purposes of this Development Code, and the eligibility criteria outlined in §7.16.060(b); Applicant Response: The Avon Land Use Map indicates the property as Residential - Low Density as indicated on the map below: The Comprehensive Plan deﬁnes “Residential-Lot Density” as follows: Areas designated for residential low density are intended to provide sites for single-family, duplex, and multi-family dwellings at a density no greater than 7.5 dwelling units per acre. The proposal complies with the density as recommended by the Comprehensive Plan. The purpose of the Development Code is provided in Section 7.04.030 Purposes of the Avon Development Code: The Development Code is intended to promote and achieve the following goals and purposes for the Avon community, including the residents, property owners, business owners and visitors: (a) Divide the Town into zones, restricting and requiring therein the location, erection, construction, reconstruction, alteration and use of buildings, structures and land for trade, industry, residence and other speciﬁed uses; regulate the intensity of the use of lot areas; regulate and determine the area of open spaces surrounding such buildings; establish building lines and locations of buildings designed for speciﬁed industrial, commercial, residential and other uses within such areas; establish standards to which buildings or structures shall conform; establish standards for use of areas adjoining such buildings or structures; (b) Implement the goals and policies of the Avon Comprehensive Plan and other applicable planning documents of the Town; (c) Comply with the purposes stated in state and federal regulations which authorize the regulations in this Development Code; (d) Avoid undue trafﬁc congestion and degradation of the level of service provided by streets and roadways, promote effective and economical mass transportation and enhance effective, attractive and economical pedestrian opportunities; (e) Promote adequate light, air, landscaping and open space and avoid undue concentration or sprawl of population; (f) Provide a planned and orderly use of land, protection of the environment and preservation of viability, all to conserve the value of the investments of the people of the Avon community and encourage a high quality of life and the most appropriate use of land throughout the municipality; (g) Prevent the inefﬁcient use of land; avoid increased demands on public services and facilities which exceed capacity or degrade the level of service for existing residents; provide for phased development of government services and facilities which maximizes efﬁciency and optimizes costs to taxpayers and users; and promote sufﬁcient, economical and high-quality provision of all public services and public facilities, including but not limited to water, sewage, schools, libraries, police, parks, recreation, open space and medical facilities; (h) Minimize the risk of damage and injury to people, structures and public infrastructure created by wild ﬁre, avalanche, unstable slopes, rock fall, mudslides, ﬂood danger and other natural hazards; (i) Achieve or exceed federal clean air standards; (j) Sustain water sources by maintaining the natural watershed, preventing accelerated erosion, reducing runoff and consequent sedimentation, eliminating pollutants introduced directly into streams and enhancing public access to recreational water sources; (k) Maintain the natural scenic beauty of the Eagle River Valley in order to preserve areas of historical and archaeological importance, provide for adequate open spaces, preserve scenic views, provide recreational opportunities, sustain the tourist-based economy and preserve property values; (l) Promote architectural design which is compatible, functional, practical and complimentary to Avon's sub-alpine environment; (m) Achieve innovation and advancement in design of the built environment to improve efﬁciency, reduce energy consumption, reduce emission of pollutants, reduce consumption of non-renewable natural resources and attain sustainability; (n) Achieve a diverse range of attainable housing which meets the housing needs created by jobs in the Town, provides a range of housing types and price points to serve a complete range of life stages and promotes a balanced, diverse and stable full time residential community which is balanced with the visitor economy; (o) Promote quality real estate investments which conserve property values by disclosing risks, taxes and fees; by incorporating practical and comprehensible legal arrangements; and by promoting accuracy in investment expectations; and (p)Promote the health, safety and welfare of the Avon community. As demonstrated within this document, the proposal is consistent with and in substantial compliance with the purpose of the Development Code by not increasing the number of dwelling units. The eligibility criteria for a PUD are outlined in Section 7.16.060(b) and state the following: (1) Property Eligible. All properties within the Town of Avon are eligible to apply for PUD approval. (2) Consistency with Comprehensive Plan. The proposed development shall be consistent with the Avon Comprehensive Plan. (3) Consistent with PUD Intent. The proposed development shall be consistent with the intent and spirit of the PUD purpose statement in §7.16.060(a). (4) Compatibility with Existing Uses. The proposed development shall not impede the continued use or development of surrounding properties for uses that are permitted in the Development Code or planned for in the Avon Comprehensive Plan. (5) Public Beneﬁt. A recognizable and material beneﬁt will be realized by both the future residents and the Town as a whole through the establishment of a PUD, where such beneﬁt would otherwise be infeasible or unlikely. (6) Preservation of Site Features. Long-term conservation of natural, historical, architectural, or other signiﬁcant features or open space will be achieved, where such features would otherwise be destroyed or degraded by development as permitted by the underlying zoning district. (7) Sufﬁcient Land Area for Proposed Uses. Sufﬁcient land area has been provided to comply with all applicable regulations of the Development Code, to adequately serve the needs of all permitted uses in the PUD projects, and to ensure compatibility between uses and the surrounding neighborhood. As demonstrated within this document, the proposal is consistent with the eligibility criteria for a PUD. The proposal is consistent with the Avon Comprehensive Plan and compatible with existing uses, which are of a similar density as the proposal. (iv)Facilities and services (including roads and transportation, water, gas, electric, police and ﬁre protection, and sewage and waste disposal, as applicable) will be available to serve the subject property while maintaining adequate levels of service to existing development; Applicant Response: Because there is no increase in density for the proposed project, all facilities and services are available and adequate to serve the development. (v)Compared to the underlying zoning, the PUD rezoning is not likely to result in signiﬁcant adverse impacts upon the natural environment, including air, water, noise, storm water management, wildlife, and vegetation, or such impacts will be substantially mitigated; Applicant Response: The proposal is entirely located within a previously platted subdivision, with no increase in the allowable density, and as a result will not have any additional adverse impacts on the above-reference criteria. (vi)Compared to the underlying zoning, the PUD rezoning is not likely to result in signiﬁcant adverse impacts upon other property in the vicinity of the subject tract; and Applicant Response: As there is no increase in allowable density for the properties, there is no increase to impacts upon other property in the vicinity. The proposal is consistent with the allowable density for surrounding properties and will be smaller in scale than many of the existing homes in the neighborhood. The following photos provide some idea of the character of the existing homes in the vicinity: (vii)Future uses on the subject tract will be compatible in scale with uses or potential future uses on other properties in the vicinity of the subject tract. Applicant Response: While the neighborhood is generally developed with a mix of single- family homes and duplexes, the majority of the lots in the vicinity are allowed a minimum of 2 units. The proposal is compatible with the scale of existing and potential uses in the neighborhood. The character of the architecture will also be compatible with the neighborhood, as indicated in the concept design provided below:  E. ADJACENT ADDRESSES (within 300 Feet) 4271 WILDRIDGE RD W MARSH, JOHN R. & KYLA V. PO BOX 6565 AVON, CO 81620-6565 004281 WILDRIDGE RD W WALLIS, TODD E. & CYNTHIA Z. PO BOX 5750 VAIL, CO 81658-5750 004313 JUNE POINT MCMAHAN, DONALD J. - LAWRENCE, MARY HARREL PO BOX 1940 AVON, CO 81620-1940 004391 JUNE POINT RD VULPE, RUDOLPH C. & KIM L. PO BOX 7341 AVON, CO 81620-7341 004380 JUNE POINT MARGARET E. HART TRUST, MARGARET E. HART & JOHN I. WEST CO-TRUSTEES PO BOX 8038 AVON, CO 81620-8038 004340 JUNE POINT VV REAL ESTATE HOLDINGS LTD In Care Of Name NORMA HORTON PO BOX 4940 VAIL, CO 81658-4940 004400 WILDRIDGE RD W JONES, WILLIAM H. PO BOX 281 AVON, CO 81620-0281 004420 WILDRIDGE RD W JUDITH L. OLSON TRUST - ETAL PO BOX 734 AVON, CO 81620-0734 004691 NORTH POINT #A CHRISMAN, PATRICK KILEY PO BOX 9210 AVON, CO 81620-9201 004691 NORTH POINT #B AMMER, KATRINA PO BOX 19000 PMB 120 AVON, CO 81620-9010 004686 NORTH POINT JAMES A. THARP REVOCABLE TRUST 1852 CRESTRIDGE DR LITTLETON, CO 80121-1519 004660 NORTH POINT #B BELL COLORADO LLC 4415 S BIRMINGHAM AVE TULSA, OK 74105-4349 004660 NORTH POINT #A MEIRING, COLIN W. PO BOX 2152 EDWARDS, CO 81632-2152 004644 NORTH POINT SANDRA K. MORRISON TRUST, SANDRA K. MORRISON TRUSTEE 999 WESTWIND TRCE HINCKLEY, OH 44233-9336 004611 NORTH POINT LIVERGOOD, JAN M. PO BOX 3676 AVON, CO 81620-3676 004480 WILDRIDGE RD W #A NEFF, MICHAEL J. & CAROLYN S. PO BOX 1246 AVON, CO 81620-1246 004480 WILDRIDGE RD W #B JEPPSON, PAUL A. & TERESE E. PO BOX 1154 VAIL, CO 81658-1154 004657 NORTH POINT PELLERITO, JOHN M. & KARIN GOING PO BOX 3631 VAIL, CO 81658-3631 004280 WILDRIDGE RD W FOX, TERENCE B. & LYNN PO BOX 2974 VAIL, CO 81658-2974 004274 WILDRIDGE RD W IVY, MATT & JANE 1984 BUFFEHR CREEK RD VAIL, CO 81657-4916 004485 WILDRIDGE RD W NIEDERHAUSER, DANIEL & RONDA K. PO BOX 18308 AVON, CO 81620-8908 004266 WILDRIDGE RD W #B SCHORR-RATZLAFF TRUST 10 S QUEBEC WAY DENVER, CO 80230-6823 004266 WILDRIDGE RD W #A LINDSAY REALTY PARTNERS LLC 300 CHURCHILL CT WOODSTOCK, GA 30188-6824 RE F . DW FI R E H Y D R A N T W A T E R V A L V E ( T Y PI C A L ) CURVE TAB CURVEDELTARADIUSLENGTHC19°10'14"275.00'44.0 C2212°39'07"100.00'371 18" C.P.P. F L = 8 4 6 5 . 6 S E W E R M A N H O L E M H 8 6 0 RIM E L E V A T IO N = 8 4 8 1 . 7 S E W E R M A N H O L E M H 8 4 0 RI M E L E V A TIO N = 8 4 7 1. 1 S E W E R M A N H O L E M H 8 2 0 RIM E L E V A T I O N = 8 4 9 4 . 0 E L E C T RI C M A N H O L E RIM E L E V A TIO N = 8 4 8 1. 5 8504.58508502.58503.4 8500.88501.2 8 4 9 8 . 6 8 4 9 6. 7 8 4 9 4 . 7 8 4 9 1. 3 8 4 9 3 .0 8 4 8 8.9 8 4 8 5. 4 8 4 8 5 .1 8 4 8 6 .3 8 4 8 8.8 8 4 9 1. 4 8 4 9 3. 1 8 4 9 4. 9 8 4 8 7. 0 8 4 8 3. 0 8 4 8 2 . 8 8 4 8 0. 6 8 4 7 8 . 5 8 4 8 0. 2 8 4 7 8 . 8 8 4 7 6 .8 8 4 7 6 .4 8 4 7 4 . 5 RIDGE = 8502.3OUTLINE OF RESIDENCE EDGE OF CONCRETE F O U N D N o . 5 R E B A R W I T H R E D P L A S T I C C A P L . S . N o . 2 6 6 2 6 D No. 5 REBAR D PLASTIC CAP 26FOUND No. WITH 11/2" L.S. No. 5 8480 8 4 8 0 8480 8480 8470 8470 8 4 7 0 8 4 9 08500 8490 8 4 9 0 8490 0 S59°38'22"W - 178.27'S 06 °52 '4 6"E - 21 .72 'LOT 26 0.62 ACRES ADDRESS: 4290 WILDRIDGE ROAD WEST LOT 25 WILDRIDGE ROAD WEST (50' RIGHT-OF-WAY) WILDRID G E ( UTILITY AND DRAINAGE EASEMENT (RECEPTION No. 226437) BUILDING SETBACK BUILDING SETBACK SLOPE MAINTENANCE, DRAINAGE AND SNOW STORAGE EASEMENT (RECEPTION No. 226437) FOUND No. 5 REBAR WITH RED PLASTIC CAP L.S. No. 26626 10'-0" 25'-0" 25'-0" 10'-0" S PA A T C OR D I L L E R A / B E L L Y A C H E RI D G E EDWARDS/LAKE CREEK VALLEY N E W YO R K R A N G E B A L D M O U N T A I N / G R O U S E M O U N T AI N HOUSE TO NORTH BELLYA C HE RIDGE/ WEST RESIDENCES 1 i n c h = 1 0 f t . ( I N F E E T ) 5 I C S C A L E 1 0 2 0 S S H Y D S WV E ( S E E D E T A I L ) V I E W P O I N T 12"4" 4" WD UP UP W D 84 7 4 . 2 5 84 7 3 . 5 84 7 4 . 0 84 7 4 . 5 84 8 2 84 8 0 84 7 8 84 7 6 84 9 0 84 9 0 84 8 9 . 5 8496 8494 8492 24' - 0"16' - 6" PR O P E R T Y S P L I T L I N E 35' - 11" 12' - 6" 84 9 5 84 7 3 . 5 16' - 6"19' - 5" 84 8 2 8484 84 8 6 84 8 8 8494 71' - 11 1/8"8 9 ' - 5 1 3 /1 6 "970.328.5151 OFFICE PO Box 1587, Eagle, CO 81631 www.martinmanleyarchitects.com Project number DateREVISIONS 8/28/2014 1:09:32 PM A1.0 SITE PLAN14544290 RESIDENCE two Lot Split Set 08-28-14DW Dantas Construction 4290 West Wildridge Road Avon, Colorado 81620No.DescriptionDate 1" = 10'-0"100 SITE PLAN N e w Y o r k r a n g e B e l l e y A c h e r i d g e Lake Creek valley N e w Y o r k r a n g e B e ll e y A c h e Lake Creek valley site REF. WD DW UP FIR E H Y D R A N T W A T E R V A L V E ( T Y PIC A L ) CURVE TABLE CURVEDELTARADIUSLENGTHTANGENC19°10'14"275.00'44.02'22.06 C2212°39'07"100.00'371.15'341 C . P . P . F L = 8 4 6 5 . 6 S E W E R M A N H O L E M H 8 6 0 R I M E L E VA TIO N = 8 4 8 1 . 7 S E W E R M A N H O L E M H 8 4 0 R I M E L E V A TIO N = 8 4 7 1 . 1 S E W E R M A N H O L E M H 8 2 0 RIM E L E V A TIO N = 8 4 9 4 . 0 E L E C T RIC M A N H O L E RI M E L E VA TIO N = 8 4 8 1.5 8505.88504.58504.98502.58503.48500.8 8 4 9 8 . 6 8 4 9 6 . 7 8 4 9 4 . 7 8 4 9 1 . 3 8 4 9 3 . 0 8 4 8 8 . 9 8 4 8 5 .4 8 4 8 5 . 1 8 4 8 6. 3 8 4 8 8 . 8 8 4 9 1. 4 8 4 9 3. 1 8 4 8 7 . 0 8 4 8 3 . 0 8 4 8 2 . 8 8 4 8 0 .6 8 4 7 8 . 5 8 4 8 0 . 2 8 47 8.8 8 4 7 6 . 8 8 4 7 6 . 4 8 4 7 4 . 5 RIDGE = 8502.3OUTLINE OF RESIDENCE EDGE OF CONCRETE F O U N D N o . 5 R E B A R W I T H R E D P L A S T I C C A P L . S . N o . 2 6 6 2 6 R E B A R C A P FOUND No. 5 REBAR WITH 11/2" ALUMINUM L.S. No. 5447 8480 8 4 8 0 8480 8480 8470 8470 8 470 8 4 9 08500 8490 8 4 9 0 84 9 0 S59°38'22"W - 178.27'S 0 6 °5 2 '4 6 "E - 2 1 .7 2 'LOT 26 0.62 ACRES ADDRESS: 4290 WILDRIDGE ROAD WEST LOT 25 WIL D RID G E R O (50' RIG HT 8472' UTILITY AND DRAINAGE EASEMENT (RECEPTION No. 226437)BUILDING SETBACK SLOPE M A INTEN A N CE, DRAINAGE AND SN O W STORAGE EA SE MENT (RECEPTIO N No. 22 64 37) FOUND No. 5 REBAR WITH RED PLASTIC CAP L.S. No. 26626 10'-0" 25'-0" 25'-0" 10'-0" S PA AT CORD I LLERA/ BELLY AC H E RI DG E EDWARDS/LAKE CREEK VALLEY N E W Y O R K R A N G E B A L D M O U N T A I N / G R O U S E M O U N T A I N HOUSE TO NORTH B ELLYA C H E RID GE/ W E ST RESID E NC E S S S H Y D S WV E ( S E E D E T A I L ) V I E W P O I N T 12" 4" 4" 84 7 5 . 0 84 7 3 . 5 84 7 9 . 0 84 8 0 8 4 9 1 84 8 8 84 7 6 . 0 84 7 8 . 0 8 4 9 0 8 4 8 8 6' c u t 970.328.5151 OFFICE PO Box 1587, Eagle, CO 81631 www.martinmanleyarchitects.com Project number DateREVISIONS 8/1/2014 2:57:02 PM A1.0 SITE PLAN14544290 RESIDENCE two Preliminary Design Review Set 08-01-14DW Dantas Construction 4290 West Wildridge Road Avon, Colorado 81631No.DescriptionDate 1" = 10'-0"100 DUPLEX SITE PLAN N ew Y o r k r a n ge B e l l e y A c h e r i d g e Lake Creek valley site N ew Y o r k r a n ge Lake Creek valley en t r y en t r y DUPLEX PLAN WITH 2 DRIVE CUTSsite Resolution 14-24 4290 Wildridge Road West Minor PUD Amendment TC September 23, 2014 Page 1 of 2 TOWN OF AVON RESOLUTION NO. 14-24 Series of 2014 A RESOLUTION APPROVING THE “4290 Wildridge Road West” MINOR PUD AMENDMENT FOR LOT 26, BLOCK 3, WILDRIDGE, TOWN OF AVON, COLORADO WHEREAS, a Minor PUD Amendment Application (“Application”), was submitted to the Community Development Department of the Town on August 15, 2014 by Dominic Mauriello of Mauriello Planning Group (“Applicant”); and WHEREAS, the Application requests to amend the zoning of Lot 26, Block 3, Wildridge, to allow two (2) single-family structures in place of the currently allowed single-family or duplex structure; and WHEREAS, the Planning and Zoning Commission held public hearing on September 2, 2014, after posting notice of such Public Hearing in accordance with the requirements of Section 7.16.020(d), Step 4: Notice, Avon Municipal Code, and considered all comments provided; and WHEREAS, the Planning and Zoning Commission recommended that the Town Council conditionally approve the Application; and WHEREAS, the Avon Town Council held a public hearing on September 23, 2014, and after posting notice as required by law, considered all comments, testimony, evidence and staff report prior to taking action on the Application; and WHEREAS, the Avon Town Council has examined the review criteria set forth in §7.16.060(e)(4); and WHEREAS, the Avon Town Council has made the following findings regarding the Application: (1) The Application was processed in accordance with §7.16.060(h), Amendment to a Final PUD, which allowed the application to be processed as a minor amendment pursuant to §7.16.060(h)(1)(ii), Minor Amendment, and utilized the review criteria set forth in §7.16.060(e)(4), Preliminary PUD Review Criteria; and, (2) The Application is in substantial compliance with §7.16.060(e)(4), Preliminary PUD Review Criteria, AMC based upon review of the Application, the Town staff report and other evidence considered by the Avon Town Council at the public hearing; and, (3) The Application will not result in adverse impacts upon the natural environment, including air, water, noise, storm water management, wildlife, and vegetation, or such impacts will be substantially mitigated; and, Resolution 14-24 4290 Wildridge Road West Minor PUD Amendment TC September 23, 2014 Page 2 of 2 (4) Approval of the Application will reduce building massing compared to the existing underlying zoning, allowing for an improvement in quality over what could have been accomplished through the existing zoning designations; (5) Building impacts on-site are reduced by adding restrictions that are currently not in effect including: building footprint restriction of 2,400 sq. ft.; and, (6) The Application is in conformance with policy recommendations in the Avon Comprehensive Plan, including “siting buildings of varying sizes along the street to maximize sun exposure, protect views, be compatible with surrounding development, and break up building bulk.” NOW, THEREFORE BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF AVON, that the 4290 Wildridge Road West Minor PUD Application for Lot 26, Block 3, Wildridge, Town of Avon, Colorado, is hereby approved subject to the following conditions, which shall be met as a condition prior to subdivision, design review and/or building permit approval: (1) Restrict the maximum building footprint to 2,400 square feet for each structure. ADOPTED September 23, 2014. AVON TOWN COUNCIL By:_______________________________ Attest:___________________________ Rich Carroll, Mayor Debbie Hoppe, Town Clerk TOWN COUNCIL REPORT To: Mayor and Town Council From: Matt Pielsticker, AICP, Planning Manager Date: September 18, 2014 Re: Momentum Trail Concepts Proposal to Construct Wild West Trail INTRODUCTION: The West Avon Preserve is a 478-acre open space parcel obtained by the Town of Avon. Since the proposal to construct additional trails on the West Avon Preserve was reviewed by Council this spring, culminating in a well- attended public hearing on April 22, 2014, Council authorized and Momentum Trail Concepts constructed several trails. While it was originally envisioned to apply for grant funding for what is referred to as the “Wild West Ridge” trail – one of two remaining trail yet to be constructed – Council advanced the concept for constructing this trail in 2014 at recent hearings, rather than in 2015. This Report summarizes the proposal submitted by Momentum Trail Concepts and a look at funding for this project to date. TRAIL LOCATION APPROVALS: Presenting the mountain bike trails plan to the public is an important step prior to construction. The trail locations require approval from the Eagle Valley Land Trust, the holder of the Conservation Easement on the West Avon Preserve. The EVLT Board, at its May meeting, approved the same trails map, which had been presented to the Council at its April 22, 2014, meeting, with the condition that the Management Plan for the property be updated to include the new trails, showing locations with descriptions. Staff has continued to meet with EVLT staff to update the Management Plan, as approved by the Board, however, an updated Management Plan has not been signed. PROPOSAL: Momentum Trail Concepts has submitted a proposal (Attachment A) to design-build the proposed 2.14 mile Wild West Trail for $42,500. The trail would include a 6’ x 10’ bridge to cross June Creek near the June Creek Trail entrance to the trail. The project would take approximately 6 weeks, and they are available as early as October 1. If weather prohibited finishing this fall, the trail would be finished in 2015. FUNDING: The attached (Attachment B) breakdown of funding sources and expenditures was prepared to calculate the additional funding necessary to consider this contract. As summarized, additional funding of not less than $25,176 would need to be appropriated by Council for this project. STAFF RECOMMENDATION: Staff sees the opportunity for full build out of the West Avon Trail Preserve to meet a number of important objectives for the Town, including development of a recreational amenity which provides for healthy activity and, if several trails are approved at different ability levels, the establishment of a notable mountain bike and hiking “place” for residents and tourists. RECOMMENDED MOTION: I move to approve construction of the Wild West Trail by Momentum Trail Concepts and to authorize the Town Manager or designee to enter into a Professional Service Agreement in an amount not to exceed $42,500; and to appropriated $25, 176 from the Capital Projects Fund. ATTACHMENTS: A- Momentum Trail Concepts Proposal, titled “Fall 2014 Proposal” B – West Avon Preserve Trail Funding Summary Hay Meadow Trail ProjecT ProPosal wesT avon Preserve Trails ProjecT Fall 2014 ProPosal Wild West Ridge tRail submitted to Town of avon c/o Justin Hildreth, Town Engineer by Momentum Trail Concepts, llC ProjecT overview Together with the town of avon, Momentum Trail Concepts endeavors to construct approximately 2.13 miles of trail (i.e. - Wild West Trail) on the town owned parcel of land between June Creek/singletree and Wild ridge. This trail will begin off of the June Creek Trail, climb to the ridge line (below private property, and above the sensitive, densely forested section of the draw) and across, ultimately terminating at the avon singletree Connector trail. Primarily a directional trail, the Wild West ridge Trail will serve to further disperse existing trail traffic in the West avon Preserve. It will give riders both an additional climbing and descending option and will be, in our opinion, a valuable addition to the trail inventory for the community. We will also construct a small, approximately 10’ x 6’ wooden bridge over June Creek to mitigate damage to the riparian zone in the canyon. Trail sPecificaTions Proposed Construction specifications single track trails constructed for this project will average between 12-24 inches in width. soil and vegetation will be cleared from the trail, exposing mineral soil underneath. Tread will require a minimal 5% outslope to facilitate drainage, along with the wide dispersal of removed soil onto downhill side. Final preparation of trail will involve the smoothing and/or compaction of exposed mineral soil to a reasonable standard. Exposed roots and stone need not be removed. Further stone may be used to denote trail line and corral users onto correct trail line. wesT avon Preserve Trails ProjecTFall 2014 ProPosalWild West Ridge tRail Proposed Construction specifications (con’t) Where necessary, constructed trail will be used in conjunction with full bench construction or other recognized trail construction techniques dependent on slope and ground conditions. It is anticipated that several features will be added to improve user experience on this trail, including berms, rollers, and beginner-level jumps. sTaTeMenT of QualificaTions Momentum Trail Concepts is ably qualified to undertake this project and provide a trail product of the highest quality. We have multiple examples of this type of work in our resume—as recently as our work on the Hay Maker and Pool and Ice trails in Eagle County in 2013, in Chile in 2012 and 2013, and dating back to 2005 with our help in constructing the World Cup cross country track in angel Fire, NM. additionally, we constructed more than 5 miles of cross country trails at the solVista Bike Park in Granby, Co from 2008-2011. Please feel free to consult our website for examples of our work at www.momentumtrail.com. references are available upon request. wesT avon Preserve Trails ProjecTFall 2014 ProPosalWild West Ridge tRail work scHedule and cosTs schedule Momentum Trail Concepts estimates construction time for this project will take approximately 6 weeks. We can begin construction as early as october 1, 2014 Costs Momentum Trail Concepts submits a bid of $42,500 for the entirety of this project; including design, construction, lodging, fuel, equipment rental, and bridge materials. We request a 1/3 deposit upon execution of the contract, 1/3 payment upon 50% completion, and 1/3 payment upon full completion to the town’s satisfaction. wesT avon Preserve Trails ProjecTFall 2014 ProPosalWild West Ridge tRail West Avon Preserve Trail Funding Current Budget - Revenues TOA - Trailhead Parking on Nottingham $10,000 TOA -Capital Projects Fund $75,000 Eagle County Grant Trail work $12,450 Signage $3,000 Other Sources John Shipp/Dusty Boot $5,000 Berry Creek Metro $11,000 Singletree Property Owners $11,000 Total Current Funding $127,450 Expenses Momentum Contract #1 Easy Loop $16,500 Playground Way $16,500 ASC Loop $8,250 Flow Trail $8,250 Lee’s Way $33,000 Signage 4 Trailheads $15,340 15 Directional $1,875 Land Acquisition for Playground Trail Land $8,000 Survey $2,400 Plat Recording $11 Total Expenditures $110,126 Momentum Contract #2 Wild West Ridge $42,500 Total Expenses $152,626 Minus Current Revenues $127,450 Balance needed for Wild West $25,176 TOWN COUNCIL REPORT To: Honorable Mayor Rich Carroll and Avon Town Council From: Susan Fairweather, Director of Economic Initiatives Ad Hoc Sub‐Committee: Matt Pielsticker, Senior Planner Danita Dempsey, Special Events Supervisor Virginia Egger, Town Manager Todd Goulding Susan Fairweather, Director of Economic Initiatives Date: September 23, 2014 Agenda: 2015 Budget Work Session: Outside Agency Requests 2014 ‐ 2015 Community Funding: Requests and Recommendations Please find attached Exhibit 1: 2014‐15 Community/Special Event Funding: Requests and Recommendations. ‐ Exhibit 1 is a summary of 2015 funding requests from outside agencies with recommendations on funding, rating score by the Ad Hoc Sub‐Committee and additional notes including in kind recommendations. ‐ Exhibit 2 is the full application packet used for the solicitation of outside funding requests. ‐ The review and rating process is described at the end of this memo. Representatives from outside agencies have been notified of this meeting and may be present to answer questions. Council Direction Council is asked at Tuesday’s meeting to provide direction for funding the various programs listed on Exhibit 1 in preparation of the 2015 General Fund Budget . While still under final review and preparation by Town staff, the 2015 draft General Fund budget, will show a balanced budget with the funding recommendations for outside agency based upon your direction. Summary Exhibit 1 is organized by program areas with sub‐totals. Each program includes notes and any recommendations for conditions of funding. Organizations submitted applications electronically, and are provided after Exhibit 2 for your review/reference. One hard copy binder will be available at Tuesday’s meeting for reference.  Total requests equaled $421,290. The total 2015 funding recommendation, as shown on Exhibit 1, is $186,790. This is $234,500 less than requested.  The Town Council’s 2013‐14 Strategic Plan and the Town’s Brand Platform are the lead documents used to assess each request and its relevance and fit for the Town.  Signature Special Event “seed” funding for events such as Winter Wonder Grass, Flavors of Colorado, Salute to the USA, and Man of the Cliff are not included in the Community Grant request summary. The General Fund’s Special Event Reserve is the source of funding for these types of events, which are recommended on a case‐ by‐case basis to Council once applications are received. Page 1 of 5 Page 1 of 5 Exhibit 1 2014-15 Community/Special Event Funding: Requests and Recommendations Entity Program/Event Bud g e t 201 4 Re q u e s t e d 201 5 Re c o m m e n d a t i o n 201 5 Tot a l P o i n t s Mu n i r e v s Tra c k e d 201 4 F u n d i n g Rep o r t i n g C o m p l e t e ? Not e : R e c i p i e n t s h a v e unt i l D e c e m b e r 3 1 , 2 0 1 4 to m e e t t h e r e q u i r e m e n t s of t h e i r 2 0 1 4 f u n d i n g agr e e m e n t . 2015 Proposed Funding Notes ECONOMIC DEVELOPMENT: REGIONAL PROGRAMS Vail Valley Partnership Regional Economic Development and Group Sales Efforts $ 15,000 $ 25,000 $ 10,000 49.6 no no All requirements of 2014 funding must be met prior to releasing any 2015 funds. Recommendation to tie funding to Avon specific deliverables (stage activations, recruitment of events). Meet with TOA ED Director six times per year. Vail Leadership Institute Business Base Camp operation in Avon, business recruitment through scholarship program $ 12,500 $ 54,900 $ 17,500 45.6 no Yes $7,500 for continued support of Base Camp operations with trade in scholarships for TOA employee leadership development within existing VLI programs, $10,000 for general scholarships to attract businesses to Avon with the stipulation that the businesses receiving scholarships are mutually agreed upon between the TOA and VLI. Vail Leadership Institute Rent subsidy to bring Investment Fund (1.2 million)Attraction to Avon with a focus on outdoor tech based companies $ 10,000 $ 10,000 see comments No Yes Acquisition of 1.2M investment fund intended to invest in and accelerate outdoor tech based companies. 10K subsidy contingent upon full development of a proposal with all other fundraising secured. Avon's funding should be the last commitment. Subsidy for office space in Avon. EGE Air Alliance Regional Air Service $ 30,000 $ 30,000 $ 10,000 37.4 No No 2015 funding contingent upon TOA receiving 2015 Study as a deliverable for 2014 funding. Committee recommends funding at 10K level to allow EGE Air Alliance to find alternative funding sources to make added air service (Houston - Eagle Vail or other added route) sustainable. $ 57,500 $ 119,900 $ 47,500 SUB-TOTAL: ECONOMIC DEVELOPMENT - REGIONAL PROGRAMS Use of Funds: Regional Economic Development Plan Implementation. Business recruitment and retention, and special event promotion. Use of Funds: Business recruitment and retention Use of Funds: Seed funds for attraction of additional funds Use of Funds: Business recruitment ECONOMIC DEVELOPMENT: REGIONAL PROGRAMS Page 2 of 5 Page 2 of 5 Exhibit 1 2014-15 Community/Special Event Funding: Requests and Recommendations Entity Program/Event Bud g e t 201 4 Re q u e s t e d 201 5 Re c o m m e n d a t i o n 201 5 Tot a l P o i n t s Mu n i r e v s Tra c k e d 201 4 F u n d i n g Rep o r t i n g C o m p l e t e ? Not e : R e c i p i e n t s h a v e unt i l D e c e m b e r 3 1 , 2 0 1 4 to m e e t t h e r e q u i r e m e n t s of t h e i r 2 0 1 4 f u n d i n g agr e e m e n t . 2015 Proposed Funding Notes Walking Mountains Sustainable Film Series Sustainable Community Film Series $ 1,500 $ 7,500 $ 7,500 47.8 No Yes Wild & Scenic Film Series Radiate Live Reds, White, & Brews $ 15,000 $ 17,500 $ 10,000 55.2 Yes Yes Recommend $6,000 cash and $4,000 in kind support for 10K total. Event will be moving to a new weekend. Beaver Creek Rodeo $ 2,500 $ 5,000 $ 5,000 48 No No Continued support of this annual event is recommended Vilar Performing Arts Center Vilar programming $ - $ 35,000 $ 5,000 30.6 No N/A Recommend setting aside $5,000 for future opportunity in Avon. Work to find mutually beneficial opportunities, application not specific. Programming should be directed to Avon. Alpine Arts Center Social Art Series $ - $ 36,000 $ 14,400 45.6 No N/A Funding for Social Art Series, Option 2 presented. Funding contingent upon AAC finding location in Avon for winter series, locate summer series on pedestrian mall in summer. Payment 1/2 up front, 1/2 after successful completion of winter series. No in kind recommended. Recommended additional consideration up to $5,600 to help secure location and rental of equipment. $ 19,000 $ 101,000 $ 41,900 Use of Funds: General operations and marketing of the event including Avon name recognition SUB-TOTAL: ECONOMIC DEVELOPMENT: SPECIAL EVENTS IN AVON - MUSIC & FILM & ART ECONOMIC DEVELOPMENT: OUTSIDE PRODUCERS: SPECIAL EVENTS IN AVON - MUSIC & FILM & ART Use of Funds: Management, film procurement, screening costs, marketing & materials. Use of Funds: Rodeo event - 7 high summer Thursday nights Use of Funds: Possible underwriting of a performance series Use of Funds: Possible underwriting of a performance series TOWN COUNCIL REPORT To: Honorable Mayor Rich Carroll and Avon Town Council From: Susan Fairweather, Director of Economic Initiatives Ad Hoc Sub‐Committee: Matt Pielsticker, Senior Planner Danita Dempsey, Special Events Supervisor Virginia Egger, Town Manager Todd Goulding Susan Fairweather, Director of Economic Initiatives Date: September 23, 2014 Agenda: 2015 Budget Work Session: Outside Agency Requests 2014 ‐ 2015 Community Funding: Requests and Recommendations Please find attached Exhibit 1: 2014‐15 Community/Special Event Funding: Requests and Recommendations. ‐ Exhibit 1 is a summary of 2015 funding requests from outside agencies with recommendations on funding, rating score by the Ad Hoc Sub‐Committee and additional notes including in kind recommendations. ‐ Exhibit 2 is the full application packet used for the solicitation of outside funding requests. ‐ The review and rating process is described at the end of this memo. Representatives from outside agencies have been notified of this meeting and may be present to answer questions. Council Direction Council is asked at Tuesday’s meeting to provide direction for funding the various programs listed on Exhibit 1 in preparation of the 2015 General Fund Budget . While still under final review and preparation by Town staff, the 2015 draft General Fund budget, will show a balanced budget with the funding recommendations for outside agency based upon your direction. Summary Exhibit 1 is organized by program areas with sub‐totals. Each program includes notes and any recommendations for conditions of funding. Organizations submitted applications electronically, and are provided after Exhibit 2 for your review/reference. One hard copy binder will be available at Tuesday’s meeting for reference.  Total requests equaled $421,290. The total 2015 funding recommendation, as shown on Exhibit 1, is $186,790. This is $234,500 less than requested.  The Town Council’s 2013‐14 Strategic Plan and the Town’s Brand Platform are the lead documents used to assess each request and its relevance and fit for the Town.  Signature Special Event “seed” funding for events such as Winter Wonder Grass, Flavors of Colorado, Salute to the USA, and Man of the Cliff are not included in the Community Grant request summary. The General Fund’s Special Event Reserve is the source of funding for these types of events, which are recommended on a case‐ by‐case basis to Council once applications are received.  Page 2  Avon Special Events & Economic Development Initiatives: The investment in Avon Special Events and Economic Initiatives including the performance pavilion/stage and creative arts district/pedestrian mall continues to be the highest priority for the use of Town revenues over the next several years – these Avon specific investments are needed to attract and support local businesses, provide interest and vitality for the Avon community and our visitors, and provide additional revenue to the Town of Avon. Growing a diversity of Special Events in Avon, with a view to increasing lodging and retail sales, continues to be a priority and best assures funding for the needs and partnerships of outside agencies into the future and, therefore, are prioritized in our recommendations. Outside Funding Requests & Rating Process On July 25th, 2014, the application materials for funding requests, found in Exhibit 2, were advertised for a twenty ‐ seven (27) day period. The advertisement was posted on the Town’s website accompanied by a press release. Past recipients were also notified of the application process. Over the course of soliciting requests, the Town received twenty one (21) requests. The Watershed Council request, if granted, would be funded from the Water Fund and is noted as such. Once all of the submittals were accepted an “ad hoc committee” met to review the applications. The review focused on the Review Criteria and rating sheet included in the application materials.  Points were weighted to organizations that provided the most public benefit to Avon residents and visitors, as well as programs that fell in line with the 2013‐14 Strategic Plan goals and policies and the Avon Brand Platform.  The points were only one of the key indicators to determine the funding recommendation.  Past funding levels, available funds, potential for on‐going requests, filling a funding or service gap and general priorities for all applications were also considered in the funding level recommendation. Future “ad hoc committees” to review the community grant requests may be comprised of business and community members who would provide for the solicitation of outside funding requests, evaluation and recommendation to Council. Page 3 of 5 Page 3 of 5 Exhibit 1 2014-15 Community/Special Event Funding: Requests and Recommendations Entity Program/Event Bud g e t 201 4 Re q u e s t e d 201 5 Re c o m m e n d a t i o n 201 5 Tot a l P o i n t s Mu n i r e v s Tra c k e d 201 4 F u n d i n g Rep o r t i n g C o m p l e t e ? Not e : R e c i p i e n t s h a v e unt i l D e c e m b e r 3 1 , 2 0 1 4 to m e e t t h e r e q u i r e m e n t s of t h e i r 2 0 1 4 f u n d i n g agr e e m e n t . 2015 Proposed Funding Notes Vail Valley Charitable Fund Bec Tri Triathlon $ 2,500 $ 3,000 $ 3,000 38 Yes Yes Continued support of this annual sporting event is recommended Team Evergreen Triple Bypass Bike Ride $ 2,500 $ 5,500 $ 5,500 39.6 Yes No Continued support of this annual sporting event is recommended $3000 cash, $2,500 in kind for 5K total Beaver Creek XTERRA $ 2,500 $ 2,500 $ 2,500 36.8 Yes No Continued support of this annual sporting event is recommended America Cup Juniors Fly Fishing Championship $ 5,000 $ 5,000 30.6 Yes N/A Recommended that funding is contingent upon the event being held in Avon at Nottingham Lake (if enough fish) or the Eagle River. Vail Valley Soccer Club In kind request only - use of field $ 1,240 $ 1,240 30.6 No N/A In kind use of the H.A. Nottingham soccer field and limited other in kind services is recommended. BMHS Super Boosters Request for advertising support $ 1,500 $ - 25.4 No N/A Not Avon specific, committee does not feel the request meets the goals of the strategic plan. Vail Valley Foundation FIS Men's Birds of Prey $ 40,000 $ 50,000 $40,000 see comments Yes No Funding contingent upon Avon receiving specific benefits and rights as a sponsor, including other agreed activations (e.g. banners in Avon.) $ 47,500 $ 68,740 $ 57,240 Use of Funds: General event operations Use of Funds: General event operations for local community Use of Funds: General event operations - generates overnight accommodation stays ECONOMIC DEVELOPMENT: OUTSIDE PRODUCERS: SPECIAL EVENTS IN AVON - SPORTS Use of Funds: General event operations Use of Funds: General operations and marketing of the event Use of Funds: General event operations - race starting point Use of Funds: General event operations SUB-TOTAL: ECONOMIC DEVELOPMENT: SPECIAL EVENTS IN AVON - SPORTS Page 4 of 5 Page 4 of 5 Exhibit 1 2014-15 Community/Special Event Funding: Requests and Recommendations Entity Program/Event Bud g e t 201 4 Re q u e s t e d 201 5 Re c o m m e n d a t i o n 201 5 Tot a l P o i n t s Mu n i r e v s Tra c k e d 201 4 F u n d i n g Rep o r t i n g C o m p l e t e ? Not e : R e c i p i e n t s h a v e unt i l D e c e m b e r 3 1 , 2 0 1 4 to m e e t t h e r e q u i r e m e n t s of t h e i r 2 0 1 4 f u n d i n g agr e e m e n t . 2015 Proposed Funding Notes Walking Mountains Science School Programs $ 17,500 $ 30,000 $ 15,000 47.8 No Yes Continued support of the educational series is recommended Eagle River Watershed Council Community Programming $ 28,000 39.4 No No Continued support at 15K- 20K level though water fund is recommended. $ 17,500 $ 58,000 $ 15,000 SUB-TOTAL: REGIONAL ENVIRONMENTAL Use of Funds: Operating expenses for K-12 field studies, interpretive programs & hikes REGIONAL ENVIRONMENTAL PROGRAMS Use of Funds: general organizational support, Eagle River Cleanup event,Water Quality Monitoring & Assessment Program and Urban Runoff Program Page 5 of 5 Page 5 of 5 Exhibit 1 2014-15 Community/Special Event Funding: Requests and Recommendations Entity Program/Event Bud g e t 201 4 Re q u e s t e d 201 5 Re c o m m e n d a t i o n 201 5 Tot a l P o i n t s Mu n i r e v s Tra c k e d 201 4 F u n d i n g Rep o r t i n g C o m p l e t e ? Not e : R e c i p i e n t s h a v e unt i l D e c e m b e r 3 1 , 2 0 1 4 to m e e t t h e r e q u i r e m e n t s of t h e i r 2 0 1 4 f u n d i n g agr e e m e n t . 2015 Proposed Funding Notes Eagle River Youth Coalition Parent Education and Outreach $ 2,000 $ 4,000 $ 4,000 35.6 No Yes County wide program - this funding would directly benefit Avon Elementary students. Committee noted that ERYC is not reaching out to other municipal funders. Youth Foundation PwrHrs' afterschool & Summer Program $ - $ 10,000 0 No N/A Additional information received on 10/15 - will review prior to October 22nd meeting. Red Ribbon HIV/AIDS awareness $ 750 $ 750 $ 750 29.4 No Yes Recommend funding - program focuses on Avon Elementary programming. Early Childhood Partners Coaching & Consultation $ 1,000 $ 3,600 $ - 28.2 No Yes Committee does not recommend funding social services without a specific outreach in Avon (Avon specific) Small Champions Recreational Programs for Youth with Disabilities $ 5,600 $ - 23.4 No No Program request for two participants. Committee does not feel the request meets the goals of the strategic plan. Education Foundation of Eagle County Strategic initiatives and programs for quality education in Eagle County $ 39,700 $ 20,400 33.6 No No Committee recommends an in kind donation of 1 office space at an estimated yearly value of $20,400. CAM fees estimated at $5.00 per SQ. FT. not included in donation (requestor pays) Salvation Army Community Garden Initiatives & programs $ 20,000 $ - 29.2 No No Committee does not feel the request meets the goals of the strategic plan. $ 83,650 $ 25,150 $ 431,290 $ 186,790 Use of Funds: Increased marketing efforts to support parent education & outreach initiatives Use of Funds: To support programming held at Avon Elementary with Avon name recognition. TOTAL 2015 FUNDING REQUESTS & RECOMMENDATION SUB-TOTAL: HEALTH & HUMAN SERVICES Use of Funds: Staff Instructor compensation (hourly rate & mileage) Use of Funds: Programming and office space Use of Funds: Get Out and Grow Avon Series - Educators support and materials support HEALTH & HUMAN SERVICES Use of Funds: Family Leadership Training Institute Use of Funds: Sponsor two children for program  Page 2  Avon Special Events & Economic Development Initiatives: The investment in Avon Special Events and Economic Initiatives including the performance pavilion/stage and creative arts district/pedestrian mall continues to be the highest priority for the use of Town revenues over the next several years – these Avon specific investments are needed to attract and support local businesses, provide interest and vitality for the Avon community and our visitors, and provide additional revenue to the Town of Avon. Growing a diversity of Special Events in Avon, with a view to increasing lodging and retail sales, continues to be a priority and best assures funding for the needs and partnerships of outside agencies into the future and, therefore, are prioritized in our recommendations. Outside Funding Requests & Rating Process On July 25th, 2014, the application materials for funding requests, found in Exhibit 2, were advertised for a twenty ‐ seven (27) day period. The advertisement was posted on the Town’s website accompanied by a press release. Past recipients were also notified of the application process. Over the course of soliciting requests, the Town received twenty one (21) requests. The Watershed Council request, if granted, would be funded from the Water Fund and is noted as such. Once all of the submittals were accepted an “ad hoc committee” met to review the applications. The review focused on the Review Criteria and rating sheet included in the application materials.  Points were weighted to organizations that provided the most public benefit to Avon residents and visitors, as well as programs that fell in line with the 2013‐14 Strategic Plan goals and policies and the Avon Brand Platform.  The points were only one of the key indicators to determine the funding recommendation.  Past funding levels, available funds, potential for on‐going requests, filling a funding or service gap and general priorities for all applications were also considered in the funding level recommendation. Future “ad hoc committees” to review the community grant requests may be comprised of business and community members who would provide for the solicitation of outside funding requests, evaluation and recommendation to Council. POST OFFICE BOX 975 1 Lake Street Avon, CO 81620 970‐748‐4000 970‐949‐9139 Fax 970‐845‐7708 TTY July 25, 2014 RE: 2015 Town of Avon Community Funding Requests APPLICATION DEADLINE: August 22, 2014, by email only. Dear Potential Applicant: The Town of Avon welcomes applications from organizations who are seeking grants for programs, projects, special events and/or activities which preserve or enrich the social and economic welfare, and the education and health of the Avon community. This packet includes important information to help your organization meet the goals of Town funding, the application submission requirements, review criteria and schedule for application presentations to the Avon Town Council. AVAILABILITY OF FUNDS: The Town of Avon looks at every opportunity for advancing the partnerships with organizations in Avon. The demands on Town resources, however, must be understood. In the 2014 budget, Town Council appropriated $240,145.00 in funding for Community grants. This funding level is anticipated to again be available. Funding, however, is not guaranteed and is in the complete discretion of the Avon Town Council. Monies to outside agencies are prioritized with all the other requests, services and facility needs of the Town of Avon and its revenue projections. Funding, if any, will be based upon the organization’s written application and, if requested, a presentation to Town Council. The Town Council is scheduled to review all applications at their September 23, 2014 regular meeting. The following materials include all information you should need to prepare a grant request:  GRANTS: MEETING ESTABLISHED TOWN GOALS, including Program Overview, Eligibility Criteria, Review Criteria and Review Process  APPLICATION REQUIREMENTS & SUBMITTAL GUIDELINES  Avon Brand Platform  1013‐14 Strategic Plan If you have any questions on materials to be submitted, please do not hesitate to contact Susan Fairweather, at 748‐4072 or e‐mail, sfairweather@avon.org. Sincerely, Susan L. Fairweather Director of Economic Initiatives Page 2 of 4 2015 Town of Avon Community Funding Requests APPLICATION DEADLINE: August 22, 2014, by email only. GRANTS: MEETING ESTABLISHED TOWN GOALS Program Overview: The Town Council will evaluate the various proposals based upon direct benefit to the Avon community, including its residents, visitors and businesses. Community organizations may receive grants, if funds are available, or in‐kind support (including land, buildings, equipment, and services) which support, preserve, or enrich the social and economic welfare, and the education and health of the Avon community. The Town Council adopted the following Overview Statement in its 2013‐14 Strategic Plan: The Town of Avon, surrounded by natural beauty, is today a strong community that will build on its strengths to become a nationally and internationally recognized year‐round mountain resort community. Committed to providing a high level of municipal services for our citizens and visitors, and the stewardship of our natural resources, Avon will expand its cultural, recreational and educational offerings in partnership with our broader community and regional public and private sector agencies, thereby ensuring sustained economic vitality and a vibrant community experience. In order to build on the Town’s strengths to become nationally and internationally recognized resort community, the Town is committed to growing a vibrant, diverse economy and community, providing our citizens and guests with exceptional services and an abundance of recreational, cultural and educational opportunities. Applicants are encouraged to review the 2013‐2014 Strategic Plan and Avon Brand Platform to ensure programs, activities and special events are in support of the Strategic Plan and Brand Platform. Applicants should indicate any services or programming an organization or program can provide to the Town of Avon in support of the Strategic Plan and Brand Platform. Eligibility Criteria: 1. Only one application may be submitted per organization. 2. Non‐profit applicants may apply as a 501(c)(3) or under the umbrella of a 501(c)(3) with a letter of agreement between the applicant and the umbrella 501(c)(3). 3. For‐profit business applications as a general practice are not accepted except for signature events. Applicants, who are interested in “seeding” a special event in Avon, are, however, eligible, when a non‐profit is included as a beneficiary of some or all of the proceeds of the proposal. At a minimum, the applicant must include a description of the corporate organizational structure and plan for determining total “seed” needs and terms. 4. Applications will be accepted from organizations and for events that provide educational, cultural, athletic and entertainment opportunities, which directly benefit the Town of Avon residents, businesses and visitors. 5. Special event and festival applicants must identify a specific calendar date which is compatible with other events in the Town of Avon, and when applicable, in the Vail Valley. 6. Funding will not be provided for capital improvements. 7. Funds will not be available until after January 1, 2015, and may be dispersed in installments, if awarded. Page 3 of 4 2015 Town of Avon Community Funding Requests APPLICATION DEADLINE: August 22, 2014, by email only. Review Criteria: Community and Citizen Benefit (Quality of Life): 1. Points: 0‐10  How many people benefit this event/program/organization?  Does this event/program/organization have the potential to contribute to Avon’s sense of community 2. 2014‐15 Strategic Plan & Avon Brand Platform (Established Policies/Priorities): Points: 0‐20  Is the event/program/organization supported by the priorities adopted by the Town Council in the Strategic Plan?  Is it associated with one or more of the following priorities: Economic Development; Special Events?  Does this event/program/organization have the potential to expand Avon’s cultural, recreational, and/or educational offerings? 3. Feasibility & Implementation Risk: Points: 0‐10  Are there significant obstacles or unknown factors that may prevent the event/program/organization from being completed?  What happens if the event/program/organization is delayed or denied? 4. Business Vitality: Points: 0‐10  Does this event/program/organization have the potential to benefit Avon’s restaurants, hotels, and retail establishments and does it promote visitors intent to return?  Does this event/program/organization reinforce the Town’s goal of sustained economic vitality? 5. Partnership with the Town of Avon (programs or organizations only): Points: 0‐10 Can or does the program/organization provide programming or other services to the Town of Avon? 6. Special Events Only: Points: 0‐10  Does this event have the potential to contribute to Avon’s long term sustainable special events strategy?  What is the growth potential for this event? Does it have the potential to be an annual event and grow within Avon?  How does this event contribute to a balanced annual calendar of events?  Does the producer of this event have the ability to produce an event compatible with the image of Avon as a cultural attraction? Review Process & Schedule: August 1st 2015 Town of Avon Community Funding Requests Open for Application August 22nd Deadline for Applications Week of August 25th Review by Community Grants/Special Events Committee & Staff Week of September 9th Funding Recommendation Distributed to Council & Applicants September 23rd Applicant Presentations to Council December 1st Notification of Awards Page 4 of 4 2015 Town of Avon Community Funding Requests APPLICATION DEADLINE: August 22, 2014, by email only. APPLICATION & GUIDELINES FOR COMMUNITY ORGANIZATIONS REQUEST FOR 2015 FUNDING THE DEADLINE FOR RECEIPT OF THIS APPLICATION IS FRIDAY, AUGUST 22, 2014, BY 5 PM. APPLICATION REQUIREMENTS PLEASE DO NOT EXCEED THREE PAGES. 1. Contact Information: Name of organization & mailing address, contact person, telephone number, email address 2. Description & Purpose of the Organization. If representing a tax exempt organization, please provide a copy of the determination letter from the Internal Revenue Service recognizing your tax‐exempt status under IRS 501(c)(3). If applying under the umbrella of a 501(c)(3), please provide letter of agreement. 3. Detailed description of the event or program and explanation of funding needs. Include if this is a new program, organization or event. 4. Amount of funds requested from the Town of Avon. Please include when funds are needed for payment. 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed). 6. Anticipated line item budget for the organization or event. 7. 2013 final actual profit and loss statement. 8. How the event or organization benefits the Avon community? Please provide details. 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town. 10. Include a description of any "in‐kind" contributions and related costs that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. 11. If a recipient of funds from the Town of Avon in fiscal year 2014, a progress or final report on the funded activity, program and/or event. 12. NO ADDITIONAL MATERIALS WILL BE ACCEPTED. PLEASE DO NOT SEND NEWSPAPER CLIPPINGS, LETTERS OF SUPPORT, OR PROMOTIONAL MATERIALS. APPLICATION SUBMITTAL GUIDELINES 1. Submit, by email, a PDF of the full application to: sfairweather@avon.org 2. Number each item in the application to correspond to the Application Requirements stated above. 3. Incomplete or late applications will not be considered. Pa g e 1 of 5 Ex h i b i t 1 20 1 4 ‐15 Co m m u n i t y / S p e c i a l Ev e n t Fu n d i n g : Re q u e s t s an d Re c o m m e n d a t i o n s En t i t y Pr o g r a m / E v e n t Budget 2014 Requested 2015 Recommendat ion 2015 Total Poin ts Mu nirevs Tracked 2014 Funding Rep or ting Com plete ? Note: Recipients have unti l Decem be r 31, 2014 to meet th e requi re ments of their 2014 fu ndi ng agree ment. 20 1 5 Proposed Funding Notes EC O N O M I C DE V E L O P M E N T : RE G I O N A L PR O G R A M S Va i l Va l l e y Pa r t n e r s h i p Re g i o n a l Ec o n o m i c De v e l o p m e n t an d Gr o u p Sa l e s Ef f o r t s $ 15 , 0 0 0 $ 25 , 0 0 0 $ 10 , 0 0 0 49 . 6 no no Al l re q u i r e m e n t s of 2014 funding must be met prior to releasing any 20 1 5 fu n d s . Re c o m m e n d a t i o n to tie funding to Avon specific de l i v e r a b l e s (s t a g e activations, recruitment of events). Meet with TO A ED Di r e c t o r six times per year. Va i l Le a d e r s h i p In s t i t u t e Bu s i n e s s Ba s e Ca m p op e r a t i o n in Av o n , bu s i n e s s re c r u i t m e n t th r o u g h sc h o l a r s h i p pr o g r a m $ 12 , 5 0 0 $ 54 , 9 0 0 $ 17 , 5 0 0 45 . 6 no Ye s $7 , 5 0 0 for co n t i n u e d support of Base Camp operations with trade in sc h o l a r s h i p s fo r TO A employee leadership development within ex i s t i n g VL I pr o g r a m s , $10,000 for general scholarships to attract bu s i n e s s e s to Av o n with the stipulation that the businesses re c e i v i n g sc h o l a r s h i p s are mutually agreed upon between the TOA and VL I . Va i l Le a d e r s h i p In s t i t u t e Re n t su bsi dy to bri n g In v e s t m e n t Fu n d (1 . 2 mi l l i o n ) A t t r a c t i o n to Av o n wi t h a fo c u s on ou t d o o r te c h ba s e d co mpa ni es $ 10 , 0 0 0 $ 10 , 0 0 0 se e co m m e n t s No Ye s Ac q u i s i t i o n of 1. 2 M in v e s t m e n t fund intended to invest in and ac c e l e r a t e ou t d o o r tech based companies. 10K subsidy contingent up o n fu l l de v e l o p m e n t of a proposal with all other fundraising se c u r e d . Av o n ' s fu n d i n g should be the last commitment. Subsidy fo r of f i c e sp a c e in Av o n . EG E Ai r Al l i a n c e Re g i o n a l Ai r Se r v i c e $ 30 , 0 0 0 $ 30 , 0 0 0 $ 10 , 0 0 0 37 . 4 No No 20 1 5 fu n d i n g co n t i n g e n t upon TOA receiving 2015 Study as a de l i v e r a b l e fo r 20 1 4 funding. Committee recommends funding at 10 K le v e l to al l o w EG E Air Alliance to find alternative funding sources to ma k e ad d e d air se r v i c e (Houston ‐ Eagle Vail or other added ro u t e ) su s t a i n a b l e . $ 57 , 5 0 0 $ 11 9 , 9 0 0 $ 47 , 5 0 0 SU B ‐TO T A L : EC O N O M I C DE V E L O P M E N T ‐ RE G I O N A L PR O G R A M S Us e of Fu n d s : Re g i o n a l Ec o n o m i c De v e l o p m e n t Pl a n Im p l e m e n t a t i o n . Bu s i n e s s re c r u i t m e n t an d re t e n t i o n , an d sp e c i a l ev e n t pr o m o t i o n . Us e of Fu n d s : Bu s i n e s s re c r u i t m e n t an d re t e n t i o n Us e of Fu n d s : Se e d fu n d s fo r at t r a c t i o n of ad d i t i o n a l fu n d s Us e of Fu n d s : Bu s i n e s s re c r u i t m e n t EC O N O M I C DE V E L O P M E N T : RE G I O N A L PR O G R A M S Pa g e 1 of 5 Pa g e 2 of 5 Ex h i b i t 1 20 1 4 ‐15 Co m m u n i t y / S p e c i a l Ev e n t Fu n d i n g : Re q u e s t s an d Re c o m m e n d a t i o n s En t i t y Pr o g r a m / E v e n t Budget 2014 Requested 2015 Recommendat ion 2015 Total Poin ts Mu nirevs Tracked 2014 Funding Rep or ting Com plete ? Note: Recipients have unti l Decem be r 31, 2014 to meet th e requi re ments of their 2014 fu ndi ng agree ment. 20 1 5 Proposed Funding Notes Wa l k i n g Mo u n t a i n s Su s t a i n a b l e Fi l m Se r i e s Su s t a i n a b l e Co m m u n i t y Fi l m Se r i e s $ 1, 5 0 0 $ 7, 5 0 0 $ 7, 5 0 0 47 . 8 No Ye s Wi l d & Sc e n i c Fi l m Se r i e s Ra d i a t e Li v e R e d s , Wh i t e , & Br e w s $ 15 , 0 0 0 $ 17 , 5 0 0 $ 10 , 0 0 0 55 . 2 Ye s Ye s Re c o m m e n d $6 , 0 0 0 cash and $4,000 in kind support for 10K total. Ev e n t wi l l be mo v i n g to a new weekend. Be a v e r Cr e e k R o d e o $ 2, 5 0 0 $ 5, 0 0 0 $ 5, 0 0 0 48 No No Co n t i n u e d su p p o r t of this annual event is recommended Vi l a r Pe r f o r m i n g Ar t s Ce n t e r Vi l a r pr o g r a m m i n g $ ‐ $ 35 , 0 0 0 $ 5, 0 0 0 30 . 6 No N/ A Re c o m m e n d se t t i n g aside $5,000 for future opportunity in Avon. Wo r k to fi n d mu t u a l l y beneficial opportunities, application not sp e c i f i c . Pr o g r a m m i n g should be directed to Avon. Al p i n e Ar t s Ce n t e r S o c i a l Ar t Se r i e s $ ‐ $ 36 , 0 0 0 $ 14 , 4 0 0 45 . 6 No N/ A Fu n di ng for So c ial Ar t Series, Option 2 presented. Funding co n t i n g e n t up o n AA C finding location in Avon for winter series, lo c a t e su m m e r se r i e s on pedestrian mall in summer. Payment 1/2 up fr o n t , 1/ 2 af t e r su c c e s s f u l completion of winter series. No in kind re c o m m e n d e d . Re c o m m e n d e d additional consideration up to $5 , 6 0 0 to he l p se c u r e location and rental of equipment. $ 19 , 0 0 0 $ 10 1 , 0 0 0 $ 41 , 9 0 0 Us e of Fu n d s : Po s s i b l e un d e r w r i t i n g of a pe r f o r m a n c e se r i e s SU B ‐TO T A L : EC O N O M I C DE V E L O P M E N T : SP E C I A L EV E N T S IN AV O N ‐ MU S I C & FI L M & AR T EC O N O M I C DE V E L O P M E N T : OU T S I D E PR O D U C E R S : SP E C I A L EV E N T S IN AV O N ‐ MU S I C & FI L M & ART Us e of Fu n d s : Ma n a g e m e n t , fi l m pr o c u r e m e n t , sc r e e n i n g co s t s , ma r k e t i n g & ma t e r i a l s . Us e of Fu n d s : Ro d e o ev e n t ‐ 7 hi g h su m m e r Th u r s d a y ni g h t s Us e of Fu n d s : Po s s i b l e un d e r w r i t i n g of a pe r f o r m a n c e se r i e s Us e of Fu n d s : Ge n e r a l op e r a t i o n s an d ma r k e t i n g of th e ev e n t in c l u d i n g Av o n na m e re c o g n i t i o n Pa g e 2 of 5 Pa g e 3 of 5 Ex h i b i t 1 20 1 4 ‐15 Co m m u n i t y / S p e c i a l Ev e n t Fu n d i n g : Re q u e s t s an d Re c o m m e n d a t i o n s En t i t y Pr o g r a m / E v e n t Budget 2014 Requested 2015 Recommendat ion 2015 Total Poin ts Mu nirevs Tracked 2014 Funding Rep or ting Com plete ? Note: Recipients have unti l Decem be r 31, 2014 to meet th e requi re ments of their 2014 fu ndi ng agree ment. 20 1 5 Proposed Funding Notes Va i l Va l l e y Ch a r i t a b l e Fu n d Be c Tr i Tr i a t h l o n $ 2, 5 0 0 $ 3, 0 0 0 $ 3, 0 0 0 38 Ye s Ye s Co n t i n u e d su p p o r t of this annual sporting event is recommended Te a m Ev e r g r e e n T r i p l e By p a s s Bi k e Ri d e $ 2, 5 0 0 $ 5, 5 0 0 $ 5, 5 0 0 39 . 6 Ye s No Co n t i n u e d su p p o r t of this annual sporting event is recommended $3 0 0 0 ca s h , $2 , 5 0 0 in kind for 5K total Be a v e r Cr e e k X T E R R A $ 2, 5 0 0 $ 2, 5 0 0 $ 2, 5 0 0 36 . 8 Ye s No Co n t i n u e d su p p o r t of this annual sporting event is recommended Am e r i c a Cu p Ju n i o r s Fl y Fi s h i n g Ch a m p i o n s h i p $ 5, 0 0 0 $ 5, 0 0 0 30 . 6 Ye s N/ A Re c o m m e n d e d th a t funding is contingent upon the event being he l d in Av o n at No t t i n g h a m Lake (if enough fish) or the Eagle River. Va i l Va l l e y So c c e r Cl u b In ki n d re q u e s t on l y ‐ us e of fi e l d $ 1, 2 4 0 $ 1, 2 4 0 30 . 6 No N/ A In ki n d us e of th e H. A . Nottingham soccer field and limited other in ki n d se r v i c e s is re c o m m e n d e d . BM H S Su p e r Bo o s t e r s Re q u e s t fo r ad v e r t i s i n g su pp or t $ 1, 5 0 0 $ ‐ 25 . 4 No N/ A No t Av o n sp e c i f i c , co m m i t t e e does not feel the request meets the goa l s of th e st r a t e gic plan. Va i l Va l l e y Fo u n d a t i o n FI S Me n ' s Bi r d s of Pr e y $ 40 , 0 0 0 $ 50 , 0 0 0 $4 0 , 0 0 0 se e co m m e n t s Ye s No Fu n d i n g co n t i n g e n t upon Avon receiving specific benefits and rig h t s as a sp o n s o r , including other agreed activations (e.g. banners in Av o n . ) $ 47 , 5 0 0 $ 68 , 7 4 0 $ 57 , 2 4 0 EC O N O M I C DE V E L O P M E N T : OU T S I D E PR O D U C E R S : SP E C I A L EV E N T S IN AV O N ‐ SP O R T S Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s Us e of Fu n d s : Ge n e r a l op e r a t i o n s an d ma r k e t i n g of th e ev e n t Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s ‐ ra c e st a r t i n g po i n t Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s SU B ‐TO T A L : EC O N O M I C DE V E L O P M E N T : SP E C I A L EV E N T S IN AV O N ‐ SP O R T S Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s fo r lo c a l co m m u n i t y Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s ‐ ge n e r a t e s ov e r n i g h t ac c o m m o d a t i o n st a y s Us e of Fu n d s : Ge n e r a l ev e n t op e r a t i o n s Pa g e 3 of 5 Pa g e 4 of 5 Ex h i b i t 1 20 1 4 ‐15 Co m m u n i t y / S p e c i a l Ev e n t Fu n d i n g : Re q u e s t s an d Re c o m m e n d a t i o n s En t i t y Pr o g r a m / E v e n t Budget 2014 Requested 2015 Recommendat ion 2015 Total Poin ts Mu nirevs Tracked 2014 Funding Rep or ting Com plete ? Note: Recipients have unti l Decem be r 31, 2014 to meet th e requi re ments of their 2014 fu ndi ng agree ment. 20 1 5 Proposed Funding Notes Wa l k i n g Mo u n t a i n s Sc i e n c e Sc h o o l Pr o g r a m s $ 17 , 5 0 0 $ 30 , 0 0 0 $ 15 , 0 0 0 47 . 8 No Ye s Co n t i n u e d su p p o r t of the educational series is recommended Ea g l e Ri v e r Wa t e r s h e d Co u n c i l Co m m u n i t y Pr o g r a m m i n g $ 28 , 0 0 0 39 . 4 No No Co n t i n u e d su p p o r t at 15K‐ 20K level though water fund is re c o m m e n d e d . $ 17 , 5 0 0 $ 58 , 0 0 0 $ 15 , 0 0 0 Us e of Fu n d s : ge n e r a l or g a n i z a t i o n a l su p p o r t , Ea g l e Ri v e r Cl e a n u p ev e n t , W a t e r Qu a l i t y Mo n i t o r i n g & As s e s s m e n t Pr o g r a m an d Ur b a n Ru n o f f Pr o g r a m SU B ‐TO T A L : RE G I O N A L EN V I R O N M E N T A L Us e of Fu n d s : Op e r a t i n g ex p e n s e s fo r K‐12 fi e l d st u d i e s , in t e r p r e t i v e pr o g r a m s & hi k e s RE G I O N A L EN V I R O N M E N T A L PR O G R A M S Pa g e 4 of 5 Pa g e 5 of 5 Ex h i b i t 1 20 1 4 ‐15 Co m m u n i t y / S p e c i a l Ev e n t Fu n d i n g : Re q u e s t s an d Re c o m m e n d a t i o n s En t i t y Pr o g r a m / E v e n t Budget 2014 Requested 2015 Recommendat ion 2015 Total Poin ts Mu nirevs Tracked 2014 Funding Rep or ting Com plete ? Note: Recipients have unti l Decem be r 31, 2014 to meet th e requi re ments of their 2014 fu ndi ng agree ment. 20 1 5 Proposed Funding Notes Ea g l e Ri v e r Yo u t h Co a l i t i o n Pa r e n t Ed u c a t i o n an d Ou t r e a c h $ 2, 0 0 0 $ 4, 0 0 0 $ 4, 0 0 0 35 . 6 No Ye s Co u n t y wi d e pr o g r a m ‐ this funding would directly benefit Avon El e m e n t a r y st u d e n t s . Committee noted that ERYC is not reaching ou t to ot h e r mu n i c i pal funders. Yo u t h Fo u n d a t i o n Pw r H r s ' af t e r s c h o o l & Su m m e r Pr o gra m $ ‐ $ 10 , 0 0 0 0 No N/ A Ad d i t i o n a l in f o r m a t i o n received on 10/15 ‐ will review prior to Oc t o b e r 22 n d me e t i n g. Re d Ri b b o n H I V / A I D S aw a r e n e s s $ 75 0 $ 75 0 $ 75 0 29 . 4 No Ye s Re c o m m e n d fu n d i n g ‐ program focuses on Avon Elementary pro gra m m i n g. Ea r l y Ch i l d h o o d Pa r t n e r s Co a c h i n g & Co n s u l t a t i o n $ 1, 0 0 0 $ 3, 6 0 0 $ ‐ 28 . 2 No Ye s Co m m i t t e e do e s no t recommend funding social services without a sp e c i f i c ou t r e a c h in Avon (Avon specific) Sm a l l Ch a m p i o n s Re c r e a t i o n a l Pr o g r a m s fo r Yo u t h wi t h Dis a b i l i t i e s $ 5, 6 0 0 $ ‐ 23 . 4 No No Pr o g r a m re q u e s t fo r two participants. Committee does not feel the re q u e s t me e t s th e goals of the strategic plan. Ed u c a t i o n Fo u n d a t i o n of Ea g l e Co u n t y St r a t e g i c in i t i a t i v e s an d pr o g r a m s fo r qu a l i t y ed u c a t i o n in Ea g l e Co u n t y $ 39 , 7 0 0 $ 20 , 4 0 0 33 . 6 No No Co m m i t t e e re c o m m e n d s an in kind donation of 1 office space at an es t i m a t e d ye a r l y va l u e of $20,400. CAM fees estimated at $5.00 per SQ . FT . no t in c l u d e d in donation (requestor pays) Sa l v a t i o n Ar m y Co m m u n i t y Ga r d e n In i t i a t i v e s & pro gra m s $ 20 , 0 0 0 $ ‐ 29 . 2 No No Co m m i t t e e do e s no t feel the request meets the goals of the st r a t e gic pla n . $ 83 , 6 5 0 $ 25 , 1 5 0 $ 43 1 , 2 9 0 $ 18 6 , 7 9 0 SU B ‐TO T A L : HE A L T H & HU M A N SE R V I C E S Us e of Fu n d s : St a f f In s t r u c t o r co m p e n s a t i o n (h o u r l y ra t e & mi l e a g e ) Us e of Fu n d s : Pr o g r a m m i n g an d of f i c e sp a c e Us e of Fu n d s : Ge t Ou t an d Gr o w Av o n Se r i e s ‐ Ed u c a t o r s su p p o r t an d ma t e r i a l s su p p o r t HE A L T H & HU M A N SE R V I C E S Us e of Fu n d s : Fa m i l y Le a d e r s h i p Tr a i n i n g In s t i t u t e Us e of Fu n d s : Sp o n s o r tw o ch i l d r e n fo r pr o g r a m TO T A L 20 1 5 FU N D I N G RE Q U E S T S & RE C O M M E N D A T I O N Us e of Fu n d s : In c r e a s e d ma r k e t i n g ef f o r t s to su p p o r t pa r e n t ed u c a t i o n & ou t r e a c h in i t i a t i v e s Us e of Fu n d s : To su p p o r t pr o g r a m m i n g he l d at Av o n El e m e n t a r y wi t h Av o n na m e re c o g n i t i o n . Pa g e 5 of 5 SPONSORSHIP GRANT PROPOSAL PRESENTED TO TOWN OF AVON Attn: Susan Fairweather Director of Economic Initiatives Town of Avon P.O. Box 975, Avon, CO 81620 2015 FIS ALPINE BIRDS OF PREY MEN’S SKI WORLD CUP Presented by: 1. Contact Information: Name of organization & mailing address, Contact person, telephone number, email address a. Vail Valley Foundation PO Box 309, Vail, CO 81658 b. Contact: Mike Imhof, SVP, Sales & Operations 970.777.2015 mimhof@vvf.org 2. Description & Purpose of the organization. a. The Vail Valley Foundation is a non‐profit IRS 501 (c)(3) corporation. Our Mission is to enhance and sustain the quality of life in Eagle County through leadership and excellence in Arts, Education and Athletics. Enhancing Lives. Enriching Community. 3. Description of the event or program and explanation of funding needs. Vail Valley Foundation is requesting financial support for the Birds of Prey event. Birds of Prey is an annual International Alpine Ski Racing World Cup held on Beaver Creek Mountain where over twenty (20) countries showcase their top athletes going head to head in Alpine disciplines; Downhill, Super G and GS to name a few. Birds of Prey is widely recognized and arguably the most technically demanding racecourse in the world. a. Facts and Figures: i. On‐site Audience Reach: 22,000+ over 3 days ii. Affluent – Avg. HHI of $175k, 20% HHI $250k + iii. 60/40 Male/Female Gender Split, Lead Active Lives, Median Age: 35 iv. Majority Of On Site Audience & NBC Viewership Originates From Top 30 US DMAs v. Domestic TV ‐ 2 Hours NBC Coverage + 2 hours Programming on NBC Sports Net plus 4 hours live coverage on Universal Sports. Multiple Re‐Airs during the 2015‐2015 winter seasons. International TV – 75 Million Households In Prime Time; over 100 million viewers worldwide vi. General Media – Twelve (12) nations broadcast the races live. Six (6) nations delay broadcast the races, fourteen (14) nations will do a magazine broadcast and seven (7) nations provide news feed. vii. VVF (organizer) and our business partner USSA will each provide robust local, in state (Front Range) and national print, radio and web based marketing campaigns promoting the event. viii. Vibrant, energized environment throughout entire community for two solid weeks for men’s and ladies races. ix. Approximately 3 million public relations impressions in local, regional, national and international media outlets. x. Approximately 2,000 digital impressions in the Enthuse Audi Birds of Prey Mobile app. xi. 207 accredited members of the national and international media representing 100 different media outlets including: Associated Press, Denver Post, New York Times, Outside Magazine, Ski Magazine, Reuters, CBS, NBC, and ABC. 4. Amount of funds requested from the Town of Avon. a. Vail Valley Foundation respectfully requests $50,000 in financial support from the Town of Avon for the Men’s FIS Alpine Ski World Cup in December of 2015. 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed). a. The Vail Foundation will secure corporate sponsorship funding, in addition to the Town of Avon grant request, from Domestic and International Corporations through sponsorship investment, Local (Eagle County) Businesses and Corporations for community and special contributor sponsorship investment, United States Ski & Snowboard Association, Vail Resorts, Town of Vail, Beaver Creek Resort and The Beaver Creek Resort Company. Across all the above listed entities (including Town Of Avon), we are seeking approximately $2.8 million in cash and in‐kind support. The Town of Avon request of $50,000 is less than 1% of the total 2015 World Cup expense budget. 6. Anticipated budget for the organization or event. a. Total Revenues ‐ $2,948,421 b. Total Expenses ‐ $2,780,855 c. Net Contribution ‐ $167,565 7. How the event or organization benefits the Avon community, please provide details. a. In addition to the value described in Section 3 above, Town of Avon shall receive: i. Tangible value through increased retail sales. ii. Increased lodging bookings surrounding dates of event. iii. Increased restaurant and bar business. iv. Increased visibility of Avon through general traffic flow in, around and through Avon. v. VIP credentials for Town of Avon Council and or Staff to attend the Event. vi. VIP Gift Bags for Town of Avon Council vii. Increased tax revenues. 8. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town. a. Town of Avon recognition in Vail Valley Foundation Audi Birds of Prey Digital Program –2,864 downloads/views. b. Town of Avon recognition in all official event creative and signage. c. Town of Avon Recognition in all Audi Birds of Prey print advertising: 3,046,000 impressions. d. Town of Avon logo inclusion and recognition in all Vail Valley Foundation press releases, marketing, advertising and promotional endeavors specific to Birds of Prey including but not limited to: local, state and regional, print, radio, web and where appropriate, PA mentions during the athletic events and on local TV. e. Along with the larger Vail Valley (Eagle County) Community, Avon will receive exposure and value through the domestic and international media channels who will be broadcasting not only the core highlights of the athletic events but vignettes and general bios on our larger community. f. Town of Avon shall be listed on the partner page for the Audi Birds of Prey and Vail Valley Foundation website. 9. The Town may request a progress report on the event or organization prior to its implementation and final report once the event is completed. a. The Vail Valley Foundation shall be available to The Town of Avon at any time to answer any questions, provide further information and investment justification. The Vail Valley Foundation shall provide the Town of Avon a detailed Stakeholder report post event (within 45 days of event completion) covering all aspects of the media value and economic benefit of the event. 10. Include a description of any "in‐kind" contributions and related cost that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. Vail Valley Foundation requests the following “in‐kind” contributions for Birds of Prey 2015: a. Town of Avon Bus support to begin approximately on December 1 and conclude on December 15, 2015. 1. Alpine Arts Center: PO Box 2280, Edwards CO 81632 Contact: Lauren Merrill 970-‐926-‐2732 lauren@alpineartscenter.org 2. Alpine Arts Center fosters the appreciation, practice, and enjoyment of the visual arts throughout Eagle County and beyond. Programs are offered to attract emerging and established artists of all ages, from local residents to out of town guests. These offerings include a broad spectrum of art classes, workshops, exhibits, guest artist presentations, public events, team building activities, corporate retreats, and outreach programs. Alpine Arts Center provides a cultural experience that unifies the community and attracts people to live and vacation in Eagle County. Alpine Arts Center is a for-profit business. If a non-profit fiscal sponsor is required we can also apply under the umbrella of Eagle River Youth Coalition. 3. In conjunction with The Town of Avon’s plans for redesigning Nottingham Park/Main Street to create a cultural outlet in the heart of the Vail Valley, we are requesting Avon Community Funding to support two new art programs that would take place within the Town of Avon’s new art hub. Below is a description of programs that would be run by Alpine Arts Center for Avon community members, businesses, and visitors to enjoy. • Town of Avon Social Art Series: Alpine Arts Center would host monthly events in the Town of Avon based on the popular “Cocktails & Canvas” style painting classes. Up to 40 participants would be led by an instructor through a local landscape painting of Avon scenery, and they would leave with a finished masterpiece and a souvenir of their Avon experience. Monthly events could be geared towards different groups, some targeting families/kids, some aimed at corporate groups, and some intended for adult nightlife entertainment. During the summer months, these could take place on the stage at Nottingham Park and be called Art in the Park and during the winter months they could occur in any indoor facility such as Avon Recreation Center or the Seasons Building and be referred to as Cookies & Canvas or Cupcakes & Canvas for family friendly events, or Cocktails & Canvas for adults in any venue with a liquor license. If approved, Alpine Arts Center would organize 1 event per month, which would be subsidized or partially subsidized by the Town of Avon for the community. • Town of Avon Team Building Rotating Art Display: The Town of Avon or staff at Alpine Arts Center would select a different “Avon team” of about 20 people every month to come to Alpine Arts Center for a subsidized team building art activity. Teams would consist of local Avon businesses, local restaurants, schools, community organizations, town employees, etc. Each month, the selected team would be led through a group art activity such as creating a clay tile mosaic, a group mural painting, a stained glass painting, etc., which would then be featured as a temporary art exhibit in the Town of Avon for the month (per town approval). A special project could also be selected for a team building activity to display during the 2015 World Championship. This team building program would unify the community through art and also provide the town with a beautiful rotating art display in a location of choice, such as Nottingham Park. 4. Funding for these programs is requested to introduce them at discounted or free rates to the community. Once established a few years down the road, these programs could run without being subsidized by the town (except for in kind facility donations). Funding could be organized as follows: • Town of Avon Social Art Series: January through December 2015 o Option 1: Fully subsidized by the Town of Avon, 1 event monthly for up to 40 people: $2,000 monthly from January 2015 through December 2015, or $24,000 total up front if preferred. o Option 2: Partially subsidized by the Town of Avon, 1 event monthly for up to 40 people; Participants would pay $20 to register and the Town of Avon would subsidize the remainder of the event: $1,200 monthly from January 2015 through December 2015, or $14,400 total up front if preferred. • Town of Avon Team Building & Rotating Art Display: $1000 monthly from January 2015 through December 2015, or $12,000 total up front if preferred. This pricing includes all art supplies and instruction. Finished artwork will be delivered to the Town of Avon for installation. 5. No other funds are being requested from other organizations; these programs have been specifically designed for the Town of Avon and this funding request is exclusive. 6. Anticipated line item budgets • Town of Avon Social Art Series Budget o Painting Materials (canvas, acrylic paints, brushes, art smocks, easels, palettes, tarps, paper towels, water cups): $800 per event x 12 = $9,600 o Instructor & Travel/Setup fees: $550 per event x 12 = $6,600 o Alpine Arts Center Event Expense: $650 per event x 12 = $7,800 o Total Expense: $2,000 per event x 12 = $24,000 • Town of Avon Team Building Rotating Art Display Budget o Art Materials (average expense for project): $400 per event x 12 = $4,800 o Instructor & Project Planning fees: $400 per event x 12 = $4,800 o Alpine Arts Space Rental/Event Expense: $200 per event x 12 = $2,400 o Total Expense: $1000 per event x 12 = $12,000 7. See bottom of application for Alpine Arts Center 2013 final profit and loss statement. 8. These events benefit the Town of Avon because they bring culture and entertainment to the heart of the valley. The proposed art events and art displays make Avon a culturally richer place to live. By providing a creative outlet to locals and tourists, Avon will benefit by enhancing the overall quality of life provided to the community, thus making it a place locals want to stay and a place tourists want to continually visit. By providing non-athletic and cultural offerings, Avon will become a more diverse and attractive resort community. 9. Marketing for these programs will be handled by Alpine Arts Center through email blasts to over 3,000 customers, press releases written to The Vail Daily, information posted on Alpine Arts Center’s website, Facebook promotions, and event information posted on websites such as What To Do Magazine and Parents Handbook. With all marketing efforts, the Town of Avon will be recognized as the exclusive sponsor. 10. In-‐kind contributions required to make these events possible are as follows: • For Social Art Series Events: Use of facilities (such as Nottingham Park Stage or indoor facilities), as well as folding tables/folding chairs for 40 painters. Also a special event liquor license permit could be considered for select events, as well as subsidized childcare at Avon Rec. Center (both optional). • For Team Building Art Displays: Avon personnel to assist with hanging monthly art displays 11. Alpine Arts Center did not apply for any funds from the Town of Avon in 2014. We are excited about this new possible partnership and are willing to adjust this proposal to fit with the Town of Avon’s best interests and programming needs. 7. Profit/Loss 2013 Photos below approved by Susan Fairweather. This is a sample of a Cocktails & Canvas group event. This is an example of a group teambuilding mural created by Vail Resorts staff. For the Town of Avon, projects would be larger and in various mediums. Alpine Arts CenterProﬁt and Loss Standard 08/20/14January through December 2013 Jan - Dec '13Ordinary Income/Expense Income Perkville Discount -70.00 Liquor Sale 4,455.12 Teen Summer Camps 3,777.01 Teen Events 25.00 Teen Classes 140.00Special Event 41,779.12Private Lessons 7,842.99Parties13,790.16Drop-In Activities 8,822.37Children's Workshops/Events 16,975.94Children's Summer Camps 65,191.61Children's Classes 17,395.93Adult Workshops/Events 603.33 Adult Classes 10,316.19 Jewelry, Pottery, Knitting, etc 3,985.89 Art Store Materials 1,345.61 Paint Pottery 10,109.12 Art Gallery Sales 2,761.00 Cash Over/Short 0.00Total Income 209,246.39Cost of Goods SoldLiquor 2,492.82Paint Pottery Supplies 1,946.27Food Expense 727.98Ceramics Supplies 1,126.43Birthday Parties Supplies 326.94Subcontracted Services 4,596.30 Tools and Craft Supplies 11,675.75 Total COGS 22,892.49 Gross Proﬁt 186,353.90 Expense Cash Rebate -218.28 Shareholder Health Insurance 2,765.00Operating Supplies 868.97Merchant Account Fees 4,870.88Fundraiser Expense 3,895.33Gift Expense 325.00Membership Dues 50.00Gallery Commissions Expense 3,938.15Advertising and Promotion 6,685.55Automobile Expense 5,152.80 Bank Service Charges 218.28 Licenses and Permits 626.00 Charitable Contributions 393.00 Computer and Internet Expenses 1,939.48 Depreciation Expense 3,818.00 Insurance Expense 2,213.00Interest Expense 0.00Janitorial Expense 3,336.92Meals and Entertainment 719.14Office Supplies 1,203.74Payroll Expenses 46,786.26Postage and Delivery 121.46Professional Fees 1,855.00Rent Expense 42,400.40 Repairs and Maintenance 3,655.23 Telephone Expense 2,855.89 Utilities 1,745.23 Total Expense 142,220.43 Net Ordinary Income 44,133.47 Other Income/ExpenseOther IncomeOther Income 482.15Sales Tax Vendor Fee 23.90Total Other Income 506.05Other ExpenseAsk My Accountant 0.00Total Other Expense 0.00Net Other Income 506.05 Net Income 44,639.52 2015 Town of Avon Community Funding Request 2015 Beaver Creek Rodeo Series at Traer Creek 1) Contact information: - Organization: Beaver Creek Resort Company – 2015 Beaver Creek Rodeo Series - Contact: Anna Robinson - Phone: (970) 845-5974 - Email: Arobinson1@vailresorts.com - Mailing Address: PO Box 5390, Avon, CO 81620 2) Description & Purpose of the Organization: The Beaver Creek Resort Company of Colorado combines a homeowners’ association and a resort association with some municipal services added. The Resort Company, a Colorado non-profit corporation, incorporated on April 30, 1979, was designed to help Beaver Creek become and remain a unique resort community. By virtue of its Articles of Incorporation, the Resort Company is vested with a wide range of responsibilities and authority. It was created to perform certain functions and to manage certain property for the common benefit of property owners and businesses within Beaver Creek. Today, these functions include: Marketing, Special Events, Central Reservations, Transportation, Municipal Services and Community Quality. 3) Event Description: The Annual Beaver Creek Rodeo Series offers fun and excitement for the entire family with classic events like Mutton Bustin’, Team Roping, and Bull Riding. Pony rides, face painting and more are free for the kids; and Mom and Dad can enjoy an authentic Western food from high country restaurants. The ski town rodeo is one of Colorado’s lingering connections with the Old West and keeps the Western spirit alive. For guests and residents alike, the rodeo is a celebration of the cowboy life and skill. For Beaver Creek, the Thursday night rodeo series started in 1994 at Berry Creek Ranch just east of Edwards, CO. As the popularity of the event grew, the Beaver Creek Rodeo was moved to the Traer Creek rodeo grounds in 2004. For seven Thursdays every summer, the Beaver Creek Rodeo at Traer Creek entertains around 2000 guests a night. Families from all over the region, nation and the world attend the Beaver Creek Rodeo at Traer Creek and enjoy a boot-stompin’ good time! Beaver Creek is requesting community funding to offset a portion of the operating costs required to produce the Rodeo Series. Some of these costs include, but are not limited to: marketing and collateral, contracting of key entities (i.e. - stock contractor), maintenance of the rodeo grounds, facility rentals (i.e. – bleachers, restrooms, etc). The Rodeo relies on sponsorship and community funding in order to produce an event in which the expenses are justified by the return on investment for the resort & community as a whole. 4) Funding Request: $5000, payment is needed by June 1st. 5) Other Funding: Approximately $38,000 from various sponsors (Westin, Coors, Steadman Clinic, Slifer, Smith & Frampton, East West Resorts, Alpine Bank, Big Horn Toyota, etc) 6) Anticipated FY15 Budget: See Exhibit A 7) 2013 Final P&L: See Exhibit B 8) Benefits to Avon: • The Beaver Creek Rodeo reaches approximately 12,000 - 14,000 guests per year o In 2013, 46% of those attendees came to Avon specifically for the Rodeo (approximately 5,980 guests) o The 5,980 visitors who came specifically for the Rodeo spent approximately $744,000 on lodging, dining, retail and activities in Avon (average of $125/person) o 20% of Rodeo guests stay in Avon, for an average of 5.5 nights o 67% of Rodeo guests are out of state, 22% are local, 8% are in-state and 3% are international. o (Source – 2013 Rodeo Survey conducted by independent 3rd party company) • The Rodeo showcases several Avon restaurants and businesses (Fiesta Jalisco, Eagle River Pizza, the Westin Riverfront Resort & Spa, East West Resorts, Slifer, Smith & Frampton, Alpine Bank, Sage Outdoor Adventures, Castle Peak Grille, etc) • As a popular Signature Event, the Rodeo garners media mentions from such high profile outlets as: Forbes, Departures, FoxNews.com, US News & World Report and more. 9) Marketing Efforts: • 2 ads per week in the Vail Daily • 1 ad per week in the Vail Daily Weekly • Posters are distributed to businesses from Vail to Glenwood Springs • Radio Ads run every day during peak commute times (Ski Country & Zephyr) • Radio spots & promotions on the Front Range (Alice 105.9/KOSI 101) • Billboard on Westbound I-70 at Dumont • Front Range Print – Westword Summer Guide, 5280 Traveler Magazine • Emails to all Epic Pass Holders • Signage at the Eagle Airport baggage carousel and in Vail Parking Garage • Featured event on BeaverCreek.com Rodeo marketing efforts benefit the Town of Avon by reminding guests that the fun doesn’t stop at Vail! By catching guests no matter how they’re arriving to the Valley (I-70 or the airport), the Rodeo advertising encourages guests to research other ways to eat, stay and play in Avon. 10) In Kind Contributions: At this time there are no in-kind opportunities for the Town of Avon, as it does not own the land used for the event. 11) FY14 Progress Report: • The Beaver Creek Rodeo’s performance each season is highly dependent on the weather, and one year’s results are not necessarily indicative of future results. • Final financials are not yet available for FY14, but with favorable weather for 6 of 7 events, the FY14 Rodeo is expected to meet or exceed current revenue projections. • Over the course of the 2014 season, the rodeo saw over 13,000 guests – up from 11,500 in 2013 and one of the best-attended seasons on record. EVENTS PROGRAM BUDGET Budget FY 15 Notes REVENUES Sales & Sponsorship 246,850 Includes tickets, bar sales, activity & vendor fees & sponsorships Total 246,850 COST OF SALES Beverage 17,500 Retail Total 17,500 EXPENSES Arena Staff 55,000 Support Staff 13,500 Entertainment 39,000 Transportation 5,500 Licenses/Permits/Insurance 1,000 Site & Facilities 88,000 Safety 3,000 Collateral 18,000 Signs & Banners 8,000 Marketing 21,500 Sponsor Activations 7,500 Capital Projects 6,000 Miscellaneous 8,000 Total 274,000 EVENT SUMMARY Revenue: Event Revenue 246,850 Cost of Sales: Event Cost of Sales 17,500 Expenses: Arena Staff 55,000 Support Staff 13,500 Entertainment 39,000 Transportation 5,500 Licenses/Permits/Insurance 1,000 Site & Facilities 88,000 Safety 3,000 Collateral 18,000 Signs & Banners 8,000 Marketing 21,500 Sponsor Activations 7,500 Capital Projects 6,000 Miscellaneous 8,000 274,000 Net Income/(Loss)(44,650) FY 2015 RODEO SERIES EXHIBIT A EVENTS PROGRAM BUDGET (Income - Costs) REVENUES Actual Forecast Notes Sales & Sponsorship $228,470.00 ***One event cancelled due to weather! Total $228,470.00 EXPENSES Actual Forecast Notes COST OF SALES $14,971.00 RODEO ARENA STAFF $46,838.00 RODEO SUPPORT STAFF $13,263.00 RODEO ENTERTAINMENT $34,755.00 TRANSPORTATION $5,500.00 LICENSES/PERMITS/INSURANCE $5,595.00 SITE & FACILITIES $85,346.00 SAFETY $2,475.00 COLLATERAL $14,536.00 SIGNS & BANNERS $5,759.00 MARKETING $16,500.00 Surveys, Local & Front Range/National Marketing SPONSOR ACTIVATIONS $7,176.00 MISCELLANEOUS $3,632.00 EVENT PRODUCTION $241,375.00 Revenue: Event Revenue $228,470.00 Expenses: Event Production $241,375.00 Cost of Sales $14,971.00 Net Income/(Loss)-$27,876.00 2013 Rodeo Series P&L EXHIBIT B - FINAL 9.26.13 Town of Avon Community 2015 Funding Request for BMHS Super Boosters 1. BMHS Super Boosters, 151 Miller Ranch Road, Edwards, CO 81632 —Jodi Teague, (970) 376- 0817, jochteague@msn.com 2. The BMHS Super Boosters is a 501c3 run by a volunteer board that helps provide funding for Battle Mountain High School athletics in the form of uniforms, scholarships to sports specific camps and other general needs. 3. We are requesting funds for our uniform program. Every team is on a four year rotation for new uniforms and BMHS Super Boosters supply 100% of this funding through the Sponsorship Program. 4. We are requesting that the Town of Avon continue being a Gold Sponsor in the amount of $1,500. Funds would be needed no later than August 15, 2015. 5. We anticipate other governmental agencies, parents and for-profit companies to support BMHS Super Boosters for the balance. 6. Our anticipated line item budget for uniforms is between $25,000 and $30,000 every year. 7. Our fiscal year end is 5/31. See attached. 8. BMHS Super Boosters benefits the Avon community in many different ways. There are many Avon families that attend Battle Mountain High School and participate in one or more sports. We find that keeping high school aged kids involved in sports and activities is beneficial to the community at large. For example, when the boys' soccer team won the state championship the sense of community was greatly increased. 9. As a gold sponsor, Town of Avon is given two outside banners and one inside banner (in the gym), an ad in our program and recognition at all home games. We are also working on getting a calendar put together for each season to hand out at home games and post at various businesses around the Valley. 10. Town of Avon helps our BMHS community at large — including allowing BMHS Project Graduation to be held at the Rec Center for a minimal cost. Respectfully submitted, biThiS 56 *2- DEPARTMENT OF THE TREASURY Employer Identification Number: 20-5603050 DLN: 17053096323000 Contact Person: RENEE RAILEY NORTON ID# 31172 Contact Telephone Number: (877) 829-5500 Accounting Period Ending: May 31 Public Charity Status: 509(a)(2) Form 990 Required: Yes Effective Date of Exemption: September 21, 2006 Contribution Deductibility: Yes Addendum Applies: No INTERNAL REVENUE SERVICE P. 0. BOX 2508 CINCINNATI, OH 45201 Date: JUN 1 1 1010 BATTLE MOUNTAIN HIGH SCHOOL SUPER BOOSTERS INC 0151 MILLER RANCH RD EDWARDS, CO 81632 Dear Applicant: We are pleased to inform you that upon review of your application for tax exempt status we have determined that you are exempt from Federal income tax under section 501(c)(3) of the Internal Revenue Code. Contributions to you are deductible under section 170 of the Code. You are also qualified to receive tax deductible bequests, devises, transfers or gifts under section 2055, 2106 or 2522 of the Code. Because this letter could help resolve any questions regarding your exempt status, you should keep it in your permanent records. Organizations exempt under section 501(c)(3) of the Code are further classified as either public charities or private foundations. We determined that you are a public charity under the Code section(s) listed in the heading of this letter. Please see enclosed Publication 4221-PC, Compliance Guide for 501(c)(3) Public Charities, for some helpful information about your responsibilities as an exempt organization. Letter 947 (DO/CG) BATTLE MOUNTAIN HIGH SCHOOL SUPER -2- Sincerely, Robert Choi Director, Exempt Organizations Rulings and Agreements Enclosure: Publication 4221-PC Letter 947 (DO/CG) BMHS Superboosters Profit & Loss June 2013 through May 2014 Jun '13 - May 14 Ordinary Income/Expense Income Speed Camp Fees 800.00 Fund Raiser Income Haunted House Event 2,500.00 Snowflake Ball Revenues 24,154.00 Total Fund Raiser Income 26,654.00 Ad Sales 28,228.00 Other Income Uniform Sponsorship 1,000.00 Sports Pass Income 3,475.00 Sponsor - Family 600.00 Concessions Income 8,082.50 Product sales 1,058.00 Other Income - Other 250.00 Total Other Income 14,465.50 Team 74,951.25 Total Income 145,098.75 Cost of Goods Sold Merchandise 2,260.70 Total COGS 2,260.70 Gross Profit 142,838.05 Expense Ice Machine -30.00 Positive Coaching Alliance 1,800.00 Speed Camp Expense 3,000.00 Hudl Software 1,600.00 Postage 54.00 Lightning/Weather Subscription 1,271.84 Team Expense 33,822.63 Fundraising Expense Snowflake Ball Expenses 10,525.53 Fundraising Expense - Other 926.16 Total Fundraising Expense 11,451.69 FBLA Other Expenses 12,920.34 FBLA Fees 975.00 Commission on Ad Sales 5,340.60 Photography 4,940.00 Printing -50.00 Spirit Wear 7,228.54 Accounting 2,320.00 Page 1 2:17 PM 08/22/14 Accrual Basis BMHS Superboosters Profit & Loss June 2013 through May 2014 Jun '13 - May 14 Advertising 800.09 Bank Charge 776.88 Banners 2,025.00 Banquet 3,916.91 Camps 10,010.65 Concessions -1,884.06 Equipment 403,28 Licenses and Permits 8.00 Meals 3,702.41 Supplies 1,278.29 Training 141.75 Training Supplies 34.91 Travel/Lodging Lodging 1,386.00 Total Travel/Lodging 1,386.00 Trophies and Plaques 1,291.50 Uniforms 24,336.88 Total Expense 134,873.13 Net Ordinary Income 7,964.92 Other Income/Expense Other Income Interest Inc 35.10 Total Other Income 35,10 Other Expense Scholarship Award 3,006.10 Total Other Expense 3,006.10 Net Other Income -2,971.00 Net Income 4,993.92 Page 2 August 12, 2014 Avon Town Council P.O. Box 975 Avon, CO 81620 Dear Mayor Carroll and Avon Town Council members, The Eagle River Watershed Council (ERWC) would like to thank the Town of Avon for its generous support of our organization in the past. This support has been critical in continuing our mission-driven work to protect the Eagle River. In supporting the work of ERWC, the Avon community, including its residents, visitors and businesses, see direct benefit, as ERWC advocates for the health and conservation of the Eagle River, which is a primary economic driver in the town- and beyond. Without exaggeration, ERWC’s work protects the water our residents and visitors drink from and play in. In 2015, ERWC respectfully requests $28,000 from the Town of Avon. This request includes: $4,000 for general organizational support, $1,000 for the Eagle River Cleanup event, $13,000 for the Water Quality Monitoring & Assessment Program and $10,000 for the Urban Runoff Program. Details on each of these are provided in the attached funding request. Thank you for your consideration of ERWC’s request. We look forward to a continued partnership with the Town of Avon in sustaining and improving the health of the Eagle River watershed through research, education and projects, which aligns with and supports the strategic plan of the Town of Avon. Sincerely, Holly Loff Executive Director Board of Directors Pete Denise, President Gary Brooks, Vice President Rob Sperberg, Treasurer/Secretary Chip Bair Bill Carlson Greg Espegren Kim Gortz Cliff Simonton Brian Tracy Emeritus Board Members Dr. Thomas Steinberg, Chair Kathy R. Chandler-Henry Josiah (Joe) Macy Susan Pollack Arlene S. Quenon Executive Director Holly Loff Water Quality Seth Kurt-Mason Education & Outreach Kate Burchenal Projects & Events Doug Serrill ERWC advocates for the health and conservation of the Upper Colorado and Eagle River basins through research, education, and projects. PO Box 5740, Eagle, CO 81631 330 Broadway St, Unit D, Eagle info@erwc.org ● www.erwc.org 970-827-5406 2015 Town of Avon Community Funding Request 1. Contact Information Name of Organization: Eagle River Watershed Council Tax I.D #: 20-4448864 Mailing Address: P.O. Box 5740, Eagle, CO 81631 Contact Person: Holly Loff, Executive Director Phone: (970) 827-5406 Email: loff@erwc.org 2. Description and purpose of the organization: The Eagle River Watershed Council, a nonprofit 501c3 organization (IRS determination letter is attached), has a mission to advocate for the health and conservation of the Upper Colorado and Eagle basins through research, education and projects. Eagle River Watershed Council (ERWC) provides a forum in which everyone can participate and gain a greater understanding of the Upper Colorado and Eagle River watersheds. Our vision is to protect and enhance the high quality, natural, scenic and economic values that our rivers and tributaries provide our citizens, visitors and wildlife population. 3. Description of the event or program and explanation of funding needs: General Support ($4,000). General operating funds allow the ERWC board and staff to allocate funds for new projects and allows us the flexibility to shift funds quickly as issues arise. Also, this support allows ERWC to collaborate on numerous projects where our input is vital but where we are not the lead organizer, for example, the drafting of the master plan for the Camp Hale- Eagle River Headwaters Restoration Project, and the drafting of the Colorado Basin Implementation Plan for the Colorado Water Plan. Both will have large impacts on water quality and use in our valley and it is critical that ERWC participate. The Town of Avon is joined in its support of ERWC by private foundations, the Town of Vail, Eagle River Water and Sanitation District (ERWSD), Upper Eagle Regional Water Authority (UERWA), local businesses, and individuals. Eagle River Clean Up ($1,000). Over 350 volunteers participate in the Eagle River Cleanup annually. The volunteers clean approximately 70 miles of river in our valley every fall. The popular event builds community, giving participants a feeling of ownership in maintaining our beautiful landscape. The Cleanup readies and beautifies the valley for the upcoming ski season and removes trash from our rivers. Funding supports event coordination and expenses. ERWC uses the event as a fundraising opportunity and receives sponsorship support from Eagle County, the Towns of Vail, Gypsum, Minturn and Eagle, Vail Resorts, and numerous local businesses and foundations. Water Quality Monitoring & Assessment Program (WQMAP) ($13,000). This program was created in recognition that multiple parties were collecting data along the rivers and streams in Eagle County. The collection of data had overlaps, as well as gaps, and no central entity was analyzing, holding or providing access to the data. Therefore, ERWC established WQMAP which coordinates water quality data collection from these diverse entities in the Eagle River Watershed. The program has led to the identification of water quality threats as they emerge, allowing stakeholders to get in front of the issue. Funding supports program coordination, data analysis, reporting, data storage, and annual development of the Water Quality Report Card, which gives a snapshot of the rivers’ health by segment. Additional support comes from ERWSD, UERWA, Homestake Partners, Vail Resorts, Battle Mountain, the Towns of Gypsum, Eagle, Avon, Minturn and Vail, and the Colorado River Water Conservation District. Middle Eagle River Water Quality Improvement Plan (WQIP) ($10,000). The Middle Eagle River WQIP addresses concerns of area stakeholders relating to biological health and water quality in the Eagle River between Gore Creek and Squaw Creek. The goal of this effort is to investigate potential sources of current water quality and aquatic life degradation, and provide information for decision- making processes aimed at remediating existing impacts and preventing future degradation. This effort is built upon the following objectives: Eagle River Watershed Council 2015 Town of Avon Community Funding Request Page 2 • Evaluate the appropriateness of existing stormwater regulations, ordinances, policies and programs implemented by land use authorities across Eagle County, • Prioritize geographic areas by likely stormwater impacts to the river based on the potential for existing land uses to generate point or non-point source pollutants, • Delineate the aerial extent of observed vs. potential riparian areas and characterize the current condition of vegetation in those areas, and • Assess the feasibility of and develop a prioritization scheme for stormwater infrastructure and riparian improvements. Work to meet the objectives listed above began in early 2014 and will progress through the end of 2015. Funding is pending from Town of Vail, ERWSD, Colorado Department of Transportation, Town of Eagle, Eagle County, and Vail Resorts. 4. Amount of funds requested from Town of Avon: Funding needed by: Funds requested: General support No specific date in 2015 $4,000 Eagle River Clean Up August 1, 2015 $1,000 Water Quality Monitoring & Assessment Program No specific date in 2015 $13,000 Eagle River Water Quality Improvement Plan No specific date in 2015 $10,000 TOTAL REQUEST: $28,000 5. Amount of funds requested/provided from other funding entities: (funding of $10,000 or more) Colorado Water Conservation Board $ 70,000 Eagle County (pending) $ 80,000 Town of Vail (pending) $ 62,000 ERWSD $ 50,000 UERWA $ 50,000 The Forrest C. and Frances H. Lattner Foundation $ 45,000 Vail Resorts Echo (pending) $ 24,000 Town of Gypsum (pending) $ 15,000 Town of Eagle (pending) $ 13,000 National Forest Foundation $ 12,350 El Pomar Foundation $ 10,000 Edwards Metro District (pending) $ 10,000 Eagle River Foundation $ 10,000 6. Anticipated budget for the organization: The 2015 budget has not yet been drafted and approved for the organization. The 2014 approved organizational budget is attached. 7. 2013 final actual Profit & Loss Statement: Please see attached 8. Direct benefits to the Avon community from the efforts of the Eagle River Watershed Council: The health of the Eagle River as it travels through Avon is important to the town’s full time residents as well as to the seasonal homeowners and visitors to town. Our recreation-based economy relies upon excellent water quality and quantity. Many different land uses in the towns throughout Eagle County impact water issues. Consider the following examples in Avon: • the Westin Riverfront is situated on the Eagle River creating an area of heavy river access • ERWSD has a plant located in Avon where effluent is added to the river • Beaver Creek Ski Resort utilizes local waters to make snow Eagle River Watershed Council 2015 Town of Avon Community Funding Request Page 3 • locally-based commercial fly fishing & rafting operations utilize the river daily during their seasons • hundreds of lodging units dot the Eagle River’s banks where people consistently access the river • large impermeable surfaces are found in commercial parking lots with water draining into the river when it rains and the snow melts, often carrying chemicals and debris from those lots with it ERWC works to ensure that problems that could impact or come from such land uses are observed and monitored, and a plan created to deal with such problems which promotes river health. ERWC monitors the river before it flows into Avon to make sure traction sand from I-70, as well as zinc and other metals from the Eagle Mine, do not cause an adverse effect on Avon’s waters. In addition to broaching these serious topics, ERWC also reminds the community that our rivers are fun- we encourage people to access them and enjoy them. And remind them of how to do that responsibly. 9. Marketing efforts which benefit Avon: As appropriate, collateral for WQMAP and Eagle River WQIP will recognize the Town of Avon. As a River Cleanup sponsor, the Town of Avon will be thanked and promoted through posters, newspaper ads, press releases, radio campaign, TV8, eblasts to our list of over 1,300 area contacts, social media, the ERWC website, emails to our cleanup teams and on the 350 volunteer tshirts. The Town of Avon will be recognized from the stage and with your banner at the Thank You BBQ. 10. In kind contributions the Town of Avon provides: ERWC often uses the Avon Public Library for public meetings such as Watershed Wednesday and the Black Gore Creek Steering Committee. Avon businesses and residents enthusiastically volunteer twice a year to support our annual Community Pride Highway Cleanup and the Eagle River Cleanup. 11. Progress reports / final report on 2014 funding: Thanks to the funding from the Town of Avon ERWC accomplished the following in 2014: • General Operating Support ($4,000). ERWC established a regular monthly column in the Vail Daily on varying water topics pertinent to the Eagle Valley. Our River Guide Education Program, new in 2013, saw great expansion in 2014, reaching 85 guides through 5 presentations to raft, fishing, SUP and kayak guides with details they can use to educate their clients while out on the river. Additionally, ERWC collaborated on the Camp Hale-Eagle River Headwaters Restoration Project planning process as well as the Colorado Basin Implementation Plan for the Colorado Water Plan. The general operating support from the Town of Avon made all of this (and more) possible. • Eagle River Cleanup ($1,000). The 20th Annual Eagle River Cleanup is planned for September 13th, 2014. It is projected to have similar participation to recent years- typically over 350 volunteers clean approximately 70 miles of streams in our valley, including the Eagle River. • Water Quality Monitoring & Assessment Program ($13,000). In 2014, the first Water Quality Report Card was released, which compiles three years of data into a format that is accessible and understandable to the general public. The report card will be updated annually. • Urban Runoff Group support ($10,000). The Urban Runoff Group is identifying the appropriate scope for WQIP expansion and the components of the Gore Creek WQIP that could/should be repeated elsewhere in the watershed, and reviewing local existing and model stormwater ordinances, policies, regulations and outreach programs. This work will continue throughout the rest of 2014. Attachments: 1. IRS 501c3 determination letter 2. 2014 approved budget 3. 2013 final actual profit & loss statement Eagle River Watershed Council 2015 Town of Avon Community Funding Request Page 4 4:31 PM 08/20/14 Accrual Basis Eagle River Watershed Council, Inc. Profit & Loss Budget Overview January through December 2014 Page 1 of 3 Jan - Dec 14 Ordinary Income/Expense Income 4000 · INDIVIDUALS 4010 · Directors' Fund 5,000.00 4030 · CO Gives Day 7,500.00 4040 · Individual-other 2,500.00 Total 4000 · INDIVIDUALS 15,000.00 4100 · BUSINESS 4120 · Roundup for Rivers 5,000.00 4140 · Grants - Corporate 10,000.00 4160 · Donations - Business 15,000.00 Total 4100 · BUSINESS 30,000.00 4200 · GOVERNMENT 4230 · Grants - County 25,000.00 4240 · Grants - Municipal 16,000.00 4250 · Other 50,000.00 Total 4200 · GOVERNMENT 91,000.00 4300 · FOUNDATION 4310 · Grants - Foundation 40,000.00 Total 4300 · FOUNDATION 40,000.00 4400 · EVENTS 4410 · Riverfest 24,000.00 4420 · ERCU 30,000.00 4430 · CPHCU 27,000.00 Total 4400 · EVENTS 81,000.00 4700 · RESTRICTED PROJECT FUNDS 4710 · URG/WQIP 10,000.00 4720 · CRRCP 105,000.00 4730 · NFF 4732 · Red Dirt II 6,992.00 Total 4730 · NFF 6,992.00 4740 · WQMAP 144,500.00 4750 · Education/Outreach 30,000.00 4760 · Black Gore S.C.14,000.00 4765 · Gore Creek Restoration Project 24,000.00 4770 · Edwards Restoration Project 15,000.00 Total 4700 · RESTRICTED PROJECT FUNDS 349,492.00 4:31 PM 08/20/14 Accrual Basis Eagle River Watershed Council, Inc. Profit & Loss Budget Overview January through December 2014 Page 2 of 3 Jan - Dec 14 4900 · OTHER 4910 · Interest Income 300.00 4920 · Assoc. & Organizations 3,000.00 Total 4900 · OTHER 3,300.00 Total Income 609,792.00 Gross Profit 609,792.00 Expense 6000 · Salaries 6001 · Executive Director 77,000.00 6002 · Education/Outreach Coordinator 36,000.00 6004 · Administrative Assistant 30,000.00 Total 6000 · Salaries 143,000.00 6050 · Payroll Taxes and Benefits 6052 · Retirement-Co Match 4,290.00 6054 · Social Security/Medicare 11,440.00 6056 · Health Insurance 10,800.00 6060 · HSA - Staff Benefits 4,500.00 6064 · Wellness Benefit 1,947.00 6070 · Workers Compensation 750.00 Total 6050 · Payroll Taxes and Benefits 33,727.00 6100 · QuickBook Payroll Expenses 650.00 6105 · Accounting 5,000.00 6106 · Auditing 6,500.00 6110 · Dues/Fees/Subscriptions 900.00 6130 · Office Rent 16,800.00 6132 · Moving Expenses 5,000.00 6135 · Telephone 3,000.00 6140 · Office Supplies 2,000.00 6145 · Bank Charges 125.00 6150 · Copier/Printing 4,500.00 6155 · Postage 300.00 6160 · Information Technology 5,000.00 6170 · Professional Development 4,500.00 6175 · Mileage & Travel 6,000.00 6180 · Insurance 2,200.00 6185 · Meeting/Food/Beverage 3,200.00 6190 · General Marketing/Paid Adv.1,000.00 6200 · Miscellaneous Expense 200.00 4:31 PM 08/20/14 Accrual Basis Eagle River Watershed Council, Inc. Profit & Loss Budget Overview January through December 2014 Page 3 of 3 Jan - Dec 14 6300 · Development/Fundraising 6310 · Grants 200.00 6320 · Annual Mailing 2,000.00 6330 · Donor Recognition 1,000.00 6340 · CO Gives Day 200.00 6350 · Database 4,610.00 6390 · Miscellaneous 500.00 Total 6300 · Development/Fundraising 8,510.00 6400 · Project Expenses 6410 · WQMAP 121,420.00 6420 · WQIP/URG 10,000.00 6430 · CRRCP 90,000.00 6440 · Education & Outreach 6,500.00 6450 · ERP 15,000.00 6460 · USFS Projects 6468 · Red Dirt II 6,992.00 Total 6460 · USFS Projects 6,992.00 6470 · Black Gore S.C.14,000.00 Total 6400 · Project Expenses 263,912.00 6500 · Event Expenses 6510 · CPHCU 13,000.00 6520 · ERCU 9,000.00 6530 · Riverfest 12,000.00 Total 6500 · Event Expenses 34,000.00 Total Expense 550,024.00 Net Ordinary Income 59,768.00 Net Income 59,768.00 Jan - Dec 13 Ordinary Income/ExpenseIncome 4000 · INDIVIDUALS 4010 · Directors' Fund 4,411.30 4020 · Annual Appeal 3,590.00 4030 · CO Gives Day 5,895.814040 · Individual-other 1,773.97 Total 4000 · INDIVIDUALS 15,671.08 4100 · BUSINESS 4160 · Donations - Business 11,983.00 Total 4100 · BUSINESS 11,983.00 4200 · GOVERNMENT4230 · Grants - County 80,000.00 4240 · Grants - Municipal4242 · Town of Vail 39,600.00 4246 · Other Municipalities 27,150.00 Total 4240 · Grants - Municipal 66,750.00 4250 · Other 25,000.00 Total 4200 · GOVERNMENT 171,750.00 4300 · FOUNDATION4310 · Grants - Foundation 25,164.00 Total 4300 · FOUNDATION 25,164.00 4400 · EVENTS 4410 · Riverfest 22,305.00 Total 4400 · EVENTS 22,305.00 4700 · RESTRICTED PROJECT FUNDS 4720 · CRRCP 77,927.24 4730 · NFF 44,438.25 4740 · WQMAP UERWA 25,000.004740 · WQMAP - Other 106,500.00 Total 4740 · WQMAP 131,500.00 4770 · Edwards Restoration Project 4774 · Edwards Metro District 6,500.00 Total 4770 · Edwards Restoration Project 6,500.00 4700 · RESTRICTED PROJECT FUNDS - Other 10,000.00 Total 4700 · RESTRICTED PROJECT FUNDS 270,365.49 4900 · OTHER 4910 · Interest Income 332.95 4920 · Assoc. & Organizations 1,804.86 Total 4900 · OTHER 2,137.81 Total Income 519,376.38 Gross Profit 519,376.38 Expense6000 · Salaries 6001 · Executive Director 100,980.67 6002 · Education/Outreach Coordinator 28,045.46 Total 6000 · Salaries 129,026.13 11:58 AM Eagle River Watershed Council, Inc. 06/24/14 Profit & Loss Accrual Basis January through December 2013 Page 1 Jan - Dec 13 6050 · Payroll Taxes and BenefitsFUTA 0.00 6052 · Retirement-Co Match 3,414.22 6054 · Social Security/Medicare 10,250.63 6056 · Health Insurance 5,890.16 6057 · Health Ins - paid as taxbl wage 1,886.546060 · HSA - Staff Benefits 312.48 6061 · HSA - paid as taxable wages 1,784.58 6064 · Wellness Benefit 1,298.00 6070 · Workers Compensation 665.00 Total 6050 · Payroll Taxes and Benefits 25,501.61 6100 · QuickBook Payroll Expenses 586.14 6105 · Accounting 4,673.15 6106 · Auditing 6,500.00 6110 · Dues/Fees/Subscriptions 1,183.006130 · Office Rent 15,275.00 6135 · Telephone 2,952.33 6140 · Office Supplies 758.23 6145 · Bank Charges 159.88 6150 · Copier/Printing 3,624.776155 · Postage 603.81 6160 · Information Technology 1,275.816170 · Professional Development 1,863.86 6175 · Mileage & Travel 2,324.68 6180 · Insurance 1,445.006185 · Meeting/Food/Beverage 1,366.08 6190 · General Marketing/Paid Adv.1,074.726200 · Miscellaneous Expense 304.94 6300 · Development/Fundraising 6320 · Annual Mailing 239.776330 · Donor Recognition 96.46 Total 6300 · Development/Fundraising 336.23 6400 · Project Expenses 6410 · WQMAP6411 · Consultant 6,131.25 6412 · USGS 43,540.00 6414 · Aquatics Biomonitoring 26,045.00 Water Quality Consultant 55,132.66 6410 · WQMAP - Other 3,885.52 Total 6410 · WQMAP 134,734.43 6413 · 3610 Policy/Planning Consultant 13,863.49 6430 · CRRCP 83,862.53 6450 · ERP 612.766460 · USFS Projects 6465 · Camp Hale 17,946.60 Red Dirt 47,447.27 Total 6460 · USFS Projects 65,393.87 6470 · Black Gore S.C.4,000.00 6499 · VISTA 3,250.00 6400 · Project Expenses - Other 388.68 Total 6400 · Project Expenses 306,105.76 6500 · Event Expenses 16,232.27 Total Expense 523,173.40 Net Ordinary Income -3,797.02 Other Income/Expense Other Income 9010 · Volunteer Time 5,921.10 Total Other Income 5,921.10 11:58 AM Eagle River Watershed Council, Inc. 06/24/14 Profit & Loss Accrual Basis January through December 2013 Page 2 Jan - Dec 13 Other Expense9510 · Volunteer Time.5,921.10 Total Other Expense 5,921.10 Net Other Income 0.00 Net Income -3,797.02 11:58 AM Eagle River Watershed Council, Inc. 06/24/14 Profit & Loss Accrual Basis January through December 2013 Page 3 Page 1 of 3 2014 Town of Avon Funding Request Eagle River Youth Coalition 1. Contact Information: Name of organization & mailing address, contact person, telephone number, email address. The Eagle River Youth Coalition P.O Box 4613, Edwards, CO 81632 Michelle Stecher, mstecher@eagleyouth.org, 970-949-9250 2. Description & Purpose of the Organization The Eagle River Youth Coalition (ERYC) was founded in 2001 with a vision of providing cohesion among youth service providers. Since its inception, ERYC has taken a leadership role in assessing local youth behaviors and perceptions, evaluating service gaps, and mobilizing the community to address priority youth needs. ERYC collects and disseminates critical data that benefits the community in a multitude of ways, and utilizes conversations as a springboard to ensure youth needs are met, gaps are addressed, and coordination is occurring. By working together with diverse service providers, the community can more effectively and efficiently assess and meet the changing needs of youth and mobilize the community for positive change. ERYC has expanded its organizational focus to offer a variety of prevention programming based on identified gaps. Through strong partnerships with local, state, and federal governments as well as youth program providers, ERYC provides youth leadership opportunities, substance use prevention and parent education efforts throughout the Eagle River Valley. Through these efforts, ERYC is able to support fostering a healthy and supportive community that makes youth a priority, increases their self-sufficiency and enables them to reach their full potential. 3. Detailed description of the event or program and explanation of funding needs. ERYC is kindly requesting funds from the Town of Avon to support parent and community education efforts, and in-school substance use prevention programs. ERYC offers services to parents that are interactive, educational and a basis for skill building. ERYC also coordinates in-school substance use prevention programs. Additionally, ERYC builds community capacity around prevention by offering training to community members with a focus on youth development and nonprofit development. ERYC has been successful in the past year in reaching 300 parents through the various forums and educational outlets, including at least 40 parents residing in the Town of Avon, and is eager to surpass this number in 2014-2015. The free bilingual Dinner & Dialogue series offered by ERYC includes live Spanish interpretation, on-site childcare and dinner. The series develops parenting skills and helps parents become aware of critical areas of concern with local youth behaviors, perceptions and attitudes. ERYC’s parent efforts are directly linked to priorities of the local community. Additionally, ERYC has been facilitating the more intensive evidence-based Active Parenting of Teen series since 2012, which offers a comprehensive approach to address issues such as substance use and abuse, communication, discipline and misbehavior, as well as reinforcing positive parenting skills. This program is offered on a sliding scale fee basis to remove financial barriers. With additional funding, ERYC aims to support scholarship opportunities for Avon parents who wish to participate in the program. Forums held by ERYC and collaborating partners engage the community in an informal, educational setting to create and encourage open dialogue about the issues perceived by the community as youth- specific concerns. These forums are also designed to address those perceptions by providing community members and parents with factual information from local professionals. Highlighting this effort, ERYC hosted a training on August 20th for 20 attendees at the Avon Public Library titled: Social Norms & Preventing Youth Marijuana Use. Attendees learned valuable skills to keep our community safe and prevent negative youth behaviors. ERYC hosts trainings throughout the year, many in Avon, that bring community partners together as well as professionals from surrounding counties. The format of these Page 2 of 3 2014 Town of Avon Funding Request Eagle River Youth Coalition trainings and education forums engages community members that are eager to learn more around a specific topic. ERYC utilizes the community voice to determine what needs are most urgent and works with trainers throughout the community and state to offer professional presentations. In-school prevention education is a large focus of ERYC. At Avon Elementary, ERYC collaborates with Avon Police Department to host activities during Red Ribbon Week that encourage students to interact with police officers, pursue positive decisions and commit to staying drug-free. The Project Towards No Drug Abuse (TND) is an evidence-based curriculum that reaches over 150 local youth annually through health classes at two high schools, including Battle Mountain High School, and is offered through 12 highly interactive sessions to prevent adolescent substance use and impaired driving. TND is designed to help students develop self-control and communication skills, acquire resources that help them resist drug use, improve decision making strategies, and develop the motivation to not use drugs or drive impaired. Project Alert is a recognized evidence-based prevention curriculum for middle school youth. Beginning prevention education in middle school provides youth with the tools and knowledge to prevent risky behaviors through high school. The eleven session curriculum has been proven to lower alcohol misuse by an average of 24% and decrease current marijuana use by 60%, per nationwide middle school participants. ERYC aims to increase impact in the coming school year by offering Project Alert to 100 students at two local middle schools (Homestake Peak and Berry Creek Middle Schools). 4. Amount of funds requested from the Town of Avon. Please include when funds are needed for payment. The Eagle River Youth Coalition would like to request support from the Town of Avon in the amount of $4,000 to support 2014-2015 youth education, parent education, and community trainings and outreach initiatives. With funds requested from the Town of Avon, the Eagle River Youth Coalition intends to expand programs for additional opportunities to Avon community members who wish to participate. ERYC aims to educate 225 Avon youth, 15-20 Avon parents through Active Parenting of Teens series, and 60 Avon community members through trainings and forums held throughout the school year. ERYC operates on a fiscal cycle from January 1-December 31. Fund disbursement would be acceptable on an annual basis, a bi-annual basis or a quarterly basis. 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed).  Drug Free Communities (SAMSHA- reimbursable) - $31,700 (committed)  Community Block Grant (CO Office of Behavioral Health- reimbursable) - $29,900 (committed)  Vail Valley Cares - $2,000 (committed)  Wells Fargo Bank - $2,000 (pending)  Town of Avon - $4,000 (pending)  Town of Gypsum - $2,000 (pending) 6. Anticipated line item budget for the organization or event. (See Attached Annual Operating Budget and Education Efforts Annual Budget) The Eagle River Youth Coalition strives to adhere to a fiscally responsible operating budget. The current operating budget for the 2014 fiscal cycle is $288,025. The total operating budget for all requested programs is $71,600. The budget categories are: Personnel, Evaluation, Materials and Supplies, Marketing, Food, Misc. Supplies and Travel. Page 3 of 3 2014 Town of Avon Funding Request Eagle River Youth Coalition 7. 2013 final actual profit and loss statement. (Please see attachment) 8. How the event or organization benefits the Avon community? Please provide details. ERYC’s youth, parent, and community education efforts benefit the overall Avon community because these efforts teach valuable skills and knowledge that help youth understand positive behaviors, decision-making, and provides them with the appropriate community and familial support to thrive. Having healthy and safe families and youth benefits the overall community because it reduces problem behaviors that result in challenging community outcomes. As Avon Chief of Police Robert Ticer explains, “As a community leader, I was proud to see young girls and boys committing to positive decision making and healthy lifestyle choices through the inaugural AES Red Ribbon Week prevention program. Young, energetic residents will grow up to become positive, contributing citizens.” 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town Currently ERYC markets parent programs through the ERYC website, two local radio stations, the Vail Daily newspaper, TV8 interviews, press releases, social media, newsletters and event posters throughout the community. ERYC’s efforts have included youth-specific and community-wide media and marketing campaigns highlighting factual information about issues pertaining to youth, special events partnerships, and collaborative efforts with the Avon Police Department and other local agencies. ERYC would recognize the Town of Avon through previously mentioned media outlets when promoting its community education efforts. Additionally, ERYC engages a number of different Avon businesses and community members for the implementation of its programs including, but not limited to, the Avon Police Department, Avon Elementary School, the Avon Recreation Center, Avon restaurants and various youth-serving organizations based out of Avon, Colorado. 10. Include a description of any ʺin‐kindʺ contributions and related cost that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. Robert Ticer of the Avon Police Department currently serves on the Eagle River Youth Coalition’s Board of Directors. In total, Chief Ticer donates $2,000 worth of volunteer time to ERYC annually. Additionally, the Avon Recreation Center has contributed in-kind donations for ERYC’s annual fundraiser, Valley Tastings: Food for Youth. Six, 5-punch cards were donated in the past three years, valued at $324. 11. If a recipient of funds from the Town of Avon in fiscal year 2014, a progress or final report on the funded activity, program and/or event. ERYC was awarded $2,000 in fiscal year 2014 by Town of Avon for parent education programs, which were highly successful in serving over 300 parents. Town of Avon residents made up 20% of the D& D participants, and 15% of Active Parenting of Teen participants. In the Dinner & Dialogues (D&D) series, 100% of parents reported increased knowledge on the topic presented and 95% could identify local resources related to the topic. In the Active Parenting of Teen series, 94% of parents were very likely to use the skills gained in the program with their families. In addition, ERYC strives to offer this education and outreach to low-income families who represented 38% of total attendees of who received financial assistance. One parent powerfully shared: “I would like to see Active Parenting of Teens offered more often because many parents benefit. The information is excellent. Like my 21 year old daughter now says – ‘if only you were attending these classes when I was 13 years old, you could have been able to understand the depression that I had and you could have helped me.’ This was very powerful for me. For this reason, I give thanks to the program and the people who have taken the time to prepare us.” Eagle River Youth Coalition, Inc. Profit & Loss Budget vs. Actual January through December 2013 Jan - Dec 13 Budget $ Over Budget % of Budget 2014 Ordinary Income/Expense Income 4000 · Grants/Foundations 4110.12 · Youth Leadership Council 0.00 5,000.00 -5,000.00 0.0% 4000 · Grants/Foundations - Other 16,015.49 15,000.00 1,015.49 106.77%20000 Total 4000 · Grants/Foundations 16,015.49 20,000.00 -3,984.51 80.08%20000 4001 · Fees for Services 1,435.00 1,500.00 -65.00 95.67%1500 4100 · Individual Donations 4,377.05 4,500.00 -122.95 97.27%4500 4110 · Restricted Grant Income 4110.15 · Drug Free Communities (DFC)134,635.89 131,000.00 3,635.89 102.78%125000 4110.3 · CO DBH (ADAD)108,811.30 100,000.00 8,811.30 108.81%95000 Total 4110 · Restricted Grant Income 243,447.19 231,000.00 12,447.19 105.39%220,000.00 4200 · Corporate/Business Donations 6,375.00 2,500.00 3,875.00 255.0%6000 4250 · Organization Memberships 7,755.00 7,000.00 755.00 110.79%7500 4300 · Special Events Sponsors 6,250.00 4,750.00 1,500.00 131.58%6500 4300 · Special Events - Other 19,264.51 13,750.00 5,514.51 140.11%22000 Total 4300 · Special Events 25,514.51 18,500.00 7,014.51 137.92%28500 4480 · Other/Project Reimbursement 500.00 0 4500 · Interest Income 27.51 10.00 17.51 275.1%25 Total Income 305,446.75 285,010.00 20,436.75 107.17%288,025.00 Expense Contract Labor 4,400.00 2,400.00 2,000.00 183.33%$7,400.00 5000 · Salaries 134,619.47 140,000.00 -5,380.53 96.16%$142,500.00 5100 · Workers Comp & Payroll Tax 9,533.94 11,310.00 -1,776.06 84.3%$11,300.00 5200 · Benefits 17,092.57 12,200.00 4,892.57 140.1%$15,000.00 5300 · Rent 20,213.25 22,800.00 -2,586.75 88.66%$22,800.00 5700 · Telephone 1,588.43 2,000.00 -411.57 79.42%$1,550.00 5800 · Professional Fees 2,641.75 2,500.00 141.75 105.67%$2,500.00 6100 · Dues and Subscriptions 465.00 500.00 -35.00 93.0%$500.00 6150 · Office Expense 339.13 $0.00 6500 · Insurance 2,434.00 2,300.00 134.00 105.83%$2,750.00 6800 · General Project Expense 6800.15 · Drug Free Communities Exp (DFC)52,371.98 62,000.00 -9,628.02 84.47%$55,000.00 6800.3 · Co-DBH (ADAD)21,086.34 23,000.00 -1,913.66 91.68%$21,000.00 Total 6800 · General Project Expense 73,458.32 85,000.00 -11,541.68 86.42%$76,000.00 6900 · Special Event Expense 4,937.47 4,000.00 937.47 123.44%$5,500.00 7000 · Miscellaneous 223.44 Page 1 of 2 January through December 2013 Jan - Dec 13 Budget $ Over Budget % of Budget 2014 Total Expense 271,946.77 285,010.00 -13,063.23 95.42%$287,800.00 Net Ordinary Income 33,499.98 0.00 33,499.98 100.0%225.00 Other Income/Expense Other Income Inkind Donations 52,542.02 22,000.00 30,542.02 238.83%50000 Total Other Income 52,542.02 22,000.00 30,542.02 238.83%50000 Other Expense In kind Expense 52,542.02 22,000.00 30,542.02 238.83%50000 Total Other Expense 52,542.02 22,000.00 30,542.02 238.83%50000 Net Other Income 0.00 0.00 0.00 0.0% Net Income 33,499.98 0.00 33,499.98 100.0% Page 2 of 2 ERYC Parenting Efforts, In-School Curriculum & Community Training Budget Fall 2014-Spring 2015 Parenting Efforts Project Towards No Drug Abuse Project Alert Training Personnel (Oversight and facilitation)22,400 16,500 12500 4500 Evaluation 200 2000 1000 250 Materials and Supplies 1750 2250 500 200 Marketing 2100 ------------250 Food 3150 ------------200 Other (Misc Supplies, Travel)400 750 500 200 TOTAL 30,000 21,500 14,500 5,600 TOTAL EDUCATION EFFORTS 71,600 Education Foundation of Eagle County 1. Education Foundation of Eagle County (EFEC) - PO Box 18533, Avon, CO 81620, Julie Norberg, 801.870.0891, Julien@efec.org 2. The Public Education Foundation, a nonprofit 501(c)3 organization established in 2001, now the Education Foundation of Eagle County (EFEC), has worked in partnership with Eagle County Schools to fund strategic initiatives and programs for quality education in Eagle County. The purpose of the Education Foundation of Eagle County is to make specific and targeted recommendations to, and to work in conjunction with the Eagle County School District in order to retain our most qualified teachers, preserve staffing levels, maintain smaller class sizes, conserve and improve one on one teacher-student ratios, and to protect vital programs and curricula that have been or are in danger of being reduced or eliminated. EFEC’s top priority is to maintain an excellent learning experience for students in the Town of Avon and Eagle County. 3. EFEC is asking for a cash and in kind donation to EFEC, the cash would support two of EFEC’s annual events, Project Funway and Summer School of Rock; and our in-kind request is for office space in Avon. EFEC has always maintained it’s post office box and primary physical address in Avon. - Project Funway is an event based on the smash TV hit, “Project Runway,” a show where inspiring designers are challenged to create their finest work. For Efec’s Project Funway the designers are all local amateurs and the challenge is to raise money and the point is to have fun. Project Funway supports the general fund of EFEC. EFEC’s general fund supports the following programs, Equity Grant Funding, Directed Giving, Distinguished Teacher Scholarship Awards, Bots for Boys, Back to School, Evening of Stars, and direct support of Eagle County School District (ECSD) teachers and programs. Please note, last year through EFEC's Directed Giving program, a program that raises funds for additional staff in ECSD schools and contributes to our Equity Grant Fund, we raised and gave $16,000 to ECSD, however received $49,000 in grant requests leaving $33,000 that we could not fund. Also, since 2004 EFEC has awarded scholarships to 40 Eagle County teachers to participate in Masters Degree programs, intensive summer language immersion programs, and furthering their education. Public K-12 teachers in Eagle County Schools can apply with the requirement that they agree to remain in an Eagle County Schools teaching position for a minimum of three years following the completion of studies. Each of these programs is funded from Project Funway directly impacting our educators and students. - Summer School of Rock Day Camp & Benefit Concert is the Education Foundation of Eagle County’s musical day camp for children ages 7-13. Every day, each camper participates in three hours of musical instruction. At the end of the camp, they showcase their melodic accomplishments with a concert. Additional activities each day include yoga, musical meditation, hula hooping, art, and face painting. 4. EFEC is requesting $17,500 in monetary funding and in-kind services. Project Funway is scheduled for May 2, 2015 at the Westin Riverfront Resort & Spa. Funding for Project Funway would be requested in the month it is hosted. Summer School of Rock will be hosted in the summer of 2015. Funding and in-kind services will be requested at that time. 5. Funding from other organizations have not yet been confirmed for the 2015. Potential donors of in-kind services and monetary amounts (that have donated in past years) include, but are not limited to Vail Valley Cares, First Bank, Alpine Bank, 4 Eagle Ranch, Slifer Smith & Frampton, Vail Honeywagon, VVF Youth Foundation, RA Nelson, George K. Baum & Associates, GE Johnson, Westin Riverfront Resort, Vilar Performing Arts Center, Vail Resorts ECHO, Crazy Mountain Brewery, National Republic Distributing, Alpine Insurance, Beck Building Company, Continental Divide Cabins, and Edwards Shell Station. Education Foundation of Eagle County 6. Line Item Budget amount - $10,000 to Summer School of Rock, $7,500 to Project Funway and in-kind requests as listed below. 7. 2013 Actual Profit & Loss is attached in a separate document. Highlights are specified below. Please note: EFEC has awarded and designated approximately $166,000 to Eagle County School District, Directed Giving, Distinguished Teacher Scholarship Awards and Equity Grants in 2013. These funds are not included in our 2013 P&L as they will be paid out in 2014. Education Foundation of Eagle County Profit and Loss January -‐ December 2013 Income Total Donation Received 155,481.83 Total Event Program Donations 101,615.83 Total Income $257,097.66 Gross Profit $257,097.66 Expenses Total EFEC Giving 13,288.38 Apple Award 4,000.00 Back To School 1,108.20 Bonfire Brewing 555.15 Bots for Boys 1,990.21 Community Events 893.62 Evening of the Stars 30,077.60 Fundraising Events -‐ other 412.26 Golf -‐ Eagle fore Education 614.75 Haunted House 5,604.87 HPS Events 6,588.18 Project Funway 6,103.04 School of Rock 8,831.78 Total Event /Program Expense 66,779.66 Total Operating Expenses 34,826.36 Total Expenses $114,894.40 Net Operating Income $142,203.26 Total Other Income $13.07 Net Income $142,216.33 Friday, Aug 15, 2014 07:42:34 AM PDT GMT-‐6 -‐ Accrual Basis 8. Benefits to the Town of Avon are as follows: - Both events, Project Funway and Summer School of Rock events bring non-resident guests to Avon in the shoulder season which in turn promotes hotel accommodations and dining in the Town of Avon. - By sponsoring EFEC, TOA will participate in educational funding therefore directly impacting Avon’s sense of community and its schools. Education Foundation of Eagle County - By supporting the supplemental education efforts of EFEC, TOA will support the sustainability of its future economic development, unique special events and sustained economic development. - EFEC’s events and programs expand the cultural and educational offerings. By supporting EFEC, the Town of Avon will also be expanding their arts, cultural and educational offerings. - Avon Elementary School had an 81.47% use of the free and reduced school lunch program for the 2013/2014 school year. By offering a venue for the Summer School of Rock in Avon children ages 7-13 will have the ability to walk to the event thereby eliminating the need for transportation. - By supporting the Summer School of Rock in Avon, EFEC/TOA will be able to sponsor more scholarships for children to attend. Participation in music is known to increase children’s self confidence which leads to more “well rounded” individuals that will be able to mature into productive members of society. - EFEC’s Project Funway and Summer School of Rock are • Successful annual events with proven track records. The only limitations of growth would be due to venue restrictions. Each will have growth potential in the Town of Avon. • Unique events that support a balanced calendar of events with a focus on youth education. • Events produced by planners and volunteers that reside in Eagle County who care about their community, its culture, its growth, its future and the thoughtful promotion of our community. 9. EFEC promotes all events and recognizes sponsors utilizing the following platforms: Social media including Twitter and Facebook; advertising in the Vail Daily and via the Vail Valley Partnership; press releases are distributed to an extensive statewide network including all major Colorado television network stations and newspapers and promoted throughout the Eagle County Schools. The Town of Avon’s logo and link will be posted on our EFEC website Sponsor page www.efec.org; banners will be hung at Project Funway and Summer School of Rock Day Camp & Benefit Concert events; included on all print and media and in any/all advertising, press releases, PSAs, and interviews for the above mentioned events. Any of the two EFEC programs listed (Project Funway and Summer School of Rock) are available to be renamed and branded as Town of Avon events depending on the funding awarded. Five tickets to each of the two events listed will be available with VIP front row seating and the ability to purchase additional tickets at a discounted rate. One designer entry promoting TOA for Project Funway will be included. 10. In-Kind Requests are as follows: - Natural Amphitheater - EFEC would like to request the in-kind use of the new TOA Natural Amphitheater for the week long Summer School of Rock Day Camp, Summer School of Rock Benefit Concert and any required TOA Natural Amphitheater staff. Rental pricing for the Amphitheater space has not been established as of August 19, 2014. - Transportation Center Swift Gulch - EFEC would like to request in-kind use of office space located above the Transportation Center located on Swift Gulch Road. EFEC has been a purely volunteer organization without the need of office space. Office space is now requested to house minimal office supplies and one staff person. A 10’ x 10’ individual space or a larger office that is shared office space is appropriate at $22/sq ft. 11 - EFEC has not yet been a recipient of a Town of Avon Community Funding Request. Education Foundation of Eagle County Profit and Loss January -‐ December 2013 Total Income Donation Received 10% Grant Fund 6,718.42 Directed Giving Donations 121,003.53 EFEC Donations -‐ General Fund 27,709.88 Great Ed Luncheon 50 Uncategorized 0 Total Donation Received 155,481.83 Event Program Donations Apple Award -‐ YVF 8,500.00 Bots for Boys 2,400.00 Evening of the Stars 34,519.37 Fundraising Events-‐ other 6,428.73 Haunted House 5,908.85 HPS Events 1,909.45 Project Funway 21,642.07 School of Rock 10,818.00 Walking Mountain Events 969 Wild West Days 8,520.36 Total Event Program Donations 101,615.83 Other Inc (deleted)0 Uncategorized Income 0 Total Income $257,097.66 Gross Profit $257,097.66 Expenses EFEC Giving 10% Grant Fund Dispersements 2,733.21 prior yr Directed Giving 10,555.17 Total EFEC Giving 13,288.38 Event /Program Expense Apple Award 4,000.00 Back To School 1,108.20 Banks 0 Bonfire Brewing 555.15 Bots for Boys 1,990.21 Community Events 893.62 Evening of the Stars 30,077.60 Fundraising Events -‐ other 412.26 Golf -‐ Eagle fore Education 614.75 Haunted House 5,604.87 HPS Events 6,588.18 Project Funway 6,103.04 Raffle Sales Expense 0 School of Rock 8,831.78 Total Event /Program Expense 66,779.66 Operating Expenses Accounting/ Bookkeeping Expense 630 Annual Business Filings 60 Annual Mailing 3,760.46 Bank Charge 35.15 Amex Fees 185.4 Check Order 88.39 Merchant Fees 497.42 Pingg 40 Total Bank Charge 846.36 Conferences 195 Consulting Dawn Volk (deleted)361.4 Rimel Professional Services 11,094.68 Total Consulting 11,456.08 Dues and Subscriptions 244 Donor Tools 360 Intuit -‐ QB 172.48 Memberships -‐ nonprofits 730 Total Dues and Subscriptions 1,506.48 EFEC Board Meetings 225 Insurance 715 Marketing 0 Advocacy 3,119.74 EFEC-‐Mktg 10,283.13 Misc 132.78 Startup EFEC Marketing 379.32 Website 1,250.00 Total Marketing 15,164.97 Miscellaneous, Bus 0 Office 91.25 Postage and Delivery 62.23 Printing and Reproduction 113.53 Total Operating Expenses 34,826.36 Supplies, Bus (deleted)0 Uncategorized Expense 0 Total Expenses $114,894.40 Net Operating Income $142,203.26 Other Income Interest Earned 13.07 Total Other Income $13.07 Other Expenses Reconciliation Discrepancies 0 Total Other Expenses $0.00 Net Other Income $13.07 Net Income $142,216.33 Friday, Aug 15, 2014 07:42:34 AM PDT GMT-‐6 -‐ Accrual Basis This report was created using QuickBooks Online Plus. 2014 Youth Skills Building Budget INCOME YSB Grants $26,000.00 YSB TOTAL $26,000.00 EXPENSE SCHOOL PRESENTATIONS Health Educator Presentations $14,500.00 Mileage $3,200.00 Health Educator Prep $2,600.00 Program Management $4,200.00 Program Overhead $1,500.00 Sub-Total $26,000.00 YSB TOTAL $- The YSB budget had increased from $22,250.00 in 2013 to $26,000.00 in 2014 because of the addition of the 5th grade district wide maturation program Town of Avon Application for Community Organizations for 2014 1. Contact Information: Red Ribbon Project PO Box 6058 Avon, CO 81620 Executive Director: Denise Kipp Phone Number: 970-827-5900 Email: denise@redribbonproject.org 2. Description and Purpose of the Organization. If representing a tax-exempt organization, please provide a copy of the determination letter from the IRS. Red Ribbon Project (RRP) started in 1996 as a nonprofit with the hopes of building HIV/AIDS awareness. The organization originally formed in order to address a gap in services and systems around the HIV/AIDS epidemic. Since then the organization has continuously evolved to address HIV through a broad look at many of the social determinants of health. For over a decade the RRP has provided Youth Skills Building classes, free HIV testing, and educational resources to the community. RRP has also provided connections to financial, medical, and emotional resources for those affected by HIV. Over time, the focus evolved to educating youth about HIV/AIDS prevention strategies. Recognizing the inter-relatedness between HIV, sexually transmitted infections (STIs), and teen pregnancy the RRP expanded the organizational mission in 2010. Our mission is "We promote healthier lives by empowering the community to reduce teen pregnancy, HIV/AIDS and other STIs". Through this mission the RRP impacts youth with powerful programming that inspires self-confidence and healthy decision-making. The common theme in all of our efforts is the utilization of comprehensive programming that aligns with best practices that keep kids safe and aware of the consequences of risky behavior. All of our programs include both character development and life skills development as cornerstones of prevention. 3. Detailed description of the event or program and explanation of funding needs. The flagship program of RRP’s work is its Youth Skills Building (YSB) programs. Most recently, this program has evolved to develop students' skills at decision-making, self-awareness, coping, self- efficacy, and conducting healthy relationships, all of which bring spillover benefits to other youth issues such as violence and substance abuse prevention. Thus, prevention programming focuses on celebrating and strengthening existing positive behaviors as well as building resilience and skills to improve behaviors. The YSB Program takes a positive, holistic approach to social and emotional development rather than focusing on the negative aspects of engaging in substance abuse and violence. RRP wants to help raise kids who are responsible, productive, employable members of our community. Obviously, in addition to skills building, classes teach factual sexual health information ranging from maturation classes for 5th and 6th graders to the epidemiology of HIV and STIs for an older audience. These classes fill an important gap for Eagle County youth who, due to budget cuts at Eagle County schools and parent reluctance to teach these taboo topics, would not receive this education otherwise. For the past two years, Avon Elementary School (AES) has utilized the YSB program to teach their 5th grade students about “Maturation” and “Dignity and Bullying”. The two classes that AES has utilized from the YSB program are described as follows: Puberty and Maturation 5-8th grade Understand the physical, social, and emotional changes that occur during puberty Dignity (and Bullying) 5-8th grade Understanding ourselves, respecting others and stopping the cycle of bullying The safety of young people is a community concern. Interventions that help young people learn to make better choices is an effective component of a larger commitment to youth development and healthy communities. The meaningful, collaborative relationships the RRP has built with the school district, health and medical agencies, and youth serving organizations assures the RRP’s comprehensive programming for youth and compliments and enhances the work of RRP’s partners, yet avoids duplication. Collaborative relationships provide sustainability to the organization and the work by using resources efficiently. 4. Amount of funds requested from TOA. Please include when funds are needed for payment. Red Ribbon Project is respectively requesting $750 in support of our Youth Skills Building program at Avon Elementary School. One of RRP’s primary challenges is to manage rapid and significant increased community utilization of programs with a financial revenue budget that, although growing, is not growing at a pace that matches community utilization, interest, and need. The RRP is building strategies that will diversify and stabilize funding streams. With this increase in demand for our programs, we realize a greater impact on our budget. We work with highly skilled professional educators, and this increase in funding is used to pay our instructors (hourly rate and mileage). Fund dispersement would be acceptable on an annual basis, a bi-annual basis or a quarterly basis . 5. Amount of funds requested or provided from other agencies, organizations, companies, etc. Major Donors/Contributions to Youth Skills Building and RRP's General Operations Committed: Vail Valley Cares- $5,000, Eagle County Community Grant-$4,000, Eagle River Foundation-$1,000, United Way-$3,000, Climax Community Investment-$2,000, Edwards Rotary- $500, Town of Gypsum-$750, Gallegos Corporation-$500, Alpine Bank-$1,000 Pending: Eagle County School District-$3,000, Wells Fargo-$1,000, Anschutz Family Foundation- $5,000, Eagle Valley Community Fund-$3,000 6. Anticipated line item budget for the organization or event. See attachments (Organizational budget for 2014 and Youth Skills Building Budget for 2014) 7. 2013 final actual profit and loss statement. See attachment 8. How the event or organization benefits the Avon community? Please provide details. Red Ribbon Project (RRP) is seeking financial support of our Youth Skills Building (YSB) program. This program has been in existence since the year 2000, and most recently has been enhanced to include the numerous issues that today's youth are dealing with, such as substance abuse, healthy relationship building, coping with adversities, and improving communication. The YSB programs' innovative efforts provide young people with the tools to promote healthy development, realize their full potential, and make meaningful contributions to their communities. The program fosters emotional well-being and builds a foundation for healthy decision-making. Overall, as an organization, RRP realizes the importance of reaching out to young children and teens in our community in an effort to prevent risky behavior and promote overall healthy, contributing members of society. The YSB program, RRP's longest running program since 2000, teaches youth to practice self-efficacy (providing opportunities to practice concrete strategies and refusal skills), develop self-awareness and acceptance of others. It is our overall goal that Eagle County continues to work as a community to keep young people safe and help them make better choices. Avon is an important community within Eagle County with a high population of young Hispanic students. RRP is sensitive to the needs of all members of the diverse communities and cultures in Eagle County and strives to reach out and support these young children and adolescents with our Youth Skills Building program. 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town of Avon? RRP would list Town of Avon as a sponsor on our website, in school newsletters, posts on Facebook, at networking events, fundraising events, in school district communications, in press releases, in other non-profit newsletters and at all other opportunities that arise. 10. Include a description of any “in-kind” contributions and related cost that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. Red Ribbon Project hosts an annual fundraiser each year. Last year, the Avon Recreation Center provided us with a punch card. We plan to ask the Avon Recreation Center again for a donation. 11. If a recipient of funds from the Town of Avon in fiscal year 2013, a progress or final report on the funded activity, program and/or event. See attached grant report Jan - Dec '13 Ordinary Income/Expense Income Grant Income Youth Skills Bldging Income YSB Grants 19,662.50 YSB Donation 300.48 Youth Skills Bldging Income - ...5,033.73 Total Youth Skills Bldging Income 24,996.71 Cuidate!13,500.00 Testing Income Testing Grants 3,000.00 Testing Income - Other 900.00 Total Testing Income 3,900.00 General Operating 3,942.00 Total Grant Income 46,338.71 Donations Board Donations 1,584.48 Appeal 7,127.57 Condom donations 43.75 Misc. Donations 2,409.96 Total Donations 11,165.76 Fundraising Events WAD 9,254.42 Total Fundraising Events 9,254.42 Income 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 1 Jan - Dec '13 Miscellaneous Income 521.95 Interest Income 10.62 Pin and Jewelry Sales 10.00 Total Income 542.57 In Kind Income In Kind Legal 350.00 In Kind Condoms 1,000.00 In Kind Website Support 2,000.00 In Kind Accounting Income 1,200.00 In Kind YSB Income 1,200.00 In Kind Testing Income 7,300.00 Total In Kind Income 13,050.00 Total Income 80,351.46 Expense Education Program YSB Misc. Expenses 282.98 YSB Mileage/Travel 2,817.47 YSB Presentations Class Prep 2,600.50 YSB Presentations - Other 11,625.00 Total YSB Presentations 14,225.50 YSB Curriculum Design 12.40 YSB Supplies 258.65 YSB Copies/Printing 87.72 YSB meals 18.85 In-direct allocation 1,560.00 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 2 Jan - Dec '13 Director Allocation 4,038.50 Total Education Program 23,302.07 Cuidate! Expense In Direct Allocation 600.00 Cuidate! Health Educator Teach 5,600.00 Cuidate! Health Educator Prep 1,737.50 Cuidate! Mileage 734.00 Cuidate! Snacks for Participant 1,573.14 Cuidate! Materials for Teaching 56.25 Cuidate! Incentives for Part.2,450.00 Director Allocation 843.50 Total Cuidate! Expense 13,594.39 HIV Testing Program HIV Tests 309.00 Testing Miscellaneous 22.98 Testing Lodging 33.00 Testing Advertising 1,324.45 Testing Mileage/Meals 163.22 In-Direct Allocation 363.00 Director Allocation 956.50 Total HIV Testing Program 3,172.15 Awareness/Prevention Director Allocations 788.00 In Direct Allocations 246.00 Condoms 13.37 Awareness/Prevention - Other 26.50 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 3 Jan - Dec '13 Total Awareness/Prevention 1,073.87 Funding Expense Director Allocations 8,915.50 In Direct Allocation 1,248.00 Events WAD 1,172.77 Total Events 1,172.77 Appeal Expense 273.25 Grant Expense 76.20 Misc. Funding Expense 18.16 Total Funding Expense 11,703.88 Financial Support 800.00 General Operating Program Director Director Allocations -15,542.00 Program Director - Other 23,844.00 Total Program Director 8,302.00 Staff Development Per Diem 46.84 Mileage 389.00 Staff Development - Other 305.00 Total Staff Development 740.84 Utilities Telephone 848.48 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 4 Jan - Dec '13 Total Utilities 848.48 Advertising 900.75 Membership 600.00 Accounting 200.00 Insurance 1,647.00 Website 350.80 Board Development 409.08 Community Relations 295.65 Office Supplies 212.93 Postage 228.60 Printing and Copies 204.07 Mileage 1,441.60 Miscellaneous Licenses 20.00 Miscellaneous - Other 9.00 Total Miscellaneous 29.00 Bank Charge 180.31 G.O. Allocation Credit -4,050.00 General Operating - Other 1.00 Total General Operating 12,542.11 Total Expense 66,188.47 Net Ordinary Income 14,162.99 Other Income/Expense Other Expense In Kind Expense 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 5 Jan - Dec '13 In Kind Legal Expense 350.00 In Kind Condom Expense 1,000.00 In Kind Website Expense 2,000.00 In Kind Accounting Expense 1,200.00 In Kind YSB Expense 1,200.00 In Kind Testing Expense 7,300.00 Total In Kind Expense 13,050.00 Total Other Expense 13,050.00 Net Other Income -13,050.00 Net Income 1,112.99 9:38 PM Red Ribbon Project 04/28/14 Profit and Loss Standard Accrual Basis January through December 2013 Page 6 August 10, 2014 Town of Avon PO Box 975 1 Lake Street Avon, CO 81620 Dear Susan Fairweather and the Town of Avon Staff: The Red Ribbon Project (RRP) would like to thank you for the opportunity to apply for funding to support our Youth Skills Building program. This program has proven to be a valued component in the middle and high schools in Eagle County over the past decade. Recently, RRP has been able to offer our programs as early as 5th grade (including Avon Elementary School) because there is compelling evidence that intervening with young children is a promising approach to preventing drug use and other problem behaviors. The Red Ribbon Project is respectively submitting a $750 Youth Skills Building program funding request. The Youth Skills Building program focuses on the prevention and intervention of youth participating in risk behaviors, which ultimately will help youth to prosper. In addition, the program also prepares young people for adulthood by focusing on healthy relationships, including development of positive self-esteem, healthy attitudes and values about adolescent growth and development, goal setting, decision making, communication and negotiation skills. The Youth Skills Building program is comprehensive, targets underserved communities, utilizes best practices, and has proven to be effective in impacting behavior. There are no other in-school programs in Eagle County that address these issues with adolescents in our community. We have a proven record of delivering programs successfully to adolescents focusing on life skills and healthy development. RRP's focus on sexual health has contributed to a significant decline in teen births in Eagle County. In 2009 there were 60 births to teens between the ages of 15-19. In 2013 there were 27 births to teens between in the ages of 15-19. We welcome the opportunity to partner with the Town of Avon in improving outcomes for youth in the Town of Avon. Thank you for considering our grant request. I look forward to hearing from you. Sincerely, Denise Kipp denise@redribbonproject.org Executive Director Phone 970.827.5900 1. Radiate Live Events, 5670 Greenwood Plaza Blvd., Suite 506W, Greenwood Village, CO 80111. Jen Radueg, 970-485-1811, jen@radiatelive.com 2. Radiate Live Events is an event production & promotion company based in Colorado that works with our sister company, AlwaysMountainTime Media Network to produce and promote signature events. For the Town of Avon Reds, Whites & Brews 2015 event, we are partnering with a local non-profit to receive a portion of proceeds from this event. 3. Reds, Whites & Brews Festival brings together the best of America to kick off summer in Avon. The event will focus on live music, wine and craft beer tastings, feature local restaurants & food vendors, local and regional retail vendors and the event will tie-in with other local and regional businesses as sponsors to create additional unique event experiences. Funding is requested for 2015 to build on the Reds, Whites & Brews name and to keep the price low to guests to increase attendance and audience reach, therefore increasing overall exposure for Avon. ●Event Date: We would prefer that the date be moved up a week to the weekend of June 19th - 20th, 2015. If this date is not available, we would like to stay with the weekend of June 26th - 27th, 2015. ●Music Element: We will work with regional and national acts to focus on bringing in fun, festival-type music to create an overall great festival atmosphere and provide entertainment for the event-goers. Targeted music types will be rockabilly, bluegrass, indie & country-rock. ●Wine & Beer Element: For 2015, we will bring in more beer, spirits and wine purveyors to enhance the guest experience. The goal for 2015 is to keep this as a true tasting event and to enhance this experience with more options while keeping the price low for consumers. We will feature presentations during the event by brewers, wineries and other industry experts. We’d also like to pair brewers & wineries with local restaurants and bars to create Saturday night Reds, Whites & Brews after-party locations at various venues throughout Avon. ●Food: Friday night wine & beer pairing dinner at a local restaurant. Bring in more local and regional restaurants to showcase their foods & sell at the event. ●Vendors: Local, Regional and National vendors selling a variety of products will be the focus. We'd like to introduce a feeling of a high end farmers market/specialty boutique shop with amazing products. 4. Reds, Whites & Brews is requesting $10,000 in cash seed monies and $7,500 in in-kind services for the 2015 event. Payment would be requested to be made by May 1, 2015. 5. Sponsorships for the event will be sold for additional funding. At this time, no sponsorships are confirmed for 2015. 6. Anticipated Budget Total Anticipated 2015 Revenue $ 58,000.00 Ticket Revenue $ 35,000.00 Sponsorship & Booth Revenue $23,000.00 Total Anticipated 2015 Expenses $49,300.00 Entertainment $10,000.00 Marketing $15,000.00 Rentals, Staffing, Permits, Misc.$24,300.00 7. 2014 Budget Overview ●Total Revenue: $62,369.36 ●Total Expenses: $57,858.03 ●Total Profit: $4,511.33 8. As the location for the Festival, the Town of Avon will not only benefit from all marketing and promotional efforts, but will also receive community goodwill, exposure and revenue from event visitors. Tangible benefits include visitor lodging stays, dining in restaurants, shopping and participating in activities throughout the event weekend. Intangible benefits include exposure of Avon to a new crowd and visitor in your key demographic. Based on respondent survey results, 92% of attendees came to Avon specifically for the event. As this event grows, the Town of Avon will continue to reap the benefits of this event bringing in an affluent visitor to Avon. 9. A comprehensive marketing and PR campaign will target local, regional and a few key national markets. This campaign will include, but is not limited to: Radio, Newspaper, TV, Digital, Social Media, Email to past guests, Grass Roots efforts, Website listings and interactive promotional campaigns. All of these efforts will prominently feature the Town of Avon as the location for Reds, Whites & Brews. Each of these elements will include the Avon logo and Avon as the location for the event. 10. In conjunction with this event, Radiate Live would ask that The Town of Avon provide the following in-kind contributions for the event ●Use of Harry A. Nottingham Park for event set-up, event days, and teardown from Thursday, June 18th - Sunday, June 21st, 2015 OR Thursday, June 25th - Sunday, June 28th, 2015 ●Park/Public Works/Streets Support Staff & assistance for the event ●Additional bus line running around Avon from 6 - 9 p.m. ●Fencing ●Power from the Pump House ●Nottingham Park Stage & Staging area ●Park restrooms & water sources ●Street closures for vendor load in and out ●Street staff for closures ●Use of Council Chambers ●Use of Town Parking lots ●Police Support during the event ●Marketing assistance through Town managed promotional tools ●Three electronic messaging sign boards in the Town of Avon for the event ●Any additional signage available in & around the Town of Avon ●Banner placement on the Avon Bridge 6 weeks prior to the event ●Banner placement on the Avon light poles one month prior to the event ●Assistance with getting the event information to all area businesses 11. The event report from Reds, Whites & Brews 2014 was submitted to the Town of Avon on August 21st, 2014 2015 Town of Avon Funding Request Contact Information: The Salvation Army, a California Corporation, Vail Valley Salvation Army P.O. Box 2183, Edwards, CO 81632 0322 E. Beaver Creek Blvd, Avon, CO 81620 Tsu Wolin‐Brown, Center Coordinator (970)748‐0704 tsu@salvationarmyvail.org Description and Purpose of Organization: The Vail Valley Service Extension Unit of the Salvation Army provides emergency services and strives to meet human needs, in an effort to promote self‐sufficiency. Emergency assistance: Self Sufficiency and Economic Supports: Vail Valley Salvation Army supports individuals in the work force and their families, allowing them to continue to work, and linking unemployed individuals with resources so that they are able to work and therefore be self‐sufficient. This benefits Avon’s working residents as well as Avon Employers. When households need assistance with rent, utilities, prescriptions, transportation, and food, etc., we are a safety net. Approximately 500 households come for assistance each month. We provide these services with only two paid staff, and a plethora of volunteers. Our building is donated rent‐free by Traer Creek and all we pay are utilities and maintenance. Almost our entire budget is for direct services to families and individuals. Vail Valley Salvation Army partners with local public safety and law enforcement by feeding rescue workers and victims with our canteen, by managing shelters, and by assisting with stranded motorists and travelers’ aid. We have partnered with Eagle County Health and Human Services on myriad cases, even developing a common case information intake sheet. The Salvation Army collaborates with the following agencies in terms of referrals to our organization as well as referrals to our clients in addressing ongoing needs: Bright Future Foundation, Head Start, Early Head Start, Health & Human Services, Victim’s Assistance, Catholic Charities, Swift Eagle, MIndSprings Mental Health, Samaritan Center, Vail Valley Charitable Fund, Vail Valley Cares and local law enforcement and public safety agencies. It is very important to our agency that a continuation plan is formulated with the hopes of a family becoming self‐ sufficient in the future. Additionally, we collaborate with Eagle County Health and Human Services to create and sustain a TANF Internship Training program, and also be a PEAK Eligibility center. Avon Community Garden: Mountain Harvest Foundation OUR MISSION: The Mountain Harvest Foundation, a project of the Vail Valley Salvation Army, aims to foster healthy food access in Eagle County and the surrounding region. We grow community and confidence when we support sustainable food practice through education, outreach, and partnership. OUR VISION: The Mountain Harvest Foundation creates an environment of support and understanding within the community around issues of healthy food access. We network across sectors to involve and engage all demographics as we work together to build sustainable local food systems. We integrate culturally appropriate strategies, honor the wealth of our local agriculture, and listen to the needs local businesses and community leaders. OUR PARTNERSHIP: The Mountain Harvest Foundation is engaging non‐profits, local government, community outreach organizations, local businesses, farmers and ranchers within the region, religious organizations, Colorado Mountain College, and Colorado State University Extension. We seek to partner with all organizations; understanding the common goal of creating a sustainable local food system doesn’t happen without teamwork. OUR OBJECTIVE: Build and maintain a community garden and greenhouse structure at the Salvation Army in Avon, Colorado. The Mountain Harvest Greenhouse project will provide a safe space to learn about, grow, and access whole healthy food. The project will reflect the stewardship of Avon’s natural resources while providing educational opportunities that build a vibrant community experience around local foods. Thinking of local food systems as an essential part of the built environment allows the Town of Avon to honor and celebrate our rich farming heritage. The Avon Community Garden has been in place for two summers. The Greenhouse has a commitment of funding from Eagle County as well as the Winn Foundation. The plan is to install the greenhouse prior to the ground freezing. We offer garden plots to Avon Residents for $50.00 and to local businesses for $200.00 a season. Foods by Marc, a local Avon restaurant, has a large garden plot used to grow fresh food for his business. Other restaurants would be welcome. We have included raised beds, with good organic soil, and a drip irrigation system. We also offer plots to our low‐income clients at no charge. We partner with SOS Outreach, Eagle River Youth Coalition, Bright Future Foundation, and the Town of Avon summer camp program offering education and community engagement opportunities, free of charge. Mountain Harvest Foundation “Get Out and Grow Avon!” Project OUR EVENTS: The "Get out and Grow Avon!" community garden event series ‐Farm to table free dinner at the garden featuring local chefs. This event will benefit local restaurants through visibility. ‐"Lunch at the Garden" summer lunch program featuring local chefs. Grab a bite to eat, enjoy the sunshine, and learn about local food on your lunch break! This event will encourage employees to get outside, take a walk, and eat healthy during their work day. This will benefit businesses concerned with health & wellness in the workplace. ‐Ongoing free workshops including but not limited to: Starting your garden, Winterizing your garden, Seed saving, Food preservation, Composting, Troubleshooting your garden, Container gardening, preparing local foods demo/ Q&A with local chefs. ‐Growing Gardeners program offered to preschoolers. This event will be held at Avon Elementary during the winter months. These events will take place at the Avon Community Garden and Greenhouse. All events lead by CSU Extension Master Gardeners. As with any community engagement project, we allow for adjustment based upon community voice and needs. The "Get out and Grow Avon!" event series will benefit the community and local economy by providing opportunities for health and wellness activities around local foods. These events encourage active lifestyles and healthy eating. When we work together to connect the community with nature and build healthy habits the entire community is elevated. We are requesting funding to develop and expand the “Get Out and Grow Avon!” Project: Funding to support educators providing these programs at little to no charge to the community: $10,000.00 Funding to support materials and resources required to execute this program: $10,000.00 Total amount requested: $20,000.00 Should you require our operational budget, we can provide it. We do not yet have a line‐item budget for the “Get Out and Grow!” Project. Program development is in place. Classes have been offered this summer. Funding is needed to augment and execute “Get out and Grow Avon!”. 4:25 PM 09/29/13 Accrual Basis The America Cup Profit & Loss January through December 2013 Page 1 of 1 Ordinary Income/Expense Income Direct Public Support 5,500.00 Program Income 33,633.00 Total Income 39,133.00 Expense Business Expenses Marketing 3,928.09 Business Expenses - Other 670.80 Total Business Expenses 4,598.89 Contract Services videographer 1,000.00 Facilities and Equipment Equip Rental and Maintenance 535.90 Facilities and Permits 1,465.26 Total Facilities and Equipment 2,001.16 Operations Books, Subscriptions, Reference 365.00 PHWFF 4,638.19 Postage, Mailing Service 216.65 Printing and Copying 1,756.00 Supplies 2,339.70 Venue Transportation 6,000.00 Clothing Tshirts, Hats, Pins 4,839.78 Lunches and Waters 5,024.02 Total Operations 25,179.34 Other Types of Expenses Bank Fees 322.00 Insurance - Liability Cert 1,368.26 Other Costs 650.00 Total Other Types of Expenses 2,340.26 Travel and Meetings Lodging 2,872.40 Travel and Gas 1,797.97 Travel and Meetings 787.98 Total Travel and Meetings 5,458.35 Total Expense 40,578.00 Net Ordinary Income -1,445.00 Net Income -1,445.00 ROI Explaination Over budget due to: Hotel expenses Venue changes WFFC expenses Team cancellation The America Cup, Inc. | PO Box 6084, Vail, CO 81658 | 970‐376‐5703 | www.theamericacup.org APPLICATION & GUIDELINES FOR COMMUNITY ORGANIZATIONS REQUEST FOR 2015 FUNDING. THE DEADLINE FOR RECEIPT OF THIS APPLICATION IS FRIDAY, AUGUST 22, 2014, BY 5 PM. APPLICATION REQUIREMENTS PLEASE DO NOT EXCEED THREE PAGES. 1. Contact Information: Name of organization & mailing address, contact person, telephone number, email address The America Cup, Inc., PO Box 6084, Vail, CO. 81658, John Knight, 970‐376‐5703, jwk@vail.net 2. Description & Purpose of the Organization. If representing a tax exempt organization, please provide a copy of the determination letter from the Internal Revenue Service recognizing your tax‐exempt status under IRS 501(c)(3). If applying under the umbrella of a 501(c)(3), please provide letter of agreement. The America Cup is a 501(c)(3) non‐profit organization that promotes both competitive and amateur fly fishing at the national and international levels to provide programmatic and monetary support to Project Healing Waters Fly Fishing. Project Healing Waters Fly Fishing is dedicated to the crucial work of physical and emotional rehabilitation of disabled, active duty military personnel and veterans through fly fishing outings and fly tying education. We are proud and honored to partner with Project Healing Waters Fly Fishing to support this incredibly important work for our veterans and men and women in uniform. 3. Detailed description of the event or program and explanation of funding needs. Include if this is a new program, organization or event. The America Cup is producing the 14th World Youth Fly Fishing Championship WYFFC, August 10‐16, 2015 in the Vail valley. We have partnered with Colorado Trout Unlimited CTU to provide an “International Youth Day” on Saturday, August 15, 2015. This would be 4 hours for activities, promoted by CTU for an entire year, to come and participate in a variety of event stations (fly tying, casting, fishing, ect). Local and state youth would interact with the 15 countries representing with 5 angler teams for a day event by Lake Nottingham. The America Cup would also like to utilize Lake Nottingham on Tuesday, August 11, 2015. This would be for a morning and afternoon practice session on the lake with Drift Boats and rowers (no motors). Funds would be used for staging and producing the practice sessions in the 11th. Funds would be used for staging the event and providing lunch for 200‐250 participants in the Youth day. Both events would be contingent upon the lake being stocked with trout and in a healthy condition. 4. Amount of funds requested from the Town of Avon. Please include when funds are needed for payment. We would request $5,000.00 for hosting of the events. Monies would be needed by July 1, 2015 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed). The WYFFC will be funded by donors, TOV, and potential sponsors. The venue for this practice session is part of the overall budget and production of $400,000. 6. Anticipated line item budget for the organization or event. $5,000.00 7. 2013 final actual profit and loss statement. attached 8. How the event or organization benefits the Avon community? Please provide details. The America Cup, Inc. | PO Box 6084, Vail, CO 81658 | 970‐376‐5703 | www.theamericacup.org TOA will be highlighted for one year by Colorado Trout Unlimited and provide a destination event for the International Youth Day. We expect 200‐250 attendees for the youth day. Showcasing TOA and Lake Nottingham as part of the fishery within the Vail valley, while playing host to the international teams, is exposure to revenue streams not normally pursued. 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town. TOA will be highlighted for one year by Colorado Trout Unlimited. 10. Include a description of any "in‐kind" contributions and related costs that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. In Kind would be use of the field area, covered lake deck and restrooms. Use of TOA cooking grills and staff, and some fencing and signage. 11. If a recipient of funds from the Town of Avon in fiscal year 2014, a progress or final report on the funded activity, program and/or event. Happy to provide post event details. 12. NO ADDITIONAL MATERIALS WILL BE ACCEPTED. PLEASE DO NOT SEND NEWSPAPER CLIPPINGS, LETTERS OF SUPPORT, OR PROMOTIONAL MATERIALS. APPLICATION SUBMITTAL GUIDELINES 1. Submit, by email, a PDF of the full application to: sfairweather@avon.org Sincerely, John W. Knight Founder / Organizer Team Evergreen Cycling – PO Box 3804 – Evergreen, Colorado 80437 August 22, 2014 Ms. Susan Fairweather Town of Avon PO Box 975 Avon, CO 81620 Dear Ms. Fairweather, Please find attached a Request for Funding for Team Evergreen and the 2015 Triple Bypass Bicycle Ride. The Triple Bypass just completed its 26th year of the ride. The past 8 years, we have finished in Nottingham Park in Avon and we would like to continue a great tradition. The dates for the Triple Bypass are Saturday and Sunday July 11-‐12, 2015. We look forward to working with the Town of Avon again and making the Triple a success again. I look forward to working with you again and please don’t hesitate to contact me if you have any questions. I can be reached at 720 560-‐2545 and triple@triplebypass.org . Sincerely, Jenny Jenny Anderson Triple Bypass Ride Director Team Evergreen Cycling – PO Box 3804 – Evergreen, Colorado 80437 Team Evergreen/Triple Bypass Bicycle Ride Request for Funding from Town of Avon Contact Information: Team Evergreen Cycling Triple Bypass Bicycle Ride Jenny Anderson – Ride Director PO Box 3804, Evergreen CO 80437 Office: 720 560-‐2545 Email: triple@triplebypass.org Description & Purpose: The Triple Bypass is a RIDE and NOT a Race. The ride is a one-‐day or two-‐day bicycle ride, which begins in Bergen Park, Evergreen Colorado and ends in Avon, Colorado on Saturday. The Triple Bypass is a 120-‐mile bicycle tour that travels over Squaw (Juniper) Pass, Loveland Pass and Vail Pass. Team Evergreen Bicycle Club has implemented a cap of 3,500 participants and has sold out the past 6 years. In 2011, Team Evergreen has expanded the ride to Sunday, the return to Evergreen. The Triple Bypass starts in Avon and finishes in Evergreen, Colorado. The riders would go across Vail Pass, Loveland Pass and Squaw (Juniper Pass). There is a reroute from Frisco to Dillon on Dillon Dam Road in lieu of Swan Mountain. Team Evergreen would cap the Sunday ride to 2,500 participants. We have had 1,500 – 1,880 registered riders. Team Evergreen Cycling is a non-‐profit organization. Over $1.3 Million have been donated to local charities and towns from proceeds of the Triple Bypass in the past 11 years. A majority of the donations go to the volunteer groups that assist with the Triple Bypass. Eagle County organizations that have received donations from Team Evergreen Cycling include – Borders to Borders, Eagle Valley Land Trust, Eagle Valley Humane Society, Vail Mountain Rescue and Vail Veterans. Explanation of Funding Needs: TE would like to request $3000 in kind services and equipment to include: Traffic control from Riverfront/Avon Road to the Lake Street closure Barricade (900 ft) and labor for set up and tear down Zero Hero tents including containers and liners for trash, recycle and composting Provide Avon 10x10 tents for finish line VMS Boards Town of Avon volunteer in Triple Bypass tent to assist with local questions and directions Team Evergreen Cycling – PO Box 3804 – Evergreen, Colorado 80437 Funds requested from Town of Avon: TE would like to request $2,500 in cash. Only sponsors contributing $2,000 and higher, receive their full color logo on the 5,000 Triple Bypass official jerseys. Payment due on February 1, 2015 prior to production of the jerseys. Funds requested from companies: Triple Bypass has several sponsors that include: First Bank, Primal, CytoMax, Muscle Milk, Lodo’s Bar & Grill, OrthoColorado and several others. We have not received other funding from any other agencies. 2013 Triple Bypass donated $224,000 to local charities and non-‐profits from the proceeds of the Triple. Triple Bypass benefits the Avon community: • Having a nationally recognized, 120 mile bike ride, finish in the bike-‐friendly Town of Avon • Over 3,500 registered riders for Saturday. We had 1,000 riders registered for the Double. • We had 39% of our riders complete our survey. o The Triple Bypass survey shows 47% stayed in a hotel. 33% stayed in Avon. o We asked how much people spent on lodging, gas, food and other misc – 47% between $1-‐$200. 28% between $201-‐$400. 13% between $401-‐$800. o 72% of the riders are from Colorado. 28% are from out of state o 96% of the riders thought the overall experience was Terrific, Great or Good • Local organizations volunteer for the Triple and receive a donation: Eagle Valley Land Trust, Eagle Valley Humane Society, Vail Mountain Rescue. Marketing efforts – The Triple Bypass is a “bucket list” bike ride for cyclists. Riders hear about the epic 120 mile ride over the Rocky Mountains and want to complete the Triple. They wear their Triple jersey with pride, that they accomplished and conquered the Triple Bypass. On all the Triple Bypass descriptions and maps, Avon is listed as the finish (and start for Sunday). The logo is on 5,000 jerseys, website, emails, posters. We have several ads in the Vail Daily leading up to the event. Recipient of 2014 Funds – TE received $2500 in cash. We also received five 10x10 tents, barricade, traffic control materials, Zero Hero tents with containers and liners. In 2015, Team Evergreen will hire Walking Mountain to supervise sustainability project. TE will also request additional Avon police officers to assist with traffic control. • P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org 1. Contact Information: Name of organization & mailing address, contact person, telephone, number, email address Vail Leadership Institute PO Box 7210 Avon, CO 81620 Ross Iverson (970)-315-2675, ross@vailleadership.org 2. Description & Purpose of the Organization. If representing a tax exempt organization, please provide a copy of the determination letter from the Internal Revenue Service recognizing your tax-‐‑ exempt status under IRS 501(c)(3). If applying under the umbrella of a 501(c)(3), please provide letter of agreement. The Vail Leadership Institute is a 501c3, and exists to develop values based leaders who produce higher levels of results by leading with purpose. The Institute is striving to put the Vail Valley on the global map for the ultimate destination for experiential character based leadership training. 3. Detailed description of the event or program and explanation of funding needs. Include if this is a new program, organization or event. #1 Group Sales Strategy: The Vail Leadership Institute has spent most of 2014 building a stronger base of clientele within the local market, and has begun outreach efforts to front-range organizations and associations. In 2015, the Institute will roll out targeted efforts on building a base of “destination” customers for board retreats, custom conferences, and company trainings. This strategy will be highly focused on attracting “high-quality” guests/groups to the area as well as building sustainable long-term custom leadership conferences. Current Highlights: • The Institute is currently working with the Colorado Oil and Gas Association (COGA) for a custom conference in Beaver Creek in December of 2014 that has the potential to be an annual event and grow in size. • Collaboration with the Vail Resorts group sales teams to offer experiential leadership packages that can be promoted through their sales channels. In our current stage of development, our focus is on developing the necessary marketing and communication tools to properly promote and build the brand of the Valley as a place for corporate teams to come to LEARN. Tactics to be delivered through this strategy: • Vail Leadership Magazine Development: • The Institute is working in partnership with Swift Media to develop a publication to spotlight learning experiences in order build the higher education brand of the Valley. • The total cost for this project is $60,000 with distribution of 20,000 copies strategically distributed to connect with C-Suite individuals. • Potential partners for the publication include: Beaver Creek Resort, CO, Vail Resorts, Town of Vail, Eagle County, CMC, Colorado Innovation Network (COIN). • Video testimonials of experiences of groups that will recommend the Institute as a key component in their leadership development. • Development of web pages specific to corporate retreat experiences and the development of digital assets to be distributed offline and online to targeted decision makers. • Online direct marketing campaign to drive traffic to the website selling these corporate experiences. Town of Avon Grant Request P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org This strategy will bring groups to Vail and Beaver Creek and with the Town of Avon as a partner in the effort, we can ensure that the Westin and other Town Assets, such as Nottingham Park can be incorporated into the event planning for groups. Avon could be the “basecamp” for “break out” activities, dining, and gear when it matches with the groups needs. This effort will realistically take 24-36 months from launch in order to determine how many groups per year can be attracted with the foundational sales and marketing tools. Without a concerted effort towards building more knowledge based programs in the Valley, areas such as Jackson Hole & Aspen will continue to outperform the Vail Valley for this type of visitor. The C-Suite executive needs to be a focus to properly balance quality vs. quantity in our community. Total Request for Group Sales Strategy: $37,400.00 #2 Business Development in the Town of Avon The Vail Leadership Institute has become a key asset to the Town of Avon through the opening the BaseCamp facility. The facility has provided the town with a lot of forward progress and has been summarized in an attachment. The Institute is requesting the continued support of $7,500 for the BaseCamp facility in 2015. These funds will ensure we can continue to expand the space and programming associated with it. In addition to the facility subsidy, the Institute is requesting (4) scholarships to be used strategically through the year that are focused on moving businesses to Avon. These scholarships would cover 50% of the tuition to an Executive Level RoundTable for one year. Total Scholarship request amount is $10,000. We are currently working with a small manufacturer that would consider moving their operation from Edwards to Avon through this use of this scholarship. This scholarship would be appropriately used when talking with a new businesses considering Avon as their new home by telling them “that the town supports business owners through the VLI RoundTable program.” This will help new owners integrate much quicker into the community, and through the professional training of VLI, give them a leg up on achieving success in our local economy. 4. Amount of funds requested from the Town of Avon. Please include when funds are needed for payment. • $37,400.00 Targeted Group Sales Efforts • $17,500.00 BaseCamp Economic Development Strategy • Total: $54,900.00 *The funds for the development of the programs included in this program would be requested in January of 2015 to ensure we have the entire calendar year to develop the strategies described. 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed). $245,000 Total Funding Requests • Town of Vail: $60,000 • Vail Resorts: $35,000 • Private donors: $120,000 • CMC $10,000 • COIN $10,000 • BeaverCreek:$10,000+ P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org 6. Anticipated line item budget for the organization or event. Group Sales Budget: Leadership Magazine $60,000 Website Enhancements $8,000 Sales Tools $15,000 Online SEO $12,000 Video $10,000 Print Advertising $25,000 Sales Support $90,000 Sub Total Group Sales Budget $220,000 BaseCamp Budget: Revenue Budget Annual Monthly 70% Occupancy Hoffmann Scholarships 23,439 1,953 1,953 Average Monthly Rent 60,000 5,000 4,150 Total Revenue 83,439 6,953 $6,103 Total Expenses $81,352 $6,779 $6,779 Monthly Net 70% ($676) Annual Net 70% (8,112) *An additional $15,000 of fixed assets will be needed to furnish a phase 2 roll out. 7. 2013 final actual profit and loss statement. (View Attached) 8. How the event or organization benefits the Avon community? Please provide details. The Town of Avon has benefited from outside investors becoming interested in making substantial real estate investments. The ability to attract this level of investor is contingent upon programs and events that have the ability to draw in wealth at this level. It is also important to maintain a brand experience that fits investors expectations in relation to other resort based areas such as Park City, Apsen, Jackson Hole, or Telluride. Building a connection with these people through board retreats, custom conferences, and thought leadership will provide the continuity necessary to build a “pool” of future investors in the Town. Avon’s brand platform talks about the “essence” of a Town, and many times determining the specifics of how it “got this way” is tough. It isn’t one event, or one venue, but perhaps is built more by the intent and interactions of the key entities that make up the Town. It is definitely is made up by the “way” in which leaders lead. The Institute can contribute in many ways to the brand essence over a long period of time, and the larger the Institute becomes, the more potential it has to influence this essence. As the Town looks to become the business epicenter of the Valley and attract many unique and successful entrepreneurs to Avon, the Institute serves a key role in connecting this community. The RoundTable programs held at BaseCamp held organizations help to produce better business results, but more importantly the leaders in this program have some level of management responsibility for nearly 1,000 workers in the Valley. You can see the ripple effect. 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town. Please see detailed description of funding requests since most of this request is based on marketing the area. 10. Include a description of any "in-‐‑kind" contributions and related costs that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. N/A 11. If a recipient of funds from the Town of Avon in fiscal year 2014, a progress or final report on the funded activity, program and/or event. Please see updates on the attached. P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org 1. Contact Information: Name of organization & mailing address, contact person, telephone, number, email address Vail Leadership Institute PO Box 7210 Avon, CO 81620 Ross Iverson (970)-315-2675, ross@vailleadership.org 2. Description & Purpose of the Organization. If representing a tax exempt organization, please provide a copy of the determination letter from the Internal Revenue Service recognizing your tax-‐‑ exempt status under IRS 501(c)(3). If applying under the umbrella of a 501(c)(3), please provide letter of agreement. The Vail Leadership Institute is a 501c3, and exists to develop values based leaders who produce higher levels of results by leading with purpose. The Institute is striving to put the Vail Valley on the global map for the ultimate destination for experiential character based leadership training. 3. Detailed description of the event or program and explanation of funding needs. Include if this is a new program, organization or event. #1 Group Sales Strategy: The Vail Leadership Institute has spent most of 2014 building a stronger base of clientele within the local market, and has begun outreach efforts to front-range organizations and associations. In 2015, the Institute will roll out targeted efforts on building a base of “destination” customers for board retreats, custom conferences, and company trainings. This strategy will be highly focused on attracting “high-quality” guests/groups to the area as well as building sustainable long-term custom leadership conferences. Current Highlights: • The Institute is currently working with the Colorado Oil and Gas Association (COGA) for a custom conference in Beaver Creek in December of 2014 that has the potential to be an annual event and grow in size. • Collaboration with the Vail Resorts group sales teams to offer experiential leadership packages that can be promoted through their sales channels. In our current stage of development, our focus is on developing the necessary marketing and communication tools to properly promote and build the brand of the Valley as a place for corporate teams to come to LEARN. Tactics to be delivered through this strategy: • Vail Leadership Magazine Development: • The Institute is working in partnership with Swift Media to develop a publication to spotlight learning experiences in order build the higher education brand of the Valley. • The total cost for this project is $60,000 with distribution of 20,000 copies strategically distributed to connect with C-Suite individuals. • Potential partners for the publication include: Beaver Creek Resort, CO, Vail Resorts, Town of Vail, Eagle County, CMC, Colorado Innovation Network (COIN). • Video testimonials of experiences of groups that will recommend the Institute as a key component in their leadership development. • Development of web pages specific to corporate retreat experiences and the development of digital assets to be distributed offline and online to targeted decision makers. • Online direct marketing campaign to drive traffic to the website selling these corporate experiences. Town of Avon Grant Request P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org This strategy will bring groups to Vail and Beaver Creek and with the Town of Avon as a partner in the effort, we can ensure that the Westin and other Town Assets, such as Nottingham Park can be incorporated into the event planning for groups. Avon could be the “basecamp” for “break out” activities, dining, and gear when it matches with the groups needs. This effort will realistically take 24-36 months from launch in order to determine how many groups per year can be attracted with the foundational sales and marketing tools. Without a concerted effort towards building more knowledge based programs in the Valley, areas such as Jackson Hole & Aspen will continue to outperform the Vail Valley for this type of visitor. The C-Suite executive needs to be a focus to properly balance quality vs. quantity in our community. Total Request for Group Sales Strategy: $37,400.00 #2 Business Development in the Town of Avon The Vail Leadership Institute has become a key asset to the Town of Avon through the opening the BaseCamp facility. The facility has provided the town with a lot of forward progress and has been summarized in an attachment. The Institute is requesting the continued support of $7,500 for the BaseCamp facility in 2015. These funds will ensure we can continue to expand the space and programming associated with it. In addition to the facility subsidy, the Institute is requesting (4) scholarships to be used strategically through the year that are focused on moving businesses to Avon. These scholarships would cover 50% of the tuition to an Executive Level RoundTable for one year. Total Scholarship request amount is $10,000. We are currently working with a small manufacturer that would consider moving their operation from Edwards to Avon through this use of this scholarship. This scholarship would be appropriately used when talking with a new businesses considering Avon as their new home by telling them “that the town supports business owners through the VLI RoundTable program.” This will help new owners integrate much quicker into the community, and through the professional training of VLI, give them a leg up on achieving success in our local economy. 4. Amount of funds requested from the Town of Avon. Please include when funds are needed for payment. • $37,400.00 Targeted Group Sales Efforts • $17,500.00 BaseCamp Economic Development Strategy • Total: $54,900.00 *The funds for the development of the programs included in this program would be requested in January of 2015 to ensure we have the entire calendar year to develop the strategies described. 5. Amount of funds requested and/or provided from other agencies, organizations, companies (i.e. other funding committed). $245,000 Total Funding Requests • Town of Vail: $60,000 • Vail Resorts: $35,000 • Private donors: $120,000 • CMC $10,000 • COIN $10,000 • BeaverCreek:$10,000+ P.O. Box 7210 Avon, CO 81620 | 970-926-7800 | VailLeadership.org 6. Anticipated line item budget for the organization or event. Group Sales Budget: Leadership Magazine $60,000 Website Enhancements $8,000 Sales Tools $15,000 Online SEO $12,000 Video $10,000 Print Advertising $25,000 Sales Support $90,000 Sub Total Group Sales Budget $220,000 BaseCamp Budget: Revenue Budget Annual Monthly 70% Occupancy Hoffmann Scholarships 23,439 1,953 1,953 Average Monthly Rent 60,000 5,000 4,150 Total Revenue 83,439 6,953 $6,103 Total Expenses $81,352 $6,779 $6,779 Monthly Net 70% ($676) Annual Net 70% (8,112) *An additional $15,000 of fixed assets will be needed to furnish a phase 2 roll out. 7. 2013 final actual profit and loss statement. (View Attached) 8. How the event or organization benefits the Avon community? Please provide details. The Town of Avon has benefited from outside investors becoming interested in making substantial real estate investments. The ability to attract this level of investor is contingent upon programs and events that have the ability to draw in wealth at this level. It is also important to maintain a brand experience that fits investors expectations in relation to other resort based areas such as Park City, Apsen, Jackson Hole, or Telluride. Building a connection with these people through board retreats, custom conferences, and thought leadership will provide the continuity necessary to build a “pool” of future investors in the Town. Avon’s brand platform talks about the “essence” of a Town, and many times determining the specifics of how it “got this way” is tough. It isn’t one event, or one venue, but perhaps is built more by the intent and interactions of the key entities that make up the Town. It is definitely is made up by the “way” in which leaders lead. The Institute can contribute in many ways to the brand essence over a long period of time, and the larger the Institute becomes, the more potential it has to influence this essence. As the Town looks to become the business epicenter of the Valley and attract many unique and successful entrepreneurs to Avon, the Institute serves a key role in connecting this community. The RoundTable programs held at BaseCamp held organizations help to produce better business results, but more importantly the leaders in this program have some level of management responsibility for nearly 1,000 workers in the Valley. You can see the ripple effect. 9. If applicable, what marketing efforts will be made for this event or program and how will it benefit the Town. Please see detailed description of funding requests since most of this request is based on marketing the area. 10. Include a description of any "in-‐‑kind" contributions and related costs that the Town of Avon provides to your organization, including but not limited to: land, buildings, and their facilities and/or services. N/A 11. If a recipient of funds from the Town of Avon in fiscal year 2014, a progress or final report on the funded activity, program and/or event. Please see updates on the attached. PO Box 1130, Vail, CO 81658 www.visitvailvalley.com Town of Avon Susan Fairweather, Economic Development Manager and Virginia Egger, Town Manager 1 Lake Street / PO Box 975 Avon, CO 81620 Dear Susan, Virginia and Town Council members, Thank you for the opportunity to present a funding request as part of your 2015 community organization funding cycle. Please accept the following as our funding outline for the Vail Valley Partnership & the Economic Council of Eagle County. VVP’s programs require both public and private support. Vail Valley Partnership is uniquely positioned to facilitate and actively engage entities throughout the valley and state in order to strengthen our community through our economic development, business support and destination marketing programs. We support local businesses. We unite key stakeholders. We lead collaborative efforts throughout the community. Economic Development Goals and Objectives To promote the long-term economic health of Eagle County and solidify an economic base that is strong, diverse, and resilient our communities must: 1. Retain and expand current businesses and; 2. Recruit new businesses. This plan targets 6 Core Objectives to position Eagle County’s economy for long-term success and to achieve local area Economic Health. Our 6 Core Objectives are to: 1. Build a Business Friendly Eagle County 2. Create and Market an Eagle County Business Brand 3. Retain, Grow, and Recruit Businesses 4. Protect our Natural Environment 5. Expand Opportunity in our Leading Sectors (Tourism & Recreation, Health & Wellness and Creative Industries) 6. Provide Support for a Quality Workforce (Affordable Housing, Education, Transportation, Health) We expect our collective efforts to contribute significantly to these goals for Eagle County stakeholders (including the Town of Avon) with financial support from Eagle County, individual municipalities, unincorporated communities and the business community. These goals are aligned with Avon’s goals of in-fill development in East Avon and you can count on VVP’s continued support around the creation of a Creative Arts District designation. PO Box 1130, Vail, CO 81658 www.visitvailvalley.com Work is underway in the following areas: 1. Designing and implementing a Business Retention & Expansion program (BRE) This will build a proof point of a business friendly community through a coordinated network of communication and action. This will be a formal program that will effectively listen to local businesses needs and will act on what is heard. 2. Creating and Marketing an Eagle County Business Brand Brand development is underway and the language of that brand will be communicated to our targets via a new countywide business development website. The Eagle County business brand will be designed to enhance and leverage, not compete with, individual brand identities. 3. Move toward Active Business Recruitment Once a solid outward facing marketing strategy is developed, we will, for the first time as a region, have the ability to pursue ‘active’ business recruitment, rather than the passive recruitment to which we are limited today. Destination Marketing (Group Sales & Event Recruiting): The Partnership’s destination sales & marketing efforts (including group sales, event recruiting and leisure sales) resulted in an economic impact of $74,000,000 in 2013, contributing over $4.5m in local and state tax revenues. VVP is the only regionally focused destination marketing organization in the valley, working with stakeholders such as the Colorado Tourism Office to ensure all communities are represented in state tourism promotion. A large component of our destination marketing effort is targeted at recruiting groups, meetings and special events to the valley. As an example, Ride the Rockies in June 2014 was initiated by the Vail Valley Partnership and we were thrilled that Avon could serve as the host community. We continue to focus on generating incremental room nights through our group & event sales efforts. VVP produces Visit Vail Valley – the Official Visitors Guide and manages VisitVailValley.com, which includes robust tourism information and reservation services for lodging properties in all communities within the valley. These tools also include a valley-wide calendar of events, spotlighting events in the Town of Avon and other communities. A new, enhanced visitor website is scheduled to launch in June 2015 listing all businesses and local events. 2015 Funding Request Our regionally targeted economic development efforts include a variety of business-focused community programming and ensures local representation at, and active participation in, various regional and state-wide forums including the Northwest Colorado Council of Governments economic development district, Colorado Rural Workforce Consortium, Colorado Innovation Network, Colorado Office of Economic Development & International Trade, Colorado Tourism Office, and various regional planning coalitions. Our regionally focused destination marketing efforts (targeting group & meeting sales) includes PO Box 1130, Vail, CO 81658 www.visitvailvalley.com participation in a variety of group & meeting industry tradeshows, hosted customer events and meeting planner outreach in addition to leveraging VVP’s meeting planner database to drive increased group & meeting business to the Vail Valley. This includes a focus on participatory events. Active participation and promotion ensures Eagle County interests are represented in an active and professional manner and ensures local facilitation and coordination of economic development and tourism efforts. Moving forward the Partnership and Economic Council will continue to: • Generate positive economic conditions in Eagle County through implementation of the Economic Development Plan - a plan that will deliver a network of community business support resources to retain & grow existing businesses - and an outward facing marketing strategy to attract additional business development. • Forge strong relationships between the various segments, both geographic and within key industries, within the business community and key stakeholders • Provide economic information (research) to stakeholders to assist in data driven decision- making. • Represent Eagle County stakeholders and business community interests to regional & statewide organizations and provide local facilitation of economic development activities. • Drive destination overnight visitation via our group sales and participatory sport event recruiting efforts. • Promote all communities in the Vail Valley through VisitVailValley.com, including a valley- wide regionally focused calendar of events, and through Visit Vail Valley – Official Visitors Guide. • Promote Avon as an engaged community stakeholder via destination marketing, chamber of commerce programming and economic development efforts to help build your updated brand in the community and to our destination visitor audience. Additional details, including copies of our quarterly updates, are available to help in your decision- making process as needed. Funding is requested from the Town of Avon in the amount of $25,000 to support our regional economic development and group sales efforts, specifically to assist with the continued implementation of the Economic Development Strategic Plan for Eagle County, to continue efforts and momentum outlined briefly in this request letter and the (attached) quarterly updates provided to our municipal supporters, and to continue to drive group, meeting and participatory sporting events to the Vail Valley and Town of Avon. Thank you for your consideration, Chris Romer President & CEO Vail Valley Partnership PO Box 1130, Vail, CO 81658 www.visitvailvalley.com Town of Avon 2015 Funding Request Application Guidelines: Name of Organization: Vail Valley Partnership / Economic Council of Eagle County (P) 101 Fawcett Road, Suite 240, Avon, CO 81620 (M) PO Box 1130, Vail, CO, 81658 Contact Information: Chris Romer, president & CEO Cromer@visitvailvalley.com / (970) 477-4016 Description of Organization: The Vail Valley Partnership (VVP) takes the leadership role to create and manage collaborative programs that encourage economic development and result in increased destination tourism in Eagle County. Detailed Description of Funding Request: included in request letter Amount of Funds Requested: $25,000; preferred payment in January 2015 Amount of Funds Requested from other agencies: Eagle County: $265,000 Vail Local Marketing District/Town of Vail: $585,000 Beaver Creek Resort Company: $154,000 Town of Minturn: $5,000 Town of Eagle: $5,000 Town of Gypsum: $5,000 Community of Eagle Vail: $5,000 Edwards Metro District: $5,000 Note: the vast majority of Vail & Beaver Creek funding is earmarked directly to support the group sales/special event recruiting efforts; other monies are earmarked toward implementation of the Eagle County Economic Development Plan. Audited 2013 Financial Statements: Attached How this benefits Avon: Increased lodging occupancy via groups & meetings at local properties; increased lodging occupancy & local activation via event recruiting; increased sales tax collections; regional representation at key events; regional collaboration and economic benefits outlined in plan; support of business expansion & retention program; benefits from business recruiting. No in-kind services are required from any Vail Valley Partnership effort. Town of Avon Grant Lisa Connolley ‐ Vail Valley Soccer Club P. O. Box 2728 Edwards, Co 81632 970‐390‐5831 lisa@vailsoccer.com The Vail Valley Soccer Club, a 501c organization, is & has been involved in competitive soccer in the Valley for 20 years. It has evolved from a 7 team club to its present size of 30 teams. The ages of the children involved range from U9 all the way up to U18 Boys & Girls (the high school levels playing one season vs. 2) As in the past, Vail Valley Soccer hosts what has grown to a 110 team soccer tournament that is held the first weekend in October every year (for 2015 the dates are 10/3 & 10/4). 110 teams, including Vail Valley soccer club team’s ages U10‐U14 boys & girls, participate in this tournament. The club has grown the tournament by accepting girls team levels U16 & U18. All parents of our teams are asked to participate not only on the sidelines supporting their children but by volunteering in positions as volunteer and facilities coordinators as well as field marshals working the fields their child’s games are played at so not to miss any portion of their children’s games. The tournament brings in @1800+ children from all over Colorado with some team participation from Wyoming and Utah. The majority of the kids are accompanied by parents, sometimes grandparents and siblings. With all these attendees it helps the Vail Valley’s economy with hotel and condo rentals as well as filling restaurants, coffee houses & other businesses for 2‐3 days during the Valley’s slow time. Because Avon is centrally located to all fields, many of the participants choose to stay in hotels such as Comfort Inn, Christie Lodge, Charter at Beaver Creek, Park Hyatt and Westin Riverfront. Restaurants are full with players & their families and some teams enjoy their down time by visiting the Rec Center & swimming. The tournament is played on approximately 15 soccer fields from East Vail to Edwards with Avon Upper & lower included. All fields used have, in the past as well as present, been donated by following entities: Town of Avon, Town of Vail, the Vail Rec District, Vail Mtn. School, Eagle Vail Metro, Homestead & Singletree Homeowner Associations as well as numerous Eagle County Schools. Each entity donates field use as well as the labor/supplies to line the fields and provide nets. Each sponsorship is listed on the club website as well as in the tournament program. This tournament is the Club largest fundraising effort which helps to provide kids that are skilled to play at a competitive level the ability to be part of the club regardless of race and /or economics. It also provides funding to hold summer camps, partial travelling expenses for kids to participate in out of town/state tournaments as well as providing uniforms for those in need. Without the use of the Avon fields (used from 7:30 a.m. to 6 pm each day for 8 games per field) the tournament would have to reduce the number of teams allowed therefore reducing the registration revenue. An “in‐kind” donation is requested for the following items. The funds will be used as an “in‐kind” donation to cover the rental, field lining and net use of both fields. These numbers are based on 2014 rental rates so does not include any possible 2015 increases: Upper Avon (Main field) use (7:30 – 6:00 for 2 days) $ 420.00 Lower Field use (7:30 – 6:00 for 2 days) $ 420.00 Striping of both fields $ 100.00 Miscellaneous/Cleaning of bathrooms $ 100.00 4 nets used (no pricing provided) $ 200.00 TOTAL COST $1,240.00 As the club gets closer to the tournament, articles have been written in the Vail Daily to give all Valley entities a heads up to be prepared with their food supply as well as Staffing. It helps to provide Economic Development, comraderie with our community with the potential of repeat guests during other times of the year. The only possible “danger” that would prevent the Valley from having all these guests come into town is if tournament is cancelled due to weather/natural causes. However as was proven at the 2013 tournament where we got 1’+ of snow 2 days prior to the start, the club was still able to pull it off with some game schedule adjusting, team parents jumping in along w/temp works to shovel the snow off the fields. We even had out of town parents, coaches & their teams jump in for their warm up when they arrived at the field & were told their game was delayed. At some point, we hope that Colorodo Youth Socccer will permit us to increase the team #’s therefore allowing more participants . Many thanks & if there are some questions, please don’t hesitate to contact us. Regards, Lisa Connolley – 390‐5831 1. Contact Information: Organization: The Vail Valley Foundation d/b/a Vilar Performing Arts Center Mail Address: PO Box 3822 Avon, CO 81620 Contact Person: Gena Buhler, Theatre Director VPAC Contact Phone Number: 970-748-6651 Contact Email: gbuhler@vvf.org 2. Description and Purpose of organization: Located in the heart of the Beaver Creek Village, the cultural complex hosts a variety of acclaimed performances that one might expect to see at Carnegie Hall or the Kennedy Center. The intimate and inviting performance space was designed to exacting specifications to create perfect acoustics and unobstructed views from every seat. The pristine facility paired with a supportive and engaged audience base has allowed the VPAC to grow as an organization. 2014-2015 marks our 17th season presenting the highest quality of arts programming available. Over 17 years we have seen our audience and community exposed to the best that the touring industry has to offer. Each season we grow their knowledge and exposure to various genres of arts and culture, we continue to gain their trust, and we annually grow our support for this first class cultural center in the heart of the Rocky Mountains. The Vilar Performing Arts Center is a project of the Vail Valley Foundation. *IRS tax exempt status following, along with d/b/a paperwork. 2. I R S T a x E x e m p t L e t t e r Document must be filed electronically Paper documents will not be accepted. Document processing fee $20.00 Fees & forms/cover sheets are subject to change. To access other information or print copies of filed documents, visit www.sos.state.co.us and select Business Center. ABOVE SPACE FOR OFFICE USE ONLY Statement of Trade Name of a Reporting Entity filed pursuant to §7-71-103 and §7-71-107 of the Colorado Revised Statutes (C.R.S) 1.For the reporting entity delivering this statement, its ID number, true name, form of entity and the jurisdiction under the law of which it is formed are ID Number _________________________ (Colorado Secretary of State ID number) True name ______________________________________________________ Form of entity ______________________________________________________ Jurisdiction ______________________________________________________. 2.The trade name under which such entity transacts business or conducts activities or contemplates transacting business or conducting activities in this state is ______________________________________________________________________________________. 3.A brief description of the kind of business transacted or activities conducted or contemplated to be transacted or conducted in this state under such trade name is ______________________________________________________________________________________. 4.(If the following statement applies, adopt the statement by marking the box and include an attachment.) This document contains additional information as provided by law. 5.(Caution: Leave blank if the document does not have a delayed effective date. Stating a delayed effective date has significant legal consequences. Read instructions before entering a date.) (If the following statement applies, adopt the statement by entering a date and, if applicable, time using the required format.) The delayed effective date and, if applicable, time of this document are ____________________________. (mm/dd/yyyy hour:minute am/pm) Notice: Causing this document to be delivered to the Secretary of State for filing shall constitute the affirmation or acknowledgment of each individual causing such delivery, under penalties of perjury, that such document is such individual's act and deed, or that such individual in good faith believes such document is the act and deed of the person on whose behalf such individual is causing such document to be delivered for filing, taken in conformity with the requirements of part 3 of article 90 of title 7, C.R.S. and, if applicable, the constituent documents and the organic statutes, and that such individual in good faith believes the facts stated in such document are true and such document complies with the requirements of that Part, the constituent documents, and the organic statutes. TRDNM_RE Page 1 of 2 Rev. 01/01/2008 VAIL VALLEY FOUNDATION Colorado 19871422974 Vilar Performing Arts Center Performing Arts Center Nonprofit Corporation Colorado Secretary of State Date and Time: 09/09/2011 12:29 PM ID Number: 20111513179 Document number: 20111513179 Amount Paid: $20.00 2. D/B/A Paperwork This perjury notice applies to each individual who causes this document to be delivered to the Secretary of State, whether or not such individual is identified in this document as one who has caused it to be delivered. 6. The true name and mailing address of the individual causing this document to be delivered for filing are ____________________ ______________ ______________ _____ (Last) (First) (Middle) (Suffix) ______________________________________________________ (Street number and name or Post Office Box information) ______________________________________________________ __________________________ ____ ____________________ (City) (State) (Postal/Zip Code) _______________________ ______________. (Province – if applicable) (Country – if not US) (If the following statement applies, adopt the statement by marking the box and include an attachment.) This document contains the true name and mailing address of one or more additional individuals causing the document to be delivered for filing. Disclaimer: This form/cover sheet, and any related instructions, are not intended to provide legal, business or tax advice, and are furnished without representation or warranty. While this form/cover sheet is believed to satisfy minimum legal requirements as of its revision date, compliance with applicable law, as the same may be amended from time to time, remains the responsibility of the user of this form/cover sheet. Questions should be addressed to the user’s legal, business or tax advisor(s). TRDNM_RE Page 2 of 2 Rev. 01/01/2008 80302 1470 Walnut Street, Suite 300 MauraCoffin c/o Faegre & Benson LLP CO United States Boulder M. 3. Description of Event or Program: We are requesting funding to help with 2014-2015 year of programing. Our current programs can be split into three season: Winter, Summer and Underground Sound/Off-Season. Below is a summary of the elements of which these programs entail. Our programs reach a full-time year-round population of the Eagle River Valley, as well as a transient resort population at the surrounding ski resorts. A key community element for our programs is maintaining the balance between the resort tourist traffic, our second home owners, our year round residents, and our underserved workers and their families. In the Winter season, we program 55 artists from Thanksgiving to Easter. We believe that we will be most successful as a performing arts center if we keep our programming diverse, offering something for everyone in any given week. Genres range from jazz, blues, country, and classical concerts as well as ballet and contemporary dance troupes, comedy, theatre, Broadway touring productions, and family friendly shows. The Summer season we program to complement our other non-profit partners who present classical music, jazz, and dance. We present high profile touring concert artists so that our community has the opportunity for diverse programming year round. Our partners also rent our facility in the summer for some of their more intimate concert events (Bravo! Vail, Vail International Dance Festival). Artists on the Summer 2014 season include Joe Bonamassa and Trace Adkins. We aim to reach a broad base of music lovers, and each of these concerts builds our audience base by introducing many to the venue. Most of our concerts on the summer season would play large outdoor venues like Red Rocks Amphitheater; however, with financial support from our donors, we offer an alternative concert experience that features precision acoustics and intimate performances in our 535 seat theatre. As Alison Krauss said from our stage in 2011, “this is one of the most beautiful theatres, if not the prettiest that we’ve ever had the chance to play in”. We have a shoulder season that we call the “Off-Season” where we program as series called “Underground Sound: Love for the Locals”. The series boasts an affordable price ($100 for 7 shows and 7 drinks), and consists of 7 talented and stylistically differing performers. This is a great price for our locals (a 60% discount) who are very deserving of world class entertainment in the shoulder seasons, and it’s a great reward to them once the heavy Summer season has started, and just prior to the Winter season beginning. Several businesses purchase these transferrable passes for employee appreciation passes, and our Vilar Guild donates passes each year to the Eagle County school system. 4.Request Fund Amount: We are asking for a combination of cash and in kind support from the Town of Avon. The combination would have a total value of $35,000 (recognizing TOA as a VPAC Facility Sponsor); of that $20,000 is cash and $15,000 is in-kind donations. Funds are needed during our 2014-2015 fiscal year which is October 1, 2014-September 30, 2015. However based on TOA’s schedule, we could adjust this schedule so that it’s in a window that still allows partnerships for all three of the programming seasons. 5.Other Funds: Fund Awarded: WESTAF: $4,150 ($2,000 for artist in residence Cirque Mechanics, $2,150 for artist in residence MOMIX) United Way: $6,500 (The STARS, Supporting the Arts Reaching Students, Program) Beaver Creek Resort Company: $1,035,815 (annual support contract) Funds Applied for: Colorado Creative Industries: $10,000 Requested Vail Resort ECHO Program: $10,000 Requested Annual Individual Donor Support: $1,186,850 Estimated for next fiscal Facility Sponsorship Support: $115,000 (from US Bank, Triumph Partners, and other local companies) 6. Budget to follow 7. 2013 Final Profit and loss to follow A B C Notes (if needed) TEXT CANNOT EXCEED 60 CHARACTERS Cash IncomeCash IncomeCash Income Last FY Current FY Next FY 1Ticket Sales & Admissions $1,441,575$1,316,014$1,350,000 2Memberships $0 $0 $0 3Merchandise/Concession Sales $94,996 $94,000 $100,000 4Facilty Rental $283,263 $214,000 $215,000 5Program Fees $0 $0 $0 6Other Earned Revenue (explanation required)$0 $82,100 $80,000 Ad sales program book 5 Total Earned Income $1,819,834$1,706,114$1,745,000 8Federal $0 $0 $0 9State (DO NOT INCLUDE Colorado Creative Industries Grants)$2,250 $2,250 $4,150 WESTAF Grant 10Colorado Creative Industries Grants $10,000 $0 $10,000 11County or Local Government 0 $3,500 $6,500 United Way 12Scientific & Cultural Facilities District (SCFD) Grants $0 $0 $0 13 Total Public Support Income $12,250 $5,750 $20,650 14Individual Contributions $1,186,556$1,102,764$1,200,000 15Foundation Grants $95,000 $95,000 $95,000 16Corporate Support/Sponsorships $1,255,357$1,316,000$1,300,000 17Special Events $0 $0 $0 18Other Support Income (explanation required)$0 $0 $0 19 Total Support Income $2,536,913$2,513,764$2,595,000 20Interest Income $6,650 $2,550 $5,000 21Box Office Fees $116,591 $115,000 $115,000 22 23 24 25 Total Miscellaneous Income $123,241 $117,550 $120,000 $4,492,238$4,343,178$4,480,650 26Goods $40,530$50,530$50,530 27Services $33,000$33,000$33,000 28 Total In-Kind Contributions $73,530$83,530$83,530 A B C Notes (if needed) TEXT CANNOT EXCEED 60 CHARACTERS Last FY Current FY Next FY 29 Administrative Salaries and Benefits $1,153,038$1,137,058$1,200,000 30Artistic/Program Salaries and Benefits $286,950 $278,500 $280,000 31Artistic/Program Contractor Fees $1,378,814$1,342,018$1,400,000 32Exhibition/Performance Production Expenses $323,386 $349,000 $350,000 33Artistic/Program Materials and Supplies $15,726 $33,000 $33,000 Current FY community parking program 34Royalties/Licensing Fees $17,000 $18,000 $18,000 35Grants Given to Other Organizations $36,248 $38,000 $38,000 Community Performance Fund 36Miscellaneous Artistic/Program (explanation required)$61,675 $62,000 $62,000 Program Fundraising Direct Cost 37Office Expenses and Supplies $193,326 $147,900 $150,000 38 Meetings, Entertainment, Travel and Lodging (including per diems)$20,487 $27,500 $28,000 39Advertising and Publicity $232,473 $308,925 $310,000 40Accounting and Legal Professional Fees $12,817 $15,250 $15,500 41Miscellaneous Administrative (explanation required)$0 $0 $0 42Rent $229,709 $259,700 $265,000 43Operations and Maintenance $66,750 $66,000 $66,000 44Insurance (non-employment related)$64,653 $60,000 $60,000 45Miscellaneous Operations (explanation required)$0 $0 $0 46Merchandise/Concessions Expenses $95,364 $96,500 $96,500 47 Miscellaneous Earned Income Expenses (explanation required)$78,215 $20,500 $18,000 Facility Rentals 48Bad Debt Expense (explanation required)$7,072 $15,000 $15,000 49Other (explanation required) $4,273,701 $4,274,851 $4,405,000 50Goods $51,419$50,530$50,530 51Services $0 $33,000 $33,000 52 Total In-Kind Expenses $51,419$83,530$83,530 A: Include ACTUAL expenses for the most recently completed fiscal year as of submission date. B: Include PROJECTED expenses for entire current fiscal year. C: Include PROJECTED expenses for next fiscal year budget. Cash ExpensesCash Expenses Value In Kind Contributions Cash Expenses EXPENSES Operations and Facilities Administrative Expenses Organizational Three Year Financial Summary Earned Income Public Support Income (Grants/Contracts) Private Support Income Applicant Name: INCOME A: Include ACTUAL income for the most recently completed fiscal year as of submission date. B: Include PROJECTED income for entire current fiscal year. C: Include PROJECTED income for next fiscal year budget. 0 In-Kind Expenses (should match Value of In Kind Contributions Total All Operating Expenses Total All Operating Income Miscellanous Income (please list below) Salaries and Wages Direct Artistic/Program Expenses Applicant Name: Earned Income Expenses Other Expenses 6. Anticipated Line Item Budget Consolidated Financial Statements September 30, 2013 and 2012 Vail Valley Foundation 7. 2013 Final Actual Profit and Loss Statement Vail Valley Foundation Table of Contents September 30, 2013 and 2012 Independent Auditor’s Report .................................................................................................................................... 1 Financial Statements Consolidated Statements of Financial Position ...................................................................................................... 2 Consolidated Statements of Activities ................................................................................................................... 3 Consolidated Statements of Cash Flows ................................................................................................................ 5 Notes to Consolidated Financial Statements .......................................................................................................... 6 Independent Auditor’s Report on Supplementary Information ............................................................................... 26 Supplementary Information Schedule of Consolidated Program Revenues and Expenses .............................................................................. 27 1 www.eidebailly.com 5299 DTC Blvd., Ste. 1000 | Greenwood Village, CO 80111-3329 | TF 877.882.9856 | T 303.770.5700 | F 303.770.7581 | EOE Independent Auditor’s Report To the Board of Directors Vail Valley Foundation Avon, Colorado Report on the Financial Statements We have audited the accompanying consolidated financial statements of Vail Valley Foundation, which comprise the statements of financial position as of September 30, 2013 and 2012, and the related consolidated statements of activities and cash flows for the years then ended, and the related notes to the financial statements. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Vail Valley Foundation as of September 30, 2013 and 2012, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Greenwood Village, Colorado February 18, 2014 See Notes to Consolidated Financial Statements 2 Vail Valley Foundation Consolidated Statements of Financial Position September 30, 2013 and 2012 2013 2012 Assets Cash and cash equivalents 3,425,756$ 1,865,077$ Cash held for 2015 FIS Alpine World Ski Championships 6,780,532 2,144,376Accounts receivable, net 210,370 500,600 Promises to give, net 3,004,122 4,323,150 Prepaid expenses and other assets 186,773 100,350 Long-term investments 5,805,151 5,123,717Deferred bond offering costs, net 255,553 191,015Property and equipment, net 21,237,381 19,224,286 Goodwill and intangible assets, net 534,398 542,398 Endowment investments 3,769,547 3,644,702 Total Assets 45,209,583$ 37,659,671$ Liabilities and Net AssetsAccounts payable 60,631$ 107,022$ Accrued expenses and other liabilities 1,258,288 830,524Refundable advances 94,777 175,375Deferred revenue 876,310 317,795 Deferred membership benefits 521,822 357,078Line of credit - 989,751 GRFA loan payable 137,431 - Bonds payable 5,570,000 5,600,000 Interest rate swap 1,110,387 1,640,209Foreign currency swap 2,205,282 1,211,546 Total liabilities 11,834,928 11,229,300 Net AssetsUnrestrictedUndesignated 6,119,806 910,298 Invested in property and equipment, net of related debt 15,529,950 13,624,286 21,649,756 14,534,584 Temporarily restricted 8,441,602 8,612,490 Permanently restricted 3,283,297 3,283,297 Total net assets 33,374,655 26,430,371 Total Liabilities and Net Assets 45,209,583$ 37,659,671$ See Notes to Consolidated Financial Statements 3 Vail Valley Foundation Consolidated Statement of Activities Year Ended September 30, 2013 Temporarily PermanentlyUnrestrictedRestrictedRestricted Total Revenue, Support and GainsProgram revenue 8,374,203$ 75,556$ -$ 8,449,759$ Sponsorships 4,392,597 - - 4,392,597 Contributions 4,081,385 9,050,832 - 13,132,217 In-kind contributions 3,121,145 148,193 - 3,269,338 Exchange portion of membership dues 1,465,927 - - 1,465,927 Net investment return 116,913 897,535 - 1,014,448 Other revenue 5,567 14,976 - 20,543 Gross special events revenue 518,192 1,179,691 - 1,697,883 Less cost of direct benefits to donors (250,358) (338,711) - (589,069) Net special events revenue 267,834 840,980 - 1,108,814 Net assets released from restrictions 11,167,209 (11,167,209) - - Total revenue, support and gains 32,992,780 (139,137) - 32,853,643 Expenses and LossesProgram services expense 19,151,930 - - 19,151,930 General and administrative 2,424,451 - - 2,424,451 Fundraising 2,333,234 - - 2,333,234 Depreciation and amortization 1,244,689 - - 1,244,689 Interest expense 259,390 - - 259,390 Loss on uncollectible promises to give - 31,751 - 31,751 Total expenses and losses 25,413,694 31,751 - 25,445,445 Change in net assets before change in valueof interest rate swap and foreign currency swap 7,579,086 (170,888) - 7,408,198 Change in value of interest rate swap 529,822 - - 529,822 Change in value of foreign currency swap (993,736) - - (993,736) Change in Net Assets 7,115,172 (170,888) - 6,944,284 Net Assets, Beginning of Year 14,534,584 8,612,490 3,283,297 26,430,371 Net Assets, End of Year 21,649,756$ 8,441,602$ 3,283,297$ 33,374,655$ See Notes to Consolidated Financial Statements 4 Vail Valley Foundation Consolidated Statement of Activities Year Ended September 30, 2012 Temporarily PermanentlyUnrestrictedRestrictedRestricted Total Revenue, Support and GainsProgram revenue 3,224,768$ 61,477$ -$ 3,286,245$ Sponsorships 7,216,453 - - 7,216,453 Contributions 2,953,814 7,620,713 100,177 10,674,704 In-kind contributions 3,421,490 166,330 - 3,587,820 Exchange portion of membership dues 1,326,262 - - 1,326,262 Net investment return 108,795 1,106,135 - 1,214,930 Other revenue 148,323 - - 148,323 Gross special events revenue 440,876 976,160 - 1,417,036 Less cost of direct benefits to donors (263,024) (397,262) - (660,286) Net special events revenue 177,852 578,898 - 756,750 Net assets released from restrictions 6,969,563 (6,969,563) - - Total revenue, support and gains 25,547,320 2,563,990 100,177 28,211,487 Expenses and LossesProgram services expense 18,990,380 - - 18,990,380 General and administrative 2,594,287 - - 2,594,287 Fundraising 1,581,435 - - 1,581,435 Depreciation and amortization 1,198,944 - - 1,198,944 Interest expense 234,080 - - 234,080 Loss on uncollectible promises to give - 88,809 - 88,809 Total expenses and losses 24,599,126 88,809 - 24,687,935 Change in net assets before change in valueof interest rate swap and foreign currency swap 948,194 2,475,181 100,177 3,523,552 Change in value of interest rate swap 156,931 - - 156,931 Change in value of foreign currency swap 917,880 - - 917,880 Change in Net Assets 2,023,005 2,475,181 100,177 4,598,363 Net Assets, Beginning of Year 12,511,579 5,514,338 3,183,120 21,209,037 Excess of assets acquired over liabilities assumedin acquisition of Youth Foundation - 622,971 - 622,971 Net Assets, End of Year 14,534,584$ 8,612,490$ 3,283,297$ 26,430,371$ See Notes to Consolidated Financial Statements 5 Vail Valley Foundation Consolidated Statements of Cash Flows Years Ended September 30, 2013 and 2012 2013 2012Cash Flows from Operating ActivitiesChange in net assets 6,944,284$ 4,598,363$ Adjustments to reconcile change in net assets to net cash from (used for) operating activitiesDepreciation and amortization 1,244,689 1,198,944 Net investment (return) loss (1,014,448) (1,077,678) Contributions restricted to endowment - (100,177) Losses on uncollectible promises to give 31,751 88,809 Change in value of interest rate swap (529,822) (156,931) Change in value of foreign currency swap 993,736 (917,880) Change in operating assets and liabilitiesAccounts receivable 290,230 (602,441) Promises to give 1,287,277 (2,294,438) Prepaid expense and other assets (86,423) (36,179) Accounts payable (46,391) 59,887 Accrued expenses and other liabilities 427,764 (47,917) Deferred revenue and refundable advances 642,661 (425,387) Net Cash from (used for) Operating Activities 10,185,308 286,975 Cash Flows from Investing Activities Additions to investment portfolio, net (172,245) (156,617) Purchase of property and equipment (3,236,256) (713,345) Additional payment for Summer Mountain Games - (42,500) Cash balance acquired in acquisition of Youth Foundation - 499,642 (Addition to) withdrawal from endowment 380,414 307,956 Net Cash from (used for) Investing Activities (3,028,087) (104,864) Cash Flows from Financing ActivitiesCollection of contributions restricted to endowment - 100,177 Net borrowings (repayments) under line of credit (989,751) 989,751 Borrowing under GRFA loan payable 137,431 - Principal payments on bonds (105,000) (100,000) Payments on refinance of bonds payable (3,066) - Net Cash from (used for) Financing Activities (960,386) 989,928 Net Change in Cash and Cash Equivalents 6,196,835 1,172,039 Cash and Cash Equivalents, Beginning of Year 4,009,453 2,837,414 Cash and Cash Equivalents, End of Year 10,206,288$ 4,009,453$ Supplemental Disclosure of Cash Flow InformationCash paid during the year for interest 259,390$ 234,080$ 6 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 1 - Principal Activities and Significant Accounting Policies Organization Vail Valley Foundation (the “Foundation”) is a nonprofit organization whose mission is to enhance the quality of life in the Vail Valley of Colorado through the organization and sponsorship of cultural, educational and athletic programs and events. Vilar Center Arts Foundation (“Vilar Center”) is a nonprofit organization whose sole purpose is to hold the specific property known as the Vilar Performing Arts Center. Youth Foundation (“Youth Foundation”) is a nonprofit organization whose mission is to prepare children in need for success in life through education and recreational opportunities. Effective January 1, 2012, Youth Foundation became a subsidiary entity of the Foundation. The Foundation accomplishes its mission through a variety of programs and activities. Athletics The Foundation is responsible for providing the Vail Valley community with some of its most treasured annual athletic events, such as the American Ski Classic, Summer and Winter Mountain Games, Birds of Prey World Cup Race Week and the USA Pro Cycling Challenge. In February 2015 the Foundation will stage the 2015 FIS Alpine World Ski Championships (AWSC) (Note 16). This is the third time the Foundation has been chosen to stage the AWSC in Vail/Beaver Creek (1989 and 1999 were the previous two occasions). Arts The organization owns and operates two performing-arts venues in the exquisite Vilar Performing Arts Center (VPAC) in Beaver Creek and the award-winning Gerald R. Ford Amphitheater (GRFA) in Vail. In addition, the Foundation provides the Vail Valley community with the Vail International Dance Festival, an annual event since 1989. The VPAC is a premier year-round performing-arts venue which showcases a diverse lineup of entertainment options that include concerts, Broadway musicals, classical, dance and comedy performances, family programming and community events. In addition, the VPAC is an invaluable community asset, playing host to a variety of youth performances, fundraising events and the STARS (Support the Arts Reaching Children) series. The GRFA is home to the Foundation’s Vail International Dance Festival and one of the Foundation’s trio of free concert series. In addition, the GRFA hosts the annual Bravo!-Vail Valley Music Festival. Education The Foundation’s education initiatives, spearheaded by Youth Foundation, reach from cradle to college with a focused early childhood development effort, after school academic and enrichment programs, summer academic and recreational programs, teenage mentorship and leadership development along with the Vail Valley’s largest collegiate scholarship program. 7 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Principles of Consolidation The consolidated financial statements include the accounts of the Foundation, Vilar Center and Youth Foundation because the Foundation has both control and an economic interest in Vilar Center and Youth Foundation. All significant intercompany accounts and transactions have been eliminated in consolidation. Unless otherwise noted, these consolidated entities are hereinafter referred to as “VVF”. Cash and Cash Equivalents VVF considers all cash and highly liquid financial instruments with original maturities of three months or less, and which are neither held for nor restricted by donors for long-term purposes, to be cash and cash equivalents. Cash and highly liquid financial instruments restricted to capital expenditures, permanent endowment, or other long-term purposes of VVF are excluded from this definition. Receivables and Credit Policies Accounts receivable consist primarily of non-interest bearing amounts. Management determines the allowance for uncollectible accounts receivable based on historical experience, an assessment of economic conditions, and a review of subsequent collections. Accounts receivable are written off when deemed uncollectible. At September 30, 2013 and 2012 management believes the amount of uncollectible balances to be insignificant and no allowance is reflected in the financial statements. Promises to Give Unconditional promises to give expected to be collected within one year are recorded at net realizable value. Unconditional promises to give expected to be collected in future years are initially recorded at fair value using present value techniques incorporating risk-adjusted discount rates designed to reflect the assumptions market participants would use in pricing the asset. In subsequent years, amortization of the discount is included in contribution revenue in the statement of activities. Management determines the allowance for uncollectible promises to give based on historical experience, an assessment of economic conditions, and a review of subsequent collections. Promises to give are written off when deemed uncollectible. At September 30, 2013 and 2012 management believes the amount of uncollectible balances to be insignificant and no allowance is reflected in the financial statements. Investments Investment purchases are recorded at cost, or if donated, at fair value on the date of donation. Thereafter, investments are reported at their fair values in the statement of financial position. Net investment return is reported in the statement of activities and consists of interest and dividend income, realized and unrealized capital gains and losses, less investment management and custodial fees. Deferred Bond Offering Costs Deferred bond offering costs are amortized using the effective interest rate method over the life of the bonds. 8 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Property and Equipment Property and equipment additions over $1,000 are recorded at cost or, if donated, at fair value on the date of donation. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets, or in the case of leasehold improvements, the lesser of the useful life of the asset or the lease term. When assets are sold or otherwise disposed of, the cost and related depreciation or amortization are removed from the accounts, and any remaining gain or loss is included in the statement of activities. Costs of maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed currently. VVF reviews the carrying values of property and equipment for impairment whenever events or circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. When considered impaired, an impairment loss is recognized to the extent the carrying value exceeds the fair value of the asset. There were no indicators of asset impairment during the years ended September 30, 2013 and 2012. Interest-Rate Swap VVF uses an interest-rate swap to mitigate interest-rate risk on the bonds payable (Note 9). The related liability or asset is reported at fair value in the statement of financial position, and unrealized losses or gains are included in the statement of activities. Foreign Currency Swap VVF uses a foreign currency swap to mitigate currency fluctuations on Euro contracts (Note 16). The related liability or asset is reported at fair value in the statement of financial position, and unrealized losses or gains are included in the statement of activities. Net Assets Net assets, revenues, gains, and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, net assets and changes therein are classified and reported as follows: Unrestricted Net Assets – Net assets available for use in general operations. Temporarily Restricted Net Assets – Net assets subject to donor restrictions that may or will be met by expenditures or actions of VVF and/or the passage of time, and certain income earned on permanently restricted net assets that has not yet been appropriated for expenditure. VVF reports contributions as temporarily restricted support if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. Permanently Restricted Net Assets – Net assets whose use is limited by donor-imposed restrictions that neither expire by the passage of time nor can be fulfilled or otherwise removed by action of VVF. The restrictions stipulate that resources be maintained permanently but permit VVF to expend the income generated in accordance with the provisions of the agreements. 9 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Revenue and Revenue Recognition Revenue is recognized when earned. Program service fees received in advance are deferred to the applicable period in which the related services are performed. Contributions are recognized when cash, securities or other assets, an unconditional promise to give, or notification of a beneficial interest is received. Conditional promises to give are not recognized until the conditions on which they depend have been substantially met. Refundable advances arise from advance ticket sales and theater rental for future events and reflect the amount that VVF would be required to return should the event not occur. Deferred revenue arises from sponsorship payments received for future events and other revenues related to future periods. These deferred revenues will be recognized in the periods to which they apply. VVF receives contributions from various patron membership programs, several of which require multi-year commitments. Commitments beyond the current year, aside from the membership programs for the 2015 AWSC, are considered to be indications of a member’s intention to renew membership, and not as completed sales or unconditional promises to give, and therefore are not recorded. Depending on the patron membership agreement, patrons receive various benefits such as complimentary event tickets and ski passes. Deferred membership benefits represent the amount of estimated benefits purchased but not yet used by patron members as of September 30, 2013 and 2012. Donated Services and In-Kind Contributions Volunteers contribute significant amounts of time to VVF’s program services, administration, and fundraising and development activities; however, the financial statements do not reflect the value of these contributed services because they do not meet recognition criteria prescribed by generally accepted accounting principles. Contributed goods are recorded at fair value at the date of donation. VVF records donated professional services at the respective fair values of the services received. During the years ended September 30, 2013 and 2012, VVF recorded revenue (and corresponding expenses) of $3,269,338 and $3,587,820, respectively, related to in-kind contributions (Note 12). Advertising Costs Advertising costs are expensed as incurred, with $642,481 and $653,865, respectively, paid in cash and $981,406 and $1,158,265, respectively, recorded as in-kind donations received during the years ended September 30, 2013 and 2012. Functional Allocation of Expenses The costs of program and supporting services activities have been summarized on a functional basis in Note 14. Accordingly, certain costs have been allocated among the programs and supporting services benefited. 10 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Income Taxes The Foundation, Vilar Center and Youth Foundation are organized as Colorado nonprofit corporations and have been recognized by the Internal Revenue Service (IRS) as exempt from federal income taxes under Section 501(a) of the Internal Revenue Code as organizations described in Section 501(c)(3), and qualify for the charitable contribution deduction under Section 170(b)(1)(A)(vi). In addition, the Foundation has been determined not to be a private foundation under Section 509(a)(2) while Vilar Center and Youth Foundation have been determined not to be private foundations under Section 509(a)(1). Each entity is annually required to file a Return of Organization Exempt from Income Tax (Form 990) with the IRS. In addition, the entities are subject to income tax on net income that is derived from business activities that are unrelated to their exempt purposes. Vilar Center and Youth Foundation have determined they are not subject to unrelated business income tax and have not filed an Exempt Organization Business Income Tax Return (Form 990-T) with the IRS. The Foundation files an Exempt Organization Business Income Tax Return (Form 990-T) with the IRS to report its unrelated business taxable income and its tax filings are no longer subject to examination for years before 2009. No income taxes were paid during or for the years ended September 30, 2013 and 2012. VVF believes that it has appropriate support for any tax positions taken affecting its annual filing requirements, and as such, does not have any uncertain tax positions that are material to the financial statements. The entities would recognize future accrued interest and penalties related to unrecognized tax benefits and liabilities in income tax expense if such interest and penalties are incurred. Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and those differences could be material. Financial Instruments and Credit Risk VVF manages deposit concentration risk by placing cash deposits with financial institutions believed by management to be creditworthy. At times, amounts on deposit may exceed insured limits or include uninsured investments in money market mutual funds. To date, VVF has not experienced losses in any of these accounts. Credit risk associated with accounts receivable and promises to give is considered to be limited due to high historical collection rates and because substantial portions of the outstanding amounts are due from Board members and entities supportive of VVF’s mission. Investment recommendations on fund managers and portfolio allocations are made by an investment consultant to management and the Investment Committee of the Board of Directors. Although the fair values of investments are subject to fluctuation on a year-to-year basis, management and the Investment Committee believe that the investment policies and guidelines are prudent for the long-term welfare of VVF. Reclassifications Certain reclassifications of amounts previously reported have been made to the accompanying consolidated financial statements to maintain consistency between periods presented. The reclassifications had no impact on previously reported net assets. 11 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Subsequent Events VVF has evaluated subsequent events through February 18, 2014, the date on which the financial statements were available to be issued. Note 2 - Fair Value Measurements and Disclosures Certain assets and liabilities are reported at fair value in the consolidated financial statements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal, or most advantageous, market at the measurement date under current market conditions regardless of whether that price is directly observable or estimated using another valuation technique. Inputs used to determine fair value refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability based on the best information available. A three-tier hierarchy categorizes the inputs as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that VVF can access at the measurement date. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, and market-corroborated inputs. Level 3 – Unobservable inputs for the asset or liability. VVF has no assets or liabilities valued using Level 3 inputs. In some cases, the inputs used to measure the fair value of an asset or a liability might be categorized within different levels of the fair value hierarchy. In those cases, the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. Assessing the significance of a particular input to the entire measurement requires judgment, taking into account factors specific to the asset or liability. The categorization of an asset within the hierarchy is based upon the pricing transparency of the asset and does not necessarily correspond to VVF’s assessment of the quality, risk or liquidity profile of the asset or liability. The majority of VVF’s investment assets are classified within Level 1 because they are comprised of open-end mutual funds and equity securities with readily determinable fair values based on daily redemption values or closing market prices, respectively. The hedge funds are valued by utilizing the audited financial statements of the entities, which include information regarding fair value of assets, and VVF’s ownership percentage of the entities. The interest rate swap and the foreign currency swap are valued using proprietary discounted cash flow models from independent parties which consider past, present and future assumptions regarding interest rates and market conditions to estimate the fair value of the agreements. These assets and liabilities are classified within Level 2. 12 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 The following table presents assets and liabilities measured at fair value on a recurring basis, except those measured at cost as identified below, at September 30, 2013: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)Assets Long-term investmentsCash and money market funds (at cost)241,112$ -$ -$ -$ Bond funds 1,071,067 1,071,067 - - Domestic equity mutual funds 1,816,474 1,816,474 - - International equity mutual funds 1,568,161 1,568,161 - - U.S. stock funds 1,006,006 1,006,006 - - International stock funds 31,282 31,282 - - Preferred stock funds 71,048 71,048 - - 5,805,151$ 5,564,039$ -$ -$ Endowment investmentsCash and money market funds (at cost)156,565$ -$ -$ -$ Bond funds 695,493 695,493 - - Domestic equity mutual funds 1,179,518 1,179,518 - - International equity mutual funds 1,018,278 1,018,278 - - U.S. stock funds 653,246 653,246 - - International stock funds 20,313 20,313 - - Preferred stock funds 46,135 46,135 - - 3,769,547$ 3,612,982$ -$ -$ Liabilities Interest rate swap 1,110,387$ -$ 1,110,387$ -$ Foreign currency swap 2,205,282$ -$ 2,205,282$ -$ Fair Value Measurements at Report Date Using 13 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 The following table presents assets and liabilities measured at fair value on a recurring basis, except those measured at cost as identified below, at September 30, 2012: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Long-term investmentsCash and money market funds (at cost)311,978$ -$ -$ -$ Bond funds 1,296,185 1,296,185 - - Domestic equity mutual funds 1,394,647 1,394,647 - - International equity mutual funds 1,234,650 1,234,650 - - U.S. stock funds 789,660 789,660 - - International stock funds 30,414 30,414 - - Preferred stock funds 61,796 61,796 - - Hedge funds 4,387 - 4,387 - 5,123,717$ 4,807,351$ 4,387$ -$ Endowment investmentsCash and money market funds (at cost)221,923$ -$ -$ -$ Bond funds 922,027 922,027 - - Domestic equity mutual funds 992,067 992,067 - - International equity mutual funds 878,256 878,256 - - U.S. stock funds 561,716 561,716 - - International stock funds 21,634 21,634 - - Preferred stock funds 43,958 43,958 - - Hedge funds 3,121 - 3,121 - 3,644,702$ 3,419,659$ 3,121$ -$ Liabilities Interest rate swap 1,640,209$ -$ 1,640,209$ -$ Foreign currency swap 1,211,546$ -$ 1,211,546$ -$ Fair Value Measurements at Report Date Using 14 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Fair Value of Financial Instruments Not Required To Be Reported at Fair Value The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities, deferred revenue, and line of credit payable approximate fair value due to the short-term nature of the items. The carrying amount of promises to give due in more than one year is based on the discounted net present value of the expected future cash receipts, and approximates fair value. The fair values of bonds payable are based on estimates provided by the direct purchaser of the bonds. The financial instruments not required to be recorded at fair value are categorized according to the fair value hierarchy as follows: LevelCash and cash equivalents 1 Accounts receivable 1Accounts payable 1 Accrued expenses and other liabilities 1Deferred revenue 1Line of credit payable 1Promises to give 2Bonds payable 2 Note 3 - Net Investment Return Net investment return consists of the following for the years ended September 30, 2013 and 2012: 2013 2012 Long-term investmentsInterest and dividends 174,596$ 159,614$ Net realized and unrealized gain (loss)345,284 479,116 Less investment management and custodial fees (10,691) (10,234) 509,189 628,496 Endowment investmentsInterest and dividends 156,212 141,787 Net realized and unrealized gain (loss)360,407 455,323 Less investment management and custodial fees (11,360) (10,676) 505,259 586,434 1,014,448$ 1,214,930$ 15 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 4 - Promises to Give Unconditional promises to give are estimated to be collected as follows as of September 30, 2013 and 2012: 2013 2012 Within one year 2,419,725$ 3,073,427$ In one to five years 608,700 897,033 Over five years - 401,209 3,028,425 4,371,669 Less discount to net present value (4.0%)(24,303) (48,519) 3,004,122$ 4,323,150$ Note 5 - Deferred Bond Offering Costs Future amortization expense related to deferred bond offering costs is expected to be recognized as follows: 2014 10,669$ 2015 10,669 2016 10,669 2017 10,669 2018 10,669 Thereafter 202,207 255,553$ Note 6 - Property and Equipment Property and equipment consists of the following at September 30, 2013 and 2012: Estimated Useful Lives 2013 2012 Ford Amphitheater, including fixtures 25 years 13,147,989$ 10,318,797$ Vilar Center, including fixtures 25 years 17,851,723 17,633,856Office buildings 25 years 2,670,000 2,670,000 Furniture and equipment 3-10 years 2,129,615 1,940,41835,799,327 32,563,071 Less accumulated depreciation (14,561,946) (13,338,785) 21,237,381$ 19,224,286$ 16 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 7 - Goodwill and Intangible Assets VVF has goodwill and intangible assets as a result of its bond issuance and the acquisition of the Summer Mountain Games. Goodwill represents the excess of the purchase price over the fair value of net assets acquired, including the estimated fair value of the intangible assets. Goodwill and intangible assets consist of the following at September 30, 2013 and 2012: 2013 2012 Trademark and other 100,000$ 100,000$ Non-compete agreement 20,000 20,000Less accumulated amortization (38,000) (30,000) Amortizable intangible assets 82,000 90,000 Goodwill 452,398 452,398 534,398$ 542,398$ Amortization of the intangible assets (excluding goodwill) is calculated using the straight-line method over the terms of the respective assets. Amortization expense for all intangible assets for each of the years ended September 30, 2013 and 2012 was $21,528. Future amortization expense related to intangibles is expected to be recognized as follows: 8,000$ 8,000 8,000 8,000 8,000 Thereafter 42,000 82,000$ 2014 20152016 20172018 VVF reviews the carrying values of goodwill and intangible assets for impairment whenever events or circumstances indicate that the carrying value of the assets may not be recoverable from the estimated future cash flows expected to result from their use. When considered impaired, an impairment loss is recognized to the extent carrying value exceeds the fair value of the asset. There were no indicators of asset impairment during the years ended September 30, 2013 and 2012. 17 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 8 - Line of Credit VVF has a $1,200,000 revolving line of credit with a bank, secured by receivables, inventory, equipment, contract rights, investments and intangibles as well as the right to set off against all depository account balances. Borrowings under the line bear interest at the bank’s prime rate plus 1.0 % (4.25% at September 30, 2013 and 2012). Accrued interest and principal are due at maturity (July 2014). The agreement requires VVF to comply with certain financial and non-financial covenants, all of which VVF was in compliance with at September 30, 2013 and 2012. Note 9 - Bonds Payable On January 17, 2013, the Colorado Educational and Cultural Facilities Authority (the "Authority") issued $5,570,000 of Variable Rate Revenue Refunding Bonds Series 2013 (the “Bonds) to refinance VVF’s outstanding Series 2007 variable rate bonds. The interest rate on the Bonds is the LIBOR Index Rate, which is a per annum rate of interest established on each Computation date and effective on each related LIBOR Index Rate Reset Date (not to exceed 10%). The Bonds may be converted to a fixed interest rate by the Authority on any interest rate adjustment date upon direction of VVF. The Bonds are secured by a Deed of Trust on real property and an assignment of rents and leases. The Bonds mature with annual required principal payments through 2037. The Bonds contain certain financial covenants and VVF was in compliance with those covenants as of September 30, 2013. Future maturities are as follows: Year ending September 30, 120,000$ 140,000 145,000 150,000 155,000 Thereafter 4,860,000 5,570,000$ 2014 20152016 20172018 To hedge against interest rate risk on the variable-rate bonds, VVF entered into an interest rate swap (the Swap) with a major U.S. financial institution as the counterparty. The effect of the Swap is to convert VVF’s variable- rate debt to fixed-rate debt. VVF pays interest on the notional value at 3.987% and receives interest on the notional value at a variable rate based on 67% of one-month LIBOR on a monthly basis (0.1120% and 0.1407% at September 30, 2013 and 2012, respectively). The Swap matures on December 1, 2037 and has a declining notional value matching the outstanding note principal over time. The declining notional value will result in the interest rate swap liability converging to zero upon its maturity. During the years ended September 30, 2013 and 2012, the fair value of the liability under the Swap decreased $529,822 and $156,931, respectively, which has been reflected in the accompanying consolidated statements of activities. At September 30, 2013 and 2012, the fair value of the Swap liability was $1,110,387 and $1,640,209, respectively. 18 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 10 - Leases VVF leases office equipment, parking spaces and storage space under various noncancellable operating leases expiring through 2022. Future minimum lease payments are as follows: Year ending September 30, 2014 146,514$ 2015 128,492 2016 98,352 2017 74,250 2018 44,089 Thereafter 160,350 652,047$ Rent expense, including common area maintenance charges on VVF’s office space, for the years ended September 30, 2013 and 2012 was $199,659 and $178,098, respectively. In addition, VVF leases land from the Town of Vail on which the Ford Amphitheater is situated. The lease, which is rent-free, expires May 31, 2038, but may be extended to May 31, 2048. Upon expiration of the lease term, VVF will convey title to the Ford Amphitheater to the Town of Vail. The land is available only for recreational use, and as such, has a low commercial value considered by management to be immaterial for recording as an in-kind contribution and related rental expense in the statement of activities. Note 11 - Endowments VVF’s endowment (the Endowment) consists of five individual funds established by donors to provide annual funding for specific activities. Net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed restrictions. VVF’s Board of Directors has interpreted the Colorado Uniform Prudent Management of Institutional Funds Act (UPMIFA) as requiring the preservation of the fair value of the original gift as of the gift date of the donor- restricted endowment funds absent explicit donor stipulations to the contrary. As of September 30, 2013 and 2012 there were no such donor stipulations. As a result of this interpretation, VVF classifies as permanently restricted net assets (a) the original value of gifts donated to the Endowment, (b) the original value of subsequent gifts donated to the Endowment (including promises to give at fair value), and (c) accumulations to the Endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added. The remaining portion of the donor-restricted Endowment is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by VVF in a manner consistent with the standard of prudence prescribed by UPMIFA. VVF considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: 1. The duration and preservation of the fund 2. The purpose of the organization and the donor-restricted endowment fund 3. General economic conditions 4. The possible effect of inflation and deflation 5. The expected total return from income and the appreciation of investments 6. Other resources of the organization 7. The investment policies of the organization 19 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Investment and Spending Policies VVF attempts to achieve real growth of 5% in excess of inflation. Endowment assets are invested in a manner intended to provide, over time, a greater than 50% probability of achieving annualized returns of at least 5% plus the rate of inflation over a ten year period. Actual returns in any given year may vary from this amount. To satisfy its stated return objectives, VVF seeks to maintain a prudent level of risk that is no more than 20% greater than the risk of a passive benchmark comprised of 70% of the MSCI All-Country World index and 30% of the Barclays Aggregate Bond Index. VVF seeks to meet these goals through a diversified asset allocation, consisting primarily of an appropriate weighting of high quality equities and investment-grade fixed income investments to achieve its long-term objectives. VVF has a policy of appropriating for distribution only so much of the accumulated earnings in excess of the permanently restricted net assets of the Endowment as is necessary to fund discretionary expenses as determined by the Board of Directors. In establishing this policy, VVF considered the long-term expected return on the Endowment. Accordingly, over the long term, VVF expects to preserve the permanently restricted net assets of the Endowment. This is consistent with VVF’s objective to preserve the fair values of the original gifts made to the Endowment while providing an opportunity for real growth through new gifts and undistributed investment return. Changes in endowment net assets for the year ended September 30, 2013 consisted of the following: Temporarily PermanentlyRestrictedRestricted Total Endowment net assets at October 1, 2012 361,405$ 3,283,297$ 3,644,702$ Investment return:Interest and dividend income, net of fees 144,852 - 144,852 Net realized and unrealized gain 360,407 - 360,407 505,259 - 505,259 Appropriation of endowment assets for expenditure (380,414) - (380,414) Endowment net assets at September 30, 2013 486,250$ 3,283,297$ 3,769,547$ Changes in Endowment net assets for the year ended September 30, 2012 are as follows: Temporarily PermanentlyRestrictedRestricted Total Endowment net assets at October 1, 2011 183,104$ 3,183,120$ 3,366,224$ Investment return:Interest and dividend income, net of fees 131,111 - 131,111 Net realized and unrealized gain 455,323 - 455,323 586,434 - 586,434 Contributions - 100,177 100,177 Appropriation of endowment assets for expenditure (408,133) - (408,133) Endowment net assets at September 30, 2012 361,405$ 3,283,297$ 3,644,702$ 20 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 12 - Donated Materials VVF received donated materials as follows during the years ended September 30, 2013 and 2012: Program Services General and Administrative Fundraising TotalSeptember 30, 2013 Advertising 885,616$ -$ 95,790$ 981,406 Awards 336,013 - 52,403 388,416 Supplies 1,059,283 64,880 418,615 1,542,778 Lodging 356,738 - - 356,738 2,637,650$ 64,880$ 566,808$ 3,269,338$ September 30, 2012 Advertising 995,815$ -$ 162,450$ 1,158,265 Awards 637,931 - - 637,931 Supplies 854,979 61,800 505,412 1,422,191 Lodging 369,433 - - 369,433 2,858,158$ 61,800$ 667,862$ 3,587,820$ 21 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 13 - Restricted Net Assets Temporarily Restricted Temporarily restricted net assets at September 30, 2013 and 2012, consist of: 2013 2012 Restricted by donors for: Education programs 2,138,219$ 2,345,346$ Ford Amphitheater Garden Project 1,502,891 1,000,000 Gerald R. Ford Amphitheater 1,218,614 1,076,759 Vilar Center capital improvements 939,726 1,178,085 The Barbara Treat Foundation Fund 445,883 419,468 June S. Kang Scholarship 215,655 187,717 Buckman Blount Community Fund 140,847 118,140 The Equipment Fund 140,701 144,142 Vilar Guild 76,788 - The Helmut Fricker Scholarship Fund 16,311 15,841 Beaver Creek Resort Company programming series 16,229 - 2015 Alpine World Ski Championships - 338,434 Vail Global Energy Forum - 2,783 Unspent appreciation of Endowment funds which must beappropriated for expenditure before use, restricted by donors for:Gerald R. Ford Amphitheater 317,446 225,741 Vilar Center capital improvements 139,522 108,691 Buckman Blount Community Fund 29,282 26,973 Promises to give that are not restricted by donors, but which areunavailable for expenditure until due 1,103,488 1,424,370 Total 8,441,602$ 8,612,490$ 22 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Net assets were released from restrictions as follows during the years ended September 30, 2013 and 2012: 2013 2012 Satisfaction of purpose restrictions: Education programs 3,339,498$ 2,938,353$ Ford Amphitheater Garden Project 2,817,189 275,545 Vilar Center operations 1,000,000 1,050,000 2015 World Alpine Ski Championship 988,434 686,566 Other programs and events 716,060 516,500 Vail Global Energy Forum 389,660 229,064 Vilar Center capital improvements 248,835 144,760 Beaver Creek Resort Company programming series 169,885 - Vilar Guild 39,665 - The Barbara Treat Foundation Fund 23,500 23,500 June S. Kang Scholarship 5,000 18,076 The Equipment Fund 3,585 5,370 The Helmut Fricker Scholarship Fund - 3,150 Restricted-purpose Endowment appropriations:Vilar Center operations 277,479 317,081 Gerald R. Ford Amphitheater 56,532 27,748 Buckman Blount Community Fund 36,798 33,740 Vail Valley Foundation education programs 9,605 29,564 Expiration of time restrictions 1,045,484 670,546 11,167,209$ 6,969,563$ Permanently Restricted Permanently restricted net assets consist of endowment funds restricted by donors for investment in perpetuity. Earnings on endowment funds are available for the purposes specified by the donors, or in certain cases, for the unrestricted use of VVF. The permanently restricted net asset balances, classified by restriction on the use of earnings, are as follows at September 30, 2013 and 2012: 2013 2012 Vilar Center - General 1,977,978$ 1,977,978$ Vilar Center - Buckman Blount Community Use 251,117 251,117 Ford Amphitheater 1,000,000 1,000,000 Education 54,202 54,202 3,283,297$ 3,283,297$ 23 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 14 - Functionalized Expenses Total expenses by function were as follows for the years ended September 30, 2013 and 2012: 2013 2012 Programs 20,002,389$ 19,764,898$ General and administrative (includes investment management fees of $22,051 and $20,910)2,950,550 3,132,228 Fundraising and development (includes cost of direct benefits to donors of $589,069 and $660,286)3,071,875 2,383,196 Total functionalized expenses 26,024,814$ 25,280,322$ Note 15 - Retirement Plan VVF has a salary deferral plan under Section 401(k) of the Internal Revenue Code (the “Plan”). Full-time employees that have attained age 21 are eligible for participation in the Plan after completing one year of service, as defined, with VVF. Participants may contribute up to the lower of 100% of their pre-tax compensation, or $17,000 in 2013 and 2012. VVF matches the participants’ pre-tax contributions at 50% of the amount contributed for participants up to a maximum of $2,500 for each year. The participant portion of matching VVF contributions vests at the rate of 25% per year after the employee has completed two years of service. Contributions by VVF for the years ended September 30, 2013 and 2012 totaled $59,964 and $54,249, respectively. Note 16 - Commitments and Contingencies 2015 Alpine World Ski Championships (2015 AWSC) The awarding of the 2015 AWSC obligates VVF for all costs of the event, which will be partially offset by the FIS payments. To defray expected costs relating to the infrastructure for the event, Federation Internationale de Ski (FIS) will make a total of five payments to VVF totaling €28,050,000 at various set dates during the contract term per the FIS Hosting Contract. VVF is anticipating that the cost of the event will exceed the FIS payments and has received contributions from prominent local and national entities to assist with the anticipated additional cost. Because the value of the EUROs varies with the market, VVF is exposed to variability in the payments to be received from FIS. In order to hedge such variability, management has entered into a series of foreign currency swap agreements which coincide with the payment schedule from FIS. During the years ended September 30, 2013 and 2012, the fair value of the liability under the foreign currency swap agreements increased $993,736 and decreased $917,880, respectively, which has been reflected in the accompanying consolidated statements of activities. At September 30, 2013 and 2012, the fair value of the foreign currency swap liability was $2,205,282 and $1,211,546, respectively. The notional value of the foreign currency swap decreases on dates that coincide with the payments from FIS and shall be zero upon the last payment from FIS. 24 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 VVF also purchased event cancelation insurance in October 2013 to mitigate risk of event cancelation. The policy period runs through February 15, 2015 with a total premium of $944,331 to be paid by VVF over the period. In addition, during the year ended September 30, 2013 two contracts were executed by VVF in regards to commercial and broadcasting rights for the 2015 AWSC: • A Commercial Rights Exploitation of the 2015 AWSC contract gives certain sponsorship, naming, merchandising, licensing, promotion, supply, marketing and hospitality rights to VVF and entitles VVF to the revenues from these rights. VVF will pay a total of $1,000,000 under this agreement and paid $300,000 during 2013. • A Host Broadcaster Services Agreement appoints a third party to undertake, provide, and deliver host broadcaster services and various other related broadcasting services in relation to the 2015 AWSC as required by the FIS Hosting Contract. VVF will pay a total of for $6,650,000 under this agreement. The following table shows VVF’s commitments under the above contracts and the years payments are due: Total FY 2013 FY 2014 FY 2015 Commercial Rights Exploitation 1,000,000$ 300,000$ 300,000$ 400,000$ Host Broadcaster Services 6,650,000 - 3,325,000 3,325,000 Event Cancellation Policy 944,331 - 424,949 519,382 8,594,331$ 300,000$ 4,049,949$ 4,244,382$ The following table shows VVF’s expense recognition per contract per fiscal year: Total FY 2013 FY 2014 FY 2015 Commercial Rights Exploitation 1,000,000$ 300,000$ 300,000$ 400,000$ Host Broadcaster Services 6,650,000 332,500 1,330,000 4,987,500 Event Cancellation Policy 944,331 - 649,228 295,103 8,594,331$ 632,500$ 2,279,228$ 5,682,603$ Town of Vail GRFA Remodel Agreements On November 20, 2012 VVF entered into an agreement with the Town of Vail (TOV) to construct major improvements to the Gerald R. Ford Amphitheater (GRFA). The estimated cost of the project was $7,240,322 over two phases, of which the TOV would cover the first $2.1 million of construction costs for Phase 1 with VVF funding the remainder of the project. As of September 30, 2013 the TOV had funded their $2.1 million through contributions made to reimburse VVF for construction costs of Phase 1. During the construction of Phase 1, the TOV Town Council opted to make certain revisions to the project scope and construction schedule, thereby requiring revisions to the cost-sharing arrangement in the original agreement. On August 1, 2013 the First Amendment to the TOV and VVF Cost Sharing Agreement was executed which amended the original agreement to say the TOV would pay all costs of Phase 1 up to $3,089,650 and planning costs incurred for Phase II of $211,099. The amount over the original $2.1 million ($1,200,749) will become an interest free loan from the TOV to VVF payable no later than May 18, 2018. The balance on the loan as of September 30, 2013 is $137,431. Supplementary Information September 30, 2013 and 2012 Vail Valley Foundation 26 www.eidebailly.com 5299 DTC Blvd., Ste. 1000 | Greenwood Village, CO 80111-3329 | TF 877.882.9856 | T 303.770.5700 | F 303.770.7581 | EOE Independent Auditor’s Report on Supplementary Information To the Board of Directors Vail Valley Foundation Avon, Colorado We have audited the consolidated financial statements of Vail Valley Foundation as of and for the years ended September 30, 2013 and 2012, and our report thereon dated February 18, 2014, which expressed an unmodified opinion on those financial statements, appears on page 1. Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements taken as a whole. The schedule of consolidated program revenues and expenses is presented for the purposes of additional analysis and is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the consolidated financial statements as a whole. Greenwood Village, Colorado February 18, 2014 27 Vail Valley Foundation Schedule of Consolidated Program Revenues and Expenses Years Ended September 30, 2013 and 2012 2013 20122015 Alpine World Ski Championships Revenue and contributions 6,587,146$ 3,210,166$ Expenses (2,031,259) (686,560) 4,555,887 2,523,606 Vilar Performing Arts Center Revenue and contributions 4,643,600 4,376,174 Expenses (4,451,173) (4,350,609) 192,427 25,565 Youth Foundation Education Programs Revenue and contributions 3,218,044 2,365,129Expenses(3,454,960) (2,804,905) (236,916) (439,776) Birds of Prey Revenue and contributions 2,897,371 4,093,355 Expenses (2,828,620) (3,876,802) 68,751 216,553 Summer Mountain Games Revenue and contributions 1,974,465 2,018,828 Expenses (1,867,966) (1,804,837) 106,499 213,991 Vail International Dance Festival Revenue and contributions 1,614,721 1,543,327 Expenses (1,698,334) (1,634,083) (83,613) (90,756) American Ski Classic Revenue and contributions 1,242,983 1,284,750Expenses(1,280,432) (1,460,978) (37,449) (176,228) Winter Mountain Games Revenue and contributions 1,053,317 1,329,298 Expenses (1,265,787) (1,221,078) (212,470) 108,220 Gerald R. Ford Amphitheater Revenue and contributions 547,305 1,964,320 Expenses (594,589) (698,585) (47,284) 1,265,735 USA Pro-Cycling Challenge Revenue and contributions 409,127 110,208 Expenses (403,563) (208,885) 5,564 (98,677) Vail Global Energy Forum Revenue and contributions 386,877 261,683 Expenses (398,641) (244,065) (11,764) 17,618 Other Education ProgramsRevenue and contributions 75,105 405,160 Expenses (255,000) (753,149) (179,895) (347,989) Street BeatRevenue and contributions - 324,619 Expenses - (323,971) - 648 Grants to Charitable Organizations (304,676) (244,096) Total program revenue, net of program expenses 3,815,061$ 2,974,414$ 8. Benefits for the Avon Community: With Avon being merely 2 miles down the mountain from the Vilar Performing Arts Center there are many benefits that the community will receive. We plan on having 2- Avon “Centric” events presented at the VPAC throughout the year. These events may include a lower resident ticket price for Avon residents and post show parties at Avon businesses (i.e. Agave, Loaded Joe’s, etc). We would like to have a discounted ticket package for a series on the Winter 2015 season that would be specific to the residents of the Town of Avon. Throughout the year we could work on partnerships with artist to have pop-up performances in the Town of Avon. We would also be able to provide 10 transferable passes for our 2014 Underground Sound Series that could be used for the staff members of The Town of Avon, so they could come and enjoy all we have to offer for our locals in the off season. Lastly, we plan on being able to provide 2 Venue Facility Usages through the year for collaboration events such as Winter WonderGrass, etc. allowing for the Town of Avon events to expand to the Vilar PAC stage/facility. 9. Marketing Efforts: Some of the marketing efforts that would be afforded to TOA in this partnership would be inclusion of the TOA logo at the bottom of all collateral among our other key facility sponsors (posters, banners, ads, etc.), as well as full page ads in both program book publications (Winter & Summer). We will have TOA listed and linked on the website with several co-branding and marketing opportunities available. TOA will be mentioned in press releases for certain shows with targeted promotions and lastly, TOA will be mentioned nightly in the curtain speech at each performance as a facility sponsor. 10.In-Kind donation descriptions: The in-kind donations that we are asking the TOA for include: 1) Seasonal Light Post Banners at Avon Roundabouts and throughout town, with locations to be determined. This would include banners for Underground Sound (August 18-November 9), Winter Season Branding, and Summer Season Branding. 2) The use of Avon Bus Transportation, including drivers, for the transportation of Avon guest and locals to and from Avon and VPAC on show nights. Other items will be determined based on clear valuation of benefits of the list above. Town of Avon Grant Lisa Connolley ‐ Vail Valley Soccer Club P. O. Box 2728 Edwards, Co 81632 970‐390‐5831 lisa@vailsoccer.com The Vail Valley Soccer Club, a 501c organization, is & has been involved in competitive soccer in the Valley for 20 years. It has evolved from a 7 team club to its present size of 30 teams. The ages of the children involved range from U9 all the way up to U18 Boys & Girls (the high school levels playing one season vs. 2) As in the past, Vail Valley Soccer hosts what has grown to a 110 team soccer tournament that is held the first weekend in October every year (for 2015 the dates are 10/3 & 10/4). 110 teams, including Vail Valley soccer club team’s ages U10‐U14 boys & girls, participate in this tournament. The club has grown the tournament by accepting girls team levels U16 & U18. All parents of our teams are asked to participate not only on the sidelines supporting their children but by volunteering in positions as volunteer and facilities coordinators as well as field marshals working the fields their child’s games are played at so not to miss any portion of their children’s games. The tournament brings in @1800+ children from all over Colorado with some team participation from Wyoming and Utah. The majority of the kids are accompanied by parents, sometimes grandparents and siblings. With all these attendees it helps the Vail Valley’s economy with hotel and condo rentals as well as filling restaurants, coffee houses & other businesses for 2‐3 days during the Valley’s slow time. Because Avon is centrally located to all fields, many of the participants choose to stay in hotels such as Comfort Inn, Christie Lodge, Charter at Beaver Creek, Park Hyatt and Westin Riverfront. Restaurants are full with players & their families and some teams enjoy their down time by visiting the Rec Center & swimming. The tournament is played on approximately 15 soccer fields from East Vail to Edwards with Avon Upper & lower included. All fields used have, in the past as well as present, been donated by following entities: Town of Avon, Town of Vail, the Vail Rec District, Vail Mtn. School, Eagle Vail Metro, Homestead & Singletree Homeowner Associations as well as numerous Eagle County Schools. Each entity donates field use as well as the labor/supplies to line the fields and provide nets. Each sponsorship is listed on the club website as well as in the tournament program. This tournament is the Club largest fundraising effort which helps to provide kids that are skilled to play at a competitive level the ability to be part of the club regardless of race and /or economics. It also provides funding to hold summer camps, partial travelling expenses for kids to participate in out of town/state tournaments as well as providing uniforms for those in need. Without the use of the Avon fields (used from 7:30 a.m. to 6 pm each day for 8 games per field) the tournament would have to reduce the number of teams allowed therefore reducing the registration revenue. An “in‐kind” donation is requested for the following items. The funds will be used as an “in‐kind” donation to cover the rental, field lining and net use of both fields. These numbers are based on 2014 rental rates so does not include any possible 2015 increases: Upper Avon (Main field) use (7:30 – 6:00 for 2 days) $ 420.00 Lower Field use (7:30 – 6:00 for 2 days) $ 420.00 Striping of both fields $ 100.00 Miscellaneous/Cleaning of bathrooms $ 100.00 4 nets used (no pricing provided) $ 200.00 TOTAL COST $1,240.00 As the club gets closer to the tournament, articles have been written in the Vail Daily to give all Valley entities a heads up to be prepared with their food supply as well as Staffing. It helps to provide Economic Development, comraderie with our community with the potential of repeat guests during other times of the year. The only possible “danger” that would prevent the Valley from having all these guests come into town is if tournament is cancelled due to weather/natural causes. However as was proven at the 2013 tournament where we got 1’+ of snow 2 days prior to the start, the club was still able to pull it off with some game schedule adjusting, team parents jumping in along w/temp works to shovel the snow off the fields. We even had out of town parents, coaches & their teams jump in for their warm up when they arrived at the field & were told their game was delayed. At some point, we hope that Colorodo Youth Socccer will permit us to increase the team #’s therefore allowing more participants . Many thanks & if there are some questions, please don’t hesitate to contact us. Regards, Lisa Connolley – 390‐5831 1. Contact Information: Organization: The Vail Valley Foundation d/b/a Vilar Performing Arts Center Mail Address: PO Box 3822 Avon, CO 81620 Contact Person: Gena Buhler, Theatre Director VPAC Contact Phone Number: 970-748-6651 Contact Email: gbuhler@vvf.org 2. Description and Purpose of organization: Located in the heart of the Beaver Creek Village, the cultural complex hosts a variety of acclaimed performances that one might expect to see at Carnegie Hall or the Kennedy Center. The intimate and inviting performance space was designed to exacting specifications to create perfect acoustics and unobstructed views from every seat. The pristine facility paired with a supportive and engaged audience base has allowed the VPAC to grow as an organization. 2014-2015 marks our 17th season presenting the highest quality of arts programming available. Over 17 years we have seen our audience and community exposed to the best that the touring industry has to offer. Each season we grow their knowledge and exposure to various genres of arts and culture, we continue to gain their trust, and we annually grow our support for this first class cultural center in the heart of the Rocky Mountains. The Vilar Performing Arts Center is a project of the Vail Valley Foundation. *IRS tax exempt status following, along with d/b/a paperwork. 2. I R S T a x E x e m p t L e t t e r Document must be filed electronically Paper documents will not be accepted. Document processing fee $20.00 Fees & forms/cover sheets are subject to change. To access other information or print copies of filed documents, visit www.sos.state.co.us and select Business Center. ABOVE SPACE FOR OFFICE USE ONLY Statement of Trade Name of a Reporting Entity filed pursuant to §7-71-103 and §7-71-107 of the Colorado Revised Statutes (C.R.S) 1.For the reporting entity delivering this statement, its ID number, true name, form of entity and the jurisdiction under the law of which it is formed are ID Number _________________________ (Colorado Secretary of State ID number) True name ______________________________________________________ Form of entity ______________________________________________________ Jurisdiction ______________________________________________________. 2.The trade name under which such entity transacts business or conducts activities or contemplates transacting business or conducting activities in this state is ______________________________________________________________________________________. 3.A brief description of the kind of business transacted or activities conducted or contemplated to be transacted or conducted in this state under such trade name is ______________________________________________________________________________________. 4.(If the following statement applies, adopt the statement by marking the box and include an attachment.) This document contains additional information as provided by law. 5.(Caution: Leave blank if the document does not have a delayed effective date. Stating a delayed effective date has significant legal consequences. Read instructions before entering a date.) (If the following statement applies, adopt the statement by entering a date and, if applicable, time using the required format.) The delayed effective date and, if applicable, time of this document are ____________________________. (mm/dd/yyyy hour:minute am/pm) Notice: Causing this document to be delivered to the Secretary of State for filing shall constitute the affirmation or acknowledgment of each individual causing such delivery, under penalties of perjury, that such document is such individual's act and deed, or that such individual in good faith believes such document is the act and deed of the person on whose behalf such individual is causing such document to be delivered for filing, taken in conformity with the requirements of part 3 of article 90 of title 7, C.R.S. and, if applicable, the constituent documents and the organic statutes, and that such individual in good faith believes the facts stated in such document are true and such document complies with the requirements of that Part, the constituent documents, and the organic statutes. TRDNM_RE Page 1 of 2 Rev. 01/01/2008 VAIL VALLEY FOUNDATION Colorado 19871422974 Vilar Performing Arts Center Performing Arts Center Nonprofit Corporation Colorado Secretary of State Date and Time: 09/09/2011 12:29 PM ID Number: 20111513179 Document number: 20111513179 Amount Paid: $20.00 2. D/B/A Paperwork This perjury notice applies to each individual who causes this document to be delivered to the Secretary of State, whether or not such individual is identified in this document as one who has caused it to be delivered. 6. The true name and mailing address of the individual causing this document to be delivered for filing are ____________________ ______________ ______________ _____ (Last) (First) (Middle) (Suffix) ______________________________________________________ (Street number and name or Post Office Box information) ______________________________________________________ __________________________ ____ ____________________ (City) (State) (Postal/Zip Code) _______________________ ______________. (Province – if applicable) (Country – if not US) (If the following statement applies, adopt the statement by marking the box and include an attachment.) This document contains the true name and mailing address of one or more additional individuals causing the document to be delivered for filing. Disclaimer: This form/cover sheet, and any related instructions, are not intended to provide legal, business or tax advice, and are furnished without representation or warranty. While this form/cover sheet is believed to satisfy minimum legal requirements as of its revision date, compliance with applicable law, as the same may be amended from time to time, remains the responsibility of the user of this form/cover sheet. Questions should be addressed to the user’s legal, business or tax advisor(s). TRDNM_RE Page 2 of 2 Rev. 01/01/2008 80302 1470 Walnut Street, Suite 300 MauraCoffin c/o Faegre & Benson LLP CO United States Boulder M. 3. Description of Event or Program: We are requesting funding to help with 2014-2015 year of programing. Our current programs can be split into three season: Winter, Summer and Underground Sound/Off-Season. Below is a summary of the elements of which these programs entail. Our programs reach a full-time year-round population of the Eagle River Valley, as well as a transient resort population at the surrounding ski resorts. A key community element for our programs is maintaining the balance between the resort tourist traffic, our second home owners, our year round residents, and our underserved workers and their families. In the Winter season, we program 55 artists from Thanksgiving to Easter. We believe that we will be most successful as a performing arts center if we keep our programming diverse, offering something for everyone in any given week. Genres range from jazz, blues, country, and classical concerts as well as ballet and contemporary dance troupes, comedy, theatre, Broadway touring productions, and family friendly shows. The Summer season we program to complement our other non-profit partners who present classical music, jazz, and dance. We present high profile touring concert artists so that our community has the opportunity for diverse programming year round. Our partners also rent our facility in the summer for some of their more intimate concert events (Bravo! Vail, Vail International Dance Festival). Artists on the Summer 2014 season include Joe Bonamassa and Trace Adkins. We aim to reach a broad base of music lovers, and each of these concerts builds our audience base by introducing many to the venue. Most of our concerts on the summer season would play large outdoor venues like Red Rocks Amphitheater; however, with financial support from our donors, we offer an alternative concert experience that features precision acoustics and intimate performances in our 535 seat theatre. As Alison Krauss said from our stage in 2011, “this is one of the most beautiful theatres, if not the prettiest that we’ve ever had the chance to play in”. We have a shoulder season that we call the “Off-Season” where we program as series called “Underground Sound: Love for the Locals”. The series boasts an affordable price ($100 for 7 shows and 7 drinks), and consists of 7 talented and stylistically differing performers. This is a great price for our locals (a 60% discount) who are very deserving of world class entertainment in the shoulder seasons, and it’s a great reward to them once the heavy Summer season has started, and just prior to the Winter season beginning. Several businesses purchase these transferrable passes for employee appreciation passes, and our Vilar Guild donates passes each year to the Eagle County school system. 4.Request Fund Amount: We are asking for a combination of cash and in kind support from the Town of Avon. The combination would have a total value of $35,000 (recognizing TOA as a VPAC Facility Sponsor); of that $20,000 is cash and $15,000 is in-kind donations. Funds are needed during our 2014-2015 fiscal year which is October 1, 2014-September 30, 2015. However based on TOA’s schedule, we could adjust this schedule so that it’s in a window that still allows partnerships for all three of the programming seasons. 5.Other Funds: Fund Awarded: WESTAF: $4,150 ($2,000 for artist in residence Cirque Mechanics, $2,150 for artist in residence MOMIX) United Way: $6,500 (The STARS, Supporting the Arts Reaching Students, Program) Beaver Creek Resort Company: $1,035,815 (annual support contract) Funds Applied for: Colorado Creative Industries: $10,000 Requested Vail Resort ECHO Program: $10,000 Requested Annual Individual Donor Support: $1,186,850 Estimated for next fiscal Facility Sponsorship Support: $115,000 (from US Bank, Triumph Partners, and other local companies) 6. Budget to follow 7. 2013 Final Profit and loss to follow A B C Notes (if needed) TEXT CANNOT EXCEED 60 CHARACTERS Cash IncomeCash IncomeCash Income Last FY Current FY Next FY 1Ticket Sales & Admissions $1,441,575$1,316,014$1,350,000 2Memberships $0 $0 $0 3Merchandise/Concession Sales $94,996 $94,000 $100,000 4Facilty Rental $283,263 $214,000 $215,000 5Program Fees $0 $0 $0 6Other Earned Revenue (explanation required)$0 $82,100 $80,000 Ad sales program book 5 Total Earned Income $1,819,834$1,706,114$1,745,000 8Federal $0 $0 $0 9State (DO NOT INCLUDE Colorado Creative Industries Grants)$2,250 $2,250 $4,150 WESTAF Grant 10Colorado Creative Industries Grants $10,000 $0 $10,000 11County or Local Government 0 $3,500 $6,500 United Way 12Scientific & Cultural Facilities District (SCFD) Grants $0 $0 $0 13 Total Public Support Income $12,250 $5,750 $20,650 14Individual Contributions $1,186,556$1,102,764$1,200,000 15Foundation Grants $95,000 $95,000 $95,000 16Corporate Support/Sponsorships $1,255,357$1,316,000$1,300,000 17Special Events $0 $0 $0 18Other Support Income (explanation required)$0 $0 $0 19 Total Support Income $2,536,913$2,513,764$2,595,000 20Interest Income $6,650 $2,550 $5,000 21Box Office Fees $116,591 $115,000 $115,000 22 23 24 25 Total Miscellaneous Income $123,241 $117,550 $120,000 $4,492,238$4,343,178$4,480,650 26Goods $40,530$50,530$50,530 27Services $33,000$33,000$33,000 28 Total In-Kind Contributions $73,530$83,530$83,530 A B C Notes (if needed) TEXT CANNOT EXCEED 60 CHARACTERS Last FY Current FY Next FY 29 Administrative Salaries and Benefits $1,153,038$1,137,058$1,200,000 30Artistic/Program Salaries and Benefits $286,950 $278,500 $280,000 31Artistic/Program Contractor Fees $1,378,814$1,342,018$1,400,000 32Exhibition/Performance Production Expenses $323,386 $349,000 $350,000 33Artistic/Program Materials and Supplies $15,726 $33,000 $33,000 Current FY community parking program 34Royalties/Licensing Fees $17,000 $18,000 $18,000 35Grants Given to Other Organizations $36,248 $38,000 $38,000 Community Performance Fund 36Miscellaneous Artistic/Program (explanation required)$61,675 $62,000 $62,000 Program Fundraising Direct Cost 37Office Expenses and Supplies $193,326 $147,900 $150,000 38 Meetings, Entertainment, Travel and Lodging (including per diems)$20,487 $27,500 $28,000 39Advertising and Publicity $232,473 $308,925 $310,000 40Accounting and Legal Professional Fees $12,817 $15,250 $15,500 41Miscellaneous Administrative (explanation required)$0 $0 $0 42Rent $229,709 $259,700 $265,000 43Operations and Maintenance $66,750 $66,000 $66,000 44Insurance (non-employment related)$64,653 $60,000 $60,000 45Miscellaneous Operations (explanation required)$0 $0 $0 46Merchandise/Concessions Expenses $95,364 $96,500 $96,500 47 Miscellaneous Earned Income Expenses (explanation required)$78,215 $20,500 $18,000 Facility Rentals 48Bad Debt Expense (explanation required)$7,072 $15,000 $15,000 49Other (explanation required) $4,273,701 $4,274,851 $4,405,000 50Goods $51,419$50,530$50,530 51Services $0 $33,000 $33,000 52 Total In-Kind Expenses $51,419$83,530$83,530 A: Include ACTUAL expenses for the most recently completed fiscal year as of submission date. B: Include PROJECTED expenses for entire current fiscal year. C: Include PROJECTED expenses for next fiscal year budget. Cash ExpensesCash Expenses Value In Kind Contributions Cash Expenses EXPENSES Operations and Facilities Administrative Expenses Organizational Three Year Financial Summary Earned Income Public Support Income (Grants/Contracts) Private Support Income Applicant Name: INCOME A: Include ACTUAL income for the most recently completed fiscal year as of submission date. B: Include PROJECTED income for entire current fiscal year. C: Include PROJECTED income for next fiscal year budget. 0 In-Kind Expenses (should match Value of In Kind Contributions Total All Operating Expenses Total All Operating Income Miscellanous Income (please list below) Salaries and Wages Direct Artistic/Program Expenses Applicant Name: Earned Income Expenses Other Expenses 6. Anticipated Line Item Budget Consolidated Financial Statements September 30, 2013 and 2012 Vail Valley Foundation 7. 2013 Final Actual Profit and Loss Statement Vail Valley Foundation Table of Contents September 30, 2013 and 2012 Independent Auditor’s Report .................................................................................................................................... 1 Financial Statements Consolidated Statements of Financial Position ...................................................................................................... 2 Consolidated Statements of Activities ................................................................................................................... 3 Consolidated Statements of Cash Flows ................................................................................................................ 5 Notes to Consolidated Financial Statements .......................................................................................................... 6 Independent Auditor’s Report on Supplementary Information ............................................................................... 26 Supplementary Information Schedule of Consolidated Program Revenues and Expenses .............................................................................. 27 1 www.eidebailly.com 5299 DTC Blvd., Ste. 1000 | Greenwood Village, CO 80111-3329 | TF 877.882.9856 | T 303.770.5700 | F 303.770.7581 | EOE Independent Auditor’s Report To the Board of Directors Vail Valley Foundation Avon, Colorado Report on the Financial Statements We have audited the accompanying consolidated financial statements of Vail Valley Foundation, which comprise the statements of financial position as of September 30, 2013 and 2012, and the related consolidated statements of activities and cash flows for the years then ended, and the related notes to the financial statements. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Vail Valley Foundation as of September 30, 2013 and 2012, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Greenwood Village, Colorado February 18, 2014 See Notes to Consolidated Financial Statements 2 Vail Valley Foundation Consolidated Statements of Financial Position September 30, 2013 and 2012 2013 2012 Assets Cash and cash equivalents 3,425,756$ 1,865,077$ Cash held for 2015 FIS Alpine World Ski Championships 6,780,532 2,144,376Accounts receivable, net 210,370 500,600 Promises to give, net 3,004,122 4,323,150 Prepaid expenses and other assets 186,773 100,350 Long-term investments 5,805,151 5,123,717Deferred bond offering costs, net 255,553 191,015Property and equipment, net 21,237,381 19,224,286 Goodwill and intangible assets, net 534,398 542,398 Endowment investments 3,769,547 3,644,702 Total Assets 45,209,583$ 37,659,671$ Liabilities and Net AssetsAccounts payable 60,631$ 107,022$ Accrued expenses and other liabilities 1,258,288 830,524Refundable advances 94,777 175,375Deferred revenue 876,310 317,795 Deferred membership benefits 521,822 357,078Line of credit - 989,751 GRFA loan payable 137,431 - Bonds payable 5,570,000 5,600,000 Interest rate swap 1,110,387 1,640,209Foreign currency swap 2,205,282 1,211,546 Total liabilities 11,834,928 11,229,300 Net AssetsUnrestrictedUndesignated 6,119,806 910,298 Invested in property and equipment, net of related debt 15,529,950 13,624,286 21,649,756 14,534,584 Temporarily restricted 8,441,602 8,612,490 Permanently restricted 3,283,297 3,283,297 Total net assets 33,374,655 26,430,371 Total Liabilities and Net Assets 45,209,583$ 37,659,671$ See Notes to Consolidated Financial Statements 3 Vail Valley Foundation Consolidated Statement of Activities Year Ended September 30, 2013 Temporarily PermanentlyUnrestrictedRestrictedRestricted Total Revenue, Support and GainsProgram revenue 8,374,203$ 75,556$ -$ 8,449,759$ Sponsorships 4,392,597 - - 4,392,597 Contributions 4,081,385 9,050,832 - 13,132,217 In-kind contributions 3,121,145 148,193 - 3,269,338 Exchange portion of membership dues 1,465,927 - - 1,465,927 Net investment return 116,913 897,535 - 1,014,448 Other revenue 5,567 14,976 - 20,543 Gross special events revenue 518,192 1,179,691 - 1,697,883 Less cost of direct benefits to donors (250,358) (338,711) - (589,069) Net special events revenue 267,834 840,980 - 1,108,814 Net assets released from restrictions 11,167,209 (11,167,209) - - Total revenue, support and gains 32,992,780 (139,137) - 32,853,643 Expenses and LossesProgram services expense 19,151,930 - - 19,151,930 General and administrative 2,424,451 - - 2,424,451 Fundraising 2,333,234 - - 2,333,234 Depreciation and amortization 1,244,689 - - 1,244,689 Interest expense 259,390 - - 259,390 Loss on uncollectible promises to give - 31,751 - 31,751 Total expenses and losses 25,413,694 31,751 - 25,445,445 Change in net assets before change in valueof interest rate swap and foreign currency swap 7,579,086 (170,888) - 7,408,198 Change in value of interest rate swap 529,822 - - 529,822 Change in value of foreign currency swap (993,736) - - (993,736) Change in Net Assets 7,115,172 (170,888) - 6,944,284 Net Assets, Beginning of Year 14,534,584 8,612,490 3,283,297 26,430,371 Net Assets, End of Year 21,649,756$ 8,441,602$ 3,283,297$ 33,374,655$ See Notes to Consolidated Financial Statements 4 Vail Valley Foundation Consolidated Statement of Activities Year Ended September 30, 2012 Temporarily PermanentlyUnrestrictedRestrictedRestricted Total Revenue, Support and GainsProgram revenue 3,224,768$ 61,477$ -$ 3,286,245$ Sponsorships 7,216,453 - - 7,216,453 Contributions 2,953,814 7,620,713 100,177 10,674,704 In-kind contributions 3,421,490 166,330 - 3,587,820 Exchange portion of membership dues 1,326,262 - - 1,326,262 Net investment return 108,795 1,106,135 - 1,214,930 Other revenue 148,323 - - 148,323 Gross special events revenue 440,876 976,160 - 1,417,036 Less cost of direct benefits to donors (263,024) (397,262) - (660,286) Net special events revenue 177,852 578,898 - 756,750 Net assets released from restrictions 6,969,563 (6,969,563) - - Total revenue, support and gains 25,547,320 2,563,990 100,177 28,211,487 Expenses and LossesProgram services expense 18,990,380 - - 18,990,380 General and administrative 2,594,287 - - 2,594,287 Fundraising 1,581,435 - - 1,581,435 Depreciation and amortization 1,198,944 - - 1,198,944 Interest expense 234,080 - - 234,080 Loss on uncollectible promises to give - 88,809 - 88,809 Total expenses and losses 24,599,126 88,809 - 24,687,935 Change in net assets before change in valueof interest rate swap and foreign currency swap 948,194 2,475,181 100,177 3,523,552 Change in value of interest rate swap 156,931 - - 156,931 Change in value of foreign currency swap 917,880 - - 917,880 Change in Net Assets 2,023,005 2,475,181 100,177 4,598,363 Net Assets, Beginning of Year 12,511,579 5,514,338 3,183,120 21,209,037 Excess of assets acquired over liabilities assumedin acquisition of Youth Foundation - 622,971 - 622,971 Net Assets, End of Year 14,534,584$ 8,612,490$ 3,283,297$ 26,430,371$ See Notes to Consolidated Financial Statements 5 Vail Valley Foundation Consolidated Statements of Cash Flows Years Ended September 30, 2013 and 2012 2013 2012Cash Flows from Operating ActivitiesChange in net assets 6,944,284$ 4,598,363$ Adjustments to reconcile change in net assets to net cash from (used for) operating activitiesDepreciation and amortization 1,244,689 1,198,944 Net investment (return) loss (1,014,448) (1,077,678) Contributions restricted to endowment - (100,177) Losses on uncollectible promises to give 31,751 88,809 Change in value of interest rate swap (529,822) (156,931) Change in value of foreign currency swap 993,736 (917,880) Change in operating assets and liabilitiesAccounts receivable 290,230 (602,441) Promises to give 1,287,277 (2,294,438) Prepaid expense and other assets (86,423) (36,179) Accounts payable (46,391) 59,887 Accrued expenses and other liabilities 427,764 (47,917) Deferred revenue and refundable advances 642,661 (425,387) Net Cash from (used for) Operating Activities 10,185,308 286,975 Cash Flows from Investing Activities Additions to investment portfolio, net (172,245) (156,617) Purchase of property and equipment (3,236,256) (713,345) Additional payment for Summer Mountain Games - (42,500) Cash balance acquired in acquisition of Youth Foundation - 499,642 (Addition to) withdrawal from endowment 380,414 307,956 Net Cash from (used for) Investing Activities (3,028,087) (104,864) Cash Flows from Financing ActivitiesCollection of contributions restricted to endowment - 100,177 Net borrowings (repayments) under line of credit (989,751) 989,751 Borrowing under GRFA loan payable 137,431 - Principal payments on bonds (105,000) (100,000) Payments on refinance of bonds payable (3,066) - Net Cash from (used for) Financing Activities (960,386) 989,928 Net Change in Cash and Cash Equivalents 6,196,835 1,172,039 Cash and Cash Equivalents, Beginning of Year 4,009,453 2,837,414 Cash and Cash Equivalents, End of Year 10,206,288$ 4,009,453$ Supplemental Disclosure of Cash Flow InformationCash paid during the year for interest 259,390$ 234,080$ 6 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 1 - Principal Activities and Significant Accounting Policies Organization Vail Valley Foundation (the “Foundation”) is a nonprofit organization whose mission is to enhance the quality of life in the Vail Valley of Colorado through the organization and sponsorship of cultural, educational and athletic programs and events. Vilar Center Arts Foundation (“Vilar Center”) is a nonprofit organization whose sole purpose is to hold the specific property known as the Vilar Performing Arts Center. Youth Foundation (“Youth Foundation”) is a nonprofit organization whose mission is to prepare children in need for success in life through education and recreational opportunities. Effective January 1, 2012, Youth Foundation became a subsidiary entity of the Foundation. The Foundation accomplishes its mission through a variety of programs and activities. Athletics The Foundation is responsible for providing the Vail Valley community with some of its most treasured annual athletic events, such as the American Ski Classic, Summer and Winter Mountain Games, Birds of Prey World Cup Race Week and the USA Pro Cycling Challenge. In February 2015 the Foundation will stage the 2015 FIS Alpine World Ski Championships (AWSC) (Note 16). This is the third time the Foundation has been chosen to stage the AWSC in Vail/Beaver Creek (1989 and 1999 were the previous two occasions). Arts The organization owns and operates two performing-arts venues in the exquisite Vilar Performing Arts Center (VPAC) in Beaver Creek and the award-winning Gerald R. Ford Amphitheater (GRFA) in Vail. In addition, the Foundation provides the Vail Valley community with the Vail International Dance Festival, an annual event since 1989. The VPAC is a premier year-round performing-arts venue which showcases a diverse lineup of entertainment options that include concerts, Broadway musicals, classical, dance and comedy performances, family programming and community events. In addition, the VPAC is an invaluable community asset, playing host to a variety of youth performances, fundraising events and the STARS (Support the Arts Reaching Children) series. The GRFA is home to the Foundation’s Vail International Dance Festival and one of the Foundation’s trio of free concert series. In addition, the GRFA hosts the annual Bravo!-Vail Valley Music Festival. Education The Foundation’s education initiatives, spearheaded by Youth Foundation, reach from cradle to college with a focused early childhood development effort, after school academic and enrichment programs, summer academic and recreational programs, teenage mentorship and leadership development along with the Vail Valley’s largest collegiate scholarship program. 7 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Principles of Consolidation The consolidated financial statements include the accounts of the Foundation, Vilar Center and Youth Foundation because the Foundation has both control and an economic interest in Vilar Center and Youth Foundation. All significant intercompany accounts and transactions have been eliminated in consolidation. Unless otherwise noted, these consolidated entities are hereinafter referred to as “VVF”. Cash and Cash Equivalents VVF considers all cash and highly liquid financial instruments with original maturities of three months or less, and which are neither held for nor restricted by donors for long-term purposes, to be cash and cash equivalents. Cash and highly liquid financial instruments restricted to capital expenditures, permanent endowment, or other long-term purposes of VVF are excluded from this definition. Receivables and Credit Policies Accounts receivable consist primarily of non-interest bearing amounts. Management determines the allowance for uncollectible accounts receivable based on historical experience, an assessment of economic conditions, and a review of subsequent collections. Accounts receivable are written off when deemed uncollectible. At September 30, 2013 and 2012 management believes the amount of uncollectible balances to be insignificant and no allowance is reflected in the financial statements. Promises to Give Unconditional promises to give expected to be collected within one year are recorded at net realizable value. Unconditional promises to give expected to be collected in future years are initially recorded at fair value using present value techniques incorporating risk-adjusted discount rates designed to reflect the assumptions market participants would use in pricing the asset. In subsequent years, amortization of the discount is included in contribution revenue in the statement of activities. Management determines the allowance for uncollectible promises to give based on historical experience, an assessment of economic conditions, and a review of subsequent collections. Promises to give are written off when deemed uncollectible. At September 30, 2013 and 2012 management believes the amount of uncollectible balances to be insignificant and no allowance is reflected in the financial statements. Investments Investment purchases are recorded at cost, or if donated, at fair value on the date of donation. Thereafter, investments are reported at their fair values in the statement of financial position. Net investment return is reported in the statement of activities and consists of interest and dividend income, realized and unrealized capital gains and losses, less investment management and custodial fees. Deferred Bond Offering Costs Deferred bond offering costs are amortized using the effective interest rate method over the life of the bonds. 8 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Property and Equipment Property and equipment additions over $1,000 are recorded at cost or, if donated, at fair value on the date of donation. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets, or in the case of leasehold improvements, the lesser of the useful life of the asset or the lease term. When assets are sold or otherwise disposed of, the cost and related depreciation or amortization are removed from the accounts, and any remaining gain or loss is included in the statement of activities. Costs of maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed currently. VVF reviews the carrying values of property and equipment for impairment whenever events or circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. When considered impaired, an impairment loss is recognized to the extent the carrying value exceeds the fair value of the asset. There were no indicators of asset impairment during the years ended September 30, 2013 and 2012. Interest-Rate Swap VVF uses an interest-rate swap to mitigate interest-rate risk on the bonds payable (Note 9). The related liability or asset is reported at fair value in the statement of financial position, and unrealized losses or gains are included in the statement of activities. Foreign Currency Swap VVF uses a foreign currency swap to mitigate currency fluctuations on Euro contracts (Note 16). The related liability or asset is reported at fair value in the statement of financial position, and unrealized losses or gains are included in the statement of activities. Net Assets Net assets, revenues, gains, and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, net assets and changes therein are classified and reported as follows: Unrestricted Net Assets – Net assets available for use in general operations. Temporarily Restricted Net Assets – Net assets subject to donor restrictions that may or will be met by expenditures or actions of VVF and/or the passage of time, and certain income earned on permanently restricted net assets that has not yet been appropriated for expenditure. VVF reports contributions as temporarily restricted support if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. Permanently Restricted Net Assets – Net assets whose use is limited by donor-imposed restrictions that neither expire by the passage of time nor can be fulfilled or otherwise removed by action of VVF. The restrictions stipulate that resources be maintained permanently but permit VVF to expend the income generated in accordance with the provisions of the agreements. 9 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Revenue and Revenue Recognition Revenue is recognized when earned. Program service fees received in advance are deferred to the applicable period in which the related services are performed. Contributions are recognized when cash, securities or other assets, an unconditional promise to give, or notification of a beneficial interest is received. Conditional promises to give are not recognized until the conditions on which they depend have been substantially met. Refundable advances arise from advance ticket sales and theater rental for future events and reflect the amount that VVF would be required to return should the event not occur. Deferred revenue arises from sponsorship payments received for future events and other revenues related to future periods. These deferred revenues will be recognized in the periods to which they apply. VVF receives contributions from various patron membership programs, several of which require multi-year commitments. Commitments beyond the current year, aside from the membership programs for the 2015 AWSC, are considered to be indications of a member’s intention to renew membership, and not as completed sales or unconditional promises to give, and therefore are not recorded. Depending on the patron membership agreement, patrons receive various benefits such as complimentary event tickets and ski passes. Deferred membership benefits represent the amount of estimated benefits purchased but not yet used by patron members as of September 30, 2013 and 2012. Donated Services and In-Kind Contributions Volunteers contribute significant amounts of time to VVF’s program services, administration, and fundraising and development activities; however, the financial statements do not reflect the value of these contributed services because they do not meet recognition criteria prescribed by generally accepted accounting principles. Contributed goods are recorded at fair value at the date of donation. VVF records donated professional services at the respective fair values of the services received. During the years ended September 30, 2013 and 2012, VVF recorded revenue (and corresponding expenses) of $3,269,338 and $3,587,820, respectively, related to in-kind contributions (Note 12). Advertising Costs Advertising costs are expensed as incurred, with $642,481 and $653,865, respectively, paid in cash and $981,406 and $1,158,265, respectively, recorded as in-kind donations received during the years ended September 30, 2013 and 2012. Functional Allocation of Expenses The costs of program and supporting services activities have been summarized on a functional basis in Note 14. Accordingly, certain costs have been allocated among the programs and supporting services benefited. 10 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Income Taxes The Foundation, Vilar Center and Youth Foundation are organized as Colorado nonprofit corporations and have been recognized by the Internal Revenue Service (IRS) as exempt from federal income taxes under Section 501(a) of the Internal Revenue Code as organizations described in Section 501(c)(3), and qualify for the charitable contribution deduction under Section 170(b)(1)(A)(vi). In addition, the Foundation has been determined not to be a private foundation under Section 509(a)(2) while Vilar Center and Youth Foundation have been determined not to be private foundations under Section 509(a)(1). Each entity is annually required to file a Return of Organization Exempt from Income Tax (Form 990) with the IRS. In addition, the entities are subject to income tax on net income that is derived from business activities that are unrelated to their exempt purposes. Vilar Center and Youth Foundation have determined they are not subject to unrelated business income tax and have not filed an Exempt Organization Business Income Tax Return (Form 990-T) with the IRS. The Foundation files an Exempt Organization Business Income Tax Return (Form 990-T) with the IRS to report its unrelated business taxable income and its tax filings are no longer subject to examination for years before 2009. No income taxes were paid during or for the years ended September 30, 2013 and 2012. VVF believes that it has appropriate support for any tax positions taken affecting its annual filing requirements, and as such, does not have any uncertain tax positions that are material to the financial statements. The entities would recognize future accrued interest and penalties related to unrecognized tax benefits and liabilities in income tax expense if such interest and penalties are incurred. Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and those differences could be material. Financial Instruments and Credit Risk VVF manages deposit concentration risk by placing cash deposits with financial institutions believed by management to be creditworthy. At times, amounts on deposit may exceed insured limits or include uninsured investments in money market mutual funds. To date, VVF has not experienced losses in any of these accounts. Credit risk associated with accounts receivable and promises to give is considered to be limited due to high historical collection rates and because substantial portions of the outstanding amounts are due from Board members and entities supportive of VVF’s mission. Investment recommendations on fund managers and portfolio allocations are made by an investment consultant to management and the Investment Committee of the Board of Directors. Although the fair values of investments are subject to fluctuation on a year-to-year basis, management and the Investment Committee believe that the investment policies and guidelines are prudent for the long-term welfare of VVF. Reclassifications Certain reclassifications of amounts previously reported have been made to the accompanying consolidated financial statements to maintain consistency between periods presented. The reclassifications had no impact on previously reported net assets. 11 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Subsequent Events VVF has evaluated subsequent events through February 18, 2014, the date on which the financial statements were available to be issued. Note 2 - Fair Value Measurements and Disclosures Certain assets and liabilities are reported at fair value in the consolidated financial statements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal, or most advantageous, market at the measurement date under current market conditions regardless of whether that price is directly observable or estimated using another valuation technique. Inputs used to determine fair value refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability based on the best information available. A three-tier hierarchy categorizes the inputs as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that VVF can access at the measurement date. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, and market-corroborated inputs. Level 3 – Unobservable inputs for the asset or liability. VVF has no assets or liabilities valued using Level 3 inputs. In some cases, the inputs used to measure the fair value of an asset or a liability might be categorized within different levels of the fair value hierarchy. In those cases, the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. Assessing the significance of a particular input to the entire measurement requires judgment, taking into account factors specific to the asset or liability. The categorization of an asset within the hierarchy is based upon the pricing transparency of the asset and does not necessarily correspond to VVF’s assessment of the quality, risk or liquidity profile of the asset or liability. The majority of VVF’s investment assets are classified within Level 1 because they are comprised of open-end mutual funds and equity securities with readily determinable fair values based on daily redemption values or closing market prices, respectively. The hedge funds are valued by utilizing the audited financial statements of the entities, which include information regarding fair value of assets, and VVF’s ownership percentage of the entities. The interest rate swap and the foreign currency swap are valued using proprietary discounted cash flow models from independent parties which consider past, present and future assumptions regarding interest rates and market conditions to estimate the fair value of the agreements. These assets and liabilities are classified within Level 2. 12 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 The following table presents assets and liabilities measured at fair value on a recurring basis, except those measured at cost as identified below, at September 30, 2013: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)Assets Long-term investmentsCash and money market funds (at cost)241,112$ -$ -$ -$ Bond funds 1,071,067 1,071,067 - - Domestic equity mutual funds 1,816,474 1,816,474 - - International equity mutual funds 1,568,161 1,568,161 - - U.S. stock funds 1,006,006 1,006,006 - - International stock funds 31,282 31,282 - - Preferred stock funds 71,048 71,048 - - 5,805,151$ 5,564,039$ -$ -$ Endowment investmentsCash and money market funds (at cost)156,565$ -$ -$ -$ Bond funds 695,493 695,493 - - Domestic equity mutual funds 1,179,518 1,179,518 - - International equity mutual funds 1,018,278 1,018,278 - - U.S. stock funds 653,246 653,246 - - International stock funds 20,313 20,313 - - Preferred stock funds 46,135 46,135 - - 3,769,547$ 3,612,982$ -$ -$ Liabilities Interest rate swap 1,110,387$ -$ 1,110,387$ -$ Foreign currency swap 2,205,282$ -$ 2,205,282$ -$ Fair Value Measurements at Report Date Using 13 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 The following table presents assets and liabilities measured at fair value on a recurring basis, except those measured at cost as identified below, at September 30, 2012: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Long-term investmentsCash and money market funds (at cost)311,978$ -$ -$ -$ Bond funds 1,296,185 1,296,185 - - Domestic equity mutual funds 1,394,647 1,394,647 - - International equity mutual funds 1,234,650 1,234,650 - - U.S. stock funds 789,660 789,660 - - International stock funds 30,414 30,414 - - Preferred stock funds 61,796 61,796 - - Hedge funds 4,387 - 4,387 - 5,123,717$ 4,807,351$ 4,387$ -$ Endowment investmentsCash and money market funds (at cost)221,923$ -$ -$ -$ Bond funds 922,027 922,027 - - Domestic equity mutual funds 992,067 992,067 - - International equity mutual funds 878,256 878,256 - - U.S. stock funds 561,716 561,716 - - International stock funds 21,634 21,634 - - Preferred stock funds 43,958 43,958 - - Hedge funds 3,121 - 3,121 - 3,644,702$ 3,419,659$ 3,121$ -$ Liabilities Interest rate swap 1,640,209$ -$ 1,640,209$ -$ Foreign currency swap 1,211,546$ -$ 1,211,546$ -$ Fair Value Measurements at Report Date Using 14 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Fair Value of Financial Instruments Not Required To Be Reported at Fair Value The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities, deferred revenue, and line of credit payable approximate fair value due to the short-term nature of the items. The carrying amount of promises to give due in more than one year is based on the discounted net present value of the expected future cash receipts, and approximates fair value. The fair values of bonds payable are based on estimates provided by the direct purchaser of the bonds. The financial instruments not required to be recorded at fair value are categorized according to the fair value hierarchy as follows: LevelCash and cash equivalents 1 Accounts receivable 1Accounts payable 1 Accrued expenses and other liabilities 1Deferred revenue 1Line of credit payable 1Promises to give 2Bonds payable 2 Note 3 - Net Investment Return Net investment return consists of the following for the years ended September 30, 2013 and 2012: 2013 2012 Long-term investmentsInterest and dividends 174,596$ 159,614$ Net realized and unrealized gain (loss)345,284 479,116 Less investment management and custodial fees (10,691) (10,234) 509,189 628,496 Endowment investmentsInterest and dividends 156,212 141,787 Net realized and unrealized gain (loss)360,407 455,323 Less investment management and custodial fees (11,360) (10,676) 505,259 586,434 1,014,448$ 1,214,930$ 15 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 4 - Promises to Give Unconditional promises to give are estimated to be collected as follows as of September 30, 2013 and 2012: 2013 2012 Within one year 2,419,725$ 3,073,427$ In one to five years 608,700 897,033 Over five years - 401,209 3,028,425 4,371,669 Less discount to net present value (4.0%)(24,303) (48,519) 3,004,122$ 4,323,150$ Note 5 - Deferred Bond Offering Costs Future amortization expense related to deferred bond offering costs is expected to be recognized as follows: 2014 10,669$ 2015 10,669 2016 10,669 2017 10,669 2018 10,669 Thereafter 202,207 255,553$ Note 6 - Property and Equipment Property and equipment consists of the following at September 30, 2013 and 2012: Estimated Useful Lives 2013 2012 Ford Amphitheater, including fixtures 25 years 13,147,989$ 10,318,797$ Vilar Center, including fixtures 25 years 17,851,723 17,633,856Office buildings 25 years 2,670,000 2,670,000 Furniture and equipment 3-10 years 2,129,615 1,940,41835,799,327 32,563,071 Less accumulated depreciation (14,561,946) (13,338,785) 21,237,381$ 19,224,286$ 16 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 7 - Goodwill and Intangible Assets VVF has goodwill and intangible assets as a result of its bond issuance and the acquisition of the Summer Mountain Games. Goodwill represents the excess of the purchase price over the fair value of net assets acquired, including the estimated fair value of the intangible assets. Goodwill and intangible assets consist of the following at September 30, 2013 and 2012: 2013 2012 Trademark and other 100,000$ 100,000$ Non-compete agreement 20,000 20,000Less accumulated amortization (38,000) (30,000) Amortizable intangible assets 82,000 90,000 Goodwill 452,398 452,398 534,398$ 542,398$ Amortization of the intangible assets (excluding goodwill) is calculated using the straight-line method over the terms of the respective assets. Amortization expense for all intangible assets for each of the years ended September 30, 2013 and 2012 was $21,528. Future amortization expense related to intangibles is expected to be recognized as follows: 8,000$ 8,000 8,000 8,000 8,000 Thereafter 42,000 82,000$ 2014 20152016 20172018 VVF reviews the carrying values of goodwill and intangible assets for impairment whenever events or circumstances indicate that the carrying value of the assets may not be recoverable from the estimated future cash flows expected to result from their use. When considered impaired, an impairment loss is recognized to the extent carrying value exceeds the fair value of the asset. There were no indicators of asset impairment during the years ended September 30, 2013 and 2012. 17 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 8 - Line of Credit VVF has a $1,200,000 revolving line of credit with a bank, secured by receivables, inventory, equipment, contract rights, investments and intangibles as well as the right to set off against all depository account balances. Borrowings under the line bear interest at the bank’s prime rate plus 1.0 % (4.25% at September 30, 2013 and 2012). Accrued interest and principal are due at maturity (July 2014). The agreement requires VVF to comply with certain financial and non-financial covenants, all of which VVF was in compliance with at September 30, 2013 and 2012. Note 9 - Bonds Payable On January 17, 2013, the Colorado Educational and Cultural Facilities Authority (the "Authority") issued $5,570,000 of Variable Rate Revenue Refunding Bonds Series 2013 (the “Bonds) to refinance VVF’s outstanding Series 2007 variable rate bonds. The interest rate on the Bonds is the LIBOR Index Rate, which is a per annum rate of interest established on each Computation date and effective on each related LIBOR Index Rate Reset Date (not to exceed 10%). The Bonds may be converted to a fixed interest rate by the Authority on any interest rate adjustment date upon direction of VVF. The Bonds are secured by a Deed of Trust on real property and an assignment of rents and leases. The Bonds mature with annual required principal payments through 2037. The Bonds contain certain financial covenants and VVF was in compliance with those covenants as of September 30, 2013. Future maturities are as follows: Year ending September 30, 120,000$ 140,000 145,000 150,000 155,000 Thereafter 4,860,000 5,570,000$ 2014 20152016 20172018 To hedge against interest rate risk on the variable-rate bonds, VVF entered into an interest rate swap (the Swap) with a major U.S. financial institution as the counterparty. The effect of the Swap is to convert VVF’s variable- rate debt to fixed-rate debt. VVF pays interest on the notional value at 3.987% and receives interest on the notional value at a variable rate based on 67% of one-month LIBOR on a monthly basis (0.1120% and 0.1407% at September 30, 2013 and 2012, respectively). The Swap matures on December 1, 2037 and has a declining notional value matching the outstanding note principal over time. The declining notional value will result in the interest rate swap liability converging to zero upon its maturity. During the years ended September 30, 2013 and 2012, the fair value of the liability under the Swap decreased $529,822 and $156,931, respectively, which has been reflected in the accompanying consolidated statements of activities. At September 30, 2013 and 2012, the fair value of the Swap liability was $1,110,387 and $1,640,209, respectively. 18 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 10 - Leases VVF leases office equipment, parking spaces and storage space under various noncancellable operating leases expiring through 2022. Future minimum lease payments are as follows: Year ending September 30, 2014 146,514$ 2015 128,492 2016 98,352 2017 74,250 2018 44,089 Thereafter 160,350 652,047$ Rent expense, including common area maintenance charges on VVF’s office space, for the years ended September 30, 2013 and 2012 was $199,659 and $178,098, respectively. In addition, VVF leases land from the Town of Vail on which the Ford Amphitheater is situated. The lease, which is rent-free, expires May 31, 2038, but may be extended to May 31, 2048. Upon expiration of the lease term, VVF will convey title to the Ford Amphitheater to the Town of Vail. The land is available only for recreational use, and as such, has a low commercial value considered by management to be immaterial for recording as an in-kind contribution and related rental expense in the statement of activities. Note 11 - Endowments VVF’s endowment (the Endowment) consists of five individual funds established by donors to provide annual funding for specific activities. Net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed restrictions. VVF’s Board of Directors has interpreted the Colorado Uniform Prudent Management of Institutional Funds Act (UPMIFA) as requiring the preservation of the fair value of the original gift as of the gift date of the donor- restricted endowment funds absent explicit donor stipulations to the contrary. As of September 30, 2013 and 2012 there were no such donor stipulations. As a result of this interpretation, VVF classifies as permanently restricted net assets (a) the original value of gifts donated to the Endowment, (b) the original value of subsequent gifts donated to the Endowment (including promises to give at fair value), and (c) accumulations to the Endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added. The remaining portion of the donor-restricted Endowment is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by VVF in a manner consistent with the standard of prudence prescribed by UPMIFA. VVF considers the following factors in making a determination to appropriate or accumulate donor-restricted endowment funds: 1. The duration and preservation of the fund 2. The purpose of the organization and the donor-restricted endowment fund 3. General economic conditions 4. The possible effect of inflation and deflation 5. The expected total return from income and the appreciation of investments 6. Other resources of the organization 7. The investment policies of the organization 19 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Investment and Spending Policies VVF attempts to achieve real growth of 5% in excess of inflation. Endowment assets are invested in a manner intended to provide, over time, a greater than 50% probability of achieving annualized returns of at least 5% plus the rate of inflation over a ten year period. Actual returns in any given year may vary from this amount. To satisfy its stated return objectives, VVF seeks to maintain a prudent level of risk that is no more than 20% greater than the risk of a passive benchmark comprised of 70% of the MSCI All-Country World index and 30% of the Barclays Aggregate Bond Index. VVF seeks to meet these goals through a diversified asset allocation, consisting primarily of an appropriate weighting of high quality equities and investment-grade fixed income investments to achieve its long-term objectives. VVF has a policy of appropriating for distribution only so much of the accumulated earnings in excess of the permanently restricted net assets of the Endowment as is necessary to fund discretionary expenses as determined by the Board of Directors. In establishing this policy, VVF considered the long-term expected return on the Endowment. Accordingly, over the long term, VVF expects to preserve the permanently restricted net assets of the Endowment. This is consistent with VVF’s objective to preserve the fair values of the original gifts made to the Endowment while providing an opportunity for real growth through new gifts and undistributed investment return. Changes in endowment net assets for the year ended September 30, 2013 consisted of the following: Temporarily PermanentlyRestrictedRestricted Total Endowment net assets at October 1, 2012 361,405$ 3,283,297$ 3,644,702$ Investment return:Interest and dividend income, net of fees 144,852 - 144,852 Net realized and unrealized gain 360,407 - 360,407 505,259 - 505,259 Appropriation of endowment assets for expenditure (380,414) - (380,414) Endowment net assets at September 30, 2013 486,250$ 3,283,297$ 3,769,547$ Changes in Endowment net assets for the year ended September 30, 2012 are as follows: Temporarily PermanentlyRestrictedRestricted Total Endowment net assets at October 1, 2011 183,104$ 3,183,120$ 3,366,224$ Investment return:Interest and dividend income, net of fees 131,111 - 131,111 Net realized and unrealized gain 455,323 - 455,323 586,434 - 586,434 Contributions - 100,177 100,177 Appropriation of endowment assets for expenditure (408,133) - (408,133) Endowment net assets at September 30, 2012 361,405$ 3,283,297$ 3,644,702$ 20 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 12 - Donated Materials VVF received donated materials as follows during the years ended September 30, 2013 and 2012: Program Services General and Administrative Fundraising TotalSeptember 30, 2013 Advertising 885,616$ -$ 95,790$ 981,406 Awards 336,013 - 52,403 388,416 Supplies 1,059,283 64,880 418,615 1,542,778 Lodging 356,738 - - 356,738 2,637,650$ 64,880$ 566,808$ 3,269,338$ September 30, 2012 Advertising 995,815$ -$ 162,450$ 1,158,265 Awards 637,931 - - 637,931 Supplies 854,979 61,800 505,412 1,422,191 Lodging 369,433 - - 369,433 2,858,158$ 61,800$ 667,862$ 3,587,820$ 21 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 13 - Restricted Net Assets Temporarily Restricted Temporarily restricted net assets at September 30, 2013 and 2012, consist of: 2013 2012 Restricted by donors for: Education programs 2,138,219$ 2,345,346$ Ford Amphitheater Garden Project 1,502,891 1,000,000 Gerald R. Ford Amphitheater 1,218,614 1,076,759 Vilar Center capital improvements 939,726 1,178,085 The Barbara Treat Foundation Fund 445,883 419,468 June S. Kang Scholarship 215,655 187,717 Buckman Blount Community Fund 140,847 118,140 The Equipment Fund 140,701 144,142 Vilar Guild 76,788 - The Helmut Fricker Scholarship Fund 16,311 15,841 Beaver Creek Resort Company programming series 16,229 - 2015 Alpine World Ski Championships - 338,434 Vail Global Energy Forum - 2,783 Unspent appreciation of Endowment funds which must beappropriated for expenditure before use, restricted by donors for:Gerald R. Ford Amphitheater 317,446 225,741 Vilar Center capital improvements 139,522 108,691 Buckman Blount Community Fund 29,282 26,973 Promises to give that are not restricted by donors, but which areunavailable for expenditure until due 1,103,488 1,424,370 Total 8,441,602$ 8,612,490$ 22 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Net assets were released from restrictions as follows during the years ended September 30, 2013 and 2012: 2013 2012 Satisfaction of purpose restrictions: Education programs 3,339,498$ 2,938,353$ Ford Amphitheater Garden Project 2,817,189 275,545 Vilar Center operations 1,000,000 1,050,000 2015 World Alpine Ski Championship 988,434 686,566 Other programs and events 716,060 516,500 Vail Global Energy Forum 389,660 229,064 Vilar Center capital improvements 248,835 144,760 Beaver Creek Resort Company programming series 169,885 - Vilar Guild 39,665 - The Barbara Treat Foundation Fund 23,500 23,500 June S. Kang Scholarship 5,000 18,076 The Equipment Fund 3,585 5,370 The Helmut Fricker Scholarship Fund - 3,150 Restricted-purpose Endowment appropriations:Vilar Center operations 277,479 317,081 Gerald R. Ford Amphitheater 56,532 27,748 Buckman Blount Community Fund 36,798 33,740 Vail Valley Foundation education programs 9,605 29,564 Expiration of time restrictions 1,045,484 670,546 11,167,209$ 6,969,563$ Permanently Restricted Permanently restricted net assets consist of endowment funds restricted by donors for investment in perpetuity. Earnings on endowment funds are available for the purposes specified by the donors, or in certain cases, for the unrestricted use of VVF. The permanently restricted net asset balances, classified by restriction on the use of earnings, are as follows at September 30, 2013 and 2012: 2013 2012 Vilar Center - General 1,977,978$ 1,977,978$ Vilar Center - Buckman Blount Community Use 251,117 251,117 Ford Amphitheater 1,000,000 1,000,000 Education 54,202 54,202 3,283,297$ 3,283,297$ 23 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 Note 14 - Functionalized Expenses Total expenses by function were as follows for the years ended September 30, 2013 and 2012: 2013 2012 Programs 20,002,389$ 19,764,898$ General and administrative (includes investment management fees of $22,051 and $20,910)2,950,550 3,132,228 Fundraising and development (includes cost of direct benefits to donors of $589,069 and $660,286)3,071,875 2,383,196 Total functionalized expenses 26,024,814$ 25,280,322$ Note 15 - Retirement Plan VVF has a salary deferral plan under Section 401(k) of the Internal Revenue Code (the “Plan”). Full-time employees that have attained age 21 are eligible for participation in the Plan after completing one year of service, as defined, with VVF. Participants may contribute up to the lower of 100% of their pre-tax compensation, or $17,000 in 2013 and 2012. VVF matches the participants’ pre-tax contributions at 50% of the amount contributed for participants up to a maximum of $2,500 for each year. The participant portion of matching VVF contributions vests at the rate of 25% per year after the employee has completed two years of service. Contributions by VVF for the years ended September 30, 2013 and 2012 totaled $59,964 and $54,249, respectively. Note 16 - Commitments and Contingencies 2015 Alpine World Ski Championships (2015 AWSC) The awarding of the 2015 AWSC obligates VVF for all costs of the event, which will be partially offset by the FIS payments. To defray expected costs relating to the infrastructure for the event, Federation Internationale de Ski (FIS) will make a total of five payments to VVF totaling €28,050,000 at various set dates during the contract term per the FIS Hosting Contract. VVF is anticipating that the cost of the event will exceed the FIS payments and has received contributions from prominent local and national entities to assist with the anticipated additional cost. Because the value of the EUROs varies with the market, VVF is exposed to variability in the payments to be received from FIS. In order to hedge such variability, management has entered into a series of foreign currency swap agreements which coincide with the payment schedule from FIS. During the years ended September 30, 2013 and 2012, the fair value of the liability under the foreign currency swap agreements increased $993,736 and decreased $917,880, respectively, which has been reflected in the accompanying consolidated statements of activities. At September 30, 2013 and 2012, the fair value of the foreign currency swap liability was $2,205,282 and $1,211,546, respectively. The notional value of the foreign currency swap decreases on dates that coincide with the payments from FIS and shall be zero upon the last payment from FIS. 24 Vail Valley Foundation Notes to Consolidated Financial Statements September 30, 2013 and 2012 VVF also purchased event cancelation insurance in October 2013 to mitigate risk of event cancelation. The policy period runs through February 15, 2015 with a total premium of $944,331 to be paid by VVF over the period. In addition, during the year ended September 30, 2013 two contracts were executed by VVF in regards to commercial and broadcasting rights for the 2015 AWSC: • A Commercial Rights Exploitation of the 2015 AWSC contract gives certain sponsorship, naming, merchandising, licensing, promotion, supply, marketing and hospitality rights to VVF and entitles VVF to the revenues from these rights. VVF will pay a total of $1,000,000 under this agreement and paid $300,000 during 2013. • A Host Broadcaster Services Agreement appoints a third party to undertake, provide, and deliver host broadcaster services and various other related broadcasting services in relation to the 2015 AWSC as required by the FIS Hosting Contract. VVF will pay a total of for $6,650,000 under this agreement. The following table shows VVF’s commitments under the above contracts and the years payments are due: Total FY 2013 FY 2014 FY 2015 Commercial Rights Exploitation 1,000,000$ 300,000$ 300,000$ 400,000$ Host Broadcaster Services 6,650,000 - 3,325,000 3,325,000 Event Cancellation Policy 944,331 - 424,949 519,382 8,594,331$ 300,000$ 4,049,949$ 4,244,382$ The following table shows VVF’s expense recognition per contract per fiscal year: Total FY 2013 FY 2014 FY 2015 Commercial Rights Exploitation 1,000,000$ 300,000$ 300,000$ 400,000$ Host Broadcaster Services 6,650,000 332,500 1,330,000 4,987,500 Event Cancellation Policy 944,331 - 649,228 295,103 8,594,331$ 632,500$ 2,279,228$ 5,682,603$ Town of Vail GRFA Remodel Agreements On November 20, 2012 VVF entered into an agreement with the Town of Vail (TOV) to construct major improvements to the Gerald R. Ford Amphitheater (GRFA). The estimated cost of the project was $7,240,322 over two phases, of which the TOV would cover the first $2.1 million of construction costs for Phase 1 with VVF funding the remainder of the project. As of September 30, 2013 the TOV had funded their $2.1 million through contributions made to reimburse VVF for construction costs of Phase 1. During the construction of Phase 1, the TOV Town Council opted to make certain revisions to the project scope and construction schedule, thereby requiring revisions to the cost-sharing arrangement in the original agreement. On August 1, 2013 the First Amendment to the TOV and VVF Cost Sharing Agreement was executed which amended the original agreement to say the TOV would pay all costs of Phase 1 up to $3,089,650 and planning costs incurred for Phase II of $211,099. The amount over the original $2.1 million ($1,200,749) will become an interest free loan from the TOV to VVF payable no later than May 18, 2018. The balance on the loan as of September 30, 2013 is $137,431. Supplementary Information September 30, 2013 and 2012 Vail Valley Foundation 26 www.eidebailly.com 5299 DTC Blvd., Ste. 1000 | Greenwood Village, CO 80111-3329 | TF 877.882.9856 | T 303.770.5700 | F 303.770.7581 | EOE Independent Auditor’s Report on Supplementary Information To the Board of Directors Vail Valley Foundation Avon, Colorado We have audited the consolidated financial statements of Vail Valley Foundation as of and for the years ended September 30, 2013 and 2012, and our report thereon dated February 18, 2014, which expressed an unmodified opinion on those financial statements, appears on page 1. Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements taken as a whole. The schedule of consolidated program revenues and expenses is presented for the purposes of additional analysis and is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the consolidated financial statements as a whole. Greenwood Village, Colorado February 18, 2014 27 Vail Valley Foundation Schedule of Consolidated Program Revenues and Expenses Years Ended September 30, 2013 and 2012 2013 20122015 Alpine World Ski Championships Revenue and contributions 6,587,146$ 3,210,166$ Expenses (2,031,259) (686,560) 4,555,887 2,523,606 Vilar Performing Arts Center Revenue and contributions 4,643,600 4,376,174 Expenses (4,451,173) (4,350,609) 192,427 25,565 Youth Foundation Education Programs Revenue and contributions 3,218,044 2,365,129Expenses(3,454,960) (2,804,905) (236,916) (439,776) Birds of Prey Revenue and contributions 2,897,371 4,093,355 Expenses (2,828,620) (3,876,802) 68,751 216,553 Summer Mountain Games Revenue and contributions 1,974,465 2,018,828 Expenses (1,867,966) (1,804,837) 106,499 213,991 Vail International Dance Festival Revenue and contributions 1,614,721 1,543,327 Expenses (1,698,334) (1,634,083) (83,613) (90,756) American Ski Classic Revenue and contributions 1,242,983 1,284,750Expenses(1,280,432) (1,460,978) (37,449) (176,228) Winter Mountain Games Revenue and contributions 1,053,317 1,329,298 Expenses (1,265,787) (1,221,078) (212,470) 108,220 Gerald R. Ford Amphitheater Revenue and contributions 547,305 1,964,320 Expenses (594,589) (698,585) (47,284) 1,265,735 USA Pro-Cycling Challenge Revenue and contributions 409,127 110,208 Expenses (403,563) (208,885) 5,564 (98,677) Vail Global Energy Forum Revenue and contributions 386,877 261,683 Expenses (398,641) (244,065) (11,764) 17,618 Other Education ProgramsRevenue and contributions 75,105 405,160 Expenses (255,000) (753,149) (179,895) (347,989) Street BeatRevenue and contributions - 324,619 Expenses - (323,971) - 648 Grants to Charitable Organizations (304,676) (244,096) Total program revenue, net of program expenses 3,815,061$ 2,974,414$ 8. Benefits for the Avon Community: With Avon being merely 2 miles down the mountain from the Vilar Performing Arts Center there are many benefits that the community will receive. We plan on having 2- Avon “Centric” events presented at the VPAC throughout the year. These events may include a lower resident ticket price for Avon residents and post show parties at Avon businesses (i.e. Agave, Loaded Joe’s, etc). We would like to have a discounted ticket package for a series on the Winter 2015 season that would be specific to the residents of the Town of Avon. Throughout the year we could work on partnerships with artist to have pop-up performances in the Town of Avon. We would also be able to provide 10 transferable passes for our 2014 Underground Sound Series that could be used for the staff members of The Town of Avon, so they could come and enjoy all we have to offer for our locals in the off season. Lastly, we plan on being able to provide 2 Venue Facility Usages through the year for collaboration events such as Winter WonderGrass, etc. allowing for the Town of Avon events to expand to the Vilar PAC stage/facility. 9. Marketing Efforts: Some of the marketing efforts that would be afforded to TOA in this partnership would be inclusion of the TOA logo at the bottom of all collateral among our other key facility sponsors (posters, banners, ads, etc.), as well as full page ads in both program book publications (Winter & Summer). We will have TOA listed and linked on the website with several co-branding and marketing opportunities available. TOA will be mentioned in press releases for certain shows with targeted promotions and lastly, TOA will be mentioned nightly in the curtain speech at each performance as a facility sponsor. 10.In-Kind donation descriptions: The in-kind donations that we are asking the TOA for include: 1) Seasonal Light Post Banners at Avon Roundabouts and throughout town, with locations to be determined. This would include banners for Underground Sound (August 18-November 9), Winter Season Branding, and Summer Season Branding. 2) The use of Avon Bus Transportation, including drivers, for the transportation of Avon guest and locals to and from Avon and VPAC on show nights. Other items will be determined based on clear valuation of benefits of the list above. Overview: Since the Town of Avon Grant request date has passed, the Vail Leadership Institute has been active in the attempted acquisition of a key element in building a stronger entrepreneurial economy in Avon. There is a business executive that plans on launching a 1.2M investment fund in 2015 intended to invest in and accelerate outdoor tech based companies. When the Vail Leadership Institute first met this organization, they were planning on opening this entity in Frisco, CO. Through very recent discussions, it could be very likely that this entity would consider calling BaseCamp home in Avon, CO. The Vail Leadership Institute is currently looking at doubling the size of BaseCamp in 2015 to be able to accommodate opportunities like this and the growing desire of Valley businesses to be based in this type of progressive environment. In order to procure the investment fund as an Asset in Avon, CO the Institute is recommending the Town of Avon subsidize the annual rent at BaseCamp for this entity for a period of one year at an annual rate of $10,000. This would cover 70% of their total rental needs in 2015, and will probably be necessary to convince the investor that Avon is supporting the move from Frisco. This seems like an optimal way to invest tax payer dollars, since the return of 1.2M in invested dollars is substantial enough to build and grow larger and sustainable firms that have the opportunity to base out of Avon. It will also serve as a key marketing tool for business relocation to be able to talk about this Investment Fund. There will be national campaigns in place to attract businesses into the accelerator. I would like the Town of Avon to consider this addendum outside of the Vail Leadership Institute 2015 Grant Request, and consider funding this as a separate strategy that the Institute has cultivated on behalf of the Town of Avon. Sincerely, Ross Iverson President/CEO 2015 Town of Avon Funding Addendum Reque 1.Conta Walking 318Wal POBox9 Avon,CO DougDu Director (970)30 dougd@ 2.Descr Walking located 38,000s area50 governm Ourmiss sustaina 3.Detail Wehave Program est for 20 actInformat Mountains kingMoun 9469 O81620 usenberry rofMajora 6-0561 @walkingmo iption&Pu Mountains inAvontha students,fa 1(c)3organ ment,found sionistoaw bilitythrou eddescript ebrokenou ms,Sustaina 015 Tow tion: sScienceCe tainsLane ndPlanned ountains.org urposeofth sScienceCe atprovides miliesanda nizationfun dationsand wakenase ughnatural tionofthee urproposal ableFilmSe wn of Avo enter dGifts g heOrganiza enterisaw formaland adultswho ndedprimar corporatio nseofwon scienceedu eventorpr intothree eriesandEn on Fund ation worldclassn dinformals resideino rilybycont ons. derandins ucation. ogramand separateca nergySmart ding naturalscie scienceedu orvisittheA ributionsfr spireenviro explanatio ategories(N tPrograms) nceeducat cationprog Avonareae romindivid onmentalst onoffundin NaturalScie ): tionfacility gramstoov eachyear.W uals, ewardship ngneeds. enceEducat ver We and tion Programs: WalkingMountainsScienceCenter,throughtheassistanceofdonors,offersthe followingprogramsinthetownofAvon: WalkingMountainsScienceCenter We’veinvestedsignificantresources($14.5M)tobringaworldclassnaturalscience centertostudents,teachers,familiesandadultswholiveinorvisittheTownofAvon. Ourcenter,whichisopentothepublicyearround,boastsaLEEDPlatinumdesign,a stateoftheartinteractiveexhibithall,smartclassrooms,communitymeetingspaces, interpretivetrails,outdoorclassroomsandmoredrawspeoplefromaroundtheUnited States. WalkingMountainsScienceCenteristhesiteforseveralactivitiesincluding:  InformalSciencePrograms-Visitors,fromourcommunityandaroundthe US,candropinanytimetoexploreourinterpretivetrailswithadventure packsthatweprovide,enjoyourstateoftheartinteractiveexhibits,join usforanaturalistguidedhike,accessthebackcountryontheirown,or simplyrelaxorpicniconourgrounds.Theseactivitiesareallfreeof chargeandagain,availableyearround.  HikingProgramssuchasmorningbirdwalks,lunchpicnicloopsandaprès ridgewalksexposeresidentsandvisitors,throughshorternaturalists guidedhikes,tothenaturalwondersrighthereinourtown.  AdultSeminarsandClasses-Theseprograms,ledbyhighlyqualifiedguest instructors,covertopicssuchasGeology,Botany,MedicinalPlants,Fossil Exploration,NaturePhotography,WatercolorInterpretationandmore.  FamilyPrograms-TheseprogramsincludeourpopularEarthExplorersfor 1stand2ndgraders,EarthKeepersforparentsandchildren3to5,Nature Tykesforparentsandchildren6monthsto2yearsaswellasspecial familyofferingsinpartnershipwiththeDenverMuseumofNatureand Science.  AstronomyPrograms-Theseprograms,opentopeopleofallages,are freeofchargeandteachpeopleabouttheuseoftelescopesandthenight sky.  ScienceBehindSeries-Inthismonthlyseries,WalkingMountainspartners withaguestinstructortoexplorethesciencebehindfactorsinour everydaylives.Classesarefreeorlowcosttoattend. FieldSciencePrograms 3,000+EagleCountyK-12studentsreceivehands-on,naturalscienceclassesinthe outdoors(atournewcampusandonpubliclands)onanannualbasis.Thesecurriculum alignedprograms,thatutilizethescientificmethod,awakenaninterestinsciencewhile forgingameaningfulconnectiontothenaturalworld SummerYouthScienceCamps Thesecampsengageover500youthages5-13,annually,inweeklongdayandovernight campsthatexplorethenaturalworldthroughexcitingeducationalactivities.These activeprogramsteachstudentsaboutthenaturalworldandscientificconcepts. AfterSchoolSciencePrograms Theseprogramswhichblendhandsonactivitieswithcurriculumalignedscience instructionprovideenrichingandsafeafterschooloptionsforover150studentsin elementaryschoolsthroughoutourvalleyonanannualbasis. AvonIn-School Thisprogram,whichhasattractedattentionfromfundersaroundtheUS,bringsweekly scienceenrichmentclassestoallofthe245K-5studentsenrolledatAvonElementary Schoolthroughouttheirschoolyear. AdultandFamilyEducationalPrograms Theseprogramstakefamiliesandsmallgroupsintoourmountains,orontoourcampus, toexplorenaturalsciencetopicsofinterestfromastronomytolocalecology.Partner programswithDenverMuseumofNatureandScience,andothercenters,takeplace quarterly. STEMLeadershipAcademy TheafterschoolSTEMLeadershipAcademy,initsfirstyear,challengesmiddleschool studentsinscience,technology,engineering,andmath(STEM)throughhands-on curriculuminspiredbystudentinterestandcurrentsciencestandards. TheSTEMLeadershipAcademyseekstoinspirethenextgenerationofSTEMinnovators byprovidingyouththeaccesstoandconfidenceinSTEMtopics,skills,andtools. Additionally,studentsassumeleadershiprolesingroupworkandprojectdevelopment. Currentlyasixthgradeprogram,theSTEMLeadershipAcademywillexpandtoinclude seventhgradeinthefallof2014andtheneighthgradeinthefallof2015. GraduateFellowshipsandSeasonalInternships Ourgraduatefellowship(6peryear)drawsthebestandbrightestnaturalscience educatorsfromaroundtheUS.Thesecompetitive15monthpositionsoffergraduate studentsinEducationandEnvironmentalSciencetheopportunitytohonetheirfield teachingskillswhileearninggraduatecreditthroughapartnershipwithColoradoState University.OurseasonalinternsearnundergraduatecreditwhilestaffingourDiscovery Center,theVailNatureCenterandGirlsinSciencePrograms. HighSchoolInternships OurcompetitiveHighSchoolinternshipprogramallowsasmallgroupof10th- 12thgradersinourdistricttoengageinmeaningfulfieldscienceexperimentsin partnershipwiththeUSForestService.Studentslearnfirsthandaboutexperiment design,datacollection,fieldobservationtechniquesandmorefromexperienced practitionersinthefield.Thedatatheycollectisusedinrealworldapplicationtosolve issuescurrentlyfacingourUSForestlands. TheseexperiencesallowhighschoolstudentstoearncollegecreditfromCMCwhile experienceapossiblecareerfieldfirsthand,tocontributetothescientificbodyof knowledgeandtofulfillrequirementsforcollegeapplications. ExplorationsonPublicLands WalkingMountainsofferseveningcampgroundprograms,guidedhikesandsnowshoe toursandmoreatYeomanPark,GoreCreekCampground,SylvanLakeStateParkand USForestServicelands.Thesehighqualitynaturalscienceprogramsarefreetothe public. MagicBusProgram TheMagicBusprogramisconductedthroughapartnershipwiththeYouthFoundation. Itliterallyallowsustomeetpreschoolandyounggradeschoolstudentswheretheylive toprovideimportantscienceandreadingactivitiesthatwillhelptomakethemmore successfulastheyentertraditionalclassrooms. Thismobileclassroomvisitsseveralsitesthroughoutourvalleywiththeintentof reachingthosestudentsmostatriskeducationally.Manyofthestudentsweserveare learningEnglishasasecondlanguageandthisexperienceprovesinvaluableinhelping themmaintainpacewiththeirclassmates. Theeducationalactivities,ledbyourtalentednaturalists,includeinteractiveeducational games,explorationoftopicrelatedliterature,focusedoutdoorexplorationandmore. Film Series: FilmSeries ForthecomingNovember2014throughMay2015SustainableCommunityFilmSeries, WalkingMountainsisrequestingatotalof$5,750fortwocomponentsoftheSeries:1) $2,500for“PresentingSponsor”titleforthesevenfilmsthatwillbeshownatLoaded Joe’sinAvonand,2)anadditional$3,250toco-sponsorandaddthe“WildandScenic FilmFestival”whichwouldbeaFridayeveningandSaturdayafternoon-eveningeventin JanuaryatalocationwithintheheartofAvon(potentiallyWestinRiverfront). TheSustainableCommunityFilmSeriesraisesawarenessandencouragescommunity dialogueabout environmentalandbroadersustainabilityissuesimpactingourlives throughaward-winningindependentfeaturedfilms.Lastyears’seriesreachedover750 communitymembersattwovenuesinAvon(LoadedJoe’s)&Eagle(DustyBoot).The FilmSeriesbeganin2011andhasbecomeanannualprogramwithconsistent communitysupportandpositivefeedback.ThisyearWalkingMountainswillcontinueto providefilmsattwolocationsfortheentireseriesplusapotentialthirdlocationinAvon forthe“WildandScenicFilmFestival.” WalkingMountainspartnerswithalocalrestaurant(LoadedJoe’sinAvon)toactasthe hostingvenuefortheSeries.Thisencourageslocalcommunityinteractionandsupports thelocalbusinesses.LoadedJoe’sreportsthatasaresultofcontinuingthefilmonthe firstTuesdayeverymonth,attendancegrewrangingonaverage75attendeesperfilm, withthehighestbeing115attendees.LoadedJoe’shasshowna75%increaseinsales onafilmnightcomparedtoanon-filmnight. In2014-2015WalkingMountainswillhostoneseriesagaininAvonandanotherseries inEaglewithanestimatedreachof1000+communitymembers.Onefilmpermonth willbeshownoverthecourseofsevenmonthsandthepotential2-day“WildandScenic FilmFestival”willbeshownonlyinAvonduringoneofthosemonths.IfTownofAvon choosestoco-sponsortheFilmFestival,theprogramoffilmsandactivitieswouldbe closelycoordinatedwithAvonstaffandthehostingvenue. TheSustainableCommunityFilmSeriesline-upfor2014-2015isasfollows: Trashed:Ayoungmansetsouttodiscovertheextentandeffectsoftheglobalwaste problemashetravelsaroundtheworldtobeautifuldestinationstaintedbypollution. Fromindividualswhohavechangedtheirlivesandproducealmostnowaste,to increasinganti-wastelegislation,toanentirecitywhichisnowvirtuallywaste-free,he discoversthatchangeisnotonlyessential,buthappening. TheRealDirtonFarmerJohn:ThetaleofamaverickMidwesternfarmer.Anoutcastin hiscommunity,FarmerJohnbravelystandsamidstafailingeconomy,viciousrumors, andviolence.Bymeldingthetraditionsoffamilyfarmingwiththepowerofartandfree expression,thisstoryoftransformationheraldsaresurrectionoffarminginAmerica. Wild&ScenicFilmFestival(TBDpendingTownofAvonco-sponsorship):Considered oneofthenation’spremierenvironmentalandadventurefilmfestivals,thisyear’sfilms combinestellarfilmmaking,beautifulcinematographyandfirst-ratestorytellingto inform,inspireandignitesolutionsandpossibilitiestorestoretheearthandhuman communitieswhilecreatingapositivefutureforthenextgeneration. Festival-goerscan expecttoseeAwardwinningfilmsaboutnature,communityactivism,adventure, conservation,water,energyandclimatechange,wildlife,environmentaljustice, agriculture,NativeAmericanandindigenouscultures.Thisyear’sselectionswillnotonly takeaudiencestosomeofthemostremoteandbeautifulplacesontheplanet,but introducethemtothemagnificentanimalsthatinhabittheseplacesandthecourageous individualswhoareworkingtoprotectandpreservebothforfuturegenerations. The filmsinstilladeepappreciationandasenseofwonderforthenaturalworldthat surroundsandsupportsus. DyingGreen/TheNextBestWest:(2shortfilms) DyingGreen:SetinthefoothillsoftheAppalachians,thisfilmexploresoneman’svision ofusinggreenburialstoconserveland.Dr.BillyCampbell,thetown’sonlyphysician, andhiseffortshavechangedourunderstandingofburialsintheUnitedStates.Dr. Campbell’sdreamistoconserveonemillionacresofland. TheNextBestWest:TheNext,BestWestexploresourchangingrelationshipwiththe landthatsustainsus.IttellsthestoryofhowtheconventionalAmericanconceptof progresshassteeredourexploitationoftheWesternlandscape,andtakesyoutothree places–Colorado’sSanLuisValley,thehighplainsofeasternMontanaandtheElwha RiveronWashington’sOlympicPeninsula. Switch:Everyenergyresource—fossil,nuclearandrenewable—isundergoingprofound changes.We'regraduallyshiftingfromcoalandoiltotheenergiesoftomorrow.Rather thanadvocateforhowitshouldhappen,Switchtravelstheworldtodiscoverhowit mostlikelywillhappen.Switchisaboutchangingthewayweuseenergy,torealizethe manyeconomicandenvironmentalbenefitsofefficiency. SandWars:SandWarsisasurprisinginvestigationintooneofthemostconsumed resourcesontheplanet.Duetothedemandforsand,theplanet’sreservesare threatened.Three-quartersoftheworld’sbeachesareindeclineasvictimsoferosion,or ofsandsmuggling.Triggeredbybuildingconstruction,smugglingbands,or“sand mafias,”plunderbeachesandriversforthishighlyprizedcommodity. TheCityDark:Featuringstunningastrophotographyandacastofeclecticscientists, philosophers,historians,andlightingdesigners,TheCityDarkisthedefinitivestoryof lightpollution.AftermovingtoNewYorkCityfromruralMaine,filmmakerIanCheney asks:“Doweneedthedark?”ExploringthethreatofkillerasteroidsinHawai’i,tracking hatchingturtlesalongtheFloridacoast,andrescuinginjuredbirdsonChicagostreets, Cheneyunravelsthemyriadimplicationsofaglobeglitteringwithlights. Wisdomkeepers,PaqoAndino:Aninspirational,emotionallyintimatedocumentaryfilm revealingtheheartcentered,celestiallyguidedlifewaysoftheAndeanHolyMountain Tradition,oneofourplanet’sfewremaininguninterruptedwisdomlineages.Filmedon locationinthePeruvianhighlands,thisunprecedentedfilmtakesusonajourneyinto theheartofanancientearthkeepingculturetoexperienceawayoflifethatisatonce practicalandmystical. The“PresentingSponsor”leveloffinancialsupport($2,500)includesthefollowing marketingandrecognition:TownofAvonlogoonallmarketingmaterialsincluding eightadvertisementsinVailDailyplusmentioninmonthlypressreleaseofeachfilm,30- 40postersdistributedthroughoutvalleymonthly,25+E-newsletterssentto3,200 contactsandpostingonsocialmedia(Facebook&Twitter&partnersites),seven calendareventsonourwebpageandotheraffiliates,andinanyTV&Radiocommentary forentiresevenmonths,recognitionatbeginningandendofallfilmsinbothlocations withopportunitytoshareyourbusinessstory. Budgetfor2014-2015FilmSeries: Expenses FilmProcurement&RightstoShow$1,600 Marketing&Materials$3,200 ProgramManagement&Travel$2,900 Wild&ScenicFestivalFilmsandRights$1,750 Wild&ScenicProjectManagement$1,500 TOTAL$10,950 Income Corporate$3,500(Varietyoflocalbusinesses) Government$3,500(Avon$2,500,Eagle$1,000) Government$3250(AvonforWild&Scenic) Individual$700(Donationscollected) TOTAL$10,950 Energy Smart Programs: EnergySmartPrograms EnergyefficiencyimprovementswithintheTownofAvonleadtomoneysavedforAvon residentsandbusinesses,increasedrevenuesforthelocalcontractorworkforce,and significantreductionsincarbonemissions.Investmentinenergyefficiencymeans reinvestmentinthecommunity.Forevery$1spentonenergyefficiencythereisa$2.25 multipliereffectthatbenefitsthelocaleconomy(Source:AmericanCouncilforan EnergyEfficientEconomy). WalkingMountainsisrequestingassistancefromtheTownofAvontodirectlyreinvest in:1)energyassessmentsandrebatesfor20Avonhomeowners(rebatesupto$500per homeowner,and2)energycoachingandrebatesfor10Avonbusinesses(rebatesupto $1,500perbusiness).TownofAvonfundswillbematchedwithfundsfromtheEagle CountyEco-Buildfund.ThiscouldbeagreatwayforAvontoreinvesttheirannual “CommunityEnhancement”fundsprovidedbyHolyCrossEnergy. WalkingMountainsScienceCenterhasproventobeanideallocationfortheEagle Valley’sEnergySmartprogram.TheEnergySmartprogramtransformsthelocal economyandstimulateshomeandsmallcommercialenergyimprovementsby providingaccesstoinformation,financing,andaskilledworkforce.Thismodelhas experiencedremarkablesuccesstodate. TheEnergySmartprogramisfundedinpartbyEagleCountyEco-Buildprogramwhich isfundedbyfeesforenergybuildingcodemitigationcollectedinunincorporatedEagle County.TheEco-Buildfundfluctuatesannuallyandhasdecreased30%fromthepast year.ThereisaneedtosupplementtheEnergySmartprogramwithgrantsupportfrom themunicipalitieswhoseconstituentsaretheprimarybeneficiariesoftheEnergySmart program. IntheTownofAvonalone,since2011,theEnergySmartprogramhasstimulatedatotal of$355,400inenergyimprovementprojects,givenout$28,000inrebates,andspent $23,700onenergyassessmentsforAvonhomeowners.EnergySmarthasreduced energyusewithintheTownofAvonby83,823kWhand10,400therms,between176 TownofAvonhomeownersandbusinesses.Theseenergysavingsresultindirect economicstimulusbacktothelocalAvoneconomywhilesupportingenvironmental stewardshipandsustainability.InordertoevaluatethesuccessofTownofAvon’s2015 investmentof$10,000inEnergySmartprogrammingforitscommunity,Walking Mountainswillprovideafinalreportincludingthemetricsmentionedabove. 4.AmountoffundsrequestedfromtheTownofAvon.Pleaseincludewhenfundsare neededforpayment. WalkingMountainsScienceCenterrespectfullyrequestsagrantintheamountof $35,750fromtheTownofAvon.Thisfundingwouldbeusedtoassistincovering programexpenses(approximately1.8%)thatdirectlybenefitthousandsofTownofAvon residentsandvisitors:FieldStudiesprogramsforstudentsatlocalK-12schools; InterpretiveprogramsandhikesatourcampusinAvon,Programs,speakerandfilm seriesatourworldclasssciencecenterinAvonandEnergySmartPrograms(additional informationavailableuponrequest).Specifically,ourfundingrequestisbrokendownas follows: $20,000FundingforeducationalactivitiesthatbenefitTownofAvon residentsandvisitors,atWalkingMountainsScienceCenter $10,000EnergySmartProgramsforTownofAvonresidentsandbusinesses $5,750SustainableCommunityFilmSeries,possibleadditionofWildand ScenicFilmFestival $35,750Total WeunderstandthatfundswillbepaidafterJanuary1st,2015foruseduringCY2015. 5.Amountoffundsrequestedand/orprovidedfromotheragencies,organizations, companies(i.e.otherfundingcommitted). InFY2015,$1,209,082.25or63%ofourbudgetedrevenuesof$1,922,409.25willcomein theformofphilanthropicgiftsfrom: Individuals$755,464.00 Foundations$182,991.00 Corporations$109,106.00 Government$105,817.00 InKindSupport$55,704.25 Alistofthesedonorsisavailableuponrequest.Theremaining$713,327.00willbe realizedfromgovernmentandprivatefeeforservice,storesalesincomeand investments. 6.Anticipatedlineitembudgetfortheorganizationorevent. OurprojectedFY2015expensesare$1,917,516.86(seeattachedfordetail). 7.FY2014finalactualprofitandlossstatement. Seeattached. 8.HowtheeventororganizationbenefitstheAvoncommunity?Pleaseprovidedetails. WalkingMountainsScienceCenterprovidesnumerouscultural,recreationaland educationalofferingsthatbenefitover38,000residentsandvisitorstoourcommunity eachyear.OurcenterisnowservingasaneducationaltouchstonefortownofAvon residentsandisdrawingvisitorsfromaroundtheUnitedStateswithhighquality programmingthatisinalignmentwithnationaltrendsin“green”,sustainableand educationaltourism. WalkingMountains,awellestablishednonprofitorganizationwitha15yearrecordof consistentgrowth,recentlyopenedamulti-milliondollar,stateoftheartsciencecenter forresidentsandvisitorsinthetownofAvon.Webelievethatourprogramsaredirectly alignedwithseveralofAvon’sstatedgoalsintheir2013-14Strategicplanasregards economicdevelopment,additionofappealingspecialeventsinthetown,stewardshipof naturalresourcesandexpansionofcultural,educationalandrecreationalofferingsin partnershipwithprivatesectoragencies. Ourcentercontinuestoattractattention,visitorsandfundingfromaroundtheUnited States.ThePrecourtMountainDiscoveryCenteroncampuswasrecentlyawardedLEED Platinumcertification,makingitoneofthe“greenest”educationalfacilitiesinthenation. AttractionssuchasthishelptodifferentiatetheexperienceforvisitorstotheTownof Avonandencouragereturnvisits. ThroughourworkwiththeColoradoDepartmentofTourismandDepartmentof TransportationwearebeginningtomarketourcentertoColoradovisitorsfromaround theUnitedStates.Ourcenterisalignedcloselywithstate,localandVailandBeaver CreekResorts’effortstoappealtothelargesegmentoftravelersinterestedin“green”, “active”and“educational”tourism.WalkingMountainsScienceCenteraddssignificant valueforvisitorstoourcommunityandsetsourmountainexperienceapartfromothers aroundtheUS. InadditiontoournewcenterinAvon,WalkingMountainscontinuestoprovidefield scienceprograms,afterschoolscienceprogramsandsummersciencecampexperiences forhundredsofTownofAvonstudentsonanannualbasis.Theseexperiencesimprove students’educationaloutcomesinscienceandreconnectthemtotheoutdoors, providingamyriadofphysical,intellectualandemotionalbenefits. Theinterpretiveservicesavailabletolocalsandvisitorsonourcampus,attheUSForest Servicevisitorscenter,atcampgrounds,trailheadsandattheDiscoveryCenteronVail MountainareprovidedbyWalkingMountains.Theseexperiencessignificantlyimprove guestexperiencesandofferalternativesourcesofrecreationforthoseinterestedin “green”,“active”and“educational”offerings. Themajorityofourprograms,whichbenefitresidentsandvisitorsalike,areprovidedfor nochargeorareheavilysubsidizedbyourfundraisingefforts.Itisourtarget,based uponareviewofnationalaveragesandtheDenverMuseumofNatureandScience’s fundingrelationshipwithsurroundingmunicipalitiesandcounties,toraise25%ofour annualoperatingrevenuesfromgovernmentsourcesincludingfederal,state,county andlocalmunicipal. 9.Ifapplicable,whatmarketingeffortswillbemadeforthiseventorprogramandhow willitbenefittheTown. WalkingMountainsScienceCenteractivelymarketsitsprogramsandspecialeventsin Avonthroughe-communicationswithasubstantiallistofconstituentsstate-wide,a strongsocialmediapresence,byradioandnewspaperadvertisements.Ourprograms thatareruninpartnershipwithbrandssuchastheDenverMuseumofNatureand Science,JohnFielderandPatagoniaarealsomarketedinamuchbroadereffortthrough theirestablishedmarketingchannels. WalkingMountainsScienceCenterhasattractedattentionfromfunders,government, corporationsandmediafromaroundtheUnitedStates.Ourcenterhasbeenawarded LEEDPlatinumcertification,makingitoneofthemostsustainablydesignedandbuilt sciencecentersintheUS.Thisdesignationplacesitonaselectnationalregistryof buildingswithpotentialinterestofbuildersanddevelopers. Wearealsoanationalmodelforhownonprofitorganizationscanpartnerwithschool districtstohelpthemachievetheirgoalsofprovidingasuperioreducationfortheir students. WehaveworkedwiththeCODepartmentofTourismtomarketourfacilitythroughout thestateandtheUS.Visitorsfromall50statesandinternationallyhavealreadyvisited totakeadvantageofourservices. 10.Includeadescriptionofanyʺin‐kindʺcontributionsandrelatedcostthattheTownof Avonprovidestoyourorganization,includingbutnotlimitedto:land,buildings,and theirfacilitiesand/orservices. TheTownofAvondoesnotcurrentlyprovideinkindcontributionsbutwewelcomethe opportunitytoengageinadiscussionregardingwintermaintenanceofWalking MountainsLane(connectingtoBuckCreekRoad). 11.IfarecipientoffundsfromtheTownofAvoninfiscalyear2014,aprogressorfinal reportonthefundedactivity,programand/orevent. AgrantreportforfundsreceivedfromtheTownofAvonin2014hasbeensubmitted; pleasecontactusifwemightprovideadditionaldetailsoranswerquestionsaboutthis report. Walking Mountains Science Center FY 2015 Budget FY 15 Annual Operating Budget Income 4030 · Corporate Contributions 109,106 4050 · Foundation Contributions 182,991 4090 · Government Contributions 105,817 4110 · Individual Contributions 755,564 4130 · In-Kind Donation 55,704 4210 · Program Fees 670,477 4270 · Other Income 10,200 4500 · Store Sales Income 32,650 4115 · EVAS Contributions - Total Income 1,922,509 Expense 6000 · Accounting 17,400 6020 · Advertising & Marketing 78,554 6040 · Bank and Finance Charges 300 6060 · Board & Committee Ops.850 6100 · Computer Support 58,400 6140 · Contract Services 79,760 6150 · Credit Card Fees 6,200 6160 · Donor Cultivation/Stewardship 3,370 6180 · Dues & Subscriptions 5,769 6220 · Employees 6240 · Employee Benefits 83,954 6250 · IRA Employer Contribution 21,872 6260 · Payroll Expenses 72,689 6280 · Salaries & Wages 1,025,504 Total 6220 · Employees 1,204,019 6290 · Energy Rebate 63,000 6300 · Equipment 10,450 6320 · Fees & Permits 13,675 6340 · First Aid Supplies 4,750 6360 · Food Supplies 12,740 6380 · In-Kind Expense 41,204 6400 · Insurance 33,000 6390 · Interest Expense - 6440 · Legal 300 6460 · Library Supplies 1,338 6480 · Meals & Entertainment 6,155 6490 · Special Events Food & Entertain 44,750 6540 · Office Supplies 4,005 6550 · Store Inventory Expense 17,500 6560 · Postage 4,430 6580 · Printing & Copying 28,306 6600 · Professional Development 14,870 6620 · Program Supplies 36,050 6640 · Recognition & Awards 4,200 6660 · Recruitment 1,953 6680 · Rent - 6700 · Repairs & Maintenance 52,564 6710 · Special Events Inkind Expense 14,500 6720 · Telephone 10,800 6740 · Travel & Lodging 9,095 6760 · Uniforms 3,765 6780 · Utilities 13,920 6800 · Vehicle Operations 15,575 Total Expense 1,917,517 4250 · Interest/Div Income 220 Net Ordinary Income 5,212 Fundraising Income 1,153,478 3:57 PM 01/15/14 Accrual Basis Walking Mountains Science Center Profit & Loss Budget vs. Actual Annual Operating July through December 2013 Jul - Dec 13Budget $ Over Budget% of Budget Income 4030 · Corporate Contributions 51,10348,8092,294105% 4050 · Foundation Contributions 48,19119,38428,807249% 4090 · Government Contributions 1,0001,0000100% 4110 · Individual Contributions 540,739477,49663,243113% 4115 · EVAS Contribution Revenue 128,630128,6300100% 4130 · In-Kind Donation 66,94067,771-83199% 4210 · Program Fees 164,246151,37612,870109% 4270 · Other Income 3,2535,400-2,14760% 4500 · Store Sales Income 20,04820,00048100% Total Income 1,024,150919,866104,284111% Gross Profit 1,024,150919,866104,284111% Expense 6000 · Accounting 14,91315,600-68796% 6020 · Advertising & Marketing 19,51619,43284100% 6040 · Bank and Finance Charges 283300-1794% 6060 · Board & Committee Ops.17415024116% 6100 · Computer Support 38,68038,925-24599% 6140 · Contract Services 15,59812,6952,903123% 6150 · Credit Card Fees 4,7675,000-23395% 6160 · Donor Cultivation/Stewardship 1,7271,620107107% 6180 · Dues & Subscriptions 3,3133,26053102% Total 6220 · Employees 493,522492,0071,515100% 6290 · Energy Rebate 9,87612,545-2,66979% 6300 · FF&E 4,4183,2001,218138% 6320 · Fees & Permits 6,4356,36768101% 6340 · First Aid Supplies 1,7741,70767104% 6360 · Food Supplies 4,4775,630-1,15380% 6380 · In-Kind Expense 17,85717,77186100% 6400 · Insurance 15,71614,3001,416110% 6420 · Interest Expense 289600-31148% 6440 · Legal 45 6460 · Library Supplies 517772-25567% 6480 · Meals & Entertainment 3,7651,1402,625330% 6490 · Special Events Food & Entertain 48,88749,500-61399% 6540 · Office Supplies 2,8111,6101,201175% 6550 · Store Inventory Expense 7,2174,5002,717160% 6560 · Postage 2,4102,086324116% 6580 · Printing & Copying 14,67315,845-1,17293% 6600 · Professional Development 3,7046,894-3,19054% 6620 · Program Supplies 10,62410,228396104% 6640 · Recognition & Awards 2,8712,520351114% 6660 · Recruitment 498975-47751% 6680 · Rent 2,6002,6000100% Total 6700 · Repairs & Maintenance 38,89137,8301,061103% 6710 · Special Events Inkind Expense 49,08350,000-91798% 6720 · Telephone 4,6444,840-19696% 6740 · Travel & Lodging 2,7383,245-50784% 6760 · Uniforms 49324-27515% 6780 · Utilities 5,6865,65135101% 6800 · Vehicle Operations 4,2234,660-43791% Total Expense 859,271856,3292,942100% Net Ordinary Income 164,87963,537101,342260% Other Income 4250 · Interest/Div Income 75 Total Other Income 75 Net Other Income 75075100% Net Income164,95463,537101,417260% Page 1 of 1 2015 Town of Avon Community Funding Request 2015 Xterra Mountain Championships 1. Contact information: - Organization: Beaver Creek Resort Company – 2015 Xterra Mountain Championships - Contact: Jeremy Gross - Phone: (970) 845-5288 - Email: jgross@vailresorts.com - Mailing Address: PO Box 5390, Avon, CO 81620 2. Description & Purpose of the Organization: The Beaver Creek Resort Company of Colorado combines a homeowners’ association and a resort association with some municipal services added. The Resort Company, a Colorado non-profit corporation, incorporated on April 30, 1979, was designed to help Beaver Creek become and remain a unique resort community. By virtue of its Articles of Incorporation, the Resort Company is vested with a wide range of responsibilities and authority. It was created to perform certain functions and to manage certain property for the common benefit of property owners and businesses within Beaver Creek. Today, these functions include: Marketing, Special Events, Central Reservations, Transportation, Municipal Services and Community Quality. 3. Event Description: The Xterra Off-road Triathlon has been coming to Beaver Creek and the Town of Avon for many years. It is the official Mountain Championship event on the tour which qualifies over 40 athletes to compete in the World Championships held in Hawaii each year. Being a Championship event, it draws elite athletes from around the world. This event is only possible because of the resources and support of the Town of Avon and the use of Nottingham Lake for the swim portion of the event. 4. Funding Request: $2500 5. Other Funding: $21,000 (Beaver Creek Resort Company and East West Resorts) 6. Anticipated FY15 Budget: Expenses for 2015 Budgeted at $21,000. Potential income from community sponsorship of $7500. 7. 2013 Final P&L: Expenses $22,912. Sponsorship $7500. $15,378 Net Loss. 8. Benefits to Avon: • As the start and swim location for the Xterra Mountain Championships, Avon gets great exposure to all of the athletes, family and friends, who visit the town for the event. • Exposure is also gained through the year round marketing efforts of Team Unlimited and the Xterra Brand. • Many local businesses are impacted positively during the event for lodging, entertainment, dining, and retail. Many of the athletes who come each year have built relationships with local businesses and return each year including Bobs Place, Venture Sports, etc. 9. Marketing Efforts: • Comprehensive regional, national and international marketing is produced for the event and managed by Team Unlimited. Marketing channels include; o Press Releases o Email blasts to all Xterra Athletes Nationwide o Social Media Postings 1. Facebook- Over 45,000 fans 2. Twitter- Over 15,000 followers 3. Comprehensive regional and national marketing through Beaver Creek’s summer event marketing buy. 10. In Kind Contributions: • Lifeguards • Permitted use of the Park and Nottingham Lake • Police for road crossing of Highway 6 • Volunteer assistance 11. FY14 Progress Report: • The 2014 Xterra Mountain Championships took place on the weekend of July 19th. The event was very well received by all of the stakeholders including Team Unlimited, the athletes and other village guests. • This year we brought back the Half Marathon distance for the Sunday trail run. The attendance was back up from 2013 and we will plan to continue that event in 2015. • The official Xterra recap should arrive this fall though we are very pleased in the overall execution of the event. RECREATIONAL TRAILS ADVISORY GROUP FORMATION – WORK SESSION PAGE 1 OF 2 TOWN COUNCIL REPORT To: Honorable Mayor and Avon Town Council From: Matt Pielsticker, AICP, Planning Manager Date: September 16, 2014 Agenda Topic: Trails Advisory Committee Work Session: Purpose, Duties and Process for Selection Summary During Open Houses held in May for trails planning on the West Avon Preserve, a formal trails’ advisory committee was discussed. This trails advisory committee is found in the Town of Avon Recreational Trails Master Plan (2009). The Town of Avon Recreational Trails Master Plan, or “Trails Plan,” is an advisory document that is a sub-plan of the Avon Comprehensive Plan. It recommends the formation of a Recreational Trails Advisory Group to “direct trail planning, design, construction, and maintenance.” The Trails Plan goes on to recommend the make-up of the Advisory Group and their general functions. An excerpt from the Trails Master Plan is attached hereto (Attachment A). At the July 15th Council meeting this topic was discussed and Council provided additional feedback on the group’s composition. It was agreed to come back with more information on the functional role of the committee and a more diverse range of members, including solicitation from: Traer creek, residents with trail building experience, hiker representation, possibly an International Mountain Bike Association (IMBA) specialist or liaison. This Memorandum summarizes Town staff’s recommended process for solicitation and Council appointment of a Recreational Trails Advisory Group. Recommendations 1. September 23rd – Council reviews and affirms the need for the Recreational Trails Advisory Group, and duties as described in the Trails Master Plan and sets October 28th as the date to take action on a resolution establishing the Recreational Trails Advisory Group. Two-year staggered terms are recommended. 2. Town Staff solicits through the Vail Daily newspaper a five (5) member, volunteer Recreational Trails Advisory Group composed of the following: a. One (1) member with trail building experience b. One (1) full-time resident of the Wildridge or Mountain Star Community c. One (1) full-time resident of the Singletree Community d. One (1) representative from Village (at Avon) e. One (1) member to represent the hiking community The advertisement (sample attached as Attachment B) will highlight the role of the Committee and desire for community members who are avid hikers, and also those with demonstrated experience working with the IMBA organization. 3. Interested applicants should provide a detailed letter of interest and statement of residency by not later than October 17th, 5:00 p.m. RECREATIONAL TRAILS ADVISORY GROUP FORMATION – WORK SESSION PAGE 2 OF 2 4. Town Council interviews applicants at its October 28th meeting; appointing the top three applicants to two-year terms; and two applicants to one-year terms. Thereafter, all Recreational Trails Advisory Group members will be appointed to a two-year term. 5. Recreational Trails Advisory Group, assisted by Community Development staff, begin meeting and develop work plan to carry out duties. Attachments A – Trails Plan excerpt B – Draft Advertisement Avon Recreational Trails Master Plan Page 2 Vision Statement The vision guiding the Town of Avon’s Recreational Trails Master Plan was developed from input provided through public consultations held in August 2006 and August 2008. At a general level, the vision expresses what people agree needs to be protected or retained and what may be accomplished. The vision for the Town of Avon is fundamentally one of sustainability – of respecting natural systems and managing uses of the trails in ways that enhance the resident and guest experiences and protect the ability of future generations to enjoy this wonderful endowment. By adopting an approach that protects the local ecology while providing recreational, social and health benefits, the local trail system can become a model of sustainable recreational trails management. At the heart of achieving this vision is a commitment to balancing environmental protection with recreational uses and activity. This commitment will be shared by all who are responsible for this asset – individuals using the area, partnering government agencies, surrounding private land owners, and other stakeholders. Common, sustainable strategies should emphasize awareness, education, safety and stewardship. Management approaches will be shaped by a desire to minimize negative impacts on the environment and local residents, while maximizing opportunities for positive outcomes such as community partnerships, education, habitat protection, or other opportunities. The Town has a collaborative and systematic vision for implementing this new Recreational Trails Program. An Avon Recreational Trails Advisory Group should be formed to direct trail planning, design, construction, and maintenance. This Group should consist of five members, with at least one full-time resident from Wildridge and one from Mountain Star participating. Participants who are not on Town staff should be nominated or self-volunteered and be confirmed by the Planning and Zoning Commission or the Town Council. The Trails Advisory Group will have the key responsibility to develop and manage a volunteer program for trail construction and maintenance. The Trails Advisory Group will also be responsible for updating this Recreational Trails Master Plan periodically (e.g. every 2-3 years) and presenting the update to Town leadership for formal adoption. Town staff will lead project implementation activities (including development of mapping and design details, review of deliverables from consultants, annual budget planning, bidding and assignment of trail construction contracts), public relations, and communications with outside stakeholders (e.g. USDA Forest Service, Singletree HOA, Eagle County). Statement of Principles The principles listed below were developed in conjunction with the vision statement, with input provided from Town of Avon staff and through the public consultation process. The principles express the range of basic concepts which are crucial to the development of a successful recreational trails management program and the realization of the vision. 1. Sustainable Planning Framework The mountain environment is important asset requiring careful management to preserve and sustain it for future generations. This requires a framework that supports a harmonious balance between long-term social, economic, and environmental values. Balancing the biophysical and physical capacity of the area to accommodate recreational use is a key consideration. 2. Public Health, Safety and Risk Management To enhance the healthy outdoor lifestyles found on the western slope, users require a challenging, yet safe and maintained outdoor mountain recreational trail system within a risk management framework that includes standards and regulations for trail use. Risks of use should be clearly communicated to trail RECREATIONAL TRAILS ADVISORY GROUP FORMATION – WORK SESSION PAGE 1 OF 1 DRAFT - Trail Advisory Group Advertisement What is it? The Trail Advisory Group will be a committee of engaged citizens to help direct recreational trail planning including the design, construction and maintenance of existing and new trails. Participants are volunteers with a strong interest in supporting and enhancing the recreational trails program. Trail Advisory Group Goals • Protect local ecology while providing recreational, social, and health benefits • Balancing environmental protection with recreational uses and activity • Become a model of sustainable recreational trails management • Foster positive working relationships with outside stakeholders (i.e. Vail Valley Mountain Bike Association, United States Forest Service, Beaver Creek Resort Co.) Who We’re Looking For: • Our ideal Group Composition looks like… • One (1) member with Trail building experience • One (1) full-time resident of the Wildridge or Mountain Star Community • One (1) full-time resident of the Singletree Community • One (1) representative from Village (at Avon) • One (1) member to represent the hiking community Applicants who have experience working with the International Mountain Biking Association (IMBA) are strongly encouraged to apply. Additionally, those with grant writing experience will receive preference. What is Expected? • Develop and manage a volunteer program for trail construction and maintenance • Update the Trails Plan (2009) periodically (e.g. ~2-3 years), beginning in 2015 with major update • Work with Town Staff toward implementation activities • Represent the Trail Advisory Group at Planning Commission, Town Council, and other regional trails planning (i.e. IMBA Ride Center committee) meetings Frequency of Meetings • The Trails Advisory Group will be tasked to determine an appropriate meeting frequency • Frequency may change depending on current projects and needs • Initial frequency is anticipated to be every 1-2 months How do I Get Involved? • Volunteers need to submit a detailed letter of interest not later than October 17, 2014. • Selection will be made by Town Council on October 28th, 2014 TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Preston Neill, Executive Assistant to the Town Manager Date: September 9, 2014 Agenda Topic: Town of Avon Procurement Policy Update BACKGROUND: Based on discussion and direction regarding the Town’s current Procurement Policy at the July 22, 2014, Town Council meeting, staff has researched the procurement/purchasing policies of several comparable Colorado municipalities. The purpose is to identify what other municipality’s standards of conduct/restrictions for public employees and elected officials are in procuring work. The policies of the following Colorado cities and towns were analyzed: Aspen, Durango, Steamboat Springs, Telluride and Vail. TOWN OF AVON PROCUREMENT POLICY: Attached are the applicable sections from the Town of Avon Procurement Policy, which state the standards of conduct for public employees and Town Council members in procuring work for the Town. OTHER PROCUREMENT POLICIES – STANDARDS OF CONDUCT: City of Aspen, Colorado: Municipal Code: Title 4 – Procurement Code The City of Aspen’s Procurement Code defines “employee” as the following: “Employee means an individual drawing a salary from a government body.” The code includes a section regarding “Conflict of Interest” where it explains “unless a specific exemption is obtained…it shall be a breach of ethical standards for any employee to participate directly or indirectly in drafting or preparing specifications, obtaining or processing approvals, participating in source selection or contract formation or granting approval for any procurement” when the employee is aware that the employee, any member of the employee’s immediate family or a business or organization in which the employee or any member of the employee’s immediate family has a financial interest pertaining to the procurement. In the event a conflict exists, the code indicates “an employee shall promptly file a written statement of disqualification and shall withdraw from further participation in the transaction involved. The employee may, at the same time, apply to the City Attorney…for an advisory opinion as to what further participation, if any, the employee may have in the transaction.” City of Durango, Colorado: Purchasing Policy The City of Durango’s Purchasing Policy emphasizes the unethicality for any employee or public official “who is participating directly or indirectly in the purchasing process to become or to be, while such a City employee or officer, the employee of any person contracting with the City.” This policy includes a provision regarding waivers where a waiver from the conflict of interest may be granted by the City Manager upon determining that “the contemporaneous employment or financial interest of the City employee or officer has been publicly disclosed; the City employee or officer will be able to perform the purchasing functions without actual or apparent bias or favoritism; and the award will be in the best interests of the City.” City of Steamboat Springs, Colorado: Personnel and Administrative Regulations Manual: Title III – Procurement Regulations Unlike the Town of Avon Procurement Policy, the City of Steamboat Springs’ Procurement Regulations does not include a definition for “employee” to clarify who falls within the meaning. It does include a section regarding “Conflict of Interest” that prohibits an employee from participating in or attempting to influence a decision when a conflict of interest exists. Additionally, a conflict is described as “any procurement of goods or services over $1,000, and/or any contract over $1,000, from an employee, employee spouse or immediate family member.” In the event a conflict exists, it does not necessarily mean the City of Steamboat Springs may not do business with the individual or company identified with a conflict. Their policy requires that “disclosure be made to the City Manager with a recommendation that proceeding with the procurement where a conflict of interest exists, is in the ‘best interests’ of the city.” Town of Telluride, Colorado: Municipal Code: Chapter 4, Article 6 – Procurement Code The Town of Telluride’s Procurement Code only references the sale of town-owned property to employees. Town of Vail, Colorado: Policy: Town of Vail Purchasing (P-1) Nowhere in the Town of Vail Purchasing Policy does it reference how employees/elected officials may or may not participate in projects or work funded by the Town or anything related to Conflict of Interest. CONCLUSION: The current Town of Avon Procurement Policy is very clear in identifying who falls within the definition of “employee”: “Employee means an individual drawing a salary from the governmental body, whether elected or not and any non-compensated individual performing a personal service for any governmental body, including but not limited to members of the Town Council, members of volunteer and/or advisory boards.” The Town’s current Procurement Policy does not prohibit members of the Town Council from submitting bids to procure work from the Town. It simply prohibits a Town Council from participating in any part of the procurement process when such Town Council member is seeking to procure the work. This is similar to the policies of the City of Aspen, City of Durango and the City of Steamboat Springs. The policies of the Town of Telluride and Town of Vail are less rigid. COUNCIL ACTION: Town staff requests direction from the Town Council should you desire changes to the current Procurement Policy. ATTACHMENT: Standards of Conduct from the Town of Avon Procurement Policy TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Preston Neill, Executive Assistant to the Town Manager Date: September 18, 2014 Agenda Topic: Proposition 105 Request BACKGROUND: The Avon Town Council has received an email from Mr. Gary Gilman, regarding an update on Colorado Proposition 105 which will appear on the November election ballot. The letter also requests Council’s support and endorsement of the proposition. Proposition 105 asks voters if foods modified or treated with genetically modified materials should be labeled “Produced With Genetic Engineering” starting July 1, 2016. The purpose of the ballot measure is transparency, not to ban “genetically modified organisms” (GMO’s). COUNCIL ACTION: Town staff requests direction from the Council should you desire staff to draft a Resolution to support and endorse Proposition 105 this fall. ATTACHMENT: Proposition 105 Request – Gary Gilman Letter TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Matt Pielsticker, Planning Manager Date: September 18, 2014 Re: Public Hearing Second Reading Ordinance 14-13 Revocable Encroachment License for Public Parking Lot BACKGROUND The Planning and Zoning Commission approved the design for development of a public parking lot west of Christy Sports at its April 24, 2014, meeting. The proposed site is Town-owned land, currently planted in grasses with several trees on the lot. Staff recommended the change as a better use of the land considering location near at the core of East Avon and onto Avon Road. The parking lot would be developed by Hoffmann Commercial Properties at its cost. Twenty-eight (28) parking spaces would be provided, and the parking would remain open to the public. Development of the parking lot requires a License from the Town Council. Council has taken the following actions on the License: • Passed First Reading of Ordinance 14-13, with certain terms and conditions; • Council at its meeting of July 2, 204, continued action with direction to renegotiate the terms and conditions of the lease; • Continued Second Reading and the required Public Hearing to the August 26, 2014, meeting rather than taking action. The Council directed staff to inform the applicant that Council would not consider action for proposed uses on any Town property until all improvements being made or having been made on properties owned by Hoffmann Commercial Properties are brought into code compliance; • Continued Second Reading and required Public Hearing to September 9, 2014. Council reviewed “compliance” updates related to improvements being made on Hoffmann Commercial Properties and Town properties. • Continued Second Reading and Public Hearing to September 23, 2014 after a lengthy discussion regarding the terms of the agreement, and further updates to compliance. • Council at its Work Session on September 17, 2014, directed that the Second Reading Ordinance and License be written for a 99-year lease with the Town being able to end the license with a payment of up to $150,000. COMPLIANCE SUMMARY The Town Manager has the authority to enter into a “Compliance Agreement” for any outstanding code violations. Prior to the September 23, 2014 Public Hearing, the Town and Hoffmann Commercial Properties should reach final resolution by Compliance Agreement or final action by HCRE for the following general terms: 1. Hoffmann Commercial Properties will submit a Minor Development Plan application for the painting of three (3) fences and the placement of a bronze statue located on Tract A, Chapel Square PUD, by September 22, 2014. 2. Hoffmann Commercial Properties will provide $5,000 for a Town-contracted company to paint eight (8) benches, and one (1) trash receptacle. Payment will be received not later than close of business on September 22, 2014, and the Town will provide the balance of funds back to Hoffmann Commercial Properties, if any, for painting cost less than $5,000, in total, within thirty (30) days of work being completed.  Page 2 Town Staff will process the Minor Development Plan application for painting; with the bronze relocation on Tract A, Chapel Square PUD being processed by the PZC. REVOCABLE ENCROACHMENT LICENSE The Revocable Encroachment License presented in Ordinance 14-13 provides for: • A 99-year lease, with the Town having the ability at any time to pay for the actual costs of parking lot improvements. The developer will provide an accounting of the actual costs, however, total improvement purchase is not to exceed $150,000. • The parking lot improvements must be completed by November 15, 2015. • A permanent Access Easement Area would be provided from the developer to the Town, prior to construction commencing, to ensure access to the parking lot should the Town acquire the improvements and want to continue use of the property as a parking lot. • Until such time as the Town acquires the improvements, all operations and maintenance of the parking lot is the responsibility of Hoffmann Commercial Properties. AVAILABLE ACTIONS: • Approve Ordinance 14-13 as drafted. • Approve Ordinance 14-13 with modifications • Continue Ordinance 14-13 to a future meeting MOTION: If Council wishes to proceed with the Ordinance after the Public Hearing, the recommended motion is: I move to approve Ordinance 14-13 [with or without modifications.] ATTACHMENT: Ordinance 14-13 TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Matt Pielsticker, Planning Manager Date: September 18, 2014 Re: Public Hearing Second Reading Ordinance 14-13 Revocable Encroachment License for Public Parking Lot BACKGROUND The Planning and Zoning Commission approved the design for development of a public parking lot west of Christy Sports at its April 24, 2014, meeting. The proposed site is Town-owned land, currently planted in grasses with several trees on the lot. Staff recommended the change as a better use of the land considering location near at the core of East Avon and onto Avon Road. The parking lot would be developed by Hoffmann Commercial Properties at its cost. Twenty-eight (28) parking spaces would be provided, and the parking would remain open to the public. Development of the parking lot requires a License from the Town Council. Council has taken the following actions on the License: • Passed First Reading of Ordinance 14-13, with certain terms and conditions; • Council at its meeting of July 2, 204, continued action with direction to renegotiate the terms and conditions of the lease; • Continued Second Reading and the required Public Hearing to the August 26, 2014, meeting rather than taking action. The Council directed staff to inform the applicant that Council would not consider action for proposed uses on any Town property until all improvements being made or having been made on properties owned by Hoffmann Commercial Properties are brought into code compliance; • Continued Second Reading and required Public Hearing to September 9, 2014. Council reviewed “compliance” updates related to improvements being made on Hoffmann Commercial Properties and Town properties. • Continued Second Reading and Public Hearing to September 23, 2014 after a lengthy discussion regarding the terms of the agreement, and further updates to compliance. • Council at its Work Session on September 17, 2014, directed that the Second Reading Ordinance and License be written for a 99-year lease with the Town being able to end the license with a payment of up to $150,000. COMPLIANCE SUMMARY The Town Manager has the authority to enter into a “Compliance Agreement” for any outstanding code violations. Prior to the September 23, 2014 Public Hearing, the Town and Hoffmann Commercial Properties should reach final resolution by Compliance Agreement or final action by HCRE for the following general terms: 1. Hoffmann Commercial Properties will submit a Minor Development Plan application for the painting of three (3) fences and the placement of a bronze statue located on Tract A, Chapel Square PUD, by September 22, 2014. 2. Hoffmann Commercial Properties will provide $5,000 for a Town-contracted company to paint eight (8) benches, and one (1) trash receptacle. Payment will be received not later than close of business on September 22, 2014, and the Town will provide the balance of funds back to Hoffmann Commercial Properties, if any, for painting cost less than $5,000, in total, within thirty (30) days of work being completed.  Page 2 Town Staff will process the Minor Development Plan application for painting; with the bronze relocation on Tract A, Chapel Square PUD being processed by the PZC. REVOCABLE ENCROACHMENT LICENSE The Revocable Encroachment License presented in Ordinance 14-13 provides for: • A 99-year lease, with the Town having the ability at any time to pay for the actual costs of parking lot improvements. The developer will provide an accounting of the actual costs, however, total improvement purchase is not to exceed $150,000. • The parking lot improvements must be completed by November 15, 2015. • A permanent Access Easement Area would be provided from the developer to the Town, prior to construction commencing, to ensure access to the parking lot should the Town acquire the improvements and want to continue use of the property as a parking lot. • Until such time as the Town acquires the improvements, all operations and maintenance of the parking lot is the responsibility of Hoffmann Commercial Properties. AVAILABLE ACTIONS: • Approve Ordinance 14-13 as drafted. • Approve Ordinance 14-13 with modifications • Continue Ordinance 14-13 to a future meeting MOTION: If Council wishes to proceed with the Ordinance after the Public Hearing, the recommended motion is: I move to approve Ordinance 14-13 [with or without modifications.] ATTACHMENT: Ordinance 14-13 Ord. No 14-13 Approving Revocable License Agreement September 18, 2014 Page 1 of 3 TOWN OF AVON ORDINANCE 14-13 SERIES of 2014 AN ORDINANCE APPROVING AN AGREEMENT BY AND BETWEEN THE TOWN OF AVON AND HOFFMANN COMMERICAL PROPERTIES LLC FOR THE GRANT OF A REVOCABLE ENCROACHMENT LICENSE TO INSTALL, CONSTRUCT, AND MAINTAIN PRIVATE IMPROVEMENTS ON TOWN- OWNED RIGHT-OF-WAY AND PROPERTY WHEREAS, the Town Council has authority to grant revocable encroachment licenses for Town owned public property and/or right-of-ways; WHEREAS, the Town Council conducted a public hearing on July 22, 2014, then continued such public hearing to August 26, 2014, then continued the public hearing to September 9, 2014, then continued such public hearing to September 23, 2014; WHEREAS, the Town Council finds that the grant of a revocable encroachment license to construct parking open to the general public on a public property adjacent to the Christy Sports western parking lot and on a portion of Avon Road will promote the Avon Comprehensive Plan and promote economic vitality in the Avon commercial core and will thereby promote the healthy, safety and general welfare of the Avon community; and, WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply the requirements of the Avon Home Rule Charter by setting a public hearing in order to provide the public an opportunity to present testimony and evidence regarding the application and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO, the following: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. Section 2. Revocable License Agreement Approved. The attached Revocable License Agreement is hereby approved and accepted. Section 3. Mayor and Town Clerk Authorized to Execute Documents. The Mayor and Town Clerk are authorized to execute documents approved in this Ordinance and take such other actions as may be reasonably necessary to implement the actions in this Ordinance. Section 4. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall Ord. No 14-13 Approving Revocable License Agreement September 18, 2014 Page 2 of 3 not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 5. Effective Date. This Ordinance shall take effect thirty days after public notice following final passage in accordance with Section 6.4 of the Avon Home Rule Charter. Section 6. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 7. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a copy of the ordinance in full is available for public inspection in the office of the Town Clerk during normal business hours. [Signature page follows] Ord. No 14-13 Approving Revocable License Agreement September 18, 2014 Page 3 of 3 INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED POSTED AND REFERRED TO PUBLIC HEARING and setting such public hearing for July 22, 2014 at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado, on July 15, 2014. ____________________________ Rich Carroll, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least six days prior to final action by the Town Council. ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney INTRODUCED, FINALLY APPROVED, AND PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on September 23, 2014. ____________________________ Rich Carroll, Mayor Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: _______________________________ Debbie Hoppe, Town Clerk License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 1 of 6 LICENSE AGREEMENT FOR PRIVATE IMPROVEMENTS ON A PORTION OF AVON ROAD RIGHT-OF-WAY 1.0 PARTIES. The parties to this agreement (“Agreement”) are the TOWN OF AVON, COLORADO, a Colorado home rule municipality (“Town”) and HOFFMANN COMMERCIAL PROPERTIES, LLC (“Licensee”). This Agreement is effective upon execution by the Licensee and following execution by the Mayor on the date indicated below. 2.0 RECITALS AND PURPOSE. 2.1. The Town is the owner of certain property located in the Town of Avon, Eagle County, Colorado, commonly known as Avon Road. A portion of Avon Road that is subject to this Agreement is more specifically described on Exhibit to License: Private Improvements (“Exhibit”) and such portion of Avon Road shall be referred to as the “Town Property”. 2.2. The Licensee has expressed a desire to encroach upon and occupy the Town Property for the purpose of installing, constructing, and maintaining certain temporary landscape improvements. 2.3. Licensee agrees to construct public parking and landscaping (“Private Improvements”) on the Town Property, which the Town desires and acknowledges is a valuable public benefit that promotes goals of the Town’s Comprehensive Plan. Town further finds that the Private Improvements on Town Property provide benefits and value that equal or exceed the value of the Town Property that the Town is providing for use by Licensee. 2.4. The Town is willing to grant a revocable license to the Licensee under the terms and conditions as hereinafter specified in this Agreement provided that nothing in this Agreement shall waive or modify any obligation to seek building permits, right-of-way permits (including traffic control), variances, or other approval necessary to meet any obligation imposed by law. The Licensee remains obligated to apply for and obtain all necessary permits and approvals, pay all required fees, and comply with all applicable local laws, including but not limited to any applicable provisions in the Avon Municipal Code. 3.0 TERMS AND CONDITIONS. 3.1. The Town hereby grants to the Licensee a revocable license for the encroachment and occupation described as follows: landscape plantings (trees, shrubs, and ground cover), retaining walls, as such Private Improvements are depicted on the Exhibit; provided, however, that nothing in this Agreement is intended to waive, alter, modify, or permit any violation of any local law applicable within the Town of Avon. To the extent that the location or other specifications of this Agreement or any exhibit conflicts with local laws, the local law shall govern. Except for the encroachment and occupation of the Private Improvements identified in this ¶ 3.1 and depicted on the Exhibit, no other encroachment, structure, improvement, vehicle, fence, wall, landscaping, or any other real or personal property shall be erected, installed, constructed, parked, License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 2 of 6 stored, kept, or maintained in any way or fashion on the Town Property. As a condition to the license granted in this Agreement, Licensee shall construct the Private Improvements as depicted on the Exhibit, which Private Improvements shall be constructed according to Town’s standards and which shall be completed by November 15, 2015 and Licensee hereby conveys a perpetual access easement (“Access Easement”) across the area depicted as the “Access Easement Area” on the Exhibit, which Access Easement shall run with the land and shall survive the termination or expiration of this Agreement. 3.2. The encroachment and occupation of Private Improvements as specified in ¶ 3.1 above shall continue from the date of this Agreement for a period of NINETY-NINE (99) YEARS, until September 23, 2113, unless earlier terminated in accordance with the terms of this Agreement. Town may terminate this Agreement at any time, with or without cause, upon tendering reimbursement payment in full for the cost (“Cost”) of the Private Improvements without any depreciation. The Cost of Private Improvements shall be determined as follows: Upon completion of the Private Improvements and no later than December 31, 2015, Licensee shall submit to the Town documentation of Cost associated with completion of the Private Improvements. Cost may include construction, engineering, design, testing, inspection, survey and legal expenses. Town shall have thirty (30) days from the date of receiving documentation of Cost to submit a written objection, which objection shall be limited to inadequacy of the documentation or costs not directly related to the Private Improvements. If Town does not submit a written objection then the Cost of the Private Improvements as submitted by Licensee shall be deemed accepted by the Town. If Town objects, then Licensee shall submit additional documentation to evidence the Cost of the Private Improvements within thirty (30) days. Notwithstanding the foregoing, Town and Licensee agree that Town’s obligation to tender a reimbursement payment of Cost as a condition of early termination shall not exceed ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000.00). 3.3. The Licensee agrees to construct, maintain, and repair the Private Improvements placed or located on the Town Property by the Licensee or its lessees, agents, employees, or other persons under the control or direction of the Licensee pursuant to this Agreement at the cost and expense of the Licensee and at no cost or expense to the Town. The Licensee agrees that the Private Improvements shall be accessible and open to parking by the general public without charge and that overnight parking shall not be permitted without consent of the Town. Limiting parking to periods of time shall be allowed (e.g. a 2-hour parking limit). The Licensee agrees to erect and maintain appropriate signage for parking. The Licensee agrees to provide private enforcement of parking regulations consistent with this Agreement and acknowledges that Town may provide parking enforcement assistance in a manner consistent with, and according to, Town policies as is provided for other private commercial parking areas open to the general public. 3.4. The Licensee agrees to remove or cover graffiti or other damage caused to the Private Improvements within a reasonable time following notice or knowledge of such damage or within forty-eight (48) hours of delivery to the Licensee of a written demand by the Town, whichever is earlier. The Licensee shall not erect, License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 3 of 6 cause to be erected or permit the erection of any sign, advertising object, or illustration upon any improvement, structure, fence, or wall placed or located by the Town Property pursuant to this Agreement and shall promptly remove any such sign or advertising. 3.5. The Licensee agrees to maintain the landscaping in a healthy condition at all times during this Agreement and shall be responsible for ensuring the proper pruning or replacement as necessary to present a healthy landscape condition. 3.6. The Licensee expressly agrees to, and shall, indemnify and hold harmless the Town and any of its officers, agents, or employees from any and all claims, damages, liability, or court awards, including costs and attorney’s fees that are or may be awarded as a result of any loss, injury or damage sustained or claimed to have been sustained by anyone, including but not limited to, any person, firm, partnership, or corporation, in connection with or arising out of any omission or act of commission by the Licensee or any of its employees, agents, partners, or lessees, in encroaching upon the Town Property. In particular and without limiting the scope of the foregoing agreement to indemnify and hold harmless, the Licensee shall indemnify the Town for all claims, damages, liability, or court awards, including costs and attorney’s fees that are or may be awarded as a result of any loss, injury or damage sustained or claimed to have been sustained by anyone, including but not limited to, any person, firm, partnership, or corporation, in connection with or arising out of any claim in whole or in part that all or any portion of the Private Improvements and encroachment permitted by this Agreement constitutes a dangerous and/or unsafe condition within a public right-of-way. 3.7. The Licensee agrees that it will never institute any action or suit at law or in equity against the Town or any of its officers or employees, nor institute, prosecute, or in any way aid in the institution or prosecution of any claim, demand, or compensation for or on account of any damages, loss, or injury either to person or property, or both, known or unknown, past, present or future, arising as a result of or form the revocable license granted to the Licensee by this Agreement. This provision includes but is not limited to claims relating to road maintenance, snow removal or other public works activities performed by or on behalf of the Town. 3.8. The Licensee agrees that the Town is not liable, and will not assume any liability, responsibility, or costs for any damage, maintenance, or repair of any Private Improvements erected or maintained by the Licensee under this Agreement. 3.9. The Licensee agrees to repair and reconstruct any damage to the Town Property upon termination of this Agreement or removal of the Private Improvements described in ¶ 3.1 and any other improvements erected by the Licensee on the Town Property and the Licensee shall return the Town Property to its original condition at the cost and expense of the Licensee and at no cost or expense to the Town. In the event that Licensee does not remove the Private Improvements and repair and restore Town Property to the condition prior to this Agreement within the time period determined in ¶ 3.2 above, then Licensee shall be deemed to have abandoned the Private Improvements and any rights thereto and the License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 4 of 6 Town may proceed to remove the Private Improvements. The Town may seek recovery of all costs incurred for the removal of Private Improvements from Town Property, repair of damages to Town Property, and restoration of Town Property, including legal costs and reasonable attorney fees. 3.10. The Licensee agrees to procure and maintain, at its own cost, a policy or policies of insurance protecting against injury, damage or loss occurring on the licensed premises in the minimum amount of $1,000,000.00 per occurrence. Such policy or policies shall name the Town as an “additional insured”. However, the Licensee’s failure to take such steps to insure the premises shall not waive, affect, or impair any obligation of the Licensee to indemnify or hold the Town harmless in accordance with this Agreement. 3.11. The Licensee shall be deemed to have intentionally and irrevocably abandoned and relinquished rights and interest in the Private Improvements in the event that the Licensee conveys all the Licensee’s interest in the property or properties obtaining access or receiving benefit from the improvements and encroachments described in this Agreement. The Town shall be entitled to rely upon the public records of ownership maintained by the office of either the Eagle County Clerk and Recorder or the Eagle County Assessor in rendering a determination that the Licensee has abandoned and relinquished the Licensee’s rights and interests as provided by this paragraph. In such event, the Town may remove and demolish such improvements without notice to the Licensee. 4.0 TERMINATION FOR DEFAULT. Town may elect to terminate this Agreement and revoke the license for encroachment on Town Property in the event that Licensee defaults under any provision of this Agreement provided that Town first provides written notice describing the default and Licensee fails to cure by 5:00 p.m. Mountain Time on the third business day after the date of the written notice of default if such default involves a failure to permit parking by the general public in accordance with ¶ 3.3 or a failure to provide and maintain insurance required by ¶ 3.10 or fails to cure within thirty (30) days after the date of a written notice of default for all other defaults in this Agreement. 5.0 ASSIGNMENT. This Agreement shall not be assigned by the Licensee without the prior written consent of the Town which may withhold its consent for any reason; provided that the Town encourages the Licensee to inform any purchaser of the Licensee’s property or interests of the existence of this Agreement and the Town will promptly consider any request by the Licensee for assignment of this Agreement to such subsequent purchaser. 6.0 NOTICES. Any notice required or permitted by this Agreement shall be in writing and shall be deemed to have been sufficiently given for all purposes if personally served or if sent by certified mail or registered mail, postage and fees prepaid, addressed to the party to whom such notice is to be given at the address set forth on the signature page below, or at such other address as has been previously furnished in writing, to the other party or parties. Such notice shall be deemed to have been given when deposited in the United States Mail. License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 5 of 6 7.0 INTEGRATION AND AMENDMENT. This Agreement represents the entire agreement between the parties and there are no oral or collateral agreements or understandings. This Agreement may be amended only by an instrument in writing signed by the parties. If any other provision of this Agreement is held invalid or unenforceable, no other provision shall be affected by such holding, and all of the remaining provisions of this Agreement shall continue in full force and effect. Invalidation of the Agreement in its entirety shall revoke any authorization, whether explicit or implied to the continuing use and occupancy of the Town Property for the Private Improvements. 8.0 GOVERNING LAW AND VENUE. This Agreement shall be governed by the laws of the State of Colorado and venue for any action arising under this agreement shall be in the appropriate court for Eagle County, Colorado. 9.0 WAIVER OF BREACH. A waiver by any party to this Agreement of the breach of any term or provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach by either party. 10.0 BINDING EFFECT. This Agreement shall inure to the benefit of, and be binding upon, the parties, their respective legal representatives, successors, heirs, and assigns; provided, however, that nothing in this paragraph shall be construed to permit the assignment of this Agreement except as otherwise expressly authorized herein. 11.0 UNDERLYING INTENT AND SCOPE. It is the intent of this Agreement that the Town shall incur no cost or expense attributable to or arising from the construction, maintenance, or operation of the Private Improvements and encroachment permitted by this Agreement and that, in all instances, the risk of loss, liability, obligation, damages, and claims associated with the encroachment shall be borne by the Licensee. This Agreement does not confer upon the Licensee any other right, permit, license, approval, or consent other than that expressly provided for herein and this Agreement shall not be construed to waive, modify, amend, or alter the application of any other federal, state, or local laws, including laws governing zoning, land use, property maintenance, or nuisance. 12.0 AUTHORITY TO BIND PARTY. The undersigned persons represent that they are expressly authorized to execute this Agreement on behalf of the Parties and to bind their respective Parties and that the Parties may rely upon such representation of authority. 13.0 LEGAL FEES AND COSTS. In the event the Town seeks legal action to enforce this Agreement or to recover reimbursement costs for removal of Private Improvements from, repair of any damages, and/or restoration of Town property subject to this Agreement, Town shall be entitled to recover any and all legal costs and attorney’s fees incurred. [SIGNATURE PAGE FOLLOWS] License Agreement – Avon Rd. HCRE Parking Lot September 23, 2014 Page 6 of 6 DATED SEPTEMBER 23, 2014. TOWN OF AVON: By: ________________________________ Rich Carroll, Mayor ATTEST: Approved as to Form: _________________________________ ______________________________ Debbie Hoppe, Town Clerk Eric J. Heil, Town Attorney LICENSEE: By: _________________________________ Name:_______________________________ Title:________________________________ Address: PO Box 1980 Avon, CO 81620 STATE OF COLORADO ) ) COUNTY OF EAGLE ) The foregoing instrument was acknowledged before me this ________ day of ____________________, 20____, personally by _______________________________. ___________________________________ Notary Public (SEAL) Commission expires: _____________ TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 09-09-2014 Minutes Page 1 1. CALL TO ORDER & ROLL CALL Mayor Carroll called the meeting to order at 5:20 pm. A roll call was taken and Council members present were Jake Wolf, Buz Reynolds, Matt Gennett, Jennie Fancher, Chris Evans and Dave Dantas. Also present were Town Manager Virginia Egger, Town Attorney Eric Heil, Executive Assistant Preston Neill and Town Clerk Debbie Hoppe. 2. APPROVAL OF AGENDA There were no changes to the agenda. 3. PUBLIC COMMENT Greg Bloom and MICHAEL Cacioppo commented 4. WORK SESSION 4.1. JOINT SESSION WITH AVON PLANNING AND ZONING COMMISSION (PLANNING MANAGER MATT PIELSTICKER) Councilor Dantas left meeting at 6:10 p.m. and returned at 7:50 p.m. 4.2. REVIEW AND DIRECTION ON COMCAST FRANCHISE AGREEMENT TOPICS (TOWN MANAGER VIRGINIA EGGER) 5. ACTION ITEMS 5.1. PUBLIC HEARING SECOND READING OF ORDINANCE 14-13 APPROVING THE GRANT OF A REVOCABLE ENCROACHMENT LICENSE TO INSTALL, CONSTRUCT AND MAINTAIN PRIVATE IMPROVEMENTS ON TOWN- OWNED RIGHT-OF-WAY AND PROPERTY AT CHRISTY SPORTS FOR DEVELOPMENT OF ADDITIONAL PUBLIC PARKING – CONTINUED FROM AUGUST 26, 2014 MEETING (PLANNING MANAGER MATT PIELSTICKER) Mayor Carroll opened the Public Hearing, no comments were made. Councilor Dantas moved to continue Public Hearing Second Reading of Ordinance 14-13 to the September 23rd meeting. The terms of license changed to 99 years, 20 year amortization and not to exceed $175,000. With items 1-4 of the letter from Jon White page 2 attached to the Ordinance. Mayor Carroll asked that motion include doors, Councilor Dantas agreed; Councilor Wolf seconded the motion and it passed 6 to 1 vote, with Councilor Gennett voting no. 5.2. PUBLIC HEARING FIRST AMENDMENT TO DEVELOPMENT AGREEMENT FOR WYNDHAM TIME-SHARE PROJECT (PLANNING MANAGER MATT PIELSTICKER) Mayor Carroll opened the Public Hearing, comments were made by Todd Goulding. Mayor Pro Tem Fancher moved to approve First Amendment to Development Agreement for Wyndham Time-Share project; Councilor Gennett seconded the motion and it passed unanimously by those present. Councilor Evans recused himself. TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 09-09-2014 Minutes Page 2 5.3. RESOLUTION NO. 14-22 ADOPTING THE AUTHORITY AGREEMENT AMENDING AND RESTATING THE AGREEMENT ESTABLISHING THE UPPER EAGLE REGIONAL WATER AUTHORITY AND THE MASTER SERVICE CONTRACT (TOWN ATTORNEY ERIC HEIL) Councilor Gennett moved to approve Resolution No. 14-22 Adopting the Authority Agreement Amending and Restating the Agreement Establishing the Upper Eagle Regional Water Authority and the Master Service Contract; Councilor Evans seconded the motion and it passed unanimously by those present. 5.4. RESOLUTION NO. 14-23 ADOPTION OF 2015-16 STRATEGIC PLAN (TOWN MANAGER VIRGINIA EGGER) Mayor Carroll moved to approve Resolution No. 14-23 Adoption of 2015-16 Strategic Plan Resolution with the following changes: • Under “Stakeholder & Regional Partnerships,” include a bullet that reads, “Meet to understand and learn how Eagle County revenue expenses are apportioned in Avon and neighboring communities.” • Under “Stakeholder & Regional Partnerships,” include a bullet that reads, “Work with Eagle County so they can learn how Avon’s revenue expenses are apportioned.” • Under “Infrastructure, Parks, Preserves, Trails & Sustainability,” move sub bullet “Bike climbing lane as part of Metcalf Road improvement” as the top sub bullet under “Continue to prepare a Five Year Capital Plan.” • Under “Infrastructure, Parks, Preserves, Trails & Sustainability,” amend the sub bullet regarding “Ride Center” status to read, “Regional support for meeting IMBA Gold Level “Ride Center” status. • Under “Infrastructure, Parks, Preserves, Trails & Sustainability,” include a sub bullet under “Continue to prepare a Five Year Capital Plan” that reads, “Develop a five year Master Trails Program for hard and soft trails.” • Under “Infrastructure, Parks, Preserves, Trails & Sustainability,” amend the bullet regarding the Water Authority to read, “Work with the Water Authority to promote water conservation.” • Under “Economic Development,” strike the last bullet and add a bullet that reads, “Seek every opportunity to maximize assets, reduce taxes and increase community by aligning with proper fitting sponsors and sponsorship money.” • Under “Land Use & Development,” include a new third bullet that reads, “Make district amendment and code revisions to facilitate a streamline process for the development approvals.” • Under “Land Use & Development,” add a bullet that reads, “Evaluate and keep current the Beaver Creek East lots for annexation into Avon. Councilor Wolf seconded the motion and it passed unanimously by those present. 5.5. MINUTES FROM AUGUST 26, 2014 MEETING (TOWN CLERK DEBBIE HOPPE) Councilor Evans moved to approve minutes from August 26, 2014 meeting; Councilor Wolf seconded the motion, and it was approved unanimously by those present. TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 09-09-2014 Minutes Page 3 6. WORK SESSION 6.1. 2015-16 BUDGET WORK SESSION (ASSISTANT TOWN MANAGER SCOTT WRIGHT) 6.1.1. RECOMMENDATION FOR REVENUE PROJECTIONS, INCLUDING FEES AND CHARGES FOR SERVICES, IF ANY 6.1.2. FUND BALANCE, CONTINGENCY & STABILIZATION FUND RECOMMENDATION 6.1.3. EMPLOYEE COMPENSATION: SALARY & HEALTH INSURANCE PROPOSAL 6.2. REPORT ON PROCUREMENT POLICY (ASSISTANT TO THE TOWN MANAGER PRESTON NEILL) Council continued to September 23, 2014. 7. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 8. COUNCIL COMMENTS 9. MAYOR REPORT AND FUTURE AGENDA ITEMS Mayor Carroll asked that executive session FOR THE PURPOSE OF DETERMINING POSITIONS RELATIVE TO MATTERS THAT MAY BE SUBJECT TO NEGOTIATIONS, DEVELOPING STRATEGY FOR NEGOTIATIONS, AND/OR INSTRUCTING NEGOTIATORS, UNDER C.R.S. §24-6-402(2)(E) WITH REGARD TO THE AVON PAVILION PROJECT BE ADDED, ALL AGREED. 10. EXECUTIVE SESSION 10.1. FOR THE PURPOSE OF A CONFERENCE WITH THE TOWN ATTORNEY TO RECEIVE LEGAL ADVISE UNDER CRS 24-6-402(2)(B) AND TO DISCUSS THE PURCHASE, ACQUISITION, LEASE, TRANSFER OR SALE OF REAL, PERSONAL OR OTHER PROPERTY INTEREST UNDER CRS 24-6-204(2)(A) 10.2. EXECUTIVE SESSION FOR THE PURPOSE OF DETERMINING POSITIONS RELATIVE TO MATTERS THAT MAY BE SUBJECT TO NEGOTIATIONS, DEVELOPING STRATEGY FOR NEGOTIATIONS, AND/OR INSTRUCTING NEGOTIATORS, UNDER C.R.S. §24-6- 402(2)(E) WITH REGARD TO THE AVON PAVILION PROJECT. Mayor Pro Tem Fancher moved to meet in executive session at 10:05 pm for the purpose OF A Conference with the Town Attorney to receive Legal Advise under CRS 24-6-402(2)(b) and to discuss the purchase, acquisition, lease, transfer or Sale of Real, Personal or other Property Interest Under CRS 24-6-204(2)(a). Councilor Gennett seconded the motion and it passed unanimously by those present. Councilor Wolf moved to end Executive Session; Councilor Dantas seconded the motion and it passed unanimously. Executive Session adjourned at 11:51 p.m. 11. ADJOURNMENT There being no further business to come before the Council, the regular meeting adjourned at 11:51 pm. TOWN OF AVON, COLORADO AVON MEETING MINUTES FOR TUESDAY SEPTEMBER 9, 2014 AVON TOWN HALL, ONE LAKE STREET FINAL - Avon Council Meeting 09-09-2014 Minutes Page 4 RESPECTFULLY SUBMITTED: _________________________________ Debbie Hoppe, Town Clerk APPROVED: Rich Carroll ________________________________ Dave Dantas ________________________________ Chris Evans ________________________________ Jennie Fancher ________________________________ Albert “Buz” Reynolds ________________________________ Jake Wolf ________________________________ Matt Gennett ________________________________ HAHNEWALD BARN UPDATE PAGE 1 OF 2 TOWN COUNCIL REPORT To: Honorable Mayor and Avon Town Council From: Matt Pielsticker, AICP, Planning Manager Jeanette Hix, President, Historic Preservation Committee Date: September 18, 2014 Agenda Topic: Hahnewald Barn Summary In April of 2013, The Avon Historic Committee (Committee) was informed that the Town of Avon had received notice from the Eagle River Sanitation District (District) that the Hahnewald Barn (the Barn) was going to be torn down to make space to construct another building on the site. The District indicated that there was no rush for removal and that they would work with the Town and Committee to see if there were any possible sites. The Committee has explored several options for relocation and funding opportunities. Update Since the previous Council update in July, contact was made with History Colorado, the State of Colorado Office responsible for historic restoration and education. This office was responsible for the restoration of the Nottingham Powerplant on the Eagle River. The Office of Archaeology and Historic Preservation confirmed that no money is available for the moving or restoration of structures that are not registered by the Colorado State Register of Historic Properties. According to a Historical Background and Field Analysis produced in 2010, the structure is not likely eligble for National or State Register designation. This is due to major alterations that have taken place including the addition of a bright, reflective metal roof and boarded windows. Space for Barn Town Staff investigated Town-owned property that could accommodate the Barn or at least the dismantled pieces of the Barn. No storage space for the dismantled Barn was located. The Committee thought that the acquired Town land on the north side of Interstate 70 would eventually become available for reconstructing the Barn; however, there is no storage space available in the interim period for this scenario and no access is currently available to that site. The Committee then contacted Eagle County Fair Grounds, Eagle County Historic Committee, and Eagle County Reserve to see if there was space for the Barn on their properties. All three entities replied that they did not have space for such a large structure. 4 Eagle Ranch was contacted and they did have space, but did not have funds to pay for the move. Nottingham family members who live in Eagle County were also contacted to see if they had space for the Barn as at one time it belonged to the family. All members of the Nottingham family that were contacted said they did not have space for such a structure nor the funds to move it. HAHNEWALD BARN UPDATE PAGE 2 OF 2 Funding As mentioned, Historic Colorado does not provide funding for moving historic buildings. Other foundations were contacted but did not assist with this type of historic work. The District indicated that they would be willing to donate $36,000 to the barn relocation project as that is the estimated cost to tear the Barn down and have the materials hauled to a disposal area. The El Pomar Foundation was contacted. The maximum grant that can be received for any project is $50,000. Conclusion The Committee has concluded that there is not enough space available in Eagle County to move the Barn except to 4 Eagle Ranch. There is not funding available to pay for the dismantling, labeling and moving of the barn. It will be a great loss to the Town of Avon to have the barn torn down. When History is wiped out, so are those people who lived that history. Recommendation The Committee recommends that an effort be made by the District to offer the materials from the barn to local residents for use in building projects. Many individuals, builders, and developers use old wood in their projects. This distribution of the wood from the Hahnewald Barn would allow a little bit of Avon’s history to live on. FISCAL YEAR 2014 FINANCIAL REPORT September 23, 2014 ______________________________________________________________________________________ 1. Fiscal Year 2014 Financial Report Cover Memo 2. Sales and Accommodations Tax Reports – July 2014 3. Real Estate Transfer Tax Report and Monthly Detail – August 2014 4. General Fund Year-To-Date Expenditures- August 2014 5. Fleet Maintenance Fund Year-To Date Expenditures- August 2014 6. Transit Fund Year-To Date Expenditures- August 2014 7. DestiMetrics Executive Summary- August 2014 TOWN COUNCIL REPORT To: Honorable Mayor Rich Carroll and Avon Town Council From: Kelly Huitt, Budget Analyst Date: September 18, 2014 Re: Fiscal Year 2013 Financial Report – July/August 2014 Revenues: SALES TAX • Sales tax revenue for the month of July is up $33,480.20 or 6.23% compared to July 2013, and up 3.87% compared to the monthly budget. This increase includes $16,140 from new businesses, and after adjusting for new business growth, 3.23% is the actual gain in revenue for the month. Year-to-date sales tax from new businesses makes up 44.12% of total growth. July 2014 sales tax revenue is the highest ever for the month of June. • July collections are down compared to 2013 for several industries including: Miscellaneous Retail at ($11,916.66) or (28.27%), Sporting Goods Rental/Retail at ($1,579.05) or (3.74%) and Service related businesses are down (5,988.43) or (34.09%). Liquor stores are just slightly down (1.07%) or $320.59. The decrease in Miscellaneous Retail is largely due to a business closure in this industry and a business miscoded to Miscellaneous Retail that was removed and placed in the correct category. Revenue from Home/Garden is up 23.16% for the month, Restaurants/Bars are up almost $12,000 or 11.45% and Other businesses are up $10,521, or 23.43%. The large increase in other can be partially attributed to several new businesses in the specialty trade contractors category, as well as substantial growth from existing business. Monthly Totals Category 2013/2014 Growth Growth Variance Existing Business New Business Home/Garden $10,184.73 20.85% 2.31% Grocery, Specialty, Health 12,262.77 8.81% 0.00% Liquor Stores (320.59) -1.07% 0.00% Sporting Goods Retail/Rental (1,579.05) -5.45% 1.71% Miscellaneous Retail (11,916.66) -37.14% 8.87% Accommodations 8,547.09 10.95% 0.46% Restaurants/Bars 11,769.75 4.79% 6.67% Other 10,520.59 16.34% 7.10% Service Related (5,988.43) -35.67% 1.58% Total $33,480.20 3.23% 3.00% ACCOMMODATIONS TAX • Accommodations tax revenue for July is up $8,074.09, or 11.06% compared to July 2013, and up 7.85% compared to the monthly budget. Year-to-date accommodations tax is up 8.11% compared to 2013 and 4.99% compared to the budget. • July accommodations tax collections are up for all lodging types: Timeshares increased 30.95% or $3,502.93, Hotels are up 5.11% or $2,841.77 and Vacation Rentals are up 28.20%. REAL ESTATE TRANSFER TAX • 2014 real estate transfer tax collections for August equal $154,032.32. This is a 57.85% increase from August 2013, and 38.30% over the monthly budget. Year to date collections are at 99.64% of the total budgeted amount. Expenditures: • General Fund expenditures at the end of August are 66.60% of the budgeted amounts. • Fleet expenditures to date are at 63.46% of the total budget. • Transit funds are 60.57% spent compared to the annual appropriation. DestiMetrics: • Avon’s occupancy was at 58.5% for the month of August, which is a 14.2% increase over August 2013. The average daily rate was down -1.6% while RevPAR was up at 12.4% above 2013. • September’s anticipated occupancy is 20.5%, a (10.7%) decrease compared to 2013. September’s anticipated average daily rate and RevPAR are also down at (9.7%) and (19.4%) • Looking back at the past six months, occupancy was up 7.2%, while average daily rate was up 1.1% and revenue per average room night increased 8.4% over 2013. • Projected occupancy for the upcoming six months on the books is 7.6% higher than 2013 at 11.7%. The outlook for average daily rate is also up at a 5.1% increase. • Rooms booked during August 2014 for arrival August – January has increased by 26.4% compared to rooms booked during August 2013 for arrival in the following six months. TOWN OF AVON SALES TAX WORKSHEET 2014 Actual vs. Budget Budget YTD Collections Budget % of change 2009 2010 2011 2012 2013 2014 2014 Variance from 2013 January 552,648.47$ 515,009.18$ 511,040.76$ 519,784.89$ 677,943.78$ 693,355$ 638,863.27$ (54,491.56)$ -5.76% February 516,349.68 504,752.59 532,903.25 533,546.48 636,702.27 651,176 673,722.03 22,546.21 5.81% March 536,913.42 620,937.20 665,532.70 643,910.29 720,267.31 736,640 793,301.96 56,661.50 10.14% April 319,833.51 309,937.09 305,269.73 304,220.84 307,407.13 314,395 381,839.56 67,444.43 24.21% May 267,960.76 242,830.16 236,424.93 270,082.79 309,938.72 316,984 340,332.28 23,348.02 9.81% June 396,066.29 377,920.42 406,828.27 430,588.57 490,329.18 501,475 538,517.31 37,041.94 9.83% July 409,956.20 421,975.98 452,873.44 472,215.40 537,479.66 549,698 570,959.86 21,262.18 6.23% August 374,965.99 361,702.25 419,977.29 455,439.86 504,332.25 515,797 September 350,585.25 359,139.22 391,546.49 424,793.75 475,362.88 486,169 October 286,412.11 288,859.84 299,193.35 341,711.43 356,925.96 365,040 November 281,696.02 284,528.70 301,407.41 336,060.63 362,460.94 370,700 December 786,701.84 818,360.74 921,815.61 852,868.64 981,917.79 1,004,239 Total 5,080,089.54$ 5,105,953.37$ 5,444,813.23$ 5,585,223.57$ 6,361,067.87$ 6,505,668$ 3,937,536.27$ 173,812.72$ 7.00% Actual Collections $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $550,000 $600,000 2010 2011 2012 2013 2014 Year Sales Tax Collections for July TOWN OF AVON SALES TAX WORKSHEET 2014 Actual vs. Budget $- $300,000 $600,000 $900,000 $1,200,000 $1,500,000 $1,800,000 $2,100,000 $2,400,000 $2,700,000 $3,000,000 $3,300,000 $3,600,000 $3,900,000 2010 2011 2012 2013 2014 YTD Sales Tax Collections $- $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $550,000 $600,000 $650,000 $700,000 $750,000 $800,000 Sales Tax Monthly Comparison 2012-2014 2012 2013 2014 TOWN OF AVON ACCOMMODATIONS TAX WORKSHEET 2014 Actual vs. Budget Budget YTD Collections Budget % of change 2009 2010 2011 2012 2013 2014 2014 Variance 2013 January 84,919.00$ 87,938.84$ 85,233.73$ 90,118.88$ 108,508.43$ 111,733$ 129,851.78$ 18,119.08$ 19.67% February 83,502.22 99,336.34 114,035.90 106,016.32 137,503.61 141,589 150,317.06 8,727.60 9.32% March 84,909.85 105,518.15 122,145.16 115,043.42 153,208.80 157,761 168,597.39 10,836.07 10.04% April 26,821.29 26,496.88 26,214.58 20,786.24 26,494.49 27,282 31,626.02 4,344.26 19.37% May 19,090.36 12,425.51 15,152.82 16,664.44 24,527.17 25,256 21,961.97 (3,294.01) -10.46% June 34,439.33 32,857.68 49,999.66 56,012.17 66,578.91 68,557 54,232.23 (14,325.04) -18.54% July 47,864.32 51,170.82 62,928.07 66,726.73 73,008.92 75,178 81,083.01 5,904.67 11.06% August 39,155.19 42,188.56 52,037.55 58,358.93 67,688.07 69,699 September 21,134.69 30,090.34 35,521.81 42,245.24 44,661.37 45,988 October 17,043.78 20,614.06 21,801.56 25,879.51 27,154.53 27,961 November 15,268.58 20,582.47 24,971.33 22,786.42 28,171.04 29,008 December 96,847.30 98,561.90 135,984.00 112,759.02 131,361.43 135,265 Total 570,995.91$ 627,781.55$ 746,026.17$ 733,397.32$ 888,866.77$ 915,279$ 637,669.46$ 30,312.62$ 8.11% Actual Collections - 10,000.00 20,000.00 30,000.00 40,000.00 50,000.00 60,000.00 70,000.00 80,000.00 90,000.00 2010 2011 2012 2013 2014 Accommodations Tax Collections for July Town of Avon Real Estate Transfer Tax Budget YTD Collections $ change % of change 2009 2010 2011 2012 2013 2014 2014 2013 2013 January 34,468.00$ 237,133.00$ 57,540.00$ 50,204.00$ 22,535.00$ 72,955$ 85,126.74$ 62,591.74$ 277.75% February 95,703.38 362,719.22 230,705.50 41,750.07 55,872.69 142,823 562,219.70 506,347.01 906.25% March 6,023.70 284,243.65 187,099.47 84,760.49 125,927.64 124,906 50,375.06 (75,552.58) -60.00% April 92,238.95 210,185.30 249,482.30 219,195.80 144,437.80 166,202 197,656.36 53,218.56 36.85% May 37,803.12 112,431.30 187,668.62 270,170.12 121,784.12 132,494 183,745.60 61,961.48 50.88% June 365,324.28 66,271.14 49,606.58 169,040.47 90,309.74 134,436 220,009.15 129,699.41 143.62% July 208,800.24 63,509.36 46,707.37 71,057.40 386,434.78 140,963 141,051.52 (245,383.26) -63.50% August 87,827.30 88,823.40 106,785.21 232,505.93 97,579.70 111,375 154,032.32 56,452.62 57.85% September 159,877.84 159,861.96 140,876.56 96,389.34 157,010.67 129,619 October 205,537.52 222,575.20 64,005.33 176,889.62 169,839.80 152,280 November 131,944.57 115,654.16 98,057.44 150,549.86 112,491.82 110,500 December 336,431.50 236,117.45 198,448.03 145,134.57 83,382.60 181,447 Total 1,761,980.40$ 2,159,525.14$ 1,616,982.41$ 1,707,647.67$ 1,567,606.36$ 1,600,000$ 1,594,216.45$ 549,334.98$ 52.57% Budget 1,600,000$ Variance, Favorable (Unfavorable)(5,783.55) Actual Collections $- $200,000.00 $400,000.00 $600,000.00 $800,000.00 $1,000,000.00 $1,200,000.00 $1,400,000.00 $1,600,000.00 2010 2011 2012 2013 2014 YTD Real Estate Transfer Tax Collections Town of Avon Real Estate Transfer Tax August 2014 Collections Detail Purchaser Name Property Amount Received Balance Forward 1,440,184.13$ Land Title - Poncher Falcon Pointe #212, wk 26 72.00 Stewart Title - Beaver Creek Landing A204 Benchmark Condo #B-8 2,980.00 Title Co of the Rockies Christie Lodge CL#44 2,480.40 Title Co of the Rockies Mtn Vista #14-34 1,642.00 JRA Services - Ruiz and Plaza Christie Lodge #377, wk 52 90.00 JRA Services - Nogal and Gandullia Christie Lodge #377, wk 51 90.00 Land Title - Steller and Barbee Falcon Pointe #203, wk 19 63.80 Land Title - Mountain Aerie LLC Canyon Run #F-202 12,300.00 Land Title - Adams Sunridge II #C-203 1,100.00 Land Title - Atanasov Benchmark Condos #B-22 100.00 Land Title - DP Eagle LLC 4290 Wildridge Rd West 5,540.00 Heritage Title - Hewett Sunridge II #D-102 1,270.00 Stewart Title - Ezrine Avon Lake Villas #26 10,000.00 Land Title - Hoey Chapel Square #BR-217 6,000.00 Land Title - Shanle Riverfront Resort #231 5,800.00 Land Title - Elliott Riverfront Resort #551 17,200.00 Land Title - Moreno Sunridge II #G-204 4,160.00 Title Co of the Rockies Mtn Vista #14-33 1,764.00 Title Co of the Rockies Christie Lodge CL#43 3,374.22 Chicago Title Riverfront #14-32 557.00 Chicago Title Riverfront #14-31 654.00 Assured Title - Rosser 2631 Bear Trap Rd 7,130.00 Stewart Title - Loss Sunridge #I-202 1,100.00 Land Title - Stalzer and McJunkin 5201 Longsun Ln 27,500.00 Title Co of the Rockies Mtn Vista #14-32 1,948.10 Title Co of the Rockies Christie Lodge CL#42 4,170.00 Land Title - Forenza Investments 4560 &4570 Flat Point 14,000.00 Land Title - Stevovich and Ilich Falcon Pointe #109, wk 32 72.00 Land Title - RPC Realty Riverfront Resort #422 5,700.00 Land Title - Deutsche Bank 2080 Wildridge Rd #2 170.00 Title Co of the Rockies Christie Lodge CL#41 2,242.90 Chicago Title Riverfront #14-30 828.00 Chicago Title HOA Mtn Vista #14-28 59.38 Chicago Title HOA Riverfront Mtn Villas #14-28 34.52 Fidelity National - Forenza Investments Sunridge II #M-102 3,900.00 Title Co of the Rockies - Wojtko 1013 W Wildridge Rd #6 - Gosshawk Townhomes 3,240.00 Land Title - Rickman Stone Creek Condo #102 4,700.00 Total August Revenue 154,032.32 Total YTD Revenue 1,594,216.45 Total 2014 Budget 1,600,000.00 Variance, Favorable (Unfavorable)(5,783.55)$ Dept./Div.2014 Encumbrances Year To Date Available Number Description Budget Outstanding Expenditures Balance YTD/Budget General Government: Legislative: 111 Mayor and Town Council 578,920$ -$ 397,889$ 181,031$ 68.73% 112 Boards and Commissions 15,299 - 7,900 7,399 51.64% 113 Town Attorney 155,000 68,950 102,898 (16,848) 110.87% 115 Town Clerk 153,927 5,279 119,712 28,936 81.20% Total Legislative 903,146 74,229 628,399 200,518 77.80% Judicial: 121 Municipal Court 98,235 12,093 59,025 27,117 72.40% Executive: 131 Town Manager 294,403 243 158,914 135,246 54.06% 132 Human Resources 229,806 1,042 147,395 81,369 64.59% 133 Community Relations 111,569 11 68,140 43,418 61.08% Total Executive 635,778 1,296 374,449 260,033 59.10% Finance Department: 141 Finance 741,372 36,234 449,396 255,742 65.50% 143 Information Systems 337,296 10,131 220,921 106,244 68.50% 149 Nondepartmental 290,998 13,312 227,145 50,541 82.63% Total Financial Administration 1,369,666 59,677 897,462 412,527 69.88% Total General Government 3,006,825 147,295 1,959,335 900,195 70.06% Community Development: 212 Planning 245,489 10,180 146,737 88,572 63.92% 213 Building Inspection 127,353 1,700 81,343 44,310 65.21% 214 Economic Development 111,605 3,000 57,388 51,217 54.11% Total Community Development 484,447 14,880 285,468 184,099 62.00% Police Department: 311 Administration 553,701 13,175 339,704 200,822 63.73% 312 Patrol 1,964,620 251,086 1,144,638 568,896 71.04% 313 Investigations 221,354 - 147,404 73,950 66.59% Total Police 2,739,675 264,261 1,631,746 843,668 69.21% Public Works: 412 Engineering 219,703 719 134,350 84,634 61.48% 413 Roads and Bridges 1,377,518 69,812 814,084 493,622 64.17% Total Public Works 1,597,221 70,531 948,434 578,256 63.80% Department Expenditure Summaries General Fund #10 August 2014 Expenditures to Date Dept./Div.2014 Encumbrances Year To Date Available Number Description Budget Outstanding Expenditures Balance YTD/Budget Department Expenditure Summaries General Fund #10 August 2014 Expenditures to Date Parks and Recreation: 513 Special Events 558,606 28,851 285,815 243,940 56.33% 514 Administration 223,113 3,183 145,440 74,490 66.61% 515 Adult Programs 28,657 - 16,931 11,726 59.08% 516 Aquatics 394,409 6,555 261,682 126,172 68.01% 517 Childcare 36,486 - 22,658 13,828 62.10% 518 Fitness 158,237 476 122,603 35,158 77.78% 519 Guest Services 235,050 4,925 135,866 94,259 59.90% 521 Youth Programs 118,979 338 80,735 37,906 68.14% 522 Cabin 43,643 - 26,687 16,956 61.15% 551 Parks & Grounds 1,069,325 82,914 607,670 378,741 64.58% 571 Buildings & Facilities 1,053,353 35,056 633,498 384,799 63.47% Total Parks and Recreation 3,919,858 162,298 2,339,585 1,417,975 63.83% TOTAL OPERATING EXPENDITURES 11,748,026$ 659,265$ 7,164,568$ 3,924,193 66.60% Dept./Div.2014 Encumbrances Year To Date Available Number Description Budget Outstanding Expenditures Balance YTD/Budget EXPENDITURES Public Works: 434 Fleet Maintenance 1,546,142$ 58,885$ 922,292$ 564,965$ 63.46% Total Operating Expenditures 1,546,142 58,885 922,292 564,965 63.46% TOTAL EXPENDITURES 1,546,142$ 58,885$ 922,292$ 564,965$ 63.46% Expenditure Summary Fleet Maintenance Enterprise Fund #61 August 2014 Expenditures to Date Dept./Div.2014 Encumbrances Year To Date Available Number Description Budget Outstanding Expenditures Balance YTD/Budget EXPENDITURES 431 Transit Administration 219,197$ 2,506$ 129,218$ 87,473$ 60.09% 432 Transit Operations 997,403 2,417 642,115 352,871 64.62% 435 Wash Bay 189,479 11,667 63,712 114,100 39.78% Total Operating Expenditures 1,406,079 16,590 835,045 554,444 60.57% TOTAL EXPENDITURES 1,406,079$ 16,590$ 835,045$ 554,444$ 60.57% Expenditure Summary Transit Enterprise Fund #52 August 2014 Expenditures to Date Destination: Avon Destination Period: Bookings as of August 31, 2014 Data based on a sample of up to 10 properties in the Avon Destination destination, representing up to 727 Units ('DestiMetrics Census'*) a. Last Month Performance: Current YTD vs. Previous YTD 2014/152013/14 Year over Year % Diff 58.5%51.3%14.2% $140$142 -1.6% $82$73 12.4% b. Next Month Performance: Current YTD vs. Previous YTD 20.5%22.9%-10.7% $134$148 -9.7% $27$34 -19.4% c. Historical 6 Month Actual Performance: Current YTD vs. Previous YTD 45.3%42.3%7.2% $168$166 1.1% $76$70 8.4% d. Future 6 Month On The Books Performance: Current YTD vs. Previous YTD 11.7%10.9%7.6% $215$204 5.1% $25$22 13.1% e. Incremental Pacing - % Change in Rooms Booked last Calendar Month: Aug. 31, 2014 vs. Previous Year 8.7%6.9%26.4% ADR Copyright 2006 - 2014, DestiMetrics, LLC. All Rights Reserved. Information provided here is CONFIDENTIAL INFORMATION and is the exclusive property of DestiMetrics LLC. It is expressly not for reproduction, distribution publication or any other dissemination without the express written permission of DestiMetrics, LLC. Sample reports may be provided to interested persons, specifically for purposes of their evaluation of a potential subscription and are subject to Copyrights of this product. Data and Metrics represented on this report are representative of the Sample Properties only and may not be representative of the entire Community or Industry. Persons using this data for strategic purposes do so at their own risk and hold DestiMetrics harmless. Avon Destination RevPAR for the upcoming 6 months changed by (13.1%)RevPAR Rooms Booked during last month (August, 2014) compared to Rooms Booked during the same period last year (August, 2013) for arrival August to January has changed by (26.4%)Booking Pace (August) ADR (August) Avon Destination Occupancy for the upcoming 6 months changed by (7.6%)Occupancy * DestiMetrics Census: Total number of rooms reported by participating DestiMetrics properties as available for short-term rental in the reporting month. This number can vary monthly as inventories and report participants change over time. DESCRIPTION: The Reservation Activity Outlook Report tracks occupancy, average daily rate (ADR), and revenue per available room (RevPAR); the key metrics most of interest to lodging properties. The report combines the data sets of participating properties into a destination wide view that features three data sets (providing that sufficient information is available) including: i) current YTD occupancy, ii) last YTD occupancy, iii) last season's ending occupancy. The Reservation Activity Outlook Report is generated on a monthly basis, usually for a 12 month subscription period, and is created from data provided by a group of properties participating in a cooperative manner, and representing a valid set of data as a result. Report results are provided only to those properties who participate by submitting their data. Additionally, participating properties can order (on an a-la-carte basis) an individual report which shows the reservation activity of their property, measured against an aggregated set of competitive properties that they choose from amongst DestiMetrics's other participants. As is the case in all DestiMetrics data, all information provided by individual properties is strictly confidential, except when aggregated with other data and indistinguishable as a result. Avon Destination Average Daily Rate for the prior 6 months changed by (1.1%)ADR Avon Destination RevPAR for the prior 6 months changed by (8.4%)RevPAR Avon Destination Average Daily Rate for the upcoming 6 months changed by (5.1%) Avon Destination Occupancy for next month (September) changed by (-10.7%)Occupancy (September) Avon Destination Average Daily Rate for next month (September) changed by (-9.7%)ADR (September) Avon Destination RevPAR for next month (September) changed by (-19.4%)RevPAR (September) Avon Destination Occupancy for the prior 6 months changed by (7.2%)Occupancy Avon Destination RevPAR for last month (August) changed by (12.4%)RevPAR (August) RESERVATIONS ACTIVITY REPORT Avon Destination Executive Summary Avon Destination Occupancy for last month (August) changed by (14.2%)Occupancy (August) Avon Destination Average Daily Rate for last month (August) changed by (-1.6%) 9/9/2014 Copyright (c) 2006 - 2014, DestiMetrics, LLC All Rights Reserved. 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