Title
A Resolution Authorizing the Disposal of City Real Property to the Colorado Department of Transportation (“CDOT”)
Presenter:
Greg Phillips, Director of Aviation
Colorado Springs Airport
Boy
Summary:
The Colorado Springs Municipal Airport (“Airport”) requests City Council authorize the transfer of approximately 3,073.7 square foot parcel of land to the Colorado Department of Transportation (“CDOT”). The transfer will facilitate the continued development of the Airport’s business park known as Peak Innovation Park and relieve the burden of storm water facilities management and maintenance associated with the Powers Boulevard and Grinnell Boulevard intersection.
Background:
The property situated at the south end of Peak Innovation Park adjacent to the Powers Boulevard and Grinnell Boulevard intersection, right-in deceleration lane. In 1970 the City purchased the Property (with the assistance of federal funding) as part of a larger parcel for the purpose of noise abatement and runway protection.
On June 14, 2004, the Federal Aviation Administration (FAA) released 1546.8981 acres of land that is now known as Peak Innovation Park land, which includes the Property, from aeronautical use regulations. Thereafter, the Airport began developing Peak Innovation Park into a “Class A” business park (the “Development”) as a means to further civil aviation and diversify its revenue so that the Airport is as self-sustainable as possible and as required by FAA regulations. As part of the Development, including the 70 acre land transaction known as the Amazon Fulfillment Center, the intersection of South Powers Boulevard and Grinnell Boulevard must be widened and a right-in, deceleration lane will be constructed on Airport land to accommodate the traffic needs of the business park. As part of the intersection improvements, the Airport will construct drainage system improvements, including a concrete box culvert and associated head-walls and wing-walls (“Drainage Improvements”)
Transferring ownership of the Property to CDOT will provide a substantial economic benefit to the Airport and reduce maintenance, repair, and replacement expenses associated with the Drainage Improvements because CDOT will assume those obligations. That is, (i) the Property is not situated in an area that can be utilized for commercial development and therefore the Property cannot serve as a source of revenue generation to the Airport; (ii) Storm water management is necessary to protect the health, safety, and welfare of the public and improperly maintained storm water systems can trigger environmental claims. By CDOT assuming the maintenance, repair, and replacement obligations of the Drainage Improvements, the City lessens its operating expenses and its risks to environmental claims; (iii) because the Drainage Improvements abut the CDOT right-of-way, if the Property and Drainage Improvements remain in the City’s ownership, the Airport would require CDOT approval before performing any activity that may adversely affect CDOT’s right-of-way. This, at best, would cause unnecessary delays and add another layer of governmental overview; and (iv) if the Property and Drainage Improvements are not transferred to CDOT, then the Airport would be responsible for maintaining the Drainage Improvements. Because these Drainage Improvements are contiguous to CDOT’s right-of-way, they necessarily become part of CDOT’s storm water management plan. This would result in the Airport maintaining the Drainage Improvements, in part, on behalf of CDOT.
Understandably, CDOT is unwilling to pay fair market value (“FMV”) to the city for the Property merely so that it may assume the burden and risks of maintaining the Drainage Improvements. Additionally, CDOT is unwilling to assume the maintenance, repair, and replacement obligations for the Drainage Improvements under a license or an easement with the City because, among other things, the City’s Charter limits such interest to a term of 25 years. Accordingly, the City and CDOT propose a no cost transfer of the Property by Quit Claim Deed. The substantial benefit to the Airport by not assuming the maintenance expenses and risk associated with the Drainage Improvements exceed the estimated $3,175.70 FMV that a buyer would pay for the Property. Additionally, the transfer would require CDOT granting the City a reversionary interest in the Property. That is, if the Property is no longer used by CDOT for the purpose of continuously maintaining the Drainage Improvements and CDOT’s storm water drainage plan, then the Property will revert back to the City.
Conveying the Property to CDOT is for the purpose maintaining the Drainage Improvements, which contribute to the overall development of the Amazon Fulfillment Center and the Peak Innovation Park.
Previous Council Action:
N/A
Financial Implications:
As discussed above, CDOT is not purchasing the Property; instead, CDOT will be relieving the Airport’s burden and risks associated with maintaining the Drainage Improvement (a value that in time is much greater than the estimated FMV of $3,175.70). Nevertheless, the Property was, in part, acquired with FAA funding and therefore the FAA has directed the Airport to move $3,175.70 from its “business park account” to the aeronautical account.
City Council Appointed Board/Commission/Committee Recommendation:
The Airport Advisory Commission intends to hold a special meeting in early January 2021, to discuss this matter and issue its recommendation to City Council prior to the January 11, 2021, work session.
Stakeholder Process:
N/A
Alternatives:
The alternative is not transferring the Property to CDOT, in which case, the Airport would assume the full burden of maintaining the Drainage Improvements. As a result, the Airport would, in part, subsidize CDOT as the Drainage Improvements would also benefit CDOT’s storm water management plan.
Recommended Action
Proposed Motion:
The Airport suggests the following motion: City Council moves to approve the resolution authorizing the disposal of surplus City property to the Colorado Department of Transportation (CDOT) and authorizing the City Real Estate Services Manager and Mayor to execute all documents necessary to dispose of the approximately 3,073.7 square foot parcel of land as surplus property.
Summary of Ordinance Language
N/A