Tuesday, April 19, 2016

Land deals could mean tax windfall for Broadmoor

Posted By on Tue, Apr 19, 2016 at 1:49 PM

click to enlarge One view of the Ranch at Emerald Valley, a lease-hold The Broadmoor is hoping to own through a land swap with the Forest Service. - PAM ZUBECK
  • Pam Zubeck
  • One view of the Ranch at Emerald Valley, a lease-hold The Broadmoor is hoping to own through a land swap with the Forest Service.
The Broadmoor's land office must be abuzz these days, with work on its proposed land swap with the city, and also its pending deal with the U.S. Forest Service.

In both cases, The Broadmoor could realize a handsome tax benefit.

As we recently reported, The Broadmoor would claim a tax break of some kind totaling $1.45 million from the swap for city land. That's based on the idea that the city's land, including a 189-acre open space parcel known as Strawberry Fields, is worth much less than the parcels The Broadmoor would turn over to the city in the exchange.

From the proposed resolution:
"City Council hereby authorizes the acceptance of a donation of the difference in value between the City Property and the Broadmoor Property, if any, as determined by an appraisal conducted at the behest and expense of the Broadmoor."

(The city has refused to release the actual appraisals, but says The Broadmoor's land is worth about $3.6 million compared to the city's $2.2 million.)

Turns out, the same donation arrangement seems to be at work in the federal bill, which was introduced by Sen. Cory Gardner, R-Colo., last August, and co-sponsored by Sen. Michael Bennet, D-Colo.

The Broadmoor wants to trade 320 acres for forest land near The Crags for the 82 acres upon which one of its newest wilderness getaways is located, the Ranch at Emerald Valley. (The Broadmoor bought the 320 acres, located on the west side of Pikes Peak, for $1.3 million in September 2013.) The resort currently operates the ranch under a 20-year lease with the Forest Service.

From the Committee on Energy and Natural Resources report on the pending Crags, Colorado Land Exchange Act of 2015

Section 5(a) requires the Secretary to conduct appraisals
of the parcels of land. Section 5(b) requires the land exchange
to be of equal value. If the value of the Federal land exceeds
the value of the non-Federal land, Broadmoor Hotel, Inc., must
make a cash equalization payment to be deposited into the fund
established under P.L. 90-171 (16 U.S.C. 484a). Any cash
equalization payments received by the Secretary are to be used
to acquire land or interests in land in Region 2 of the USFS.
If the value of the non-Federal land exceeds the value of the
Federal land, the surplus value of the non-Federal land will be
considered a donation by Broadmoor Hotel, Inc., to the U.S.
Government. Section 5(c) directs that the appraisals should not
take into account the special use permit at Emerald Valley
Ranch or the Barr Trail easement when determining the value of
the parcels.

The Congressional Budget Office reportedly has worked up a cost estimate, and we're trying to find out more about that. We're circle back if and when we obtain additional information.

Meantime, when we reported on the federal land swap back in January 2014, then Broadmoor CEO Steve Bartolin indicated a tax benefit was a distinct possibility when he said, "They [The Forest Service] get a higher-value piece of property" in exchange. 

According to the pending federal bill, "It is the intent of Congress that the land exchange be completed within one year." That would be Aug. 5, 2016.

Tags: , , , , ,



Showing 1-1 of 1

Add a comment

Subscribe to this thread:
Showing 1-1 of 1

Add a comment

Latest in IndyBlog

All content © Copyright 2018, The Colorado Springs Independent

Website powered by Foundation