Monday, November 27, 2017

Regional Building donations program takes some heat from City Council

Posted By on Mon, Nov 27, 2017 at 4:12 PM

An ad hoc charitable donations program by the Pikes Peak Regional Building Department came under fire Monday, Nov. 27, when the department presented its 2018 budget to Colorado Springs City Council.

The program, which doled out nearly $1 million in 2016 and 2017, has no guidelines for who can apply and for what purpose.

RBD argues it had to get rid of money because a July 2016 hail storm triggered an avalanche of re-roofing jobs that filled the agency's coffers with lots of cash it didn't need. To lower the amount held in reserve, RBD cut certain permits by 20 percent on April 1, which gobbled up about $1.2 million. But it still had extra cash.

Councilor Andy Pico said he will vote "no" on the $14.5 million budget proposal for 2018 because of the donations program.
click to enlarge Children's Hospital of Colorado, which is building a facility in north Colorado Springs, received a $150,000 donation from RBD without competing with any other applicants. - PAM ZUBECK
  • Pam Zubeck
  • Children's Hospital of Colorado, which is building a facility in north Colorado Springs, received a $150,000 donation from RBD without competing with any other applicants.
"That’s not the business of regional building at all," he said. "When you have excess revenue, that’s not the way to deal with it, so I will oppose the budget or any budget that has that opportunity in it.... I keep hearing a lot of good things were intended. I don’t want to disparage anyone. But I’d like to reiterate, I don’t think that’s what regional building should be doing at all."

He was referring to the intergovernmental agreement that includes seven entities, the city included, which limits the amount RBD can hold in reserve. From the Indy story:

Neither the website nor the IGA mention donations. The IGA states, “It is the intention that the Department shall be self supporting, but not profit-making, and to that end, such fees shall be established and from time to time reestablished as herein set forth as the need shall become apparent to the Commission.”

In other words, if revenues surge above the amount needed to run the agency, with a comfortable cushion, fees are to be lowered. The IGA defines that cushion as a cash balance that is “no less than 25 percent, nor more than 50 percent of the annual budget.”

Due to the July 2016 hail storm and other major projects, such as Children’s Hospital, the cash balance as of October 20 was 63 percent of the 2017 budget.

When the $3.1 million from RBD’s sale of downtown property to Nor’wood Development Group, which is developing the Olympic Museum area, is added, the cash balance reaches 83 percent of budget.
Councilor Don Knight shared Pico's concern. "There’s nothing in this budget that says you’re going to make a charitable contribution. My question is, if there’s nothing in this year’s budget or last year’s budget that mentioned donations, what gives the right for the board to spend money that was not specifically identified in the budget?"

Knight proposed adding language to Council's approval of the RBD budget that would specifically prohibit contributions to charitable organizations unless it came to Council for approval.

Councilor Tom Strand, a member of the three-member RBD commission, promised the commission will "look at this policy."

Actually, RBD has no policy at all guiding its decisions to give away money.

Councilors Jill Gaebler and Bill Murray also expressed concerns about RBD's practice of giving away money, but Council President Richard Skorman didn't share those concerns. "Whatever your [RBD] board decides is what will happen. I want to go on record saying you can’t keep the money [when there's excess cash generated], so what are you gonna do? You’re giving to charities, and we may not have this kind of situation again."

Regional Building Official Roger Lovell explained that while the fee schedule is set up to cover costs and not turn a profit, "When we have an unanticipated event like the hail storm, it generated an enormous amount of revenue. That can make it tricky."

Council will vote on the RBD budget on Dec. 12.

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