Settlement reached in Snowmass Base Village tax suit
The Aspen Times
A lawsuit has been settled between the owners of 29 Base Village condos and the former developers of the project over whether they were properly made aware of the tax burdens associated with purchasing their units.
The suit, filed in June 2011, made two primary claims, the plaintiffs’ attorney, Matt Ferguson, said Wednesday. One was that the square footage of the condos purchased was less than that stated by the sellers, a claim that was later dismissed; the second was that information about the tax burdens on the units, which the plaintiffs’ attorneys have said in the past is 240 percent higher than that of condo owners elsewhere in Snowmass, was not fully disclosed.
The suit was set to go to trial Dec. 10 in Pitkin County District Court, but Ferguson filed a settlement notice Dec. 5. Terms of the settlement are confidential, Ferguson said, although he noted the owners will keep their units and the suit reached a “fair conclusion.”
“In a settlement, nobody gets 100 percent of what they want, but we’re generally happy,” he said. “It was a fair outcome given the circumstances.”
Those circumstances include the fact that the defendants are basically out of the picture: While Related Cos., Aspen Skiing Co. and Intrawest, among other corporate entities, were originally named as defendants in the suit, many of them have been dismissed along the way. Intrawest has been inactive in Snowmass Village since 2007, and Base Village Phase 1A Development LLC, an entity formed by Skico and Intrawest that signed purchase and sale agreements with prospective buyers while those companies still owned the project, is now basically nonexistent, Ferguson said.
“We believe we had a strong liability case, but there are other factors in whether a case gets settled, and that would be one of them,” he said.
The out-of-proportion tax burden results in part from Related’s issuance of $47.8 million in bonds in 2008, the suit alleged, particularly as a huge chunk of units in the development have not been built yet and cannot help pay down the debt from the bonds.
Ferguson said he hoped for a “brighter future” for his clients’ experience with their condos, although that may be a few years away. New construction expected to start in 2016 has now been pushed back to 2017 or, in the case of the Viceroy expansion, 2019 or 2020, so owners won’t feel the positive impact of additional development for some time.
He added that his Capitol Peak clients also would like to see amenities like the aqua center, a community-purpose facility included in the original Base Village approvals that many owners say they understood to be part of the package when they bought. While a pool facility is planned for a later phase in development, Related is now set to fulfill that community-purpose obligation with a town-owned building in the core of the development rather than the anticipated aqua center.
“Our clients are hanging in there,” Ferguson said. “They’re owners. They’d like to see it finished and things like the aqua center, although that seems like a pipe dream at this point.”
The taxing districts that apply to the Capitol Peak condos and bonds will likely continue to cause strife for the owners, he said, although altering those was not the goal of the suit.
Tenants at the city’s oldest deed-restricted housing complex, Centennial Apartments, faced rent hikes as high as 30% in January that sent city, county, and APCHA officials into closed-door meetings with the relatively new landlord, Birge & Held.