DUS Metropolitan Districts Nos. 1, 2 and 3

2023 ANNUAL REPORT
MANAGER OF FINANCE AND MANAGER OF PUBLIC WORKS
DUS METROPOLITAN DISTRICT NOS. 1-3

As required by Section XI of the Service Plans for the DUS Metropolitan District Nos. 1-3 (collectively, the “Districts”), approved by the City and County of Denver (the “City”), Colorado on August 4, 2008, we present the following report of the Districts’ activities from January 1, 2023 to December 31, 2023.

i.                    Annual budget of the Districts:

ii.                  Annual construction schedules for the current year and reconciliation of the capital improvement program for completion of the Eligible Improvements in the following two (2) years:

The Districts did not construct any improvements during 2023.

iii.                Annual audited financial statements (or any exemption filing made to the State Auditor) of the Districts:

Please see below for 2023 Applications for Exemption from Audit for District Nos. 2 and 3.  A copy of the 2023 Audit for District No. 1 will be provided when available.

iv.                Total debt authorized, total debt issued, and remaining debt authorized and intended to be issued by the Districts:

Below is a memorandum regarding the Districts’ authorized, issued and remaining debt.  On February 3, 2017, District Nos. 1, 2 and 3 entered into a DUS Project Mill Levy Pledge Agreement with the City and County of Denver, Compass Bank, Compass Mortgage Corporation and U.S. Bank National Association, which agreement constitutes general obligation indebtedness of District Nos. 2 and 3 pursuant to their pledge of ad valorem property tax revenues to the Denver Downtown Development Authority (the “DDA”) to pay the DDA Bonds and a multiple fiscal year obligation of District No. 1.  

The Districts entered into an Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance dated February 11, 2010 by and among the Regional Transportation District (“RTD”) and DUS Metropolitan District Nos. 1, 2 and 3, as amended and restated by the Amended and Restated Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance dated January 15, 2021 (the “Amended and Restated Intergovernmental Agreement”).  The Amended and Restated Intergovernmental Agreement is considered a multiple fiscal year obligation of the Districts.

Memorandum Regarding Debt Authorization / Remaining

[1] Service Plan Debt Limitation: The total aggregate amount of debt the Districts together with DUS Metropolitan District Nos. 4 and 5 (now known as Market Station Metropolitan District Nos. 1 and 2, respectively) may issue is $300,000,000 (See Section VIII.E, p. 15 of the Service Plan).  Pursuant to each District’s First Amendment to Service Plan, each District has an additional $50,000,000 of authorization.

[1] Amended and Restated Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance:  DUS District Nos. 1-3 entered into an Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance dated February 11, 2010 with the Regional Transportation District (“RTD”), as amended and restated by the Amended and Restated Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance dated January 15, 2021 (the “A/R IGA”). This A/R IGA is considered a multiple fiscal year obligation of District Nos. 1, 2 and 3.

[1] The amount of operation and maintenance mill levy revenues collected and remitted to RTD under the IGA.

[1] Pursuant to the DUS Project Mill Levy Pledge Agreement (discussed below), the Districts allocated $300,000,000 in voted debt authorization to the DUSPA Loans.  Because the DDA Bonds refunded the DUSPA Loans at a lower interest rate, no additional voted debt authorization was needed to support the Districts’ obligations under the DUS Project Mill Levy Pledge Agreement.

DUS Project Mill Levy Pledge Agreement:  On February 3, 2017, District Nos. 1, 2 and 3 entered into a DUS Project Mill Levy Pledge Agreement with the City and County of Denver, Compass Bank, Compass Mortgage Corporation and U.S. Bank National Association (“Agreement”), which Agreement constitutes general obligation indebtedness of District Nos. 2 and 3 pursuant to their pledge of ad valorem property tax revenues to the DDA to pay the DDA Bonds and a multiple fiscal year obligation of District No. 1.  The obligation to pay to the DDA a portion of the Payment Obligation (as defined in the Agreement) constitutes a limited tax obligation of DUS District Nos. 2 and 3 and special, limited obligation of DUS District No. 1, payable solely from and to the extent of the DUS District Pledged Revenues. 

The total Payment Obligation payable under the Agreement shall not exceed the maximum amounts permitted under their respective Service Plans, their respective electoral authority and any other applicable law.  The entire Payment Obligation will be deemed defeased upon the Termination Date.

The actual total DUS District Pledged Revenues payable under the Agreement cannot be determined with any certainty at this time.  The Districts are not permitted to pre-pay any amounts due under the Agreement.

v.                  Names and terms of the current members of the Boards of Directors and officers of the Districts:

Frank Cannon, President, Term – May 2027
Amy Cara, Treasurer, Term – May 2027

Jay Lambiotte, Assistant Secretary, Term – May 2027
Mark Falcone, Assistant Secretary, Term – May 2025
Asher Werthan, Secretary, Term – May 2025

vi.                Any bylaws, rules and regulations of the Districts regarding bidding, conflict of interest, contracting and other governance matters / Access information to obtain a copy of rules and regulations adopted:

District No. 1 adopted a Resolution Regarding Special Events Policy on April 25, 2016.

The remaining Districts have not adopted any bylaws or rules and regulations, but comply with State statutes regarding bidding, potential conflicts of interest and other governance matters.  

Adopted rules and regulations are available at the offices of McGeady Becher P.C., 450 E. 17th Avenue, Suite 400, Denver, CO 80203 (303-592-4380).

vii.              Current intergovernmental agreements and amendments among the Districts:

Below is a list of the current Intergovernmental Agreements and amendments among the Districts.

Intergovernmental Agreements

Denver Downtown Development Authority (“DDA”); DUS Metropolitan District Nos. 1-5 (“Districts”), Amended and Restated Cooperation and Pledge Agreement dated February 3, 2017.

City and County of Denver; DUS Metropolitan District Nos. 1, 2 and 3, DUS Project Mill Levy Pledge Agreement dated February 3, 2017.

DUS Metropolitan District Nos. 1, 2 and 3, Facilities Funding, Construction and Operations Agreement dated November 12, 2013, as amended June 2, 2021, effective January 1, 2021.

Downtown Denver Business Improvement District (“BID”); DUS Metropolitan District   No. 1, Intergovernmental Agreements for Services and Change Orders thereunder, various dates.

Central Platte Valley Coordinating Metropolitan District; DUS Metropolitan District     No. 1, Cost Sharing Intergovernmental Agreement dated September 8, 2017.

Regional Transportation District (“RTD”); DUS Metropolitan District Nos. 1, 2 and 3 (“Districts”), Amended and Restated Intergovernmental Agreement for Denver Union Station Historic Station Zone At-Grade Public Improvement Operation and Maintenance dated January 15, 2021.

City and County of Denver acting by and through its Denver Police Department, DUS Metropolitan District Nos. 1, 2, and 3, Intergovernmental Agreement (Special District Security Services) dated August 5, 2022.

viii.            A summary of all current contracts for services of the Districts:

Below is a list of all current contracts for services of the Districts.

Current Contracts

Master Service Agreements and Statements of Work between the Districts and CliftonLarsonAllen LLP for Accounting Services.

Engagement Agreements dated February 17, 2009 between the Districts and McGeady Becher P.C. (f/k/a McGeady Sisneros, P.C.) for General Counsel Services.

Engagement Agreement dated April 20, 2009 between District No. 1 and Kutak Rock LLP for Bond Counsel Services.

Contract for Banking Services dated October 6, 2010 between the Districts and Wells Fargo Bank.

Agreement for Project Management Services dated October 6, 2009 between DUS Metropolitan District No. 1 and Union Station Neighborhood Company, LLC

Engagement Letter with Simmons & Wheeler, P.C. for auditing services.

Service Agreement for Event & Property Management Services dated November 1, 2018 between District No. 1 and Continuum Property Management Company, LLC

Service Agreement for Holiday Lighting between District No. 1 and Elevation Holiday Lighting, LLC.

Agreement between the Districts and Generation Web, Inc. (fka Archipelago Web) for website services.

Service Agreement for Landscape Maintenance Services between District No. 1 and Sustainable Landscapes Colorado LLC.

Engagement of Denver Biennial of the Americas Corporation by District No. 1 for Plaza art activation.

ix.                Official statements of current outstanding bonded indebtedness of the Districts, if not already received by the City:

Please see item (iv) above.  The outstanding general obligation indebtedness of District Nos. 2 and 3 was incurred by contract and no bonds have been issued.  No official statement was prepared in connection with such indebtedness.

x.                  Current approved Service Plans of the Districts and amendments thereto:

Copies of the Districts’ Service Plans approved by the City on August 4, 2008, and Modifications to Service Plans for the Districts effective December 31, 2009 were filed with the 2009 Annual Report.  First Amendments to the Districts’ Service Plans approved by the City on January 30, 2017 were filed with the City upon approval.

xi.                District office contact information:

DUS Metropolitan District Nos. 1-3
c/o McGeady Becher P.C.
450 E. 17th Avenue, Suite 400
Denver, Colorado 80203
303-592-4380 – phone, 303-592-4385 – fax
Elisabeth A. Cortese, Attorney for the Districts
ecortese@specialdistrictlaw.com

The following information required by Section 32-1-207(3)(c)(II), C.R.S. (and not already disclosed above) is also provided:

xii.                  Boundary changes made:

The Districts had no boundary changes in 2023.  

 xiii.                  Summary of litigation involving the Districts’ public improvements:

The Districts’ public improvements were not involved in any litigation in 2023.

 xiv.                  Status of the Districts’ construction of public improvements:

The Districts did not construct any public improvements in 2023.

  xv.                  Conveyances or dedications of facilities or improvements, constructed by the Districts, to the City:

The Districts did not convey or dedicate any facilities or improvements constructed by the Districts to the City in 2023.

  xvi.                  Final assessed valuation of the Districts for the report year:

Please see attached Exhibit F, 2023 Final Assessed Valuations from the City.

  xvii.                  Notice of any uncured events of default by the Districts, which continue beyond a ninety (90) day period, under any debt instrument:

To our knowledge, there are no uncured events of default by the Districts which continue beyond a ninety (90) day period.

 xviii.                  Any inability of the Districts to pay their obligations as they come due, in accordance with the terms of such obligations, which continues beyond a ninety (90) day period:

To our knowledge, the Districts have been able to pay their obligations as they come due.

*For accessibility purposes, this is an alternate conforming version of the 2023 Annual Report

2025 Mill Levy - 8.000 Mills

2024 Mill Levy - 23.243 Mills

The Transparency Notices for the Districts can be accessed on the Special District Association website:

https://www.sdaco.org/special-district-transparency-notice/sda-transparency/search/p/D