Board Meeting
July 27, 2026
Transcript
Describer:
Agenda
I. Call meeting to order
Presenter: Jason Blankaert
A. Roll call & disclosure of potential conflicts
II. Public comment period (three minute maximum per person)
Public comment is designed to share your thoughts and concerns with the district, but it is not an interactive discussion.
If you would like to participate, please sign up at the back of the room or if you are attending virtually, type your name and address in the chat feature to be placed in the queue.
III. Consent Agenda
This is a group of items to be acted on with a single motion, second and vote by the Board to expedite the handling of limited routine matters. The Board has previously received information on these matters and/or discussed them at a prior study session. Any board member may move an item from the consent agenda to the meeting agenda at this time.
Proposed Motion: I move to approve the items as presented in the consent agenda.
A. Approve June 22, 2026 Regular Board Meeting Minutes
B. Approve June 15, 2026 Work Session Minutes
C. Ratify claims for payment including check numbers 29730 – 29770 and electronic payments issued from June 11, 2026 to July 15, 2026 totaling $1,839,316.59
IV. Leak Adjustment Requests
A. 1077 Timbercrest Drive Presenter: Thomas J. Hasty 1077 Timbercrest Drive
B. Glen Oaks HOA Presenter: Bucky Polk
V. Hearing: Appeal Regarding Unauthorized Use, 8422 High Ridge Drive Presenter: Doug Polzin, Nathan Travis
VI. Finance Report
Presenter: Eric Harris
The Finance Director will present an overview of the District’s financial condition, including budget performance, revenue and expenditure activity, cash balances, and other financial matters for the Board’s review.
VII. Legal Counsel Status Report
Presenter: Paul Polito
Legal Counsel will provide an update on legal matters affecting the District, including but not limited to: contracts, compliance issues, ongoing or potential litigation, and other legal
considerations for the Board’s information and guidance.
A. For Review and Comment: Draft Amended and Restated Lease Agreement with City of Castle Pines for 7404 Yorkshire Drive
VIII. District Manager Report Presenter: Nathan Travis
The District Manager will present a report to the Board regarding district operations, project status, administrative activities, and other matters pertinent to the District
A. Update: South Tank Rehab Project Pre-construction Services Agreement
B. Discussion: Current Well Status
IX. Operations & Engineering Report Presenter: Nathan Travis
These reports are included in the monthly Board Packet, this agenda item serves as an opportunity for the board to ask any questions they have regarding the reports.
X. Executive Session
Proposed Motion: I move to enter Executive Session pursuant to section 24-6-402, subsection E, of the Colorado Revised Statues to develop a strategy for negotiations regarding the Regional Water Opportunities Reconnaissance Study
XI. Director's Matters
Board members may raise and discuss items of interest, concerns, or announcements that are not otherwise included on the agenda.
XII. Adjourn
Board President Jason Blankaert:
Good evening everyone. Welcome to the Castle Pines North Metropolitan District board meeting. Today is Monday, July 27th at approximately 6 p.m. we'll call the meeting to order, and we'll begin with roll call.
Board Member Director James Mulvey:
Jim. Present. No conflicts.
Board Member Director Tera Radloff:
Tera. Present. No conflicts.
Board Member Director Jana Krell:
Jana.
Jason:
Yeah, you're on mute.
Jana:
Darn it I said present. No conflicts. There you go.
Board Member Director Leah Enquist:
Very good. Leah. Present. No conflicts.
Jason:
And I'm Jason Blankaert present with no conflicts. We will go ahead and close out item number one and move to item number two, the public comment period. Do we have anyone?
Interested in making a comment this evening?
Hearing none. I will go ahead and close out item number to the public comment period.
And we'll move on to item number three. Consider accepting the 2025. Sorry, I consider thank you. This is just now updating.
Actually did not update.
District Manager Nathan Travis:
Yeah. Yeah go ahead.
Jason:
Item number three we'll consider approving the agenda for the July 2027. 2727.
Tera:
I moved to.
Jason:
26. Sorry, Nathan. The dates wrong on that. Yep. Sorry. That's all right.
Tera:
I moved to approve the July 27th, 2026 agenda as presented.
Jason:
All right, having a first. I'll go ahead and second. Thanks. And we will go to the vote.
Board Voting All Speak:
Tera. I. Jim. I. Jana. I. Leah. Approve. I approve as well. The motion passes.
Jason:
We'll go ahead and close out item number three and move to item number four. The consent agenda. The consent agenda as a group of items acted on with the single motion second and a vote by the board to expedite the handling of limited routine matters.
The board has previously received information on these matters and or discuss them at a prior study session.
I will go ahead and move to approve the items as presented in the consent agenda.
Tera & Jim:
Second I'll second. Oh.
Jason:
Great having seconds. Having multiple seconds. We will go to a vote.
Board Voting All Speak:
Tera. I. Jana.I.
Leah. Approved. Jim. Approve. I approve as well. The motion passes.
Jason:
We will go ahead and close out item 4 the consent agenda. And we will move to item number five, the leak adjustment requests.
It appears we've got two sections to this. 1077 Timber Crest Drive, presented by Thomas Hasty. Is Thomas available?
Thomas Hasty, Castle Pines Resident:
Yes I am, can you hear me? I can, and I go by, I go by TJ. By the way you can call me TJ.
Jason:
Okay. Very nice to meet you, T.J..
Thomas:
So I just start talking.
Nathan:
Yeah, I can, I can, yeah, I can introduce would. Okay. Yeah. So Mr. Hasty reached out to the district to get a an additional leak adjustment. He had had one previously. Board policy is no more than one adjustment every two years. So since he was inside of that window, it would take board action to apply the second adjustment.
There's really nothing about this that gives staff any heartburn. Either way. I'd be I would be supportive of it, but I'll go ahead and let Mr. Hasty explain or let TJ excuse me, explain the situation and the impetus for the request.
Describer:
On screen. A letter from Thomas Hasty to the District.
To Whom It May Concern:
I respectfully request an adjustment to my 4/30/2026 bill to account for a malfunction in my sprinkler system. I was granted a similar adjustment for my August 2025 and September 2025 assessments, which were $4,878.02 and $1,337.68, respectively. I was informed that an adjustment could only be granted once over a two year period, and I am respectfully requesting an exception to this policy......
Thomas:
I don't know if I want to say anything after that, but I will I will go ahead and and present.
First of all, I want to thank you for the opportunity to address the board, to seek this exception to policy and grant and adjustment for my April bill. I sent the email and I believe you've all had it. I believe you may have had the opportunity to review it, but I learned that it can only grant a waiver once every two years.
And and I had to come before the board to request an exception to policy. There's a little bit of background this. The first time I was granted adjustment occurred back in August September timeframe, where a clamp malfunctioned on my sprinkler system, resulting in a significant release of water. And I went and it went about five weeks without me knowing that it was going on.
CPN notified me. I then immediately fixed the problem, which I thought was a clamp was the problem that they told me I had with it. They did grant me an adjustment and providing me relief for a bill that was over $6,000 at that time. And they provided me with an adjustment at that time. And by the way, the team at CPN, they were very helpful.
They were understanding and they were supportive when I was going through this. So I did the repairs and things were fine for about six months. However, in April of this year, I had another leak, the same sprinkler system where I learned that the problem really wasn't the clamp, it was pressure that was coming from my house to the sprinkler system.
But this time I noted it early in the process. I noticed it within about a week of it happening, but it still resulted in about a $1,400 water bill. But. And so I'm coming now requesting relief in recognition of several things. You know, I've been a resident since 2016, had no issues with the community at all. Nothing like this is ever happened to me before.
I believe I have a good history of conserving water, my have consistent low water usage and the range of like $70 a month. So I'm getting to $6,000 bill and a $1,400 bill, or kind of out of the ordinary for me and what my normal usage is for that. I, I think granting of a waiver would also recognize the extenuating circumstances.
This of this loss based upon my malfunction that was unexpected, unplanned, and obviously immediately corrected right after, right after I did that. I note that I'm still on a on a payment plan regarding this particular bill. I have been making more payments as I'm going through, but based on pending the results of this board's decision, I'll make sure that I pay the balance expeditiously after I hear what the adjustment may or may not be on this particular case.
And as I stated in my email, I know I am responsible for maintaining my sprinkler system, and I'm ultimately responsible for the waste of a significant amount of of water in the community here. However, I believe that based upon my history, my good standing in the community, the unexpected nature of this loss that I would respectfully request exception to policy and granting me relief in this situation.
So I'd be happy to answer any questions that any of you may have for me.
Jason:
Thank you. TJ, let's opens up to the board.
James:
I'll take one. You and I read through your email and I appreciate the detail, but I'm not understanding low water pressure and how that resulted in a malfunction.
Thomas:
I said high? It was high pressure.
Oh, okay. I said it was high pressure come from my house that caused caused the my sprinkler box area there to malfunction there. So I had to get piping and all of that to make sure it would happen again.
James:
So the line itself, the PVC feeding your valve box was cracked or broken or it blew itself apart because of pressure or something.
Thomas:
Right? That's what they told me. I'm not an expert in that. I just paid the I just paid the plumber to fix it after they told me what was going on with it. Yes, because I thought at first when they looked at it, it was back in August. September. It looked like it was just a clamp that the clamp.
But apparently when they went in to fix it and over that next six month period, whatever it was building up caused it to burst again. And this time it fixed it with the piping.
James:
Okay. Did they, since it's high pressure, did they talk to you about your, you know, your your pressure reduction valve where the water comes in from the city inside your house, or did they adjust that?
Thomas:
I am not certain of that. I can certainly check and see.
James:
Yeah, I think, you know, I have you have my sympathies. I've been there. The question is, you know, I think you due diligence. You should go back and talk to your plumber and see what he actually did. I understand he fixed the sprinklers, but, you know, to prevent this happening again, there's two things I'd like you to consider.
Okay? You know, one is really just a request and heck, you can even borrow my if you want. I'll bring it over. But it's a pressure valve, you know, basically measures the pressure at your spigot, all right. And and people can argue about the number. But most of my friends and neighbors are all, you know, mid 60 psi where it comes through the valve into your house.
Some people might want a little higher, but and again, I think that keeps you safe. But you should ask your plumber if he adjusted that or checked it at least so you know what it is. And the second thing is, and these these are starting to become fairly commonplace in new construction. It's essentially a smart valve that'll turn your system off if it detects it's been running excessively.
And that can be problematic sometimes, like if you're washing your car in the driveway or what have you using water in that manner, it may detect that as a leak, which you can override, but those systems cost anywhere between $400 and $600, and they work via Wi-Fi, and they can give you some feedback and you can control them.
Via Wi-Fi, but Moen makes them. Smart Stream makes them. There's a couple other manufacturers that make these smart valves that essentially learn what your that's normal for your system. And they can even do leak checks overnight, like in 2 or 3 in the morning or whatever time of the day you feel like. But, you know, given your history of problems and issues, it may be cheap insurance, you know, understand.
So, yeah, I'm considering.
Thomas:
I thought this was a one time anomaly when I haven't got been there since 2016, and nothing like this has ever happened. And then it happened. Strikes twice in a six month period. Understand? Sure.
James:
Yeah. I'm just said it's something that a lot of people may not be aware of. Just wanted to give you a heads up that it's out there and you can buy one.
Thomas:
Thanks. Thank you for that, that advice I appreciate it. Sure.
Jana:
I have just a quick one. So just to make sure I understand the request, it's to reduce the rate at which the water is being paid for. So so TJ, this question is more for Nathan. TJ would be paying for the water use. But at the rate standard rate okay.
Nathan:
Yep. Tier 1.
Jana:
TJ thank you for coming here. I know this is hard to do. I don't have any problem with it. And I appreciate getting to hear you ask for the variance. So no issue from me.
Jason:
Thanks, Jana. Any other any other board members have any questions?
James:
I didn't say it, but no issue for me either.
Tera:
I don't have any questions, but yes, I mean, we we are here to encourage people to responsibly use water, not, you know, make it an undue hardship on them if they have something that happens beyond their control.
So and I do appreciate it means a lot that you took the time to come and and address the issue with us and be contrite and show that you know you're responsible for it. But certainly I don't have a problem since you're going to pay for the water at just the regular rate, that I don't have a problem with that.
Thomas:
Oh. I'm sorry.
Jason:
That's all right, TJ. I don't think this calls for a motion. This just is just the board directing staff. Is that correct?
Legal Counsel Paul Polito, Esq.:
This one. This probably falls on that line of official board action. I would go ahead and have the board move for for whatever it seeks here.
Jason:
Okay. Well, I moved that the board.
Allows Mr. Hasty to just pay the water usage at the lowest tier. And.
Jana:
And then I'll second. I think that's right, Jason. I think you got it.
Board Voting All Speak:
Great. All right, having a second. We'll move to vote. Tera. I. Jana. I. Jim. I. Leah.
Sorry, I couldn't find I, I. All right, I approve as well. So the motion passes. Once again. Thank you, Mr. Hasty, for coming and presenting to us tonight. And I hope you have your system finally corrected.
Thomas:
I do too. And I want to thank you all for the opportunity to present. Before. It was quite embarrassing, by the way, to do this, and I'm glad there are two whole lot of neighbors on this call for this.
But, but but thanks. Thanks again. I really appreciate it and I appreciate the process.
Jason:
Well thank you. With that said, we'll go ahead and close out. Item number A, the 1077 Timber Crest Drive and we'll open up item B, the Glen Oaks HOA with presented by Bucky Polk.
Describer:
On screen. TO: Castle Pines North Board
FROM: Glen Oaks HOA Board
RE: Glen Oaks Front Entrance Irrigation
DATE: July 11, 2026
Requests:
1. Request to CPNMD: Consideration for reduction of Glen Oaks Water bills for June, July, August, September and October, 2025. ($13,873.81)
2. Request to City Of Castle Pines: Consideration for reimbursement of cost to repair water leakage, likely caused by the city’s work on Monarch. ($14,320.42)
Highlights of the issue:
A water leak near the front entrance of the Glen Oaks neighborhood caused the water bills to spike to $1,824.97, $3,238.60, $3,525.64, $3,724.58 and $1,560.02 (Total $13,873.81) in the five months of
June-October in 2025. Our normal monthly water rates in those same months tends to be about
$400-$500.
Nathan:
Yep. So I just got notification right before the meeting started that Mr. Polk is not going to be able to join us if the board would like.
He was happy to push this to the August meeting, or I can also walk you guys kind of through the details of what happened. I was pretty involved in this, really. Whichever. Whichever you would prefer.
Jana:
I also want to let the board know that this is my neighborhood. Okay, so
Tera:
We should charge them.
Jana:
Right? I moved though, so so letting you guys know, I moved around August to this neighborhood from Serena.
However, the president Bucky did contact me last week to kind of ask me some questions, and I did tell him to move it if he couldn't come. So he must. He must have thought he could come to the very end. But I said I would recuse myself from anything other than just helping explain what is going on here. So, Nathan, I'm going to take a first stab at it, okay?
Nathan:
Go for it.
Jana:
So and if any of this is incorrect, chime in. Stop me. But it's my understanding that at the entrance of Glen Oaks, which is it's going to be on the east side. Hold on. Wait. Hold on. Nope. West side of Castle Pines Parkway, just north of the Timber Trail elementary school. They had an irrigation line under Glen Oaks Drive.
So think like. And it kind of it was irrigating both of the entrance sides of, of the neighborhood. And then when the city came in and redid the road and it the next year didn't work. And so you can't really say who's at fault for it, but it worked the year before and didn't work the second year. And so after getting some advice, the thought is that it may have been part, it may have been damaged as part of the construction activities adjacent to it.
It has since been fixed. But then, Nathan, can you fill in what the ask is from the Glen Oaks? Is it for reimbursement? This is where it gets a little foggy to me.
Nathan:
Got it? Yeah. So you ask from Castle Pines North Metro district is just a usage adjustment similar to what we just did for TJ. We talked about that at the time of the repair.
They're looking for three month coverage as opposed to two. So they're really just looking for the additional month that wouldn't be covered under the two month policy. I do think that there is a strong case to be made that the damage was caused by the city roadway project. There was a bore pit directly over that portion of the service line that was being used as part of the utility relocation efforts prior to the roadwork in that area.
Yeah, I think that's about we and I didn't tell them, direct them to speak to the city about any other potential reimbursement that they may or may not seek, but the request from the board is just for a usage adjustment or not a usage adjustment. Sorry.
Jana:
So the board knows that at my own job, I broke somebody's sprinkler last month and they are making me come back and bore it back in.
So this is so common. Like this is absolutely common that they reach out and say, hey, the city came in and widen the road. Now I sprinkler doesn't work. So I think this is an easy ask again a broken line. And then I think that Glen Oaks should consider pursuing to see if the city will help with the other part, but I think it's a small ask.
You're welcome to weigh in and I will not say anything else.
Tera:
Thank you. Jana, I appreciate that. And it does. Even when I was reading it in the packet, it seemed like this was through no fault of their own. It seemed like it was tied to the construction progress project. So again, this this adjustment makes sense to me.
Jason:
Anybody else have any questions regarding this?
James:
I do, and I'll be quick. Try to be quick. No issues with the adjustment. This goes to Paul Polito. Paul if if it's found that the one of the contractors actually broke the line.
Is there a method or a way to recover. And again, you know, again this. This HOA is going to pay for the water, I guess if we we go forward with this at tier one. But I'm just wondering is, you know, for this event as well as future events, what's the process or pathway to potentially recover? You know, if it was a considerable loss, what do we do then?
Paul:
Typically two ways to recover. You're either recovering and I'm speaking in generalities here, but you're either recovering under a contract that you have with somebody or you're recovering civilly. So if there's no contract that the district has with whoever caused the problem, that's it turns into a civil action. And at that point, you're issuing a demand letter. You're asking for some amount of money based on the damage that this party has caused to to what you own.
And then, you know, probably some negotiation at that point. I understand that the district doesn't, doesn't want to drag anybody into court, but those are typically the two general options here. So barring a contract, you're really just looking at it a civil action for whatever damage was caused, whatever money you were out because of, because of their negligence, it would have to rise to the level of negligence for something like that, meaning they violated some standard duty of care.
Jana:
Can I weigh in on this to Jim?
Paul:
Yes. Please do.
Jim:
I mean, you're probably the expert in the room, so.
Jana:
Well, no, I was going to say I'm not sure if if I understood the question correctly, but to me there was more to it, which was potentially the Glen Oaks HOA could ask for reimbursement from the city to pay even at tier one, so if that's what you're asking.
So in the case of me breaking a sprinkler line, I have no relationship with the building of the sprinkler line I broke and Aurora. But to be a good neighbor, I'm going to fix it. And and then if they wanted me to cover their water bill, like that would be part of what they would negotiate with me. So because again, no fault of their own, stuff like that doesn't have to be legally done.
I mean, I have the city lawyer attend my meetings with them to make sure I'm not on the line. But it doesn't always have to be civil or go. I mean, there's no contract. It's just neighborly. Do it. Make it right, Jana kind of thing.
James:
So. Sure. Yeah, I wasn't going to. I wasn't intending for it to sound like, raise it up to a civil action or anything.
I was just trying to understand process. And I think you explained it, and I think Paul kind of talked to it as well, you know, in the I was more concerned about in the event in the future, we, you know, something more considerable. You know, it could be a main line running down Monarch or something like that, you know, how do we, going forward in the future, kind of make sure that, you know, something of that magnitude when that occurs?
What's the mechanism to to go after that water loss or that damage.
Paul:
So typically depends on, on what agreement you're working under. So you know a lot of this is through a patchwork. Maybe you have an IGA with with the city of Castle Pines. Right. We're splitting costs. And you determine within that contract what happens if something goes wrong. You know, those are the indemnification provisions sometimes you hear about or that's why we have insurance.
So all of that will get taken care of within a contract itself or whatever area you're dealing with. Outside of that. Yeah. It will always come down to contract terms with this sort of stuff. Okay. Outside of that...
James:
I. I appreciate it. I didn't really expect I'll go into depth here. I was just kind of trying to understand the general mechanism.
I think it's based on contract and and appreciate it. Thank you.
Jason:
Okay. Thanks, Jim. Does any of the other board have any questions regarding this?
Hearing? None. I'll propose a motion similar to the last motion that the board allows these this overage to be covered at the level at the tier one rate.
James:
I can second that.
Board Voting All Speak:
Okay. Having a second. We'll go to vote Tera I. Jana recused. Oh okay Jim. I. Leah.
Approve. And I approve as well. The motion passes.
Jason:
We'll go ahead and close out item number four and we will move on to item number five. Hearing an appeal regarding the unauthorized use at 8422 High Ridge Drive. Presenters Doug and Nathan.
Describer:
On screen. The District's letter
May 26, 2026
Douglas Polzin
8422 High Ridge Court Castle Pines, CO 80108
Subject: Notice Regarding Water Service and Instructions for Compliance
Mr. Polzin,
During a recent review of water service accounts within your neighborhood, Castle Pines North Metropolitan District identified a discrepancy between the apparent irrigated landscape area at your property and the water usage recorded on your account. Based on
aerial imagery, the property appears to contain approximately 16,560 square feet of irrigated turf and 9,425 square feet of xeric landscaped areas, while recorded water usage has consistently remained between approximately 3,000 and 7,000 gallons throughout the
year.
To better understand this discrepancy and confirm that the meter was functioning and installed correctly, the District issued a work order to inspect and replace the meter. During that inspection, District staff identified a connection located upstream of the water meter
that is supplying irrigation water outside of the metered system. Our records indicate this condition may have existed since approximately 2008, or eighteen years.
The District recognizes that situations such as this can arise for a variety of reasons, including prior property modifications or installations that may not have been fully understood by property owners. Nevertheless, all water supplied through the District's system must be properly metered in accordance with District Rules and Regulations to ensure fairness to all customers and to support responsible stewardship of the community's water resources.
Under the District's Rules and Regulations, unauthorized connections or unmetered water use is subject to fines, estimated usage charges, recovery of administrative costs, and other enforcement measures. Pursuant to Sections 11.4, 16.1, 16.2.2, 16.2.4, and 16.2.5 of the District's Rules and Regulations, the following charges have been assessed to your account:
• Unauthorized use penalty: $1,500.00
• Estimated unbilled water usage: $10,249.89
• District staff, consultant, and legal costs: $1450
Total Amount Due: $13, 199.89
Paul:
And I'm happy just to kick this off. So this this hearing sort of ground rules for the hearing.
Describer:
On screen. Mr. Polzin's response letter.
Dear Mr. Travis,
I am writing in response to the District’s Notice Regarding Water Service and Instructions for Compliance dated May 26, 2026, concerning my property at 8422 High Ridge Court (Account No. 4676). Pursuant to Article 17 of the Castle Pines North Metropolitan District Rules and Regulations, I hereby formally request a hearing before the Board of Directors to contest the assessed charges, specifically the estimated unbilled water usage of $10,249.89, as well as the unauthorized use penalty and staff/legal costs.
I do not dispute the existence of the unmetered irrigation connection (the technician explained to me while visiting) and will promptly correct the condition so that all water service is properly metered. I have already begun coordinating the necessary repairs and will contact the District office at 303-688-8550 to schedule the required post-correction inspection as soon as the work is complete.
To our knowledge, there was no intent whatsoever to bypass the District’s metering system, and we were unaware of the condition until the District’s recent inspection. When the technician visited, I was fully cooperative and immediately showed him the meter and all
related components with complete transparency.
My primary disagreement concerns the District’s estimated water usage calculation in Appendix B, which relies on standard Kentucky bluegrass irrigation rates of 36 inches per year for the 16,560 sq ft of turf. This assumption does not accurately reflect the actual water needs or practices at the property for the following reasons:
1. Reveille® Hybrid Bluegrass Sod: The lawn consists of Reveille hybrid bluegrass (Kentucky × Texas bluegrass cross), a CSU-bred variety specifically developed for improved drought resistance, deeper rooting, and lower water requirements than standard Kentucky bluegrass. CSU Extension resources and Colorado-specific turf studies confirm that Reveille hybrids perform well at approximately 75%
ET replacement and have measured seasonal evapotranspiration of 23.5 inches (Kc = 0.81) — 14% less than standard mixes. The Reveille installation can be confirmed if needed.
o Sources: • CSU PlantTalk
1544: https://planttalk.colostate.ed... • Arapahoe County Extension (CSU): Water-Saving Turf graph showing Reveille at 75%
ET: https://arapahoe.extension.col...
2. Precipitation Water Delay / Rain Sensor System: The irrigation controller is equipped with a working precipitation delay (rain sensor) that automatically interrupts cycles after rainfall, further reducing unnecessary watering by an estimated 20–30% (per CSU Extension guidance on rain sensors).
3. Conservative Actual Watering Schedule: The system is programmed with only 11 turf zones run for 30 minutes each and 3 xeric drip zones watered every 3 days for 30 minutes. Combined with the drought-tolerant sod and rain sensor, actual irrigation applied has been significantly below the District’s blanket assumptions. This is
corroborated by the property’s consistently low historical metered usage (typically 3,000–7,000 gallons per billing period).
We also live a highly sustainable and energy-efficient lifestyle that aligns with responsible water stewardship. The property features a full solar array, and we drive three electric vehicles. These choices reflect our broader commitment to conservation, which extends to
our careful management of landscape irrigation. To that point, to the detriment of our very light watering you will notice our grass is not “green” like neighbors and if anything, our lower water use has led to mite infiltration of our lawn with this dryer than normal winter
(see photos).
I also respectfully request that the Board consider a discount or reduction on the $1,500 unauthorized use penalty and the $1,450 in District staff, consultant, and legal costs. While I understand the need for enforcement under the Rules and Regulations, I believe some
leniency is warranted given my long-standing support and contributions to the Castle Pines community. I have served as President of the Hidden Pointe HOA (and have been actively
involved in related Castle Pines HOA and community matters) for several years, and I have consistently worked collaboratively with the City of Castle Pines and the District on various neighborhood and community issues.
I have attached the following supporting documentation for the Board’s consideration:
• Photographs of the rain sensor and irrigation controller
• Detailed irrigation zone schedule and run times
• Side-by-side recalculation table using the District’s methodology but applying Reveille-specific rates (75% ET / 23.5 inches) plus rain-sensor adjustment (showing a potential reduction of the usage charge by approximately $3,000–$4,500)
• Photograph of the solar array on the property
• Excerpts/links to the CSU sources cited above
Paul:
The hearing that you're about to have informal hearing. It's not hearing that involves the rules of evidence. This is a quasi judicial hearing. Meaning you won't hear any sort of objections as to evidence that's being presented. You will give any evidence that's presented or testimony presented the way that you believe it is due. The petitioner in this instance, Mr. Polzin, will present his case first, including any testimony and evidence he wishes to provide.
Nathan will provide his version of events and then Mr. Polzin, if he so wishes, we'll have the opportunity for a rebuttal afterwards, after which the board can vote on this measure. You can you can accept the full violation amount. You can or you can accept some some lower amount based on testimony here today. Okay. And with that, Mr. Polzin, if if you are ready, you can feel free to go ahead and present your case.
Douglas Polzin, Castle Pines Resident:
Yeah. So I think first of all, thanks for having me. I think I tried to spell it out as much as possible on the email just because, again, I'm not really disagreeing with what took place, but more in regards to just the actual amount of water that was being assumed, based on using some analytics from CSU on what that consumption would be.
And so I try to give as much of a detail, you know, overview on the email to give you guys somewhat of an idea of of what is reality in regards to this property and how much water is actually used. And if anything, I have found out over the last 45 days that I actually don't have 11 zones.
I only have ten zones related to that, so the number would be slightly less, but here very nominal. So again, it's really to the fact that, you know, the type of, of of side that we have actually does not consume nearly as much as a typical Kentucky Bluegrass. So it was really just using those calculations based on that.
And then based on the framework of what Nate spelled out on, you know, what's within the rules of CPN. So hopefully everybody had a chance to review all that information. We as a family, as a community member, and, you know, we've been in the community since 2007. We've had the the landscaping since 2009. There was never any kind of intent at all of anything like this.
In fact, I get a water bill every month that is north of $100. So I assumed that as TJ was saying, his was $70. I assumed that I had a high water bill, but I guess that's not the case. But anyway, here nor there. It's really more just disagreeing somewhat with the estimations of water consumption, and then also looking for some relief related to the the fees associated with with also the charge.
So.
Jason:
Okay. Thank you.
Jana:
I'll take some questions. Oh, Jason, may I ask questions. Let's let Nathan do his part first.
Nathan:
Thank you for that. Mr. Polzin. Just to kind of quickly review the steps and kind of how we came to this position. Rene, deputy district manager, was doing some evaluations related to potential rate structures and looking for generally some high users. We were doing that based off of aerial photography, just looking for large lawns. Through that process, we looked at 8422 High Ridge Court.
We asked our staff here to pull the usage, and the usage was really pretty steady throughout the year. That's the usage. History is detailed inside of the board packet. And so there was really no increase for irrigation. We following up wanted to make sure that we didn't have a malfunctioning meter, something like that. So we had created a work order, sent out one of our technicians, Troy, to evaluate the property or to look at it.
And he determined that the meter that was in place was functioning properly, was able to take a photograph again, like Mr. Polzin said, that he's not not denying any in any way, just showing kind of the the location of the unauthorized connection prior to the irrigation meter using aerial photography. From that point, we really just looked at general square footage of the yard.
We have a calculation that we use we always kind of assume are we always assume Kentucky bluegrass and some general precipitation rates that are detailed in the letter that we sent out. And so those are all shown here on appendix B. And so this is what Mr. Paulson was referencing when he was talking about kind of the differentiation in our calculations.
He also provided his own. Those are included in the packet. So we do use the CSU guideline for Kentucky bluegrass as kind of a default when we have all of these, when we have like this arise, just to make sure that we're trying to stay as fair as possible in between each use case. Worth noting that it does appear that this was that this installation has been in place roughly since maybe a couple of years after the property was built.
I think going back to 2008, something like that. Statute of limitation only allows us to go back three years. So again, we entered all of that in, got the three year values. And that's where that total of the $10,249 comes in place. 89. We also added a penalty and a fine. The current the rules and regs at the time that this violation was discovered had a minimum of $500.
We took that minimum of $500 and just applied it to each of the three years that we could, and then also included some staff time, which again, is pretty consistent with what we what we've applied on similar violations.
It's really all I have. I think it'd be a good time, Doug, if you have anything that you wanted to bring back up, like Paul said, to rebut, and then we'll just kind of open it up to the floor for the board to ask questions.
Douglas:
Well, you know, I think the best thing was just, you know, open up and have any kind of questions that may come from and be able to answer those to the best of my knowledge.
Nathan:
Oh, I do really. Before we do that, I apologize for speaking. I turn a little bit. I did want to. I confirmed that Doug did get the situation resolved. He had a landscape or a plumber out relatively quickly to evaluate it. Few weeks after that he got it repaired, submitted photographs, technician went out and verified. So the condition has been resolved also.
Yeah. And something.
Describer:
On screen. Nathan is showing aerial shots of the 8422 High Ridge Drive.
Douglas:
Yeah. And in fact, on that note, you know, when the when the technician came to the house, I, I traveled quite a bit. So I'm not at the house that often. But when somebody came to the door, he actually was just leaving a little hang tag and was walking away and I, I saw somebody was at the door and I go look at the name tag, and I saw thought it was from the city.
I'm like, so I ran him down. I actually said, hey, you know, I'm not here that often. So if there's something you need, you know, just kind of let me know. And I was more than happy to take him wherever he needed to go and look whatever he needed to go to. And, you know, he came down and we looked at he he goes, oh, we have a problem.
I'm like, what? And he kind of showed me what it was. And I was like, okay, I, you know, I have no idea that, you know, what you were talking about. But I see what you're talking about schematically where, you know, things are being bypassed. And I said, you know, obviously I'll get it fixed as soon as possible.
And, and I did work in that direction. And then I got the email from Nate. And, you know, Nate and I worked on a couple other things before. And I reached right back out to him. I said, hey, you know, just so you know, first of all, I'm very sorry this even came up. You know, I'm the president of our home here, and I've been on the, you know, board and within the community for quite a while.
And there's absolutely zero intent. As I mentioned earlier, it's more just related to the fact of the type of sod we use and how much we actually water. This was intentionally put in because we are very conservative in general, both from a in fact, I wouldn't even put this much grass in had the A at the time when we moved in.
Not had a set requirement that you have to have a certain percentage of turf in your yard to meet requirements. And unfortunately, I have the largest lot and and hidden point two and a half acres. And thus I was basically, in many ways, by Mr. Elkin, required to put this amount of sod in. So I'm like, well, and if you look at if you do take an overview of the property, you know, when we did do the landscaping, overall, it's all native buffalo grass all the way around for the most part.
Right. And the reason being is, again, the idea was not to create a little wonderland. The idea was to really kind of fit within the community itself. And we did try to do that from a landscaping perspective. But again, the whole at the time and starting with Mr. Elkin when he developed the the neighborhood or took over the neighborhood, the idea was that a certain percent of your lot had to have turf.
So we tried to, again, do what we could and to mitigate the the water usage related to that. And actually that's why the Reveille sod was actually chosen. Trust me, it costs a lot more money to put that sod than a typical Kentucky bluegrass. I would say, you know, very similar to the Colorado Rockies because they used to have that same side.
I don't know if I'd pick it again. Great water, you know, lack of water that you need to use, but it just it doesn't really hold up over the years for what it's worth. But it is. It is what it is. But anyway, I knew there was going to be a lot of questions. You know, I'll be more than happy to answer whatever I can.
I'm not trying to hide from the situation again, it was more of just trying to explain that I don't think the water usage was estimated properly.
Jason:
Thank you, Mr. Paulson.
Nathan:
Leah had a question.
Jason:
Yeah, I saw that. Leah. Go ahead.
Leah:
Oh, thank you. Mr. Posen actually answered it in his most recent comment, so appreciate it.
Jason:
All right. Very nice. Any other board have any questions?
Jana:
I do. Can I see the summary that Doug put together. Because I do appreciate the adjustment that he's shown for the Kentucky Bluegrass, which is a guess.
Describer:
On screen. Table-16
Scenario District (standard KBG)
Turf Inches/Year 36
Xeric Inches/Year 10
Annual Gallons 430,125
3-Year Total Gallons 1,290,376
Approx. Usage Charge* $10,249.89
Savings vs. District $0
Scenario Reveille only (USBR/CO study)
Turf Inches/Year 23.5 (actual measured ET, Kc=0.81)
Xeric Inches/Year 10
Annual Gallons 301,165
3-Year Total Gallons 903,494
Approx. Usage Charge* ≈ $7,170
Savings vs. District ≈ $3,080
Scenario Reveille + Rain Sensor (25% further reduction)
Turf Inches/Year 23.5 × 0.75 = 17.6
Xeric Inches/Year 10 × 0.75 = 7.5
Annual Gallons ≈ 240,000
3-Year Total Gallons ≈ 720,000
Approx. Usage Charge* ≈ $5,700
Savings vs. District ≈ $4,550
Scenario Conservative max adjustment (your full system)
Turf Inches/Year 24 (Reveille) + rain sensor/drip efficiency
Xeric Inches/Year 6–8 (drip + sensor)
Annual Gallons ≈ 220,000–250,000
3-Year Total Gallons 660k–750k
Approx. Usage Charge* ≈ $5,200–$6,000
Savings vs. District $4,250–$5,050
Jana:
And he's got the reveille. So I do support that adjustment. So, and so if so, my initial question was just to walk me through your saying, oh, wait, you're so what is your total Doug I'm sorry. It's the.
Douglas:
There is a table.
Jana:
You’re saying 52 to 6000 is that's what your total is?
Douglas:
It is. Well, with the new calculations of ten zones, the original one I sent in was 11 zones.
Okay. But the the the quote unquote, the approximate usage charge would be closer between 5200 to 6000.
Jana:
Okay. And then as that compares to Nate's 10,000. So that's where you're getting that delta of 4 to 6. Yes, ma'am. Okay. I would support Doug's finite tuning of the 10,000 as it compares to Doug's, but I still do think it's appropriate to do the legal fees and the fine.
Sorry, Doug, because this is 18 years of this. And and so I think it kind of and it's consumed Nate and legal teams time so but I do I do support the reduction of rate.
Douglas:
Hey Jana if I can ask in more related to the fine the annual fine. Right. Going back for three years, I had absolutely zero idea that this was even taking place.
And as I mentioned, I was I'm sitting there going $140 a month for water. You know, I, I personally thought that was hot. I was sitting there going, that seems high and pretty consistent. And I think I told Nathan I my early thought process why when it never really it always kind of stayed the same. I thought that, you know, hidden point was on this, you know, strange water kind of deal that we used to have.
Right. That's now going to be changing here shortly. Thank God. I thought that our that we that we got charged based on the size of your lot. Right. So that that no matter what, you would pay a minimum of a certain amount based on your lot size. And then again, if you went over that minimum that then there would be an overage based on that.
So and again for, you know, maybe being an ignorant homeowner, that's how I thought it was. So that's why I assumed oh, well, you know what. We have this we had a two and a half acre yard. We don't really use that much water in my mind. So maybe that's why I'm paying a higher rate than everybody else.
Like J.T. was saying that he pays $70 a month. So I just assumed that my 100 and some dollars a month, that was pretty consistent. I thought that was normal. Right. So I guess my point on the, you know, the fine every year for three years is more the fact had somebody come to me at year one of that knowing I would have, you know, obviously fixed it as, as soon as I could of in many ways I just felt that that piece of it and, you know, maybe the attorney fees, I understand the outsource that we got to pay for some of that stuff, those costs that you guys get, you have no matter
what anyway. Obviously you got to pay that. I totally get that. You pass that on to me. I accept that piece. It was more of like just the fluff fees, in my opinion, of of items that necessarily, you know, the board doesn't necessarily or the city or the community doesn't necessarily incur. That's that's why I was just kind of pushing back on that piece also a little bit.
Jana:
But and Doug, just just to be clear, I do believe you did not know that. I do believe that that this could happen to any of us. You know, that any of us had some work done. But in in back to, to my point and the board, this is just one person on the board. This went on for 18 years.
18 years. Your family did not pay to irrigate your yard at all, nor will they retroactively go back and do that. And so to me, that $500 is just a small piece of your family kind of making it right with the metro district.
Douglas:
That's that's fair. That's true.
Tera:
Thanks Jana. So help me here. She's thanks Jana for your comments, but can you net it out for me? Doug, what is your specific ask?
Douglas:
My ask? Was the pulled up again here? Sorry. My ask was to take the usage charge in anywhere between the $5,200, I believe in the $6,000 on that piece. And then any kind of concessions related to, again, attorney fees and the fines.
That the board sees fit.
Tera:
So you're asking for $6,000 plus relief on the $1,500 fine and relief on the $1,450 staff consultant.
Douglas:
And when I say relief, not a complete relief. I just, you know, whatever the hard cost is that you guys incur related to that, I think that would be somewhat fair.
Tera:
Okay.
Yeah, I was looking looking for a number. So Nate, do you have any response to that?
Nathan:
I think that one thing that is important to also keep in mind while we go through this is that to some extent, the board is also going to be setting precedent. And I know that we've had. Some level or we've we've made adjustments to the rules and regulations kind of following this just to make sure that we're more updated and more in line.
We do have a.
Let me I want to get the usage appeal brought back up. So we are now getting to the point where we do have actual data for usage. So we read water meters today. I'm sorry, I was just verifying this. And so we read water meters today. Usage for July is coming in right at about 74,000 gallons. I say about because we read in thousand gallon increments, which is actually if you kind of extrapolate that out over four months, it kind of splits his ultimate or ultimate request with the district evaluation.
So we evaluated this 430K gallons, the 301,165 gallons. If you kind of pushed that $74,000 out lines up pretty closely with this amount.
Douglas:
And and Nate, on that note, we had major damage in regards to the sardines that some of those photos. So we've been we've actually been watering extra because we had to receive probably of that 15,000ft² I would say approximately 4000ft² of that.
So we've actually been water and much more than, than normal over the last month, for what it's worth.
Tera:
So here's where I'm at. My fellow board members, I, you know, yeah, if it was going on for 18 years, you know, that that's on us. Just because technology has changed and we have new staff and we're able to do this dive down and everything. I'm okay with whatever staff's recommendation is relief on the water. Based on what Doug has said about the types of grass that they use.
And I'm kind of ambivalent on the staff consultant and legal because that is your job. And and we're covering that anyway.
Leah:
I think the only thing that I will add, and it came up in a similar prior discussion, is that fines are not necessarily they're not tied to intent. Right. And so that I think gets back to Jana's point, right. Like like nobody I don't personally believe that you intentionally try to reroute water for 18 years. But again, like the fine is not tied to the intent.
And Nathan, I think that was a good reminder of how this could set a precedent. So I personally thought that Jana's compromise was fair, taking into account the updated cost, given that you have a different type of grass. But.
I'm very I wouldn't I don't support, I don't support pulling away all the fines.
Jason:
Thank you Leah. Jim, did you have any questions?
James:
I just wanted to understand.
From Mr. Polzin exactly when his irrigation system was put in. How many years ago?
Douglas:
2009. We went two years. We didn't move in until January, but we didn't have landscape and put until the late spring of 2009.
James:
Okay. And was the system put in by a licensed plumber or contractor?
Douglas:
Landscaper. Landscaper?
Okay. Cost a lot of money and that's what he did.
James:
I guess I'm struggling here then.
Douglas:
But. But you're struggling. Are you struggling because of the time back?
James:
Well, I mean, you know, I'm kind of with Jana here that irrespective of intent or what have you, you still essentially got free irrigation water for 18 years. And whatever that number turns out to be, it's a huge number. Whether you had an intent to do this or not, or your contractor was just, negligent or worse.
In, again, going back to Nathan's comments as well, we we just redid our fine structure. We're in the midst of looking at fee structures currently, and I'm I'm just struggling with, you know, any kind of fine reduction and even the fact that, you know, maybe we're a little bit off on the grass type and usage, I still keep going back.
It's a tremendous deal for you, per se. And in the rest of the town, you know, that is paying their water bill fully and completely every month. You know, didn't get that deal. So that's what I'm struggling with. Yeah. Thanks, Jim. Yep.
Jason:
I've just got a couple things to say about this. Sorry, Paul, but I'm going to throw you under the bus a little bit after speaking with other legal counsel. I don't think we are only allowed to go back three years on usage. It's three years from the time of discovery. We could go. We could have gone back the full 18 years on this or 16 years, whatever it is.
So I think that what we were offered here, what staff has offered here, has been a very nice offer. I don't at this point, I don't really support reducing any of the penalties and fines and usage.
Douglas:
So, Jason, if I can ask, are you saying that? So again, I'm not disagreeing with the the fact of I was actually for asking for a small concession related to the soft costs, right, in regards to the fines and the attorney fees. But I would you know, but but within the I was just disagreeing not with the water charge but the just amount of water being used.
That was really for that time period. So very similar to you know, we all work within rules. Right. So if the current rules in place go back three years and those are the rules that are in place.
Jason:
That's what I'm saying. I'm saying that rule is not accurate. I do not believe.
Leah:
I would like.
Douglas:
I okay. Go ahead.
Leah:
Sorry I don't think it for me. It doesn't have any bearing on this particular conversation, but we need to get clarity on that.
Jason:
Yes we do. Yeah. So anyhow, that's my feelings on it I think with staff is proposed is is in my opinion, correct and acceptable.
Paul do we need to.
Paul:
The board has three options here. You can either approve the penalties, it can modify them or it can reverse the decision.
Jason:
I'll make a motion to approve the penalties.
Leah:
Approve as is with no adjustments.
Jason:
Yes. For me.
Jana:
I'll Second.
James:
I'm sorry. Okay. Yeah. It was a little okay. Got it.
Board Voting All Speak:
Okay. Having a second? We'll move to vote. Leah.
I'll approve. Jim. Approve. Jana. Approve. Tera. No. Okay. And I approve as well. With that, we have four and the motion passes. Thank you very much for your time, Mr. Polzin, I appreciate it.
Jason:
Okay. That will go ahead and close out. Item number six. And, Nathan, did you say there was an item six A that we needed to put in here accepting the auditor's report? Yep. Correct. Okay.
So it just needs a motion. There we go.
Nathan:
Yeah. I think we'll go ahead and let Eric go through his finance presentation. And then we can take 6A at that point.
Jason:
Okay. Very good. So we'll we'll open up item number seven the finance report with Eric. Eric. Good evening.
Describer:
On screen.
TO: Board of Directors – Castle Pines North Metropolitan District
FROM: Eric Harris, Elevated Clarity (EC)
DATE: July 27, 2026
RE: Financial Report – July 2026 Board of Directors Meeting
General Fund Activity
Beginning Funds Available
Actual Through 5/31/26 $524,010
Budget Through 5/31/26 $197,782
Favorable/(Unfavorable $326,228
Revenues
Actual Through 5/31/26 $1,210,360
Budget Through 5/31/26 $1,334,630
Favorable/(Unfavorable $(124,270)
Total Expenditures
Actual Through 5/31/26 $988,275
Budget Through 5/31/26 $1,054,371
Favorable/(Unfavorable $66,096
Change in Funds Available
Actual Through 5/31/26 $222,085
Budget Through 5/31/26 $280,259
Favorable/(Unfavorable $(58,174)
Ending Funds Available
Actual Through 5/31/26 $746,095
Budget Through 5/31/26 $478,041
Favorable/(Unfavorable $268,054
Revenues came in $124,270 below the year-to-date budget. The largest drivers were indirect cost revenue billed to the Water Fund ($93,604 under budget, a mirror of the Water Fund's own indirect-cost variance discussed below), oil royalty revenues ($31,440 under budget), and general property taxes ($30,868 under budget, likely a timing difference in county remittances rather than a shortfall in the levy). These were partly offset by indirect cost revenue from the Wastewater Fund running $37,721 ahead of budget.
Expenditures were $66,096 under budget overall. Salaries and Benefits were $68,565 under budget, consistent with vacancy/timing savings and no spending yet against the budgeted overtime/bonus line. Professional Services ($31,059 under) and Firm Commitments ($22,708 under) also ran favorable. These savings were partially offset by two notable overages: Property & Liability Insurance is $125,755 actual against an $85,000 year-to-date budget ($40,755 over), and Software Support is $84,409 actual against $48,152 budgeted ($36,257 over).
Net of the above, the change in funds available is $58,174 unfavorable to budget — the revenue shortfall was not fully offset by expenditure savings. The fund still ends the period with $746,095 available versus a $478,041 budget, but that favorable ending position is driven almost entirely by the $326,228 favorable beginning balance carried over from 2025, not by year-to-date operating performance.
Financial Director Eric Harris:
Wonderful. Good evening board. And for the record this is seven a which will have the finance report and then seven B is that okay Nathan will be the acceptance of the audit.
Is that that work.
Nathan:
Yeah I can make that correction.
Okay. Just okay. Wonderful. On page 47 of your packet board of our finance report, this is for, of course, the board meeting tonight for the budget to actual through May 31st, 2026. We have our standard monthly reports that we're reporting on. I want to give a little of a highlight on a couple of items of May usage.
Describer:
On screen. Enterprise Fund Activity
Page 48 of the packet. Eric describers.
Eric:
Was 48.4 million to the comment of everything we had before. This is what flows through our billing system. So any, you know, adjustments here for any sort of major adjustments we just talked to, we would have to layer that on because those obviously did not flow through our billing system. But for what was billed through our system, we've had the highest cumulative usage going back to 2013 for the system.
A component of that is, of course, we have the filing came online, so there's a volume adjustment associated with that. But we have 100 and 154 million gallons through May of this year. We do expect a very high usage for June. We just don't have those numbers plugged in our financial report yet just due to the obviously the irrigation season.
So that's just one item to report moving forward. Of course, you have our report on cash balances and our payables listing that was considered during the consent agenda. Of course we are. We are projected to spend fund balance as reported in several due to the high capital capital spend that the district is incurring right now. Moving forward to page 55 of the report.
Describer:
On screen. Page 55 of the packet.
CASTLE PINES NORTH METROPOLITAN DISTRICT
STATEMENTS OF REVENUES AND EXPENDITURES WITH BUDGETS
BUDGETARY (NON-GAAP) BASIS
December 31, 2025 Actual
Actual, Projected Actual, Budget and Variance Through May 31, 2026
Eric describes.
Eric:
And this is our general fund. A couple variances stuck out and that we're going throughout the year right now a little bit of savings on salaries and wages. Because when we adopted this budget we had a deputy district manager for a full 12 months. And of course Rene started later within the first quarter. So there was a bit of a variance there on software support for under office and other of page 55.
Nathan, there is a spend of $84,400, which is about there's a there's a variance against the budget of $67,000. There was an invoice approved to Aquafinity. I believe I got that vendor correct, Nathan, which is taking on a make sure I say this correctly. It's a hydraulic modeling vendor associated for build out of the district storage system. There was some efficiencies gained by staff made to bring that in-house versus having a static model charge to a capital project.
And so it's something that the district staff has elected to go ahead and maintain that modeling in-house. So there was just an additional vendor that was associated with that. Hopefully I didn't botch that. Nathan, did you have anything else to add? Nathan or Rene.
Nathan:
Yeah. So there it was for the.
Not the Tank Rehabilitate rehabilitation program, but the pre-construction or pre what is it initial design services for determining whether or not we need to build a tank for one of the design or one of the tasks in there was for hydraulic modeling. The line item inside of that proposal that we got was running. I think Rene can correct me if I'm wrong, but around like 45 or $50,000 just for that one hydraulic model task.
Inside of that proposal. We purchased the software to allow us to do that in-house. And so rather than have a static model applied once for a specific person or purpose, we now are in the process of finalizing a dynamic model that we'll have ownership of. So there was significant savings in pulling it out of that tank evaluation scope.
And then there will be continued savings moving forward, since that's a task we'll be able to pull in house. And that is very much Rene's specialty.
Eric:
So what that means overall net net for the district, there's a cost savings because that will be pulling out of that capital project. It's just becoming an operating on cost going forward. Moving moving forward.
On page 58 you have the Water Enterprise Fund.
As reported before, we did retain some connect fees associated with the building and the Lagae Filing. So those those were un-budgeted. And of course that falls to the bottom line of that restriction for renewable water project. And as reported, we're working on that kind of policy and procedure of how we're assigning and restricting or proposing those as a component of the budgeting process in the future years.
So that goes specifically in coin to restricted forward renewable water projects. We do have that that fund balance and those revenues associated with our cost of service study as well. So that's one one item I wanted to highlight for the board moving forward to page 59. There is, of course, as prior reported collection, repairs and maintenance expenses of $478,000.
Through this year, we had an overall budget of $207, 200 and $207,000. Those were for those prior reported repairs and maintenance costs associated for the lift stations that have failed. Specifically, I believe in the wet wet well. Those repairs have since been made and all invoices have been received. Is that correct, Nathan? Correct. Okay. And so we're not anticipating any further expenses for this line item.
The unfortunate thing with this is these are all subject to the capital program of the rehabilitation replacement lift stations. So we do expect to have a very, very a lower cost associated with R&M future years associated with that. So overall that is the large component associated for the repairs and maintenance or the operating income, rather, the unfavorable operating income of $350,000 in the wastewater enterprise fund.
Going back to our memo, which would be in the conclusion concluding part, which would be on page 51, one couple items. We're really hitting hard right now. Of course, we just wrapped up the audit that we will be accepting here shortly. The auditor's opinion we are still working on the back end implementation associated with us. I we just wrapped up with staff, Susan Nagel and staff.
Describer:
On screen. Current Projects
Currently, EC is working with District staff and contractors on implementing the following process changes and projects:
- Assist with the implementation of CUSI (billing system) UB4. CUSI has converted rates and account information to the new platform.
- The District engaged Blackbaud Advisory consultants to strengthen the District’s general ledger and financial system configuration. Next-quarter priorities are to (i) build report groupings to streamline financial reporting and (ii) update the Vendor Master File in preparation for transitioning to the online AP function (Payment Assist) and expense management modules which will streamline and enhance monthly financial reporting.
- Once accepted by the Board, the District’s audit will be finalized and filed with the State Auditor’s Office by July 31, 2026.
- We have started a second-round review of the proposed District Records Management Structure with District Staff. We also met with Greystone in early June to discuss a scope of work for potentially moving the District from a local server to an online SharePoint solution. More details will be forthcoming as they become available.
- Establish accounts with InBank and CSAFE as authorized by the Board. The Board will be kept informed of our progress as we implement these new solutions into the District’s treasury management systems.
- Evaluate reserve levels and types of reserves to develop, recommend, and ultimately adopt a reserves policy.
- Update and streamline reporting for capital projects.
Anticipated Upcoming Schedule (subject to change)
July 27, 2026 – Monthly Board Meeting
July 31, 2026 – Deadline for Submitting 2025 Audit to State Auditor’s Office
August 17, 2026 – Monthly Board Meeting
August 24, 2026 – Monthly Board Work Session
51
Eric:
She finalized the new bill, which looks like just very ever so slightly different coming out of the system. And so we're just verifying all of the conversion piece associated with the back end. So we're we're finalizing that. We're not anticipating any material impacts to the customer related to that. We've also been working on incremental enhancements, as we just briefly spoke about last week, associated with the district's accounting system.
And then we are starting our budgeting process as well. So we are and it's already another year. So we have to start thinking about a little bit more at a detail level, the 2027 calendar year. So we will have a proposed calendar for the next five months of, you know, activities, if you will, for district staff that will be working through associated with that.
And then we are additionally working on at the direction of the working group established out of this board, an updated proposed reschedule with Bartle & Wells. And right now it's just that a staff level looking at water budgets, tiers and everything of that nature. But we're we're very much in the weeds right now. We do expect another meeting here over the next couple of weeks with that working group as we go through the details associated with that as well.
And I can certainly answer any questions on any of those topics this evening. But are there any questions on the finance report this evening?
Jason:
Not hearing any Eric.
Eric:
Thank you very much for your time this evening.
Jason:
Wonderful. Thank you as well. With that, we will go ahead and close out item number seven and we'll move to seven A, which is a motion. I'll go ahead and make the motion I, I move to accept the 2025 audit report as presented.
Tera:
I second it I'm so excited about that.
Board Voting All Speak:
Thank you. We'll move to vote. Tera. I.
Jana. Approve. Jim. Approve. And Eric, thank you again, Leah. I approve. Wonderful. I approve as well. The motion passes.
Eric:
Thank you. Board. We're we're wrapping up final closing procedures as the auditors actually tomorrow with that. And we'll have the opinion issue with auditors will issue their opinion this week and we'll have it filed. Thank you very much.
Jason:
That's very nice.
Thank you. Okay. We'll close I'm seven A and we will move to item number eight.
Legal counsel status report with Paul. Paul, are you with us?
Describer:
On screen. MEMORANDUM
TO: Castle Pines North Metropolitan District
FROM: Seter, Vander Wall & Mielke, P.C.; Paul Polito, Esq.
DATE: July 24, 2026
RE: Legal Status Report for the July 27, 2026 Board Meeting
MATTERS IN PROGRESS
MATTER: AMENDED AND RESTATED COMMUNITY CENTER LEASE – IGA
WITH THE CITY OF CASTLE PINES
Status: Pursuant to the Parks, Open Space and Recreational Facilities IGA, the District conveyed the Community Center Property at 7404 Yorkshire Drive to the City of Castle Pines, and the Parties concurrently entered into an Intergovernmental
Agreement for the Lease of Real Property dated July 1, 2025, providing for the District’s continued use of the building for its administrative and operational functions. The City has since completed substantial renovations to the Community Center Property, and the Parties’ use of the building has changed. District staff and counsel met on July 14, 2026 to identify the revisions necessary to reflect current conditions, and counsel has prepared an Amended and Restated Intergovernmental
Agreement for the Lease of Real Property.
The revised lease is in draft form, and has not yet been circulated with the City for review. It is being presented at this board meeting to receive director comments prior to circulation to the City.
The restated Lease revises the description of the leased space. The Leased Premises are limited to the administrative office portion on the main level and a designated storage area within the basement, in each of which the District holds exclusive use
and possession. The restrooms, kitchen, IT room, community center conference room, community room, and parking areas are defined separately as “Use Areas,” in which the District holds rights of use only and no leasehold interest. The District’s “triple net” obligations and maintenance responsibilities are
correspondingly limited to the Leased Premises and to the District’s use of the Use Areas, and do not extend to the community room, auditorium, or other renovated portions of the building. Where a building system serves both the Leased Premises and other portions of the property, the cost of repair, refurbishment, or replacement is allocated between the Parties in proportion to square footage.
Paul:
I am. Good afternoon everyone. Good evening.
So before I go to the lease agreement, does anybody have questions on the legal status report that's within the packet tonight.
Leah:
I don't have questions about this legal report, but going back to what Jason brought up, I would absolutely like you to look into that again. I would be very disappointed if that was an oversight.
Paul:
That I'm not going to lie, that catches me very off guard, because I did a lot of research into this before, before I said anything to anybody about it and made and confirmed my research. And this wasn't some one off thing that I said to Nathan, this was something that I vetted so I would be interested in hearing why the reasoning for why they thought that you could reach past the three year statute of limitations, and to the extent that it's a continuing violation that doesn't get us to where we need to go.
But and Jason, I'm not I don't mean I'm not putting you on the spot or anything. I'm not asking you to answer my questions. Just.
I will look into this. I'm happy to.
Jason:
Thanks, Paul. To put a little context to this. I was having dinner with some lawyers and we got to discussing this for some reasons. And so it was their opinion that it is from the time of discovery. It's not from the time. It's so we could have gone back and got the full compensation.
Paul:
So it was the first thing I looked into when I looked at this and it was in Colorado, law was very clear that the three year statute of limitations applied to it.
Regardless of discovery, there are some strict liability statutes that come into place sometimes. I mean, this is what I did for years. I was an enforcement attorney for the Department of Environmental Protection, where we were constantly dealing with very old violations. And a lot of times if there's strict liability, you can reach back and it's fine for a lot of things.
We were cut off because of a statute of limitations, and I didn't see any exceptions to that here, that the discovery. So me and Nathan and Rene, we've had a long back and forth about this and what we were comfortable with asserting what the date of discovery was, what the district's actions were within this. And the idea was that, okay, if we assert all of these costs from the potential date of discovery, it bakes in a lot of other things.
The district itself was not diligent back when this was originally discovered. They sent out an engineer or the some staff member went out and okayed it. You know, that was a decade ago.
Then you're still dealing with that statutory limitations issue? I don't I don't I guess.
Jason:
Sorry we had them we had a staff member go out there and that set up ten years ago?
Nathan:
In not not precisely. Okay. We did have a similar unauthorized connection that we had discovered with another neighborhood in Hidden Point that triggered us to guide the group.
I think this was in 2012, 2012. So we started doing some evaluations on other homes in the area. Mr. Polzin was identified as potential. It's a one sentence work order. So we we put a work order out that basically said, hey, let's make sure that this is working appropriately here or that it was installed appropriately. And the reply or the staff member that filled out that work order just said that it was xeriscaped and possibly reasonable, or it may have been reasonable.
It was very kind of a drive by, not properly or.
Jason:
So he didn't actually go inside the property and see the setup.
Nathan:
Correct. Yeah. I don't even think he left his truck.
Paul:
Yeah. So the district didn't didn't do its proper diligence. And I only say that for the fact that there are some issues here on top of the statute of limitations.
And so, you know, do I potentially drag the district into a major fight over which it doesn't really have proper evidence and didn't do the right things all along the way and pull you into court? Not you personally, but the district and the court. And then you're spending time and money on either me or some other insurance appointed counsel to deal with this.
It didn't. There were a number of alarm bells going off in my head enough that and and honestly, even even the diligence aside, I don't I don't know how we get past that 3-year stature of limitations and I, I vetted that quite hard. But that said, I don't want to I'm happy to answer any questions on it. I don't want to stick on the point.
I'm sure you're all ready to move on. I will look into this and see if there's anything that I potentially missed.
I mean, it doesn't. Yeah, that doesn't sit right with me. If there was something that was missed that's okay. Yeah.
Jason:
Thank you for looking further into it.
Paul:
Yeah. We'll do. Okay. So that brings us to the lease agreement.
Describer:
On screen. AMENDED AND RESTATED INTERGOVERNMENTAL AGREEMENT BY AND BETWEEN THE CASTLE PINES NORTH METROPOLITAN DISTRICT AND THE
CITY OF CASTLE PINES FOR THE LEASE OF REAL PROPERTY
THIS AMENDED AND RESTATED INTERGOVERNMENTAL AGREEMENT
FOR THE LEASE OF REAL PROPERTY (the “Lease Agreement” or “Lease”) is entered into this __ day of _________, 2026, between the CASTLE PINES NORTH METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado (the “District”), and the CITY OF CASTLE PINES, a Colorado home rule municipal corporation (the “City”) (individually referred to herein as a “Party” and collectively the “Parties”).
RECITALS
WHEREAS, the City is a Colorado home rule municipal corporation incorporated as of February, 2008; and
WHEREAS, the District is a special district pursuant to § 32-1-101, et seq., C.R.S. providing public improvements, facilities and services, for water distribution and sewage
collection and treatment for the benefit of District residents, users, property owners and the public; and
WHEREAS, pursuant to § 29-1-203, C.R.S., and Article XIV, Section 18(2)(a) of the Colorado Constitution, the Parties are encouraged to cooperate to provide any function, service or
facility lawfully authorized to each of the Parties; and
WHEREAS, the District is currentlyCity is the owner of real property and improvements, collectively known as the Community Center, located at 7404 Yorkshire Drive, Castle Pines, Colorado (“Community Center Property”), as generally depicted and described in Exhibit A; and
WHEREAS, pursuant to an Intergovernmental Agreement between the City and District Regarding Operation, Maintenance and Transfer of Recreation Properties dated March 28, 2023 ("Parks IGA"), the District conveyed the Community Center Property to the City and the City and District concurrently entered into that certain Intergovernmental Agreement for the Lease of Real Property dated July 1, 2025 (the “Original Lease”) to allow for the District’s ongoing use of the Community Center Property. ; and
Paul:
Let me let me pull my notes up and load this joint in right now. And.
So on. Page 127 I'm sorry 132 of your packet.
Is a lease agreement. So you may all recall the original lease regarding the district building 7404 Yorkshire was written when the district occupied and effectively controlled the whole building. The city of Castle Pines has taken has since taken title and renovated, so this restatement realigned the document with who now uses what and who pays for what. So I'll go through the the main items here within article one, this is the the substantive core here is on pages 132 to 133.
The least premises is narrowed to two spaces in which the district has exclusive use and possession, number one being the office portion. This the administrative offices and the main level, number two being the basement storage area. This is new. This is a designated area that will be depicted on an exhibit for just any sort of equipment, tool supplies, parts, anything that district needs to needs to store.
No, no other part of the basement will be included. And district may install a door lock partition at some cost. The ideas that this will be a secured space. So that's why you're saying that sort of language in there. Everything else becomes a use area. So rights of use only. No leasehold. Restrooms, kitchen, IT room, community center, conference room, community room and parking.
Describer:
On screen.
F. Exclusions. Notwithstanding anything herein to the contrary, the Leased Premises and the Use Areas do not include, and the District shall have no leasehold or other interest in or right to use: (i) any portion of the basement other than the Basement Storage Area, except for reasonable ingress and egress to and from the Basement Storage Area; (ii) any telecommunications facilities, equipment, or other telecommunications assets located on the Community Center
Property, or any revenues generated therefrom; or (iii) building rental or other revenue-generating activities of the City at the Community Center Property, or any revenues generated therefrom.
The Office Portion described in Paragraph A above and the Basement Storage Area described in Paragraph B above, in each of which the District is granted exclusive use and possession, are referred to herein collectively as the “Leased Premises.” The spaces described in Paragraphs C, D,
and E above are referred to herein collectively as the “Use Areas.” The Use Areas are not part of the Leased Premises, and the District’s rights in the Use Areas are limited to the rights of use expressly granted in this Article I. The District’s periodic exclusive use of the Community Room and the Conference Room during reserved times and days under Article IV is a right of use only and does not create a leasehold interest in those spaces.
Paul:
If you look at section F exclusions, there's no interest in the rest of the basement other than ingress and egress. There's no interest in the city's telecommunications facilities or any revenue from them, and no interest in the city's building, rental or other revenue generating activity or any revenue from it. And parking is conformed back to the executed July 2020 or July 1st lease, which is trail and equipment storage remaining prohibited.
The under article two is the term, so it's effective on execution rather than on conveyance for obvious reasons. Runs through December 31st, 2026, and it replaces the original lease in its entirety. So no First Amendment, Second amendment third. This is just a amended and restated lease. It's just one document. For article three, the rent. What's new is triple net obligation.
Tera:
Paul. A quick question on the term. Is it through the end of this year just because it has automatic renewals or there's another renewal clause?
Paul:
That's right. Tera. Yeah.
Any other questions on article 1 or 2 before I move on?
Nathan:
Paul. Just real quick. The IT and this is my mistake with the IT room should be included in the exclusive use area.
Pau:
Okay I will make that change. And I forgot to mention just leading this off. I'm not looking for board approval on this tonight. This is still a working draft among staff.
We had a meeting today and I thought it was a good opportunity to present this to you all. In the meantime, just so you have a look at this, and if there were any comments or if you wanted us to change direction on something, I wanted to give you the opportunity to do it. So not a final draft.
Still working out some some of the kinks. But yeah, just to just to give you that context. And Nathan, I will make sure to add the IT room to the exclusive spaces. Thank you for that. Okay.
Eric:
While Paul is taking a few notes here, Paul's office, Paul himself in his office, ready to turn this around pretty quickly. Last week we had a follow up conversation after the work session last week.
As you recall, we probably spoke about 5 to 10 minutes specifically on leases, and before you know it, we had a revised draft. So we were talking through the mechanics associated with the operations of maintenance associated with it. But really it's looking at bifurcating the existing lease and really moving where the district's operations are right now and letting the city very much control their portion of the building as well.
And so what we would do is any other inputs associated with this? Of course, Paul is going to work through the revisions, and Nathan and Paul are going to work with the city's staff and get it work towards approval on this. But really, we're looking at all we used all the input we had from our work session last weeks to get to this draft as well.
So thanks, Paul, for mentioning we're not seeking approval tonight.
Paul:
Yeah, absolutely. And thank you for that context. Eric.
Leah:
And I have one clarifying question. Is, is the city planning to use the space for their offices as well, or is it just their meetings?
Nathan:
It's just a meeting space. Okay.
Leah:
And then like the metro district will be able to continue leveraging the space.
Correct. Like for like office space.
Nathan:
Correct? Yeah. So they're they're just going to be out in kind of the same area that we've always had our boardroom, our board meetings. They also added an additional conference room that we'll be able to use. But yeah, it'll be city council meetings, parks Authority of several other functions they have. But our actual office use hasn't changed.
Leah:
Okay. Thank you.
Paul:
That brings us to article three. Some of the new sections here. And this is all in track changes. I'm sure you saw that. Everything in red is my additions or deletions. So what's new with an article three. The triple net obligations extend only to the lease premises and to the district's use of the use areas. They don't reach the community room, any auditorium or any other renovated portions, or any other part of the property.
The city is solely responsible for capital improvements and for establishing funding capital reserves, and the district has no obligation to contribute to that. Article four is on page 135.
Describer:
On screen. ARTICLE IV: Use of Leased Premises
A. The District will use the Leased Premises for administrative and operational functions necessary to provide water and/or sanitary sewer services to the District’s residents, and any other reasonably related or incidental uses.
Paul:
This just discusses the the study sessions, the timing, carving out that time a new provision for written notice to the city clerk promptly after the district adopts any changes to its recurring meeting schedule so everybody is informed. And I retained the 1.5 hour set up and a breakdown window and special meetings, another housing for other district functions and no additional charge.
Describer:
On screen. ARTICLE V: Maintenance, Repair and Upkeep
The District will keep, repair and maintain, at its sole cost and expense, including the plumbing, electrical, and heating and air conditioning systems exclusively serving the Leased Premises, according to City adopted building codes applicable to buildings of a similar type and use. The City shall be responsible for the repair, maintenance, replacement, and
improvement of the exterior walls, foundation, and roof of the building, all building systems not exclusively serving the Leased Premises, the City’s renovations and improvements to the Community Center Property, the Community Room and any auditorium or other renovated portions of the Community Center Property, the City’s telecommunications, meeting, and
audiovisual equipment, and any maintenance, repair, or replacement arising from use of the renovated portions of the Community Center Property by the City or by third parties, and all portions of the Community Center Property not included within the Leased Premises. To the extent
Paul:
And at any point, feel free to just stop me as I as I roll through this article five is maintenance. This is on page 135 and into 136. So this is where that article three gets operationalized. I think that's a word. So the district's obligation drops the exterior walls, the foundation and the roof and is limited to the lease premises, including only plumbing, electrical, HVAC systems that exclusively serve the lease premises.
Then the city takes the shell. So I'll be all building systems not exclusively serving the lease premises, its own renovations, community room, auditorium, its telecommunications and any sort of maintenance arising from from the city use or third party. So those renovated portions. Shared systems. So HVAC would be the obvious one here. Cost shared in proportion to the square footage.
District repairs. Damage to the use area is caused by its own use, but no general maintenance, repair or replacement obligation for them, so only tied to what the district does or the impact of this district has. Rather. Article six for alterations just adds the district's option to improve the lease spaces at its own cost with the city's prior consent.
Article nine covers insurance. This is on page 136 and into 137. So casualty and property insurance for the building, its structural components and the city's renovations shifts to the city rather than the district. The district insures its own content, its equipment, its furnishings, any sort of district installed improvements. And then either party can satisfy this through their blanket, blanket policies or self-insurance pool.
And then article 12 damage and destruction. This is just conformed to the new insurance structure. So the old trust fund and district rebuilds mechanism is deleted. City's casualty proceeds go to repair and restoration of its property of the property, including the lease premises by the city.
Okay, nearing the end to your article 18 and exhibit B, so like I said before, this entire agreement supersedes the original lease and then exhibit B will be that color coded depiction of the basement area. We're putting that together now. Okay. So that pretty much summarizes the changes that you're seeing within the lease agreement. Now, we haven't passed it to the city yet.
Again, we're we were waiting to present this to you just to see if there were any comments or any jerk reactions or whatnot to it, then maybe we would need to change. But yeah, there's any comments. Happy to address them and revise this. However the board sees fit.
Tera:
It looks really good. I appreciate you guys taking a really thoughtful approach and going through that, since obviously with the conveyance of properties and everything, the nature of our relationship has really changed. So I do appreciate especially you going through as a whole team and making those changes. It looks good.
Paul:
And thank you for for bringing this to our attention.
Any other any other comments to address?
Nathan:
One thing that will be added or that the city is going to request to add, is just some language around our use of the audio visual equipment, and then I don't know if it'll be captured in this lease document or not, but I did agree to pay roughly like $2,500, which is a pass through cost to set us up with like our own profile to use that that equipment the city installed independently.
And then also, I think that gives us a laptop or a tablet to kind of help facilitate that. So that's the only other thing that I can think of that'll be included in some way.
Paul::
That's good to know. Okay, great. Thank you very much, Paul, for the presentation. Does anybody else have any questions regarding this?
James:
Just one question. We talked about it room and things like that. We're data lines. And what have you enter the building. Is that covered. Is that come directly into the IT room or is that a separate area.
Nathan:
That's actually a good point, which probably we'll probably need to separate that out. So we do have where the fiber line enters the building is down in the basement. And then we have our servers. Security system cameras are segregated in their own room. So we'll probably need to make sure that we designate those as separate spaces.
James:
Okay. Appreciate it thanks.
Paul:
Good question. Thanks, Jim.
Okay. I think we can there's no further questions. We can go ahead and close out item number eight, the legal counsel status report. And we'll move on to item number nine, the district manager's report with Nathan.
Describer:
On screen. Memorandum
From: Nathan J. Travis
To: CPNMD Board of Directors
Date: 07/27/26
Re: District Manager’s Report
AGENDA ITEMS
South Tank Rehab Capital Project (Agenda Item A)
• We have agreed to all aspects of the approach related to this scope and are working to incorporate the final pricing into the Myer’s Pre-construction Service Agreement. We will be doing an expanded pipe condition assessment beyond the tank site, to include the full length a line that runs from our tank site to the distribution system. This Approach will also cover some scope within the ongoing Distribution System
Condition assessment.
Well Status Updates (Agenda Item B)
• See additional Memorandum titled “Well Status Update”
ADDITIONAL UPDATES
Interconnect Pump Station- Surge System Modifications
• A pre-bid meeting has been scheduled for July 28th to tour the site with prospective contractors.
Filter Rehab Project Update
• We officially have all 6 filters at our treatment plant up and running! Work remains on several items, including safety railing, flooring, HVAC, and control programming. The filters are performing well, with extremely low post-filter turbidity (water clarity). We look forward to hosting an open house at the facility this coming fall!
• Some floor drain lines have been identified as needing replacement, an RFI has been generated, and Kennedy Jenks is working with the contractor to identify a repair scope. This needs to be completed prior to floor coating.
Stantec Regional Water Supply Study
• Update and next steps to be discussed in Executive Session at the July Board Meeting
PCWRA Reuse Pond Project
• Holdover: This project is well underway with completion expected this fall
Conservation
• Then new rebates are in place and are being well utilized, though sod removal has slowed in July! We have $82,270 remaining of our $110,000.00 conservation rebate budget.
• CPN II HOA has asked if we would be interested in collaborating to install some areas of Tahoma 31 grass
that would be available for use as a community demonstration area. I will be meeting on site with the Brambleridge HOA on Thursday August 6th at 9:00am to discuss further
Project Updates (for additional information please refer to the engineering report)
• Lift Station Renovation Program
o Scope A (Lift Stations 1, 2, & 5) The project remains on schedule. Work has begun on Lift Station 5 North of Crossing Circle this work started much sooner than anticipated!
o Scope B (Lift Stations 3, 4, & 7) A preliminary schedule has been set, and work is set to begin on this phase late this fall.
• Documentation and Asset Management: Work is underway Kennedy Jenks is currently evaluating our line break history. Rene will spearhead this project. Work is also underway to incorporate the recently completed Well-Vault Rehabilitation Project, with associated equipment being added to the asset hierarchy.
JAM Ranch Inclusion
• Holdover: Jam ranch is moving forward with the formation of their own metro district. Recently filed for a
zoning change with the county. CPNMD provided a letter detailing our concerns, this letter was presented
to the board at the February work session.
Upcoming Time Off
• None planned
Removed From Prior Monthly Reports
• Crowsnest- no further developments and none are anticipated.
• Staffing- Will include if needed in the future
Nathan:
All right. Thank you guys I know we're having a longer meeting than we've grown accustomed to. So thank you everybody for hanging in there.
Are there any questions about my report in general. And if not, I'll jump into the agenda items.
All right. First thing that I have on the agenda.
Easy for me to say here an update on the South Tanks rehab project. So we are still working through the final stages of the pre-construction agreement with Myers and Sons. The board had previously given us approval, pending touchpoint with director Krell, to make sure that she's good with the final cost. So the two things that were outstanding were the specific modality for the pipe condition assessment.
We have identified an acoustic technology that we're going to take advantage of. It has a minimum pipe lineal foot distance. So we're going to also fold this into part of our distribution system condition assessment program. So we'll be able to kind of diffuse some costs into two separate programs that are already approved and moving forward. And then the other was just figuring out how to fully drain the tanks.
We have all of that, those cost estimates as of this morning. So Myers and Sons is is rewriting their proposal to incorporate those. And we'll have the final document ready to approve in the next couple of weeks. And so we'll make sure that we run that past Jana before we before we move forward. But we are really, really close on that one.
Describer:
On screen.Memorandum
From: Nathan J. Travis
To: CPNMD Board of Directors
Date: 07/27/26
Re: Well Status Update
Overview
District staff continue to address a series of reliability issues affecting several production wells. Recurring electrical equipment failures, aging infrastructure, extreme summer temperatures, and the recent issues involving Wells A6 and DE6 have required increased maintenance efforts and prompted a broader evaluation of both near-term operational improvements and long-term capital replacement strategies.
Please note that as of now, we have been able to meet demands and anticipate being able to continue to do so.
Well A6 – Failure Investigation
Well A6 experienced a significant failure shortly after being returned to service following rehabilitation, raising concerns regarding both equipment reliability and warranty coverage.
District staff questioned whether the failure should be considered a warranty item, noting that the well failed almost immediately after startup and did not provide a meaningful operational period following installation. While Layne indicated a willingness to honor the warranty if a
warrantable defect could be identified through additional investigation, it did not offer to perform the initial removal and diagnostic work under warranty.
To ensure prudent stewardship of District funds, staff solicited proposals from multiple reputable well contractors for removal of the equipment and completion of a comprehensive evaluation. After reviewing the proposals, the District selected Hydro Resources, which proposed to complete the work for $11,730.00, compared to Layne's proposal of approximately $53,600.00.
Nathan:
The bigger issue and a separate memo inside of the board for or inside the board packet for item B is a memorandum I put together on the status of our wells. Specifically well A6 is the one that that is the one that warrants the most discussion. A6 was one that was a well that we had done some work on back in August of last year.
It had failed, so we pulled the well in August. We reinstalled the well with new equipment. In December we were unable to do a proper start up on the on the well equipment because the treatment plant was offline, so that got delayed until June. We started the well in June. It went through its startup process absolutely famously, didn't have any problems, ran for a little bit more than half an hour without a hitch.
We went to go put it into regular operation the following day. It failed several. It failed 2 or 3 times, so we pulled it offline, got Layne back out to evaluate, to look at it, along with Principal Electric, Mountain Peak Controls a and Semocor. Went to go do a final start on it and smoke started coming out of the drive cabinet, which ultimately was an electrical connection inside of the wellhead.
We talked to Lane about potentially warranting the issue. They were hesitant to do so, largely because the wiring that was smoking and melting, for lack of a better term, wasn't really anything that they had touched. So it was outside of the scope of their work. So they gave us a proposal to pull the well equipment. That proposal came back at $53,600.
So rather than kind of a few compounding things, one there kind of hesitancy to pull that under warranty even though they had just worked on it.
Really kind of pushed us in the direction just to go get some other proposals to pull the well. We reached out to a few different reputable vendors. Hydro resources got back to us really, really quickly with the proposal. Covers the exact same scope for $11,730. So we went ahead and pulled the trigger on that. They are on site pulling the well equipment out now.
Then we'll get into valuation in place and see what the failure modality was. Paul and I have had a chance to discuss this not in depth at this point, but if it does, if if the work that hydro does in their evaluation points to any type of failure with the installation or the equipment with Lane, then we'll have a discussion about going back to Layne about doing this as a warranty item.
But for the relatively lower amount of $11,730 and made sense just to go ahead and get it operational as quickly as possible.
Any questions on. Well, A6 and I'll kind of run through the rest of the report really quick. If not.
Describer:
On screen. Well DE6 – Recent Failure
Well DE6 failed during the week of July 20, 2026, and was taken out of service pending further evaluation. District staff coordinated a joint field assessment with Semocor, Mountain Peak, and Hydro Resources Scheduled for July 28th, 2026, to diagnose the cause of the failure and determine the appropriate path forward.
During initial testing, the well produced significantly more sand than expected, which may indicate deterioration or failure of the well screen. While additional investigation is required to determine the exact cause, this finding raises concerns regarding the overall condition of the well and may have implications for the scope of repairs or rehabilitation required.
The evaluation is currently underway, and additional information regarding the condition of the well, the integrity of the well screen, and any recommended repairs or replacement will be provided to the Board as it becomes available.
Nathan:
D6. This actually just happened last week. It's a it's on the same site as well. Failed. So it got it had I think it was a high amp failure that it turned off on. We went back out to start the well it ran okay but it started pushing out quite a bit of sand. So we have little sand testers inside of the well vault.
The reason that we have those sand testers is a fairly common failure is a well, screen failure. So there's like a literal screen down at the bottom of the weld keeps the sand outlets the water in. So there is a potential that that is a failure. We don't really know. So we do have kind of that same crew that looked at the A6.
Well they're scheduled to meet out there tomorrow. So Hydro Resources, Mountain Peak Controls, Principal Electric and Semocor will be on site to kind of evaluate their initial steps. My guess is it will all end up pulling that well. Also, it's a relatively small producer, so it's not a big deal. Even with these. Even with both of these wells down, we are able to meet demand comfortably.
So there's not really any concerns on that front.
We do have some other kind of more annoyances. We've had several wells really are kind of our bigger Arapahoe Wells have been tripping on and off, tripping occasionally just because of how hot it is. We do have air conditioning systems built into those. Those are really only good to about 80, 85 degrees. And so those have just been turning off because it's too hot outside.
So to in the interim, we've got some heavy duty sun reflective canopies coming to that'll be here within the week. That'll keep the at least the sun off of them and stop that heating of the actual enclosure. And we're actually also looking at some various paints that can do some sort of heat, heat deflecting or like coatings that we can put on the outside of the weld cabinets to try and try and minimize that.
But as we get later into the year, temperatures drop. Hopefully that'll that'll fall. This is something that we've had dealt with in the past. Usually just a canopy kind of solves the issue. It's just been a while since we've seen heat this sustained this long. Jim, did you have a question? You came off. Came off mute. You were ready to.
James:
Probably a few. I'm going to hold him for a while, and let you finish.
Describer:
On screen. Wells A1, A3, and A5 – Soft Starter Reliability
Historically, wells A1, A3, and A5 have experienced recurring operational issues related to the existing Benshaw soft starters. Investigation by District contractors identified repeated failures associated with the internal Joslyn Clark contactors. Due to the orientation in which these contactors are installed within the Benshaw assemblies, premature spring wear is believed to be contributing to repeated failures.
A previous failure at Well A1 is believed to have resulted in single-phasing, potentially damaging both the circuit breaker and the well equipment. Similar issues were identified at Well A5 before catastrophic failure occurred, leading to the replacement of all six contactors (inline and bypass) across the affected soft starters.
Unfortunately, the replacement contactors have introduced a separate issue involving failed control boards that prevent the wells from operating. According to Benshaw engineering, these control board failures are a known issue, although the component manufacturer has not acknowledged responsibility.
To maintain reliable operation, staff is replacing failed control boards on an as-needed basis. Benshaw has agreed to warranty the failed control boards; however, replacement boards must first be purchased and installed by the District before the failed components are returned for laboratory evaluation and warranty credit. Replacement control boards cost approximately $3,700 each, excluding labor.
While these repairs are expected to maintain reliable operation in the near term, staff is also developing budgetary cost estimates for replacement of the A1, A3, and A5 soft starters with equipment from an alternate manufacturer. These estimates will be incorporated into the 2027 budget development process for Board consideration as part of the District's long-term capital improvement planning.
Nathan:
Going back to some of the potential historical, well, failures that we had. A1, A3 and A5. We've continued looking. These are all wells that were ultimately replaced under warranty, that we had consistent issues with. One thing that our our electrician has been able to identify as actually there's some contactors in there. I don't want to get too far into the weeds on this.
All of that to say that the soft star, these existing soft starts we've identified have some known issues. We have some. It's about $3,700 plus labor to repair these as they fail. Really the ultimate the ultimate solution is going to be fully replaced those. So we're building we're collecting information, getting some general pricing that will be included for the 2027 budget.
So that won't be any expense this year. The soft starters themselves are anywhere between about 12 to 18 years old, so they're well into the phase that it makes sense to replace them anyway.
Kind of some inside the packet you guys can review. There's a summary of our current direction. And then there's also a just a chart showing our current, well, status for anybody that's curious. And with that I will let Jim fire off some questions. Anybody else? Of course.
James:
Anybody else first.
Jason:
Go for it Jim.
Leah:
Can you triage and fix this for us? Agreed. It's so frustrating.
James:
It's funny. It's like most of this is what I do for a living. But I guess you brought up the fact that we have high thermal loading on some of these cabinets, and it's causing failure. That seems to be a known issue based on your comments.
Okay. Who designed that and put that in? And how long ago was that done?
Nathan:
Oh, I mean, the so the air conditioners were installed would have been 2018, 2019. That was a combination of IMC Designs and Layne put those in place. They've worked fine since then. And this just seems to be really more just the actual physical heating of the cabinet from heavy heat and sun that's contributing it.
So there. Yeah.
James:
Okay. Well when I do terrestrial stuff, my requirement is Baghdad noon in the middle of summer. So granted we're talking probably cheaper parts and different class of electronics. But you know, thermal loading is a simple problem to solve. So it's puzzling that, you know, we've known about this and not dealt with it before now.
Nathan:
Yeah.
Prior we we installed the air conditioning units to deal with this. And we really haven't had an issue with the thermal loading since then. It's really just now that we're seeing those sustained hundred degree temperatures that it's kind of reared its ugly head again.
James:
Okay. So I guess you're going to make a note on how to deal with that.
And I wouldn't expect the same people that designed the the current one to be on contract in the future to design a replacement.
Nathan:
Yeah, we we haven't we ink designs. We severed our relationship with them 2 or 3 years ago. And you know, we're bringing other well contractors on board at this point as well.
James:
Okay. And then you talked about high amp loading.
So you mean you're tripping it over current protection or is there some other means you're just noting high current.
Nathan:
Yeah. Just noting high current. At this point I'll know a lot more when they kind of dig in into it on site tomorrow. So we really just saw we got the alarm, saw the well failure, fired it up again, did the sand test, and then we just left it off because we don't want to unnecessarily break anything for a well that's not very high producing.
James:
Sure, sure. And I mean, is the uptake of sand or the sand getting, you know, into the, the pump itself at the bottom of the well. That would be, that would correspond to this high current. Correct. Okay.
Nathan:
So if the if the screen failure is bad enough, you can actually bury the wellhead in it. So it could be a number.
James:
So this augers in kind of so to speak or sucks enough sand that it gets buried. Yep. Okay. All right. So that hopefully you're going to do it down the well video camera and look it down or you're just going to pull it.
Nathan:
Yeah. Anytime we pull a well we'll do a deviation survey and a downhole camera. Okay.
James:
Okay. Next, next. If you could make a note if they have the, the current that you, you know that the well was drawing for that, you know pump motor. Could we just go ahead and evaluate that high current loading for that period of time and look at because you'd have to be a very massive piece of wire.
And how deep is it 1000ft. 2000ft.
Nathan:
Yeah, about 1800 feet.
James:
All right then just send me the numbers and send me the wire gauge, and I'll do it for you real quick. We can do all right. I just want to make sure that we're not smoking the insulation or causing additional damage by operating it through this high current event.
Is it? Yeah.
Nathan:
Yeah, that's that's why we've got it shut down.
James:
Yeah. Okay.
These other issues that you have associated with some of the other wells, not this. I mean, I wish we'd have a better numbering system. A6 and D6, some of the other wells. You said their soft start reliability. Is that just, you know, the capacitor to do the power factor when you start loading that up? Initially it's kicking off.
Nathan:
It has something and I can. I'll send you the I'll forward the specific email from the electrician that did the evaluation. They did a design in the contactor change. So we've got contactors that are hanging upside down. And then there's like springs that are wearing out because they're not in the optimal position. And they also drastically reduce the size of the of a control board that those directly like very physically say close to.
So the manufacturer is aware that they've got an issue, but there's no real plan to redesign or anything. So there was a there was an option to do kind of like a more comprehensive overhaul. The parts would have been closer to $9,000 plus labor and material, which didn't seem like that was a smart move to make on equipment that's past it's useful life anyway.
But I'll I'll send you the the email that I got from the electrician. That speaks more to the technicality of it.
James:
Okay. Appreciate it. But power contact do you mean I mean I mean we that's usually above a certain amperage, but that's just a big ass relay essentially. Yeah, yeah. Okay. We 50 amps and above, we kind of call them contactors, but I got you. And a lot of those work with a little molten bowl of silver at the contact itself.
So orientation is critical for it to operate properly. So let's not make that mistake in the future. The silver goes liquid right at the contact. And that's what gives you a low resistance. And they should have a preferred orientation that's marked on the case. So whoever installed it and then improper orientation should not be used again either. Anyway that's enough for me.
Jason:
Thanks, Jim.
Leah:
I was going to ask all the same questions, but Jim beat me to it. Right?
James:
Nice. I love the comic relief.
Leah:
Well, Jim, I'm I'm thankful for you. Appreciate your. Yeah. Appreciate your experience here.
James:
Thank you. Leah. Likewise.
Jason:
Okay. Is that all you have for us this evening?
Nathan:
That's all I have on this agenda item. All right. Very good. Anybody else have any questions regarding this hearing? None. We'll go ahead and close out. Item number nine, the district manager's report, and we'll move to item number ten, the operations and engineering report with Nathan again.
Nathan:
Notably missing from the operations and Engineering report is the operations report.
I got that about five minutes ago. I saw a pop up in my email. So Will sends it with his apologies. I'll forward that on to the board. If you have any questions, feel free to reach out. And other than that, I'll take any questions on the engineering report.
Jason:
It doesn't look like we have any questions on the engineering report. So hearing none we can go ahead and close out item number ten and we'll move on now to another 11 the executive session. So I moved to enter executive session pursuant to section 24-6-402, subsection E of the Colorado Revised Statutes, to develop a strategy for negotiations regarding the regional water opportunities.
Reconnaissance.
Board Voting All Speak:
Second. Thank you. Having a second, we'll move to vote. Tera. I. Leah. Approve. Jim. I. And Jana. I. And I approve as well. So at this time, we will enter executive session.
Describer:
On screen. Executive Session Please Stand By
Jason:
Okay, now that we're back, we closed out item number 11, the executive session. We'll move on to move on to item number 12, the director's matters. Does any of the board have a matter they wish to discuss?
Leah:
Not in this meeting, but did we want to think about water restrictions? I know Castle Pines recently. Sorry. Castle Rock recently went into like a different stage of water restrictions, and I feel like we're the odd district out and it also feels like it's too late. But would that be something worth talking about in like next month's study session or meeting?
Jason:
Where did we leave that?
Tera:
I thought we had. The plan was that we staff was going to do some research, and we were going to take that back. We weren't going to do anything this year. One of the recommendations that I had brought up to staff was for the, what's the party in the park? I guess that's a party in the park that perhaps our booth have some, to engage our people to ask questions like, everybody wants to know about water, but maybe solicit some community engagement from our, residents and ask them for engagement on our water policy, since we're still kind of implementing that.
I mean, I think as I best recall, our conversation is we are actually in a great position where we don't have to do water restrictions. We were just considering to do them to be great, you know, kind of partners in this water game. So that's kind of where I remember things. I see you, you're poised.
Nathan:
Yeah. Oh go ahead Jana.
Jana:
Oh I would Tera I do want to say because I do want to correct something just because we use well, water to me, doesn't mean we're in a good position. Like, it doesn't mean we get to disregard that we're in such a drought condition. But I understand where you're coming from. I just don't want to to act naive about the situation we're in, because I think this is twice now that you've said, like, we're not we're not affected by this.
And I think that irresponsible of us because we're not following drought regulations just because we're on a well. So just I wanted to add that in.
Lea:
Well, the other question that I had to was, I am assuming our surrounding metro districts who are implementing restrictions to be responsible stewards, have the same water source as we do. Correct. Is that correct?
Like Castle? Like, do they like, do we like? Yeah. Castle Rock, Highlands Ranch. Do they not get their water from aquifers?
Nathan:
It's varied. So Castle Rock and Parker are both more dependent on aquifers than surface water. Highlands ranch is almost exclusively surface water, so they're already at that like 85% metric. I think the the ultimate goal and I guess the maybe a helpful way to frame this is that we are relatively insulated from droughts because we are on groundwater.
But the ultimate goal should be is to shift more towards surface water so that we have so that we're maintaining that groundwater resource to remain insulated or to kind of be drought proof. Right. So eventually we want our primary water source to be surface water, renewable, reusable, and then have our groundwater resources in place as a potential backup or augmentation for droughts.
Yeah, I think to the earlier question. So the the ultimate direction the staff was given and that we've been taking is really to address water conservation much more from a rate rate perspective. And so that's a lot of the work that Rene has been doing. I know that, Eric, there were at a place where Rene handed that largely off to the Eric's.
So they're looking at putting actual dollars to some of those different tier structures. And then we're aiming for likely going to be aiming for a 2028 implementation just because there's going to be some pretty, pretty heavy impacts. We'll have some users that, if we were to immediately put it in place, would have their summer water bills as much as triple.
So we want to push that out in the future a little bit. Yeah, the board was was pretty specific that they didn't want to put any fines or potential schedules in place. That's not to say that we couldn't in the same vein that we have been, we could put out a two day per week watering schedule, the same way that we put out a three day per week watering schedule, and then just stay silent on whether or not it's required, which is kind of the mode that we've been in for a very long time.
Tera:
And part of that is due to the amount of the heavy lift on the communication to get that out to the community.
Nathan:
Right. Yeah, we and we just really don't have like the infrastructure, the infrastructure to do something that quickly. Like there's we don't have a schedule couch. We don't have an actual fully developed drought response plan. All the things that will be taken care of as part of our rate structure lift.
Leah:
Okay. Thank you guys for reminding me. Like.
Jana:
Do we need a drought response plan?
Nathan:
Yes. Yeah. That'll be we want to bake that into the new tier structure with the rates.
Jana:
Okay. And then so does this mean nothing will change in 2027?
Nathan:
As it currently sits. Yeah we won't. We're not looking at any drastic changes for 27. And discussions to be had. Right. So we'll still have the information that Bartle. Not Bartle. I can't remember who the rate people are the that Eric produces. Like for the raid structure for all of the budgets. We'll have a lot of discussions over that in several meetings.
So one thing we could look at is an interim step in 2027. But yeah, that's just kind of where we where we've landed to this point. So nothing set in stone, certainly.
Leah:
And I don't know where we are on community outreach. But even just like this past week and the week before, like I've seen multiple hose watering common spaces at like 1:00pm in the afternoon when it's like 100 degrees outside.
Same with the city. And, and yeah, I, I think I have a little bit more tolerance for the HOAs, but I feel like the city, like I would love for them to set a good example and be great stewards. And that just seems like really low hanging fruit.
Nathan:
Yeah, I agree with you. Especially on the city front. We have reached out to them and they've been responsive to the zones that we've caught running middle of the day, and they have made those adjustments. But yeah, that's that's been honestly a little frustrating.
Leah:
Right. And I know like you know you and we don't have control over that.
But okay. That's what.
Jana:
We should fine them.
Nathan:
Good night everybody.
Tera:
And appreciate that. Leah I know that I've had those conversations with Nate as well. I know he's been in contact with the city.
Leah:
Yeah. Thanks for doing that. Okay. That was it. Thanks for reminding me. And that makes sense.
Jason:
All right. Great. Any other comments?
Hearing none we'll go ahead and close out Director's Matters and we'll move to item 13 and adjourn the meeting.
All Speak:
Have a great night everyone. Thank you. Everyone have a great night. Good night guys. Bye bye. Thanks everyone.