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Developer's dream

Norwood gets special break on planning fees


The city of Colorado Springs may be strapped for cash, but it's not too broke to give a major real-estate developer a special $16,000 break on fees owed to the city.

When the Nor'wood Development Group filed applications last month to develop 15 lots in an upscale southwest city subdivision called Stratton Pines, the city's planning staff calculated that Nor'wood should pay more than $21,800 in standard application fees -- money the city charges to pay for the time that staff spends examining proposed new developments.

But when Nor'wood complained that the amount was unreasonable, Deputy City Manager Dave Nickerson personally knocked the fees down to $4,985.

The decision rankled city planners, who suggested Nor'wood -- a developer of high-end real estate whose owners and executives contributed heftily to the election campaigns of most City Council members this spring -- was getting preferential treatment. Other developers, they said, have been told that only the City Council, not city staff, can waive application fees.

"It seems more than odd to me that, in a time of budget constraints and possible layoffs, we would (without authority from City Council) reduce fees," wrote James Mayerl, a city planner who handled Nor'wood's applications, in an e-mail to his boss, Planning Director Bill Healy. "I want to state for the record that I believe this is wrong, very very wrong."

The e-mail was among several obtained by the Independent, under the Colorado Open Records Act, in which city staff expressed concern about Nickerson's decision.

In fact, Healy himself wrote back to Mayerl: "I don't disagree with you. ... I am not an advocate of 'waiving fees' because what we are really waiving is public revenue. In my opinion, that is an illegal gift of public money."

Healy, who was on vacation when the decision was made, said in an interview that he would not have recommended reducing the fees. "Personally, I wouldn't do it."

Didn't lobby directly

According to Healy, the city resolution that sets the Planning Department's fees doesn't give staff or administrators the authority to waive fees.

But Nickerson defended his decision, saying it was "the right thing to do."

Nor'wood asked that the fees be reduced because the company was submitting 15 separate applications for the same subdivision -- one for each lot. That would normally result in Nor'wood paying application fees 15 times, which the company argued was unfair, since city staff only had to review the overall plans for the subdivision once.

"What we offered to pay was more than [the cost of] the time they're going to spend reviewing it," said Fred Veitch, Nor'wood's vice president of commercial development.

Veitch asked Paul Tice, a division manager in the Planning Department, for the fee reduction. When Tice said his department didn't have the authority to waive fees without Council approval, Veitch suggested Tice ask Nickerson.

Nickerson says Tice called him and explained the situation, and the two agreed it "made sense" to reduce the fees to better reflect the true cost of reviewing Nor'wood's application. Nickerson says the developer never lobbied him directly on the issue and did not receive preferential treatment.

"It doesn't matter to me whether it's Nor'wood or anyone else," Nickerson said.

It was a matter, he said, of using "common sense" in applying city code. If city officials always follow rules by the letter rather than using their judgment, "we get subject to the classification of being bureaucrats," he argued.

Nickerson says he wasn't aware that only the Council can waive fees, or that his action violated standard practice.

"That's news to me," he said. "Nobody said to me, 'Gee, Dave -- you know, we typically don't do this."

Inconsistent and unfair'

City planners, however, were startled. In another e-mail to Healy, Mayerl -- who declined to be interviewed for this story -- called Nickerson's decision "inconsistent and unfair."

Fellow planner Rick O'Connor weighed in with an e-mail in which he pointed out that another developer had been denied a fee waiver unless the City Council would approve it first. "Why is this instance different?" O'Connor asked. "There seems to be an inconsistency here."

The grumbling within the Planning Department comes just as three city planners have quit in the past four months. The last planner to leave, Alece Otero, cited undue influence by developers over the city's planning process as a main reason for her resignation, saying the city had become "developer-controlled" [see "Jumping Ship," Oct. 2, available at].

City Council members who were asked to comment on the fee waiver said they didn't know anything about the matter.

However, Vice Mayor Richard Skorman said he felt waivers shouldn't be given without Council approval.

"I would be very uncomfortable with that, if that's what happened," he said.

Councilman Scott Hente, a developer himself, said he'd like to find out more about the issue.

"Everybody should play by the same set of rules," Hente said.

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