Draft resolution: halting Eldora spending, with deadlines

TOWN OF NEDERLAND, COLORADO

RESOLUTION NO. 2026-[number]

A RESOLUTION HALTING FURTHER ELDORA ACQUISITION SPENDING, REQUIRING A FINAL ACCOUNTING AND BOARD APPROVAL OF RELATED ENGAGEMENTS, AND ESTABLISHING MILESTONES FOR THE PROPOSED ACQUISITION OF ELDORA MOUNTAIN RESORT

WHEREAS, the Board of Trustees has pursued the potential acquisition of Eldora Mountain Resort and, by Resolutions 2025-03, 2025-11, 2025-16, 2025-19, and 2025-22, authorized or ratified the engagement of legal counsel, underwriters, financial advisors, and other consultants for that purpose without stating a dollar limit; and

WHEREAS, by Resolution 2025-17, the Board declared its intent to reimburse acquisition costs from the proceeds of future revenue bonds; and

WHEREAS, as of the Oct. 20, 2026, warrant list, the Town had paid $1,195,949 in acquisition costs, charged to the General Fund; and

WHEREAS, the closing deadline in the Purchase and Sale Agreement, April 30, 2026, passed without a closing; the authority to sell bonds under Ordinance 885, Section 5(c), lapsed on July 19, 2026; and the Town has stated that it continues to pursue a restructured transaction; and

WHEREAS, the Town's Sept. 30, 2026, update estimates that the Town would owe about $2.5 million in transaction-related costs if the sale does not close; and

WHEREAS, the 2026 budget does not include appropriations for these costs, and C.R.S. 29-1-110 provides that no officer or employee may spend or contract to spend in excess of the amounts appropriated; and

WHEREAS, the Board is preparing the 2027 budget and finds that halting further spending, firm milestones, and regular public reporting will protect the General Fund while any further negotiations proceed;

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF TRUSTEES OF THE TOWN OF NEDERLAND, COLORADO:

Section 1. Definition. "Acquisition costs" means fees and expenses for legal, financial, advisory, due-diligence, transition, and other services related to the potential acquisition, financing, or operation of Eldora Mountain Resort that the Town would owe whether or not a closing occurs. It does not include amounts payable only from bond proceeds at a closing.

Section 2. Spending halt. The Town shall incur no acquisition costs for work performed after the effective date of this resolution, except for work the Town Manager requests under Section 4, unless the Board authorizes them by a further resolution. Within three business days, the Town Manager shall direct each firm engaged for the acquisition, in writing, to stop billable work for the Town other than that requested work. This section does not affect amounts the Town already owes for work performed before the effective date.

Section 3. Board approval of engagements. No new engagement, contract amendment, or expansion of scope that would incur acquisition costs may be made without prior approval of the Board by resolution. To the extent Resolutions 2025-03, 2025-11, 2025-16, 2025-19, and 2025-22 authorize the Town Manager to engage counsel, advisors, or "additional consultants, as necessary," that authority is limited by this section.

Section 4. Final accounting. Within 14 days, the Town Manager shall ask each firm engaged for the acquisition for (a) fees paid, billed, and unbilled for work performed through the effective date of this resolution, and (b) any amount the Town would owe under the engagement's terms if the acquisition does not close. The Town Attorney shall identify which of the Town's obligations are owed now and which would be owed only at a closing. At the next regular meeting after that period, the Town Manager shall present a written report, included in the meeting packet, itemizing those amounts by firm and comparing the total with the Town's Sept. 30, 2026, estimate of about $2,500,000.

Section 5. Milestones. The following milestones apply:

1. By Jan. 31, 2027, a purchase agreement approved by the Board and signed by all parties, and written financing commitments sufficient to close.
2. By April 30, 2027, a closing.

If a milestone is not met and the Board has not extended it by resolution adopted before that date, the Town's pursuit of the acquisition shall end. The Town Manager shall then direct all firms to stop work other than work needed to wind down, shall incur no further acquisition costs, and shall present a final accounting at the next regular meeting.

Section 6. Independent review. Before any Board vote on a new purchase agreement, bond ordinance, lease, or financing agreement for the acquisition, the Board shall receive a written review from a qualified advisor whose compensation does not depend on a closing. The review shall address whether the resort's revenue can pay the debt at then-current interest rates and through low-snow seasons, and any obligation the General Fund or other Town funds would bear.

Section 7. Public reporting. At the first regular meeting of each month, the Town Manager shall provide a written report, included in the meeting packet, showing acquisition costs paid, billed but unpaid, and still owed, by firm; any further spending the Board has authorized under Section 2; total acquisition costs compared with the Town's Sept. 30, 2026, estimate of about $2,500,000; and the status of each milestone in Section 5.

Section 8. Budget. The Town Manager shall present to the Board:

1. a transfer, supplemental appropriation, or revised appropriation under C.R.S. 29-1-109 covering acquisition costs paid or owed in 2026, shown as a separate line item;
2. a separate line item in the proposed 2027 budget for acquisition costs still to be paid; and
3. with the proposed 2027 budget, a plan for the General Fund if the acquisition does not close, including how unrecovered acquisition costs would be paid.

Section 9. Effect. Except as provided in Section 5, nothing in this resolution requires the Town to end negotiations or terminate any agreement. Where this resolution conflicts with a prior resolution, this resolution controls. This resolution takes effect on adoption.