Loveland's Independent News Source
Loveland, January 18, 2015

Loveland resident Brian Wood is protesting the January 6, 2015 Loveland City Council ordinance
that will divert $2.2 million to private hands to facilitate the development of a Sprouts Farmers
Market on the Northeast corner of Highways 34 and 287 in Loveland.

According to Wood, Mayor Cecil Gutierrez's decision to prohibit public comments during the
second reading of the ordinance required by city charter invalidates the ordinance that passed
by a 6-3 vote after a lengthy debate.  In addition, Wood points to the substantial changes in the
ordinance by staff (like changing the recipient company and terms of the "guaranty") as requiring
another first reading.

By design, Loveland's City Charter tracks closely to Colorado State Law in requiring local
governing bodies to allow the general public to comment on legislation, zone changes and
ordinances before finally considering and passing those measures.

Loveland's City Charter anticipates the council making changes during the "first reading" but is
silent on whether unelected staff can make those changes outside the public's eye or council's
public process.  When Loveland's City Council met on January 6, for the "second reading" of the
proposed ordinance to provide Evergreen (developer of the Sprouts Farmers Market) $2.2
million those in attendance discovered the "second" reading looked like a new proposal given
substantial changes in two primary areas;

1. The recipient is no longer "Evergreen" but another company named "Thronton Longterm
Investments LLC" which Evergeeen claims they control but council was not made aware of during
their "first" approval of the appropriation.  The developer explained the change was necessary to
avoid paying taxes on a recent land sale in Thornton, Colorado through the other entity.

2.  An escape clause from the obligation to "repay" the subsidy if Evergreen fails to perform.  
According to the new agreement presented January 6, for the "second" reading, the developer is
absolved from repaying any amount of the subsidy even if a Sprouts Market is not built so long
as the City of Loveland either removes or reduces its sales tax on groceries sometime during the
next ten years.

In addition, according to Wood, the public was prevented from speaking after discovering the
new ordinance puts the city at greater risk and is now flowing the funds to another party not
originally discussed or agreed to by the council during their previous meeting in November when
it passed by a 6-1 vote (only Councilman McKean voted against while Krenning was absent).

Wood cited Loveland's City Charter as requiring public comment during a "second" reading of an
ordinance despite the fact Loveland Mayor Cecil Gutierrez announced he would not allow the
public to comment before voting on the ordinance and attached resolutions and agreement with
the developer.  LovelandPolitics has reviewed the meeting tape from the January 6, 2015 council
meeting and confirmed that Mayor Cecil Gutierrez did indeed announce (in error) that he is not
required to take public comments on the second reading of an ordinance.

Wood's main complaint is the city erred by changing the ordinance substantially from its original
form (along with attached agreements) and also refusing the public a chance to comment.  
Councilman John Fogle was reported to have stated he will entertain a second vote on the matter
when presented with the letter because he is confident the same councilors will vote again for the
same measure.

Brian Wood is also planning to speak at Loveland's upcoming council meeting this Tuesday
should the Mayor allow him to speak.  According to Loveland's new city attorney, Tami Yellico,
the council does not need to reconsider the matter but can if one councilor who voted in the
affirmative places the ordinance back before the legislative body for reconsideration.

In a January 14, email obtained by LovelandPolitics (see email in right column) Yellico takes
issue with Wood's terminology of "public hearing" by saying that is a specific legal process not
required for passing ordinances.

LovelandPolitics has learned the subsidy recipient is looking for confirmation by the city that
Wood will not follow-through with a threat in the end of the letter to bring the matter to court.  Bill
Cahill, Loveland's City Manager, is reported to be ready to fight the matter along with Mayor
Gutierrez while the more business oriented Councilman Fogle has asked what is the harm in
voting again.

Below is an excerpt of Wood's letter which can be read in its entirety by clicking the link in the
upper right of the box to the right of this story .

"Loveland’s City Charter Section 4-9 states,

(5) The ordinance shall be introduced by motion at a second regular or special meeting
of the Council held not earlier than four (4) days after the first publication.

(6) Prior to taking final action on the ordinance, the Council shall permit public
comments on the ordinance, then shall vote to amend, finally adopt, or reject the
ordinance, or take such other action as it deems appropriate

As noted above, the Loveland City Council never amended the original ordinance as
presented by staff on November 4, 2014.  Following staff changes sometime prior to
the January 6, 2015 council meeting or alleged second reading, Loveland’s City Council
failed to conduct the required public hearing before deliberating on the staff’s
substantial changes to the incentive package thus changing the recipient of the

Mayor Cecil Gutierrez announced shortly after the new ordinance was moved for
“This is a second reading and normally we do not do any public comments
on or..ah.. it is not a public hearing on second reading.”
 This prevented public
comment on the staff’s recommended changes."
Mayor Accused of Violating
City Charter, Imperiling
Sprouts Deal
Read Brian Wood's Letter Protesting
Decision by Loveland's City Council

Wood's Letter to Loveland's City Council

Loveland City Attorney Punts

Below is the email by Loveland's new city
attorney reacting to Brian Wood's letter.

On Jan 14, 2015, at 5:11 PM, "Tami
<> wrote:

Mayor & City Council,

I wanted to make you aware of the
attached letter that was provided to the
City Clerk last night and addressed to the
Mayor and City Council.  The letter
indicates that it is a "protest" of the
ordinance and resolution concerning the
incentive agreement for the Sprouts
project that was approved by City Council
at the January 6, 2015 meeting.   The City
Charter does not provide a formal
"protest" procedure for adopted
ordinances and resolutions in these

The letter states a purpose of requesting
the conduct of a "valid public hearing" on
the appropriation contained in the
ordinance.  The City Charter does not
require a public hearing on first or second
reading of ordinances.  A public hearing is
a more formal legal process and the City's
Charter requires only the opportunity for
"public comment" prior to taking final
action on an ordinance.   City Council's
written agenda routinely indicates that
public comments will be heard for items on
the consent and regular agenda.

As you know, if there is a desire to
reconsider this ordinance, City Council's
Rules of Procedure require that a motion
to reconsider be allowed if the motion is
made at the next regular meeting of the
Council by a person who initially voted
with the prevailing side.  

Please feel free to give me a call if you
have any questions about this information.

Thank you,

electronic message transmission, and any
attachment, contains information from the
Office of the City Attorney at the City of
Loveland, which may be confidential or
privileged information.  The information is
intended for the use of the individual or
entity named above.  If you are not the
intended recipient, any disclosure,
copying, distribution or use of the
contents of this message is prohibited.  If
you have received this communication in
error, please notify us by reply email and
delete or discard the message.  Thank you
See video clips of the January 6, council
debate in Sprouts' deal

Multiple councilors back and forth
Councilman John Fogle comments
Councilman Troy Krenning comments
Loveland Mayor Cecil Gutierrez
May 12, 2015 links added

Response to lawsuit

Developer asks to join lawsuit

Motion for injunction