Castle Pines North Metropolitan District
Our Role in the CPN Community
The primary function of the Castle Pines North Metropolitan District outlined in 1984 when the District was established, was to provide the residents of Castle Pines North with water, wastewater, and storm water services, and to maintain District owned parks, trails and open space.
Of equal importance, CPNMD has a fiduciary duty to maintain a solid financial foundation. The past two years have witnessed an economic downturn reminiscent of the mid-1980’s. CPNMD is fiscally stable and instead of facing insolvency, as many long-time residents remember, CPNMD is prepaying its historical debt and at the same time, acquiring assets to meet a critical issue facing the community-the future supply of water.
From Bankruptcy to AA Status
To fund the initial community infrastructure improvements, CPNMD issued General Obligation bonds in 1986. As a result of a severely depressed real estate market in the mid to late 1980’s, the District was unable to generate sufficient tax revenue to stay current on the bonds. In 1993, the District, its residents and the bondholders reached an agreement to reorganize the bond debt and this agreement was approved by the U.S. Bankruptcy Court in 1994.
In 1994, the District was responsible for the payment of nearly $60 million in bonds. Today, that level of historical debt is $20.59 million. This aggressive prepayment of historical debt has enabled CPNMD to be rated AA on their 2006 A & B General Obligation Bonds. This is one of the highest ratings awarded by Standard and Poor’s.
Standard and Poor’s views CPNMD as having a stable financial outlook reflected by the District’s “track record of strong financial performance, characterized by high reserves and internally generated funds to support ongoing capital needs.”
Proactive on Securing Renewable Water
Over the past decade, the harsh reality has set in that the aquifers that we have been getting our water from are becoming depleted at an alarming rate. For communities to meet future water demands they must look to renewable water sources.
In 2005, CPNMD implemented a Capital Improvement Fee to help fund the purchase of renewable water and the related infrastructure needed to deliver water to Castle Pines North residents. CPNMD also commissioned a study to evaluate CPN’s current and future water demands and the ability of CPNMD’s current infrastructure to meet those demands. The study determined that by the year 2022, CPNMD would not be able to meet its peak water demand supplies.
By taking a proactive stance, over the last five years CPNMD has purchased valuable water rights and storage space in reservoirs to draw from during high demand periods. While expensive to purchase, over time the cost of obtaining assets such as these will skyrocket. CPNMD has also entered into agreements with other water providers to share the cost of major projects to lessen the financial obligation of the community.
Financial Security to Acquire Renewable Water Assets
A Standard and Poor’s AA rating places CPNMD in a position to not only be eligible for lower interest rates on future loans, but also be a highly qualified applicant for funds available for borrowing from highly regarded financial institutions. As more of the District’s historical debt is eliminated, the more the District’s position for future borrowing capacity will be strengthened. CPNMD is in a strong position to obtain funding for the acquisition of future renewable water solutions as they become available for purchase.
CPNMD Has Reached an Important Milestone
Five years ago, CPNMD’s outlook on renewable water was from a position of being in dire straits. Through hard work, vision and cooperative efforts of water providers, CPNMD has secured the baseline requirements to satisfy CPN’s basic future water demands. Additional renewable water options are still being pursued in order to continue to provide CPN with affordable water.
CPNMD is committed to providing the utmost in services to the CPN community and maintain a solid financial foundation. CPNMD has advanced the renewable efforts for our community ensuring the long-term availability of water for CPN. In doing so, CPNMD enhances the quality of lifestyle to make it one of Colorado’s most desired communities to live in.