Small town, big projects

Tim Sarmo, Palisade town administrator, walks through the remodeled gym in the old Palisade High School building, which was the first phase of turning the school into a civic center. The town has a blueprint for remaining renovation, but no way to pay for it.



Palisade — 17.5 mills

Mesa County — 11.335 mills

Fruita — 10.146 mills

De Beque — 9.018 mills

Grand Junction — 8 mills

Collbran — 7.385 mills


What: Dedication of the Palisade Civic Center gymnasium

When: 5:30 p.m. June 29

Where: 711 Iowa Ave. Food and entertainment will be provided.

The town spent a little more than $1 million to refurbish the gymnasium of the old high school, envisioning it being used for recreation, concerts and meetings.

The original wood floor in the old Palisade High School gymnasium, an addition erected by the Works Progress Administration in the 1930s, has been restored and refinished to a brilliant gleam.

The freshly hung nylon nets in each of the six basketball hoops are crinkled at the bottom, waiting for a kid to sink the first jumper beneath the new energy-efficient windows and lights.

“I think what I like about it is it’s new, but it preserves the character of the old gym,” Palisade Town Administrator Tim Sarmo said last week while walking through the refurbished 7,000-square-foot space, the first phase of the conversion of the old school into what will be known as the Palisade Civic Center.

When town officials dedicate the $1.05 million project June 29, they’ll effectively knock over the first — and easiest — domino in a bevy of capital projects the town is looking to complete in the coming years to either replace cramped facilities or meet federal mandates. Altogether, the establishment of the civic center, construction of a new fire station and creation of a new sewer treatment system could cost nearly $20 million, a hefty amount for a town of fewer than 3,000 people that budgets about $1 million a year for capital construction.

But with an already high property tax mill levy, a small sales tax base and the significant revision downward of assessed valuation in the Palisade Rural Fire Protection District — grant funds drying up — town leaders find themselves challenged to unearth funding sources.

“We’ve got to put the appropriate tax burden on people to accomplish what’s necessary, and we’re doing it in a climate of recession,” Sarmo said.

Some residents, though, say they’re being asked to shoulder too much.

Wayne Reid, who unsuccessfully ran for the Town Board this spring and has been one of the town’s most vocal critics in how it spends its money, said the town needs a new fire station and sewer system. But he said the town’s plan to double sewer rates, four years after water rates were nearly doubled to pay for a new treatment plant, will put a financial strain on a lot of people. And he questions the wisdom of investing in the gym and other things, such as new street signs, when town roads are in need of repair.

“It just seems like they’re wasting money on projects that are immediately pleasing for the eye but aren’t really beneficial to the town,” Reid said.

Civic center

The town acquired the old high school at 711 Iowa Ave. and the three acres surrounding it two years ago when School District 51 concluded it no longer had any use for the school, which was built in 1924.

Palisade was able to remodel the gym largely because of a $750,000 state energy-impact grant that covered nearly three-quarters of the construction cost. The town chipped in the $300,000 balance. Two other state grants covered $400,000 of the $700,000 price tag for the design of the renovation of the school and making energy -efficiency upgrades.

But Palisade and other communities across Colorado likely have seen the last of significant infusions of cash from the state, thanks to a drop-off in energy production, which decreases severance tax revenue, some of which goes to cities and counties, and the recession, which prompted lawmakers to divert other energy-impact dollars to the state’s budget.

Town officials plan to give the rest of the 42,000-square-foot school a face-lift and relocate there town administration, the Police Department and Town Board chambers. The town has had discussions with the Mesa County Public Library District about allocating a 5,000-square-foot space for the Palisade branch, which operates out of a trailer next to the school. The Public Works Department would remain at Town Hall, 175 E. Third St., which was built in 1967.

Although a blueprint has been completed for the civic center, identifying a way to pay for it remains elusive.

Sarmo said the town won’t pursue a property-tax increase because its 17.5-mill levy is far higher than any local government. Asking voters to bump up the town’s 2 percent sales tax isn’t viable, either, because although Palisade businesses have largely buffered themselves against the economic downturn, the tax generates only about $200,000 a year in receipts for the town.

Sarmo estimates full renovation of the civic center could take eight to 10 years.

Fire station

Fire Chief Richard Rupp believes it’s time for a new fire station when the 1950s-era one built next to Town Hall doesn’t have enough space for either people or equipment.

The station has two small rooms that serve as sleeping quarters. But with a department that consists of two full-time employees and 28 volunteers, that means summoning help from people’s homes and workplaces rather than the fire station, which leads to longer response times. The station’s volunteers are remodeling the living quarters of the station, expanding the bathroom and adding bunk beds. But officials say that measure merely constitutes a Band-Aid.

The station also doesn’t have the room to store all of the Fire Department’s vehicles. The department’s brush truck and water tender sit outside year-round, where the winter would freeze the vehicles’ water if officials didn’t drain them and summer’s sun and heat can take their own toll.

“It’s hard on the paint. It’s hard on the hose. We try to keep everything covered outside and parked in the shade as much as possible,” Rupp said.

Not long ago, town officials thought they were heading toward breaking ground on a new fire station adjacent to the civic center. Thanks to technology, one boundary line adjustment scuttled those plans.

After paying taxes on a transmission line to the Palisade Rural Fire Protection District for years, Xcel Energy determined late last year through Global Positioning System coordinates that the line that connects to the Cameo Station power plant wasn’t within the fire district’s boundaries, Xcel spokesman Mark Stutz said.

The removal of the line, which was by far the largest source of tax revenue for the fire district, scooped a massive chunk of revenue out of the district’s tax base. Its assessed valuations dropped 42 percent, from $36.8 million to $21.2 million, fire district treasurer Maggie Somerville said.

The fire district, which contracts with the Fire Department to provide fire and emergency medical services, was expected to pay for half of the $3.8 million fire station.

Somerville said the district’s 3.24 mill levy ranks far below the average Colorado fire district mill levy of 7.7.

“We have gotten by on the cheap for a long time in the Palisade Rural Fire District, and now we have to come up with money for our share of the fire station,” she said.

The fire district’s board of directors is expected to ask district residents to approve a property tax increase in November, although an exact amount hasn’t been determined.

Sarmo said the town applied for but didn’t receive a $2.8 million Department of Homeland Security grant for the fire station. That, combined with the fire district’s mill levy setback, will likely result in the station being built in phases, he said.

Sewer system

Unlike the civic center and fire station projects, the town has no choice when it comes to replacing its sewer treatment plant.

Sarmo said Palisade’s lagoons can’t remove enough ammonia from wastewater before it’s discharged back into the Colorado River to comply with new, heightened federal standards. Those regulations have to be met by 2013.

The town plans to spend an estimated $7.5 million to build a lift station and construct a three-mile pipeline to hook into Clifton Sanitation District’s new treatment plant. The town could have built its own plant for the same money, but officials believe that option would have cost more long-term in maintenance.

Palisade has applied to the U.S. Department of Agriculture for a grant and loan to fund the project. Sarmo is hoping a grant will cover nearly half the cost.

Even if it does, Palisade sewer customers should brace for a spike in their bills. Sarmo said he anticipates a single-family residential bill will jump from $21.85 a month to $40 to $50 a month to generate the revenue needed to account for the town’s share of the bill.

“The people in town are hurting just as bad as the town is, and you can’t pile on more taxes, you can’t pile on more rate fees for basic services,” Reid told town trustees during a recent meeting. “You need to back off on some projects.”

Sarmo, though, noted several other Western Slope municipalities including Fruita, Glenwood Springs and Rifle have instituted similar rate increases to pay for sewer projects mandated by the federal government.

Sarmo said he doesn’t relish the idea of boosting sewer bills. But he said the town has little choice. And more than once in recent public meetings, he’s given residents a heads-up that they should expect to pay more.

“The bottom line is the sewer bill in Palisade is going to go up. It’s not going to go down. It’s going to be expensive,” he said.


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