Loveland council to decide Friday on probing members’ alleged meeting violations

LOVELAND — Members of the sharply divided Loveland City Council decided at a special meeting Tuesday to reconvene Friday to determine whether to appoint an outside prosecutor who might charge four members of the council and three former members with violating state and local open-meetings laws.

The decision came after members heard a special counsel say there was enough evidence to support criminal prosecution of the seven.

The extraordinary Friday meeting was agreed to because time was of the essence in two ways:

First, the council and acting city attorney Vince Junglas pleaded for time to digest the report written and presented by attorney Christopher Gregory, which wasn’t available until 5 p.m. Tuesday, an hour before the special meeting. Gregory is the former chairman of the Colorado Council on Judicial Conduct; the council’s majority voted to hire him March 19 and pay up to $10,000 to investigate whether the allegations had enough merit for the city to pursue misdemeanor criminal charges. Junglas noted that “we are in uncharted territory” because the potential charges are “unprecedented in the city’s history.”

Second, the charges would have to be filed by April 19 and April 27, or else the one-year statute of limitations for misdemeanors would expire. The March 19 motion to hire Gregory, made by Councilmember Troy Krenning, had asked the attorney to submit his report by the council’s next regular meeting on April 2, but Mayor Jacki Marsh and councilmembers Krenning, Erin Black and Laura Light-Kovacs requested Tuesday’s special session to hasten the process.

The allegations stem from letters council members Dana Foley, Patrick McFall, Steve Olson and Andrea Samson and former council members Richard Ball, John Fogle and Don Overcash signed on Loveland City Council letterhead and sent to Gov. Jared Polis and state lawmakers. The letter to Polis was sent April 19 and signed by all but Samson. All seven signed the letter to members of the General Assembly that was sent April 27.

The letters expressed their opposition to Senate Bill 23-273, which would have prohibited the designation of undeveloped land as blighted so it could be eligible for urban-renewal consideration — the strategy McWhinney Real Estate Services Inc. was pursuing to gain approval for its proposed $1 billion development on farmland on Loveland’s eastern edge.

The urban-renewal plan and master finance agreement would use 25 years of tax revenues that the development would generate to pay for Centerra South’s infrastructure, including streets and utility lines. The letters to Polis and lawmakers contended that the legislation would derail McWhinney’s project. 

SB 23-273 passed the Senate and House last spring but Polis vetoed it.

Summarizing his report for council members, Gregory said the coordinated letters constituted a “pretty clear set of violations” and that there “really are some legitimate open-meetings issues that need to be looked into” in state law as well as the Loveland city charter. The Loveland municipal code states that “willfully or knowingly” violating the charter provisions about open public meetings could result in a fine between $25 and $300, up to 90 days in jail or both.

Gregory said the series of one-on-one meetings, sometimes called serial meetings, to sign the letters written by Olson constituted a non-public meeting.

“No notice of these letters being circulated and drafted was given to the other two council members at the time,” Gregory said, referring to Marsh and Jon Mallo.

He said a March 10, 2023, email from then Loveland City Attorney Moses Garcia had warned the council members not to engage in serial meetings. In that email, Gregory said, Garcia referred to a Douglas County case in which a citizen filed open-meetings violation claims over school members’ conversations about firing the district superintendent. 

“This was recognized by the Douglas District Court as being extremely problematic,” Gregory said. The judge there, he said, found case law that said a series of individual meetings between members to create “kind of a serial or daisy-chain arrangement … can’t be an end run around the open-meetings law.”

Gregory said “the critical evidence I found as I was doing my investigation was that every city council member here receives a training when they become a city council member. And through that training, the city attorney’s office, which was Moses Garcia, would provide a packet through the city clerk’s office that included a copy of the charter. There were presentations given by all the different departments within the city including from the city attorney’s office on the particular issue of what happens with the open-meetings law. In that presentation, Mr. Garcia explained that ‘meetings’ are kind of a functional concept. It can be emails, it can be telephone conversations. It’s just really communications and sort of what’s being discussed.”

Answering Marsh’s question about whether there was probable cause for prosecution, Gregory said “I think the letters themselves are enough, based on what that Douglas County decision found.” The letters, he said, “read as if they were official resolutions of this council. That, within the world of open-meetings law, appears to clearly violate what’s intended. … Public policy is not supposed to be developed behind closed doors. The fact that that letter says collectively this is our position appears to go contrary to that part of open-meetings law.”

If council members were convicted of the misdemeanors, Gregory said, “the consequences could not be more grave,” adding that they couldn’t run for election to the city council in the future, and that sitting members would no longer be eligible to serve on the council.

Gregory called for “an independent process, with protections against conflicts of interest,” including seeking an outside law enforcement agency and “appointment of a conflict-free prosecutor” and an “outside municipal court judge” to hear the case, pointing out that the city has brought in judges from Greeley and elsewhere in the past.

“Like stored fish, I don’t know if this one’s going to get better over time,” Gregory said. “I think it’s sooner to get the answers, whether they’re bad or good, as to what this city council needs to do in order to move forward.”

The previous City Council approved the Centerra South plans in votes April 18 and May 2, just before Polis vetoed the bill. Gregory said he attached a copy of Polis’ veto letter to his report, in which the governor explained “that part of his logic and thinking is what happened in that May 2 meeting.”

On Nov. 21, two weeks after voters elected council members who looked less favorably on Centerra South, the new council voted to rescind the approval. McWhinney promptly filed suit in Larimer County District Court, alleging breach of contract. After each side filed responses in court, the council in the wee hours of Feb. 21 reversed its decision to rescind the agreements, and the two sides reached a settlement approved by the council on March 19 that would allow the development to continue.

Loveland resident Bill Jensen, who ran for a seat on the council in 2019, then filed a complaint in Eighth Judicial District Court, alleging that the seven had violated open-meetings laws and that the previous council’s votes last spring to approve the Centerra South agreements were thus invalid. Jensen’s allegations prompted Krenning last week to call for appointment of Gregory as special counsel to investigate whether criminal behavior had occurred.

Last Friday, District Court Judge C. Michelle Brinegar threw out Jensen’s complaint — but not based on its merits. She instead dismissed it based on laws that prohibit relitigation of claims that already had been decided. Jensen had filed a complaint in June echoing Marsh’s contention that the council didn’t provide sufficient notice for the May 2 hearing and vote on Centerra South, and asked the court to determine whether Colorado’s urban-renewal laws had been violated. District Judge Laurie Dean dismissed that complaint in September, but also not on its merits; she ruled Jensen filed it after a statutory deadline.

“We have average people, average business owners every day being subjected to the city code, being subjected to prosecution and being subjected to code violations,” Krenning said. “What’s good for them is probably good for us.”

However,council members who could face the criminal charges lashed out at Gregory and their council colleagues who hired him. Samson told him she wouldn’t discuss “the things you’ve been gladhanded $10,000 to tell us that may or may not be true,” but said it was unfair that he hadn’t talked to her or other members of the council minority.

Foley said the “horrible, horrible report” Gregory described didn’t represent the letters’ “true context” and that the “citizens of Loveland just wasted ten grand on this crap.”

Olson asked Junglas whether the city would offer legal protection for the council members being investigated. The acting city attorney replied that the city would have no such obligation, although the council could move to provide legal defense, and added that the Colorado Intergovernmental Risk Sharing Agency does have a policy that could reimburse council members up to $10,000 if they were exonerated. Olson then said he looks forward to a day in court, and that “if I have to spend money out of my own pocket, I’m going to seek restitution from those responsible.”

Foley charged that Gregory had met Krenning, Mallo and Marsh “all in the same room without a public meeting” last week. When Gregory denied such a meeting had taken place, Foley replied, “Wow, I’ll just tell you that was a bold-faced lie, or Councilor Krenning is lying according to his email that he put out saying that all three of you were in the same room at the same time.”

Marsh said the discussions were separate, and after a brief recess, Krenning read aloud his email, which was sent to Junglas and council members last Thursday. In that email, he wrote, “For the benefit of council, the mayor and I met with special counsel Chris Gregory at City Hall this morning when he was introduced to various members of the staff by the mayor. Jon Mallo arrived for another meeting. I introduced Mr. Gregory to Jon and then I left the building for another appointment. At no time did the mayor, myself or Jon interact with one another other than to say hello and good morning in passing.”