Lakes at Centerra Metro District Nos. 1-3

Join us for the Lakes at Centerra Metropolitan District Annual Community Meeting on Monday, September 15, 2025, at 6:30 PM (4255 Buffalo Mountain Dr, Loveland, or via MS Teams/phone).

This year’s meeting will include a Q&A session about the upcoming Consolidation Election on November 4, 2025. We encourage all residents to attend, learn more, and ask questions about what consolidation could mean for your community.

The Lakes at Centerra Metropolitan District

Consolidation Election Q&A

Prepared on August 6, 2025

This Q&A is intended to provide general information regarding the “Consolidation Election,” at which voters will decide whether to consolidate The Lakes at Centerra Metropolitan District Nos. 1, 2, and 3 (referred to collectively in this document as the “Districts”) into a single metropolitan district (the “Consolidated District”). This Q&A is provided for informational purposes only.

1.      When is the Consolidation Election? Who will receive a ballot? What will be on the ballot?

The Consolidation Election will be held on November 4, 2025. Eligible electors within each of the Districts will receive ballots.

The ballot will have two items to vote on, as follows:

BALLOT QUESTION 5A: CONSOLIDATION

Shall The Lakes at Centerra Metropolitan District No. 1, The Lakes at Centerra Metropolitan District No. 2, and The Lakes at Centerra Metropolitan District No. 3 be consolidated as The Lakes at Centerra Consolidated Metropolitan District in accordance with Sections 32-1-601, Colorado Revised Statutes, et seq. and the Initiating Resolution and Concurring Resolutions approving the consolidation, copies of which are available for public inspection at the Districts’ Manager office and on file with the Larimer County District Court?

BALLOT ISSUE 5A: OPERATIONS AND MAINTENANCE MILL LEVY

SHALL THE LAKES AT CENTERRA CONSOLIDATED METROPOLITAN DISTRICT TAXES BE INCREASED $1,500,000 ANNUALLY OR SUCH LESSER AMOUNT AS NECESSARY TO PAY THE DISTRICT’S ADMINISTRATION, OPERATIONS, MAINTENANCE, AND OTHER EXPENSES, SUCH TAXES TO CONSIST OF AN AD VALOREM MILL LEVY IMPOSED ON ALL TAXABLE PROPERTY OF THE DISTRICT WITHOUT LIMITATION OF RATE OR WITH SUCH LIMITATIONS AS MAY BE DETERMINED BY THE DISTRICT’S BOARD OF DIRECTORS, AND IN AMOUNTS SUFFICIENT TO PRODUCE THE ANNUAL INCREASE SET FORTH ABOVE OR SUCH LESSER AMOUNT AS MAY BE NECESSARY TO BE USED FOR THE PURPOSE OF PAYING THE DISTRICT’S ADMINISTRATION, OPERATIONS, MAINTENANCE, AND OTHER EXPENSES. AND SHALL THE PROCEEDS OF SUCH TAXES AND ANY INVESTMENT INCOME THEREON BE COLLECTED, RETAINED, AND SPENT BY THE DISTRICT AS A VOTER-APPROVED REVENUE CHANGE IN 2025 AND IN EACH YEAR THEREAFTER, WITHOUT REGARD TO ANY SPENDING, REVENUE-RAISING, OR OTHER LIMITATION CONTAINED WITHIN ARTICLE X, SECTION 20 OF THE COLORADO CONSTITUTION, SECTIONS 29-1-301 OR 29-1-1702, COLORADO REVISED STATUTES IN ANY YEAR, OR ANY OTHER LAW WHICH PURPORTS TO LIMIT THE DISTRICT’S REVENUES OR EXPENDITURES AS IT CURRENTLY EXISTS OR AS IT MAY BE AMENDED IN THE FUTURE, ALL WITHOUT LIMITING IN ANY YEAR THE AMOUNT OF OTHER REVENUES THAT MAY BE COLLECTED, RETAINED, AND SPENT BY THE DISTRICT?

2.      What will be the boundaries of the Consolidated District?

The boundaries of the Consolidated District will include all property currently within District Nos. 1, 2, and 3. Please see the attached map.

3.      Why are voters being asked to approve a new tax for operations and maintenance at the Consolidation Election (Ballot Issue 5A in Question #1 above)?

The Consolidated District will require revenue to provide for ongoing operations and maintenance (O&M) of public improvements.

Currently, District Nos. 2 and 3 have combined O&M taxing authority of up to $2,000,000 annually. This authority does not transfer to the Consolidated District. Instead, the Consolidated District must obtain new authority to levy taxes. The maximum annual O&M tax that may be levied by the Consolidated District under the ballot issue is $1,500,000. The current combined O&M tax authority of District Nos. 2 and 3 is $2,000,000.

Without voter approval, the Consolidated District will not have the authority to levy taxes to support ongoing operations and maintenance. See Question #9 below for more.

4.      How will consolidation affect the services or facilities the Districts currently provide?

The agreed intent of the Districts is for the Consolidated District to continue existing services without material change. Any future changes to services would be determined by the Consolidated District’s board of directors.

However, if voters approve consolidation but do not approve the O&M tax increase question (Ballot Issue 5A in Question #1 above), the Consolidated District will exist but will not have the ability to levy taxes to fund ongoing operations and maintenance. See Question #9 below for more.

The Consolidated District will retain the same powers, responsibilities, and limitations as those currently held by the individual Districts and will continue to operate pursuant to the Districts’ existing Consolidated Service Plan.

5.      What will happen to public improvements and property currently owned by District No. 1?

Upon consolidation, all assets and property of the individual Districts, including those owned by District No. 1, will become the property of the Consolidated District by operation of law. Likewise, any contractual obligations of the individual Districts will transfer to and become obligations of the Consolidated District.

6.      What will happen to the debt that is currently being paid by debt service mill levies in District No. 2 and District No. 3 (the “Bonds”)?

The obligation to repay the Bonds will remain with the taxpayers in District Nos. 2 and 3. There will be no change to this obligation as a result of consolidation. After consolidation, the debt service mill levies will continue to be imposed based on the pre-consolidation boundaries of District No. 2 and District No. 3. This means that the properties currently paying the debt service on the Bonds through their debt service mill levies will continue to do so on the same basis and terms as currently govern repayment.

7.      Will voters elect board members at the Consolidation Election? Who will serve on the Board of the Consolidated District?

No board members will be elected at the Consolidation Election. Under state law, once consolidation is approved, the members of the existing boards of directors of the three Districts will automatically form the “organizational” board of directors of the Consolidated District.

At the first meeting of this organizational board, its members will select five of themselves to serve as the initial five-member board of the Consolidated District. Thereafter, Consolidated District board members will be elected by voters at regular special district elections.

8.      What happens if the voters do not approve consolidation?

If the consolidation is not approved, the three Districts will continue to exist separately, with each governed by its own board of directors, and no immediate change to current boundaries, governance, or operations. Any future changes to operations would be determined by each District’s board of directors.

9.      What happens if voters approve consolidation but do not approve the O&M tax increase question (Ballot Issue 5A in Question #1 above)?

The Consolidated District will not have the authority to collect taxes to fund ongoing operations and maintenance (O&M) expenses. To generate revenue, the Consolidated District may need to raise revenue through user fees for district services, programs, or facilities. Any such fees would be billed to residents through special billings, which could incur additional administrative expenses that would be passed on to residents.

Without tax revenue to support O&M, the Consolidated District’s ability to provide the same level of services may be limited.