(November 7, 2006)

Ballot Question 21 asking to build a pipeline from the Town of Palmer Lake’s D-3 well is presented to the voters:

TOWN OF PALMER LAKE
QUESTION 21
DESIGNATED ELECTED OFFICIAL

DELLA GRAY
42 VALLEY CRESCENT
PALMER LAKE, COLORADO 80133
719-481-2953

NOTICE OF ELECTION TO INCREASE TAXES
TOWN OF PALMER LAKE
EL PASO COUNTY, STATE OF COLORADO

Election Date: Tuesday, November 7, 2006
Election Hours: 7:00 a.m. to 7:00 p.m.
Ballot Title and Text: QUESTION NO. 21

LAKE REVITALIZATION WATER CAPITAL IMPROVEMENTS BOND/LOAN

SHALL THE TOWN OF PALMER LAKE DEBT BE INCREASED $450,000 WITH A REPAYMENT COST OF NOT TO EXCEED $611,496 (SUCH AMOUNT BEING THE TOTAL PRINCIPAL AND INTEREST THAT COULD BE PAYABLE OVER THE MAXIMUM LIFE OF SAID DEBT); AND SHALL TOWN OF PALMER LAKE TAXES BE INCREASED $61,149,60 ANNUALLY, OR BY SUCH LOWER ANNUAL AMOUNT AS MAY BE NECESSARY TO PROVIDE FOR THE PAYMENT OF SUCH TOWN DEBT: SUCH DEBT TO CONSIST OF GENERAL OBLIGATION BONDS OR OTHER MULTIPLE FISCAL YEAR FINANCIAL OBLIGATIONS, ISSUED OR INCURRED FOR THE PURPOSE OF PAYING THE COSTS OF: (1) OUTFITTING THE D-3 WELL, (2) EXTENDING A LINE FOR LAKE REVITALIZATION AND TO EXTEND A LINE TO SOUTH MONUMENT CREEK FOR AUGMENTATION PURPOSES AND (3) OTHER LAKE REVITALIZATION IMPROVEMENTS AS NECESSARY; SUCH OBLIGATIONS TO BE ISSUED AT A MAXIMUM NET EFFECTIVE INTEREST RATE OF 6.25% PER ANNUM, WHICH INTEREST MAY BE PAYABLE AT SUCH TIME OR TIMES AS MAY BE DETERMINED BY THE TOWN; SUCH OLBIGATIONS TO MATURE OR BE PAYABLE IN NOT MORE THAN 10 YEARS AFTER ISSUANCE; SUCH TAXES TO CONSIST OF AN AD VALOREM MILL LEVY IMPOSED WITHOUT LIMITATION OF RATE AND IN AMOUNTS SUFFICIENT TO PRODUCE THE ANNUAL INCREASE SET FORTH ABOVE OR SUCH LESSER AMOUNT AS MAY BE NECESSARY, OR TO BE IMPOSED WITH SUCH LIMITATIONS AS MAY BE DETERMINED BY THE TOWN, TO BE USED SOLELY FOR THE PURPOSE OF PAYING THE PRINCIPAL OF, PREMIUM, IF ANY, AND INTEREST ON THE TOWN’S OBLIGATIONS; AND SHALL THE PROCEEDS OF SUCH OBLIGATIONS AND THE PROCEEDS OF SUCH TAXES, AND INVESTMENT INCOME THEREON, CONSTITUTE VOTER-APPROVED REVENUE CHANGES AND BE COLLECTED AND SPENT BY THE DISTRICT WITHOUT REGARD TO ANY EXPENDITURE, REVENUE-RAISING, OR OTHER LIMITATION CONTAINED WITHIN ARTICLE X, SECTION 20 OF THE COLORADO CONSITUTION OR ANY OTHER STATUTORY OR CONSTITUTIONAL EXPENDITURE OR REVENUE-RAISING LIMITATION?

FISCAL YEAR SPENDING INFORMATION
2006 (ESTIMATED) $648,885
2005 (ACTUAL) $621,525
2004 (ACTUAL) $603,564
2003(ACTUAL) $585,744
2002 (ACTUAL) $571,065
2001 (ACTUAL) $559,849

Overall percentage change in fiscal year spending: 9.5%
Overall dollar amount of change: $61,150

Estimated maximum dollar amount of tax increase for 2007: $61,150
Estimated 2007 fiscal year spending without tax increase: $645,885

Information of Current Bonded Debt:
Principal amount: $1,030,000
Maximum annual repayment cost: $159,577
Total repayment cost: $1,433,260

Information on Proposed Bonded/Loan Debt:
Principal amount: $450,000
Maximum annual repayment cost: $61,150
Total repayment cost: $611,496

Summary of written comments for the proposal:

This ballot issue is important milestone for the Town of Palmer Lake. The state of the lake has been deteriorating for several years now. The efforts of concerned citizens have brought a renewed sense of dedication to revitalizing the lake for the enjoyment of all. This ballot issue provides a means to accomplish a permanent solution to that revitalization.

The solution of utilizing water resources at the Town’s disposal is straightforward. The Town owns a well that was dug with taxpayer’s money. It has never been used for the production of drinking water, but it could serve the purpose of a source of water for the lake during periods of drought. It could also serve as an alternative source for the Town’s requirement under current water laws to augment, meaning producing water that is sent “downstream” for users with more senior water rights.

This represents a cost savings to the Town of Palmer Lake. The revitalization also represents the potential for increased revenue for the Town through the attraction of businesses and the visitors who support those businesses. These factors can ensure the continued fiscal viability of the Town.

With the expiration of the 1988 Bond in December 2006, and with the passing of this ballot issue, the taxpayers will see no increase in their taxes. In fact there will be a slight decrease in their overall tax bill. The proposed issue is a loan and not a bond. As such, it can be repaid earlier than the terms of the loan with no repayment penalty. This can serve to reduce the overall impact on the taxpayers.

The burden on the taxpayer is not without some cost, but it is relative to the viability of the lake. The citizens must decide what the lake means to this town. It can either mean no new taxes. Or it can mean the restoration of its namesake, the restoration of the beauty and attractiveness of the center of the town, and the potential for attracting income that it does not currently have.

If you feel a sense of pride in the Town of Palmer Lake, please support this ballot initiative.

Summary of written comments against the proposal:
NO DOCUMENTS WERE FILED BY THE CONSTITUTIONAL DEADLINE.

· Ballot Question 21 is rejected by the voters of Palmer Lake.