It’s the gateway to the Flatirons, Boulder’s crown jewel. Six-hundred thousand people a year visit Colorado’s Chautauqua, situated off of Baseline Road in central Boulder, to access the area’s iconic open space, enjoy a summer concert in the auditorium, relax on the vast lawn, or eat in the dining hall. Some come to stay, renting a cottage for a few nights in the summer or months at a time over the winter. Some visitors are new, experiencing the breathtaking views and respite Chautauqua offers for the first time. Others have been coming their whole lives, inheriting cottages passed down through the generations since the Chautauqua was established in 1898.
But it takes a lot to maintain the National Historic Landmark amid rising costs for just about everything. The lawn and grounds need upkeep. The auditorium, dining hall and academic hall must be kept in good repair. Cottages need to be modestly updated, maybe even improved. Some need air-conditioning, as summer temperatures continue to rise across the region, spurred by climate change. The entire electrical system is somewhat outdated and there’s talk of undergrounding power lines. There are other deferred maintenance costs as well, including those to make the site more resilient to fires and floods, a new stormwater drainage system and road repairs.
The City of Boulder, which owns the property, shares some of the burden for these costs. But there is also the expectation that the Colorado Chautauqua Association (CCA), a nonprofit responsible for the preservation and continuation of the historic site, must contribute to the effort, as it leases the main 26 acres housing all the buildings for just $1 per year from the City of Boulder. It’s a public-private partnership that has seen its fair share of controversy over the decades as it seeks to balance the interests of a diverse group of users from the cottage owners, to concert goers, to hikers and vacation renters, all with the mission of being open and accessible.
This unique balancing act between disparate interest groups is all coming to a head once again as the City of Boulder threatened CCA with being in breach of its lease in late November 2019. And some cottage owners responded to that threat with a lawsuit filed in early February. It all comes down to concerns about the governance of CCA, specifically the makeup of the board of directors tasked with managing the nonprofit and essentially the entire site.
People on all sides are concerned about special interest groups gaining control of the board of directors and preventing CCA from fulfilling its stated mission. The City, along with a good portion of current and former members of CCA leadership, are concerned that the board is being taken over by cottage owners, people whose families have lived in the neighborhood for decades. For their part, the cottage owners and their supporters are afraid the CCA and the City are trying to take away their historic representation on the board that has helped preserve Chautauqua for generations. There are claims of deception and spreading misleading information on all sides.
Amid all the he said/she said back and forth, it’s clear CCA needs more money to address a long list of current and deferred maintenance costs at Chautauqua. If CCA, the cottagers and the City can’t figure this out, the future of the Colorado Chautauqua as we know it could be at stake.
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On Nov. 25, 2019, City Attorney Tom Carr — with support of City Council — sent a letter to CCA charging that certain board members, particularly those who own cottages at Chautauqua, have not acted in the interest of the public or CCA in recent years, but rather have “advocated for special financial benefits for themselves and their families.” Additionally, the Carr letter states, the governance structure of the CCA board is problematic in that it allows for this conflict of interest to persist, most notably in the form of lower than normal sublease rates for the 38 privately held cottages at Chautauqua. The letter does not impose a strict timeline or define how CCA needs to remedy the situation, but it does state that if CCA doesn’t take some action, it could be in possible breach of its lease with the City.
CCA’s board of directors responded by proposing to update the organization’s bylaws to address some of the governance issues Carr raised. Over a period of a few weeks, the board drafted new bylaws and announced a membership vote on the changes. Ballots went out electronically at the end of January, and voting concludes on Feb. 24. The entire process has drawn pushback from CCA members and cottage owners who argue they were left out of the process. What’s more, they say the proposed changes will further disenfranchise them.
“We never wanted to do this before because we knew it was going to cause the reaction it’s causing right now. We were just going to try and change little policies along the way,” says Shelly Benford, executive director of CCA. “Then Tom Carr said you’re potentially in breach of the lease.”
Carr says the last CCA board election in 2019, where there was a huge spike in voting membership purchases, was the impetus behind his letter. Under the current bylaws, the majority of the 15-member CCA board is voted in by membership to serve three-year terms. Becoming a voting member to CCA is as simple as paying the $25 annual fee that gives members discounts and early access to concert tickets, which, according to Benford, is why most of CCAs approximately 1,900 members exist.
According to CCA data, membership purchases usually spike around the time the concert calendar is announced, but they also tend to spike around July, right before the board election. Allegations of “vote buying” are rampant, as cottage owners are accused of purchasing memberships for friends and family members in order to sway elections and get their endorsed candidates on the board, which critics claim allows them to advocate for low rental rates that benefit their friends and families.
Benford says there have been efforts to shore up the membership process over the years, making it more transparent as to who is actually getting a membership — a requirement for a separate email address, for instance.
Still the problem has persisted, becoming “flagrant” in 2019, she says. According to CCA, 230 memberships, with voting rights, were purchased in the two and a half days leading up to the 2019 board election. She admits there was some “defensive buying” by other CCA board members who don’t own cottages to gird up their side as well.
Currently as it stands in the bylaws, Benford says, the concept of “vote buying” is legal, although it’s discouraged. Changing the bylaws and making the board self-appointed essentially solves this problem, she says. Under the proposed bylaw changes, members will still get access to advanced ticket sales for events and concerts, but they will no longer have a vote when it comes to electing the board of directors or any other major changes in the government structure of CCA.
“If people are not handling memberships appropriately, there’s ways to tighten up on that — short of disenfranchising the people that own property up there,” says Stan Garnett, who is representing cottage owners in the lawsuit against CCA and the City.
The cottage owners feel the changes are meant to keep them out of the democratic process that is supposed to assure they have ample representation on the board. And they point out that their representation on the board has never led to cottage owners dominating the board. Since the start of the century, at least, cottage owners or their allies haven’t held a majority of board seats. At most, they held five seats from 2008-2013, says Tom Galey, who served on the board from 2000-03 and again from 09-14. And in the last several elections, several cottager-endorsed candidates have lost.
But it’s not just about cottage owners, Benford says. The current board election process allows for any special interest group to take over the board. For example, a decade ago, development interests proliferated the board and there was talk of tearing down the picnic shelter in favor of a new multi-use building and putting in an underground parking lot beneath the green. The City eventually stopped the plan.
“We have no idea who the next round of vote buyers could be,” Benford says, whether it’s cottagers, other board members, or other outside influences such as large corporations who may want to use Chautauqua for their own benefit. Benford says in the last few years the board, which gets to appoint two members a year under the current bylaws, have shown that they’re looking for board members who represent a wide array of community interests, including more diverse voices.
But a self-appointed board prevents “the larger Boulder community from having any kind of say about what’s going on up there,” according to Matt Moseley, a CCA member who lives near Chautauqua and who is doing communication work for the Committee for a Living Chautauqua, which represents the views of cottage owners and others opposed to the proposed bylaw changes.
And there are concerns that a self-appointed board would not work in the interest of property owners or even the general public.
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In the 1920s, Tom Galey’s grandmother purchased cottage no. 1, which he and his family owned until 2017 when they sold it to CCA. His family was there when people were only allowed to live at Chautauqua in the summer, as none of the buildings were winterized. And his family was there when that all changed in 1970. “We were the first generation to live there year-round,” says Galey.
These days, Galey lives in Gunbarrel and is a member of CCA but no longer serves on the board or owns property there. But he’s seen the issues surrounding CCA’s governance play out over the decades he’s been involved. There was controversy surrounding the renewal of the CCA’s 20-year lease with the City in the late 1990s and again in 2015.
When it comes to the cottage owners, the 2015 lease requires CCA to “increase rents substantially” with the additional revenue going to the major renovation projects. In turn, CCA signed a sublease with cottage owners that set the ground rates charged for allowing their cottages to be located on City-owned property. In his November 2019 letter, Carr contests CCA hasn’t raised these ground rates enough to fulfill the obligations of its $1 lease with the City.
In 2015, there was an additional fee tacked on to the ground rates, a $2,400 a year price tag in addition to yearly adjustments based on the consumer price index. Galey says there are also a number of other fees cottage owners pay each year for mail, trash service, programming, etc. By the end, he says his family was paying between $8,000 to 10,000 a year before they sold their cottage.
“It’s relative, but they’re not insignificant,” Galey says. “They are not a sweetheart deal.”
Benford confirms that on average, cottage owners pay $11,118 a year for taxes, ground lease and other fees. The City’s contention, however, is solely focused on the ground lease fees which equal approximately $4,239 a year, or $353 a month.
“What they pay to sublease the ground that the City owns is way below market. I mean, talk about a million-dollar home paying 400 bucks a month to lease while somebody in a mobile home that’s worth maybe $50,000 is paying twice as much,” Carr says. “We’re basically subsidizing their existence.”
What’s more, he contests, the cottage owners and their representatives on the board have always advocated for low rental rates for the 61 cottages that are a part of CCA’s rental program. At least two-thirds of CCA’s revenue comes from renting these cottages, short-term in the summer and long-term over the winter. CCA leadership, City Council members who have also been a part of CCA’s board and Carr say that cottage owner board members have advocated to keep these rates low so that their friends and family can come stay near them over the summer.
“Cottagers said very clearly, ‘My whole purpose in being on this board is to get reduced rates for my family and friends,’” says Lisa Morzel, former City of Boulder Council member who served on the CCA board from 2016-2019. This is the crux of Carr’s conflict of interest concerns in arguing CCA is in potential breach of its lease.
“The idea of discounting the cottages for the personal benefit of the cottage owners, that means those are dollars that will not be spent on improving the grounds,” Carr says. “And that’s the direct conflict that I’m worried about.”
But the cottage owners don’t see it that way. They see their advocacy for lower rental rates as a means of keeping Chautauqua more affordable for everyone in the age of increasing wealth disparities across the country.
“I can tell you, cottagers aren’t trying to get prices for themselves to save money. I believe sincerely … the reason why you want less price pressure is because it’s astronomically expensive,” Galey says. “If cottagers are looking for lower prices, they’re saying, look, this is the mission: we want middle-class people. We don’t want to make it exclusive for the rich only. But that has been twisted into private benefit and advantage.”
Benford, however, says Chautauqua’s rates are below market value for vacation rentals along the Front Range. Plus, there are seasonal discounts and a loyalty reward program for returning renters. Additionally, in order to alleviate some of the revenue pressure, she says, CCA hired a development director for the first time this year to help the nonprofit fundraise.
“We’ve always made enough money through lodgings and we didn’t have to do that [before],” she says. “But now we don’t want everything to be dependent on lodging. We don’t want to have to raise our rates so high that people can’t come here.”
For CCA and the City, that’s really what this all boils down to. How can the nonprofit continue to balance its mission to preserve and continue the Chautauqua by engaging the community with a need for revenue generation in order to maintain the property?
“We have an obligation to the City that we never let it go into the demise that it was in the ’70s,” Morzel says. The board, in her estimation, is dysfunctional and unlike anything she’d seen in her 20 years of public service. She raises concerns over the ability of such a board to meet its fiduciary responsibility as it seeks to become more sustainable and afford a long-list of maintenance costs. And it’s not just former Council member Morzel who sees CCA in this critical light; current Council members agree with her assessment.
According to the 2015 lease, CCA and the City agreed to a shared responsibility for major improvements, such as the roads, maintaining sewer and water lines and the possibility of undergrounding utility lines. The association also needs to contribute to the effort, according to the lease.
Overall, Benford says, CCA estimates deferred maintenance at Chautauqua is upwards of $10 million to $20 million to make the property more resilient to floods and fires, including a new stormwater management system and undergrounding power lines.
Currently, CCA contributes about $2 million annually to the maintenance of the grounds, which if the organization is found in breach of the lease would leave the City footing that bill.
As Carr says, “CCA is responsible for maintenance of the grounds up there. They put about $2 million a year into the facility, which the City then doesn’t have to pay.”
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In early February, Garnett filed a lawsuit against CCA and the City in Boulder District Court on behalf of 16 people who either own cottages at Chautauqua or are members of CCA.
“The cottagers are a different voice and occasionally I think they’re inconvenient to other folks at Chautauqua. Some of them are kind of eccentric folks. They see things a little bit differently,” Garnett says. “They have all this history, but the solution is not to cut them out and cut out their voice.”
The suit claims that CCA operates as a residential nonprofit under Colorado law, giving people who own or lease property within its area a right to vote. It also challenges the notion that CCA can increase the ground rates for cottage owners under the current sublease which is good until 2035. Lastly, the suit claims CCA violated its own bylaws by not adequately announcing meetings and votes regarding the proposed bylaw changes, making the entire voting process currently underway void and invalid.
“I think a lot of people over the years have expressed some concerns about the governance and how the board is run,” Moseley says, and he agrees the concerns aren’t unwarranted. “We are willing to come to the table and talk about these governance issues, but not be force-fed them… in the dead of night.”
But the fact that CCA could be viewed as a residential nonprofit is “a nightmare for the City,” Carr says. “That’s everybody’s biggest fear: that it becomes essentially a gated community for the benefit of a few homeowners.”
Carr says the City’s next steps are yet to be determined, as it is all dependent on the outcome of the bylaw vote, which needs 75% of a 10% quorum of the approximately 1,900 members in order to pass. Meanwhile, Garnett’s lawsuit is making its way through the courts, with an official response from the City due Feb. 27. In the end, there’s the possibility it could nullify the results of the bylaw vote, leaving CCA back where it started in November, facing threats of a breach of lease from the City.
The entire ordeal is putting the nonprofit at risk, and CCA is having to fork out money for lawyers that otherwise could be going to maintenance. Benford says all the public scrutiny and media attention raises questions about the organization’s tax-exempt status, by calling into question whether or not addressing the cottage owner concerns is actually offering a private benefit to certain individuals.
“If you’re offering someone a private benefit, that’s not something you can do [according to] 501(c)(3) rules and so, is what’s happening up here considered private benefit?” she asks. “And if it is, then that could have IRS implications.”
Not only that, it also threatens the value of all the properties, including the privately held cottages. If the lease is terminated, Carr says, theoretically, the privately held cottages “have to go away.”
“The cottages themselves have to either be removed or transferred to the City within six months if there’s a default,” he says.
All of this sets up the possibility of more lawsuits, Galey says.
“Imagine you have a home that’s worth $1 million today and the CCA says, no, I’m not going to renew your lease. The house tomorrow is worth $0. You can’t sell it,” he says. “I think there’s going to be 38 lawsuits that are million-dollar lawsuits. That’s a $38 million mistake.”
Regardless, Carr says the City Council, which has expressed unanimous support of Carr’s letter to the CCA, most recently at the Feb. 4 Council meeting, is “absolutely serious” about following through with its demands, all in the name of preserving Chautauqua.
“There are several other avenues available to the City that we’ll address if the bylaw changes don’t pass and they will not be as nice,” Carr says. “And that’s unfortunate.”
If that happens, and the partnership between CCA and the City falls apart, it’s unclear how Chautauqua would be managed moving forward, opening up a realm of possibilities for the future of the site. “If we don’t have something like the Colorado Chautauqua Association, who knows who will come in,” Morzel says.
In the end, the entire system of managing, maintaining and perpetuating the values of Colorado’s Chautauqua could be upended, threatening to change the very nature of Boulder’s iconic and historic park. That’s one point all sides seem to agree on, even as they are all trying to prevent this from happening. As Galey says, “This could potentially end in massive disaster for Boulder and Chautauqua.”
