CDOT seeks deal on Hwy. 24 motel to benefit
future road project

July 13, 2011 9:12 PM
by Debbie Kelley
The Gazette

Buying a defunct Colorado Springs motel now could save millions of taxpayer dollars in future highway improvements, a state transportation engineer told leaders from 16 nearby cities and counties Wednesday.

Hearing that, the Pikes Peak Area Council of Governments’ board agreed to let the Colorado Department of Transportation proceed with striking a deal to acquire the Express Inn on U.S. Highway 24 West as part of a plan to reconfigure the congested corridor.

CDOT Resident Engineer Dave Watt said the agency wants to borrow $1.5 million in savings on four local projects nearing completion to buy the property, which was supposed to go to foreclosure auction at the El Paso County Trustee’s Office last week.

The PPACG board is expected to give formal approval for the purchase at its Aug. 10 board meeting.

Colorado Springs-based Peoples National Bank in March began seeking foreclosure on a $2.2 loan that borrower Grot Cimarron LLC had defaulted on. The motel had most recently accommodated low income and homeless people, and efforts by a nonprofit organization to take it over failed. The facility shut down May 15.

The outstanding principle on the loan is about $1.3 million, according to Public Trustee Thomas Mowle. The auction was delayed twice, he said, first on July 6 because the bank did not file proper paperwork, and again on Wednesday because the lender failed to submit a bid.

The foreclosure sale has been rescheduled for July 20.

But CDOT will try to negotiate a deal with the bank, Watt said. After getting an appraisal to determine the fair market value and assessing how to handle the asbestos and lead paint thought to be in the building, CDOT will try to obtain the property before another buyer steps forward.

Although Watt is requesting approval for $1.5 million — which he said would be paid back within a year — he said he hopes to acquire the property for less, based on the outstanding loan amount.

CDOT needs the property to reconfigure the intersection at Highway 24 and 8th Street, one component of a $240 million regional transportation plan to expand Highway 24 from Interstate 25 west to Manitou Springs. The project is at least five years away from starting, though.

“It seems like a good idea to move forward and acquire the property now,” Watt said. “We anticipate taking the building out — it’s not in very good shape, and it’s fenced off and an eyesore at this point.”

No PPACG board member objected to the request. Ramah’s Mayor Pro Tem, Keith McCafferty, said he thinks it’s “a wise idea.”

“It would save from someone doing a quick fix on the building and trying to make money off us later on,” he said.

Watt agreed that if a developer were to buy the property and improve it, CDOT likely would spend “millions more” to acquire it in a few years.

Mowle said that has happened before, including with the Woodmen Road expansion project.

An $8 million environmental assessment of the Highway 24 corridor is in the hands of the Federal Highway Administration, Watt said, adding that he expects to receive approval this fall.

But the earliest construction would start on the corridor is 2016, he said, as funding decreases have postponed many road projects.

The plan calls for a new overpass to route Highway 24 traffic over 8th Street, at a cost of up to $60 million, Watt said. The Highway 24 exits off I-25 also are slated to be reconfigured in the same design as the highway interchange at Garden of the Gods Road, at a cost of about $90 million.