December 12, 2003

Kanne files bankruptcy
By Lora Abcarian
Editor

FAIRPLAY, Colo. -- On Dec. 5, Villages at Sunset developer Larry Kanne filed bankruptcy proceedings in federal court.

Park County Attorney Stephen Groome said he had been awaiting Kanne's filing of a $2 million irrevocable letter of credit when he received the news via email 30 minutes after the county's drop-dead deadline had passed.

The letter of credit was required to provide financial assurances that Kanne would construct a grade separated intersection at the Sunset Parkway and U.S. 285.

'This was a surprise development," stated Groome of the news. "On Monday last week, I was told by Larry Kanne he had sold the project to Security Land Trust, which developed the Wal-Mart/Home Depot in Bergen Park."

Kanne has filed Chapter 11 bankruptcy which means he is in the process of reorganization, stated Groome. The Notice of Automatic Stay means any and all creditors received the same notice, and rights pursuant to the agreement cannot be executed.

Groome is unsure about the full ramifications of Kanne's filing. Groome has contacted former Park County Attorney Robert Widner to discuss the matter. "Sunset is in limbo right now," commented Groome.

Groome was asked whether the filing meant Sunset may revert back to its original status in which approximately 780 units received zoning approval in 1982. He responded that the bankruptcy proceeding secures Kanne's rights in their present form, but he wasn't sure whether the original project would resurface.

"We are in a 'wait and see' mode right now," Groome stated.  "This could be a long, drawn out process."

Kanne contacted the Park County Planning Department on Dec. 9, indicating he would like to file an amendment to his Subdivision Improvement Agreement. The amendment would ask that the $2 million irrevocable letter of credit be filed prior to issuance of the first building permit, rather than at time of recording of the final plat. Sandy Berryman, chief administrative assistant for the Board of County Commissioners, said further legal advice is being sought on this request in light of the bankruptcy proceeding. If the request is granted, Berryman said the matter will be reviewed by the Park County Planning Commission before the BOCC makes a decision.

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