[Seether]

Why does everyone think hes behind? Its a CO raise after 1 limper.... I really think a checkraise on the flop would be the best decision for this hand if you feel the CO will always fire a continuation bet. I feel that you are fairly likely to have the best hand and might as well find out early as well as get money in the pot for when you do have the best hand.
If you cr the flop you can fold the turn UI or if you get raised on the turn its an easy toss as well.
Given that you decided to puss out on the flop and turn I think your river bet out is probably the best idea. The board is a pretty uncoordinated board, so I feel that the only thing that will raise you are sets and maybe aces up, so I feel that folding to the river raise is not a bad idea if they are loose passive as you say.