Paul Stettner: West Steamboat Neighborhoods come at a cost
September 27, 2018
City Council has approved a pre-annexation agreement with developer Brynn Grey for the West Steamboat Neighborhoods project, which plans to build 108 deed-restricted and 292 market rate units — a total of 400 living units in the Urban Growth Boundary area.
An annexation/development should:
- Comply with the Community Development Code and the West Steamboat Springs Area Plan. Code language has been changed such that City Council may, and now has, exempted the developer from complying with previous affordable housing requirements. Instead of providing 50 units with a target price under 80 percent Adjusted Median Income, Brynn Grey plans to provide 108 deed-restricted housing units but for higher incomes.
- Meet a need. Within the City limits there are approximately 400 living units in developments either under construction or in the planning stages plus Yampa Valley Housing Authority projects. Are more really "needed?”
- Pay its own way. The "Estimated Time Line for Payments," a city staff document, shows estimated revenues from the project and concurrent city costs from 2019 through 2034. This document shows the city is in the red, at financial risk, after the first year of the project through 2034. Five years into the project, by 2024, the city expense is $30,000,000 more than what is collected from project revenues.
Note: This deficit is due to transportation issues on U.S. Highway 40 and Routt County Road 129, not all due to the project. Likely, CDOT would partially fund these projects, but, how much and when is uncertain? This is of concern as city revenues already barely meet budget. What is the plan to pay for these additional deficits?
This situation continues through 2034 by when it's estimated that the project would have paid $18,163,755 at build out while the city would have paid out $35,810,923, a difference of over $17 million. The city would be financing this deficit past when the project revenues cease.
City Council has agreed to defer project fees for water and transportation firming funds. Instead of receiving the full $8,176,000 fee up front, there would be a partial $584,000 down payment with the $7,592,000 balance paid with interest over the next 16 years. Project revenues depend on project performance – underperformance means less revenue to the city.
A majority of City Council members believe that the project benefits warrant this financial risk. Do they?
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City Council. your constituents deserve an answer. Thanks.