Deal revises deed restrictions for Gypsum project | VailDaily.com

Deal revises deed restrictions for Gypsum project

EAGLE, Colorado – Eagle County may not end up with the deed restrictions it paid for under a new Stratton Flats deal. A Denver company has a contract to buy the struggling project, and that could change the way the county’s deed restrictions work. The county commissioners sank $4.5 million into the floundering project in January 2008. The tax money is supposed to buy deed restrictions on 113 of Stratton Flats’ 339 units, say the county commissioners who spent the money. That means taxpayers paid more than $40,000 for each of the county’s Stratton Flats deed restrictions. But the nature of those deed restrictions will change under a deal with a new developer and price caps will be removed, say partners in the Stratton Flats deal. Also up in the air is whether the county’s taxpayers will be paid the 6 percent interest on their money they were promised as part of the original deal. County Attorney Bryan Treu says the deal is negotiated, and they’re waiting for banking regulators to approve it. “There will be a presentation in a couple weeks, and we’ll answer questions at that time,” Treu said. The county has been trying to restructure the deal for more than a year. Banking regulators are in the mix because Colorado Business Bank, CoBiz, sank more than three times the money into Stratton Flats that Eagle County did, a bank spokesman said Tuesday. The bank has between $12 million and $18 million in Stratton Flats. “You could say $12 million is in the neighborhood,” said Sue Hermann, spokesperson for Colorado Business Bank. The bank will stay with Stratton Flats, Hermann said. “We are integrally involved and intend to remain so until it comes to a successful completion,” Hermann said. Critics say county taxpayers’ $4.5 million was squandered on Stratton Flats and is lost. But county officials say it’s no more lost than it ever was. For the county to recover any of its $4.5 million, Stratton Flats units have to sell, said Alex Potente, Eagle County’s housing director. But Gypsum is the county’s slowest real estate market, and Stratton Flats is located near the end of the Eagle County airport’s runway. Of the 338 home foreclosures this year in Eagle County, 93 are in Gypsum. One Stratton Flats house has sold in the last year, a $379,494 government-to-government deal. The Eagle River Water and Sanitation District negotiated a deed restricted purchase for one of its staff members. That deal closed Sept. 21, 2009. On the Stratton Flats website Tuesday, three bedroom homes were listed for $325,000 on the open market. “The money is gone, but the affordable housing remains part of our community,” said County Commissioner Sara Fisher. Fisher, along with Peter Runyon and former county commissioner Arn Menconi, voted unanimously to get Eagle County involved in Stratton Flats. “We’re fortunate that we were able to forge a partnership with the owners and the bank to keep it as an affordable housing project,” Fisher said. Fisher said when she was running four years ago, affordable housing was the highest priority. “All the Vail projects had been approved and were getting under way,” Fisher said. “It was full speed ahead. Some thought we’d never stop growing. They banked on it.” Not all deed restrictions are created equal. Stratton Flats is a three-way deal between the town of Gypsum, Eagle County and the developer. Gypsum waived its tap fees, real estate transfer taxes and other up-front costs, in exchange for deed restrictions on 113 units. Gypsum has no money tied up in Stratton Flats. Eagle County’s deed restrictions limit a home’s value to increases of not more than 3 percent per year. Gypsum requires that the homes be sold to locals, and have no price caps. Under the new deal, the county’s price caps will be removed, say Gypsum officials. “Their deed restrictions will change under the new deal,” said Lana Gallegos with the town of Gypsum. The other 113 Stratton Flats units are being sold on the open market. Stratton Flats has always struggled. The project was submitted to Gypsum at the same time as the Tower Center, a proposed shopping center in Gypsum that has never gotten off the ground. Stratton Flats was floundering when the county commissioners poured in $4.5 million to keep it afloat. In January 2008 the commissioners at the time – Menconi, Runyon and Fisher – spent the $4.5 million from a facilities fund. The three did not officially appropriate the money until February 2008. The three commissioners did not form the county’s housing authority until March 2008, two months after the money was spent.

Development slows in Eagle County

EAGLE COUNTY, Colorado ” Lots that would have been buzzing with the sound of construction equipment this summer in Eagle County, Colorado sit silent, the evidence of a downturn in the economy. Thanks to leery buyers, and a freeze in the finance markets, several Eagle County projects, from Vail to Gypsum, from workforce housing to high-end condo projects, are delayed or indefinitely stalled. The list includes the West End mixed-use development in Edwards, the workforce Sawatch View condos in Gypsum, and the Roost Lodge redevelopment in Vail. Besides project delays, there isn’t too much development planned for the near future, said Don Cohen, executive director of the Eagle County Economic Council. “There’s nothing in the pipelines for approval,” he said. “Nobody is planning to do anything.” Edward’s West End, a combination of homes, retail and offices planned for the northwest corner of the main Edwards intersection, was supposed to break ground this April. The project included 72 deed-restricted, workforce homes, some of which were slated to be completed in late 2009. Calls to Midtown Group, the developers of the West End, were not returned, but sources say the project is halted because of financing troubles. According to the project’s Web site, about half of the workforce homes and only 11 of the 113 market-rate homes have been sold. Gypsum’s Sawatch View condos, a combination of 72 deed-restricted and free-market homes, are also delayed. The project is one sale short of breaking ground, said developer Rick Beveridge of Beveridge Real Estate. Because of slow sales, Beveridge said he decided to build the project in four phases instead. “All the financing has changed for condos,” he said. “When we first came out, we thought we’d have a waiting list. But because of the economy, and people being unwilling to commit, we’ve scaled back.” Still, Beveridge said he is optimistic in spite of the floundering economy. The project is one of the few affordable options being built in the area ” one-bedroom, deed-restricted condos start at $173,000 ” and there is a demand, he said. “It will get better once we’ve got something standing,” he said “I think it’s simply a matter that people can’t feel and touch it. It’s a combination of that and the economy.” The county’s other workforce housing project, Stratton Flats in Gypsum, is now building it’s first model home. The sales office reports that it has seven homes with completed contracts and 18 reservations. Redevelopment of West Vail’s Roost Lodge into a condo-Marriott Hotel project is also delayed due to lack of sales. “Right now, given the lack of financing that many projects like this are facing across the nation, we’re on hold for an indefinite amount of time until we can get a sufficient number of condos sold,” said Kevin Deighan, a member of the redevelopment team. “That’s all I’m going to tell you.” Cohen said he predicted the development freeze would ease up in the next few financial quarters. “My sense is that once the credit markets unfreeze, we’ll just have to look at where the national economy is going to be,” he said. “The credit markets will sort themselves out, but obviously, it will all have some effect on us.” Staff Writer Melanie Wong can be reached at 970-748-2928 or mwong@vaildaily.com.

Eagle County schools to cut $3.3M

EAGLE COUNTY – Phil Onofrio said he can’t remember the last time state funding for Eagle County public schools went down. Yet that’s the scenario Onofrio, the district’s chief financial officer, is bracing for as he crafts next school year’s budget. The budget calls for shaving $3.3 million from the district’s operating expenses for next year. A wage freeze for teachers and 50 fewer staff positions are among the changes for next year. However, total proposed expenses are up compared with last year, partly due to proposed renovations at the old Battle Mountain High School. On Wednesday night, the school board looked at the tentative budget for 2010/11. The board is set to vote on the budget June 9. No tax increases are included in the budget. The district sets the property tax rate in December, based on the assessed value of properties and state law, Onofrio said. School officials expect to spend $54.7 million on operating costs for next school year, down 5.7 percent from the $58 million the district spent this year. Most of those cuts fell within salaries and benefits, which comprise 78 percent of the district’s operating expenses. District officials expect to spend $42.4 million on salaries and benefits next year, down $3.2 million compared with this school year. As for state funding for next year, Onofrio cites some grim statistics. He expects the district to receive roughly $42 million from the state next year, down about $3 million compared with this year. He expects funding per pupil to drop by $434, to $7,113. “This is the first time in memory it’s actually gone down,” Onofrio said. Although the district tightened up operating expenses, the total expenses are actually on the rise. School officials expect total expenses for 2010/11 to reach about $113 million, up from $106 million this year. “We have some restricted funds that must be spent on construction and debt, which can skew our total spending year to year,” Onofrio said. “The real story is that our operating spending is down significantly.” Construction projects are the main reason for the increase. Next year’s budget includes about $10.5 million for proposed renovations to the old Battle Mountain High School. The school board voted in March to transform the vacant Eagle-Vail building into a pre-kindergarten through eighth-grade school for Minturn Middle School and Meadow Mountain Elementary students. The budget also includes about $15 million to pay back money the district borrowed for past construction projects such as the new Battle Mountain High School in Edwards and renovations to Eagle Valley High School in Gypsum. Staff Writer Sarah Mausolf can be reached at 970-748-2928 or smausolf@vaildaily.com.

Housing developer to host open house Monday in Vail

VAIL — The Harp Group, the developers of the proposed Marriott Residence Inn and an affordable housing project in West Vail will host an informational open house Monday from 5 to 7 p.m. at the Sonnenalp Hotel in Vail.  The proposed project includes a 170-room Marriott Residence Inn and 113 deed-restricted apartments, as well as 328 below-grade parking spaces located on the former Roost Lodge property in West Vail. It was first submitted to the town of Vail on Aug. 15 and is currently under review by the town's Planning and Environmental Commission.  "We want to give community members and our neighbors in West Vail an opportunity to meet the development and design teams and ask questions about the project outside of the more formal town meetings," said Peter Dumon, founder and president of The Harp Group, a real estate and hospitality investment corporation headquartered in suburban Chicago. "It's an important project for Vail and all of Eagle County and we want to make sure people fully understand it. We've personally invited our immediate neighbors to the open house via email, but anyone with an interest in the project is welcome to stop by." The town of Vail has adopted a housing plan to purchase 1,000 deed restrictions on homes and apartments in the next decade. "With our proposed 113 apartments, Vail will be more than 10 percent on its way to its goal of 1,000 deed-restricted units within town limits by 2027," Dumon said.

Timber Ridge Village lease approved by Town Council

VAIL — The eastern half of Timber Ridge is now Lion's Ridge, and 113 new apartments will be built there. The Vail Town Council on Tuesday approved the details of a ground lease with the project developers, Gary Gorman and longtime Vail resident Jen Wright. The project will build 113 new apartments on roughly 5 acres of the Timber Ridge property, which has been owned by the town for about a decade. The town is putting about $1.3 million into renovating the apartments on the western half of the property, and those will be open to renters this year. Town officials and developers first agreed to a deal in November of 2013, but Gorman and Wright earlier this year asked to modify the terms of the original deal. In a July interview, Wright said he and Gorman had hit hurdles in getting the project financed due to the original 35-year lease on the property and asked instead for a 50-year lease. Lenders all asked for a longer lease term, Wright said. Must Be Employee Housing Deal modifications also included the option for the developers to buy the property for $5 million, about half the price the town paid a decade ago. That purchase option must be exercised within the first 10 years of the deal. If the developers don't buy the land, then they'll make lease payments to the town. Whatever option the developers choose, the land is contractually bound for employee housing. At least 70 percent of all units must be occupied by people working at least 30 hours per week in Eagle County. Opponents of the deal said the town was giving up too much with the sale option. Supporters said governments routinely provide low-cost, or no-cost, land to developers for housing and other projects. Eagle County is providing the land to developers of a senior housing center in Eagle. Council members Margaret Rogers and Dale Bugby voted against the deal at an Aug. 19 meeting. Both continued their opposition Tuesday. Bugby said Tuesday that the deal has "gone backwards" for the town in the months since it was first approved last year. Rogers said the rest of the council might be suffering "Timber Ridge fatigue" in accepting the deal before them. As Good As It Gets But council member Greg Moffet, who was on the council when the town purchased the apartments, said that council never intended for the town to keep the Timber Ridge property. He called the deal with the developers "as good as we're going to get." Mayor Pro Tem Ludwig Kurz, running the meeting in Mayor Andy Daly's absence, agreed with Moffet. So did council members Dave Chapin and Jenn Bruno, approving the deal by a 4-2 vote. Work on the new apartments will start this fall. The first tenants are expected to move in by the end of 2015. Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, smiller@vaildaily.com and @scottnmiller.

County seeks input on Edwards project

EAGLE, Colorado – A review of the Eagle River Meadows project is under way, and the Board of Commissioners is looking for more input on the proposal.The development is being proposed at the current site of the B & B gravel pit in Edwards. Since garnering a recommendation for approval from our Planning and Zoning Commission, the county has hosted two public meetings regarding this proposal – one in Eagle and one in Edwards.The next meeting is scheduled for 5:30 p.m. July 6 at Battle Mountain High School. Video of the county’s two previous discussions are available for review online at http://www.eaglecounty.us. If you are unable to attend, call planner Scot Hunn at 970-328-8624 or e-mail scot.hunn@eaglecounty.us to provide feedback.

Western Slope population boom predicted

GLENWOOD SPRINGS Already nipping at Glenwood Springs heels in terms of population, Rifle appears poised to turn into by far the biggest dog on the Garfield County block during the next quarter century.Thats according to new preliminary estimates that also show the Garfield School District on surpassing, and eventually dwarfing, the Roaring Fork School District in enrollment numbers. Garfield schools, in fact, are expected to quadruple in size in 25 years.The findings of a socioeconomic study being conducted for Garfield County show that Rifle and its surrounding environs will have nearly twice the population of the Glenwood Springs area by 2030. The Glenwood area will be home to about 22,215 people by then, compared to 43,859 for the Rifle area, the study predicts.Garfield County now is home to about 50,000 people. The countywide number would increase to 139,000 by 2030 under a scenario tentatively being projected by Denver-based BBC Researching & Consulting. Thats midway between a projection last year of 148,000 by the state Demographers Office, and its later, more conservative estimate of 130,000, a reduction reflecting fast-rising housing costs in western Garfield County.However, BBC also acknowledges that its number omits many undocumented immigrants because of the difficulty in getting a handle on their local population size. It also doesnt include the possibility of a revived oil shale industry that could drive up population numbers much higher.Another of its preliminary findings ties in with the staggering growth that county manager Ed Green said is coming Rifles way. BBC projects that Garfield County residents working in natural gas development will reach 2,640 in 2017 before beginning to taper off.That may sound like a lot, but BBC managing director Douglas Jeavons said the figure already is at about 2,000.The companies, from what weve been told, are not expected to increase the rate of new well development very much, he said.As drilling eventually dwindles, so will job numbers. However, BBC is predicting that the industry will continue to be responsible for 1,430 ongoing well maintenance jobs through at least 2030.A possible energy boom in neighboring Rio Blanco County also could result in more workers living in the Rifle area. If it occurs, BBC says, Garfields population could reach 146,000 rather than 139,000 by 2030.A combination of lower housing prices, more land available for building and a continuing economic boom could result in many-fold increases in the populations of towns such as New Castle, Silt and Parachute, along with their surrounding unincorporated areas. The New Castle area also could begin to rival greater Glenwood in size by 2030, nearing the 20,000 mark.Garfields school district is seeking passage of tax measures this year to keep up with its fast-rising enrollment. The district is well aware of the kind of growth that is coming. District finance director Christy Hamrick said it is projecting annual enrollment increases of 5 percent to 7 percent a year.Were really struggling with how were going to accommodate those kids and work through that, she said.One big question mark hovering over the model is how many county residents would consist of people working in Pitkin and Eagle counties. A 2005 study by the three counties projected that number could reach 35,000 by 2030. However, if that number is less because of local job opportunities and higher local housing costs, the county population may reach only 113,000 by 2030, BBC believes.Green said many of those commuters are also immigrants. Assistant County Manager Jesse Smith said undercounting immigrants will result in underestimating their social impacts on county services and their impacts on the job market.Vail Daily, Vail, Colorado

West End in Edwards resurrected as residential project

EDWARDS — A resurrected residential development is working its way back through the county's approval process. The West End project in Edwards fell dormant when the economy tanked in 2008 and 2009, but the latest incarnation, an East/West Partners project, is working its way through Eagle County's active development applications. "We think it will be a fine addition to the valley," Harry Frampton, founder and chairman of East West Partners, said. Near the Preserve The West End will be one of the first major projects Eagle County since the recession. It will be located near the entrance to the Eagle River Preserve open space in Edwards. "We like two things about it. First, it's in the middle of Edwards, which is a wonderful place to live. Second, it's buffered by the Eagle River Preserve. We think those two items make it a highly desirable project," Frampton said. They'll be priced in the valley's "medium" range, Frampton said. It's within walking distance to all sorts of things: shops, movie theaters, restaurants, said Jim Telling, of East West Partners. Strictly residential The land has changed hands several times since the economy tanked, ending up with a financial firm in the Midwest. East West's people started talking with the banking people, and they came to an agreement. The new plan is strictly residential, unlike the previous plan approved in 2007, which also included commercial space. "We felt there's enough commercial in the valley already, and certainly in Edwards," Frampton said. In 2007, the 5.4-acre West End site was approved for a combination of 185 units — 113 free market, 72 employee housing units and 85,000 square feet of commercial space. East West's plan proposes between 56 and 60 units, in a mix of single family homes, stacked flats, three-story townhomes and two-story townhomes. The plan remains fluid, Telling said. "If the market tells us the townhome units are more popular than single family homes, we can adapt to that," Telling said. "Our hope is that this is a project that could appeal to young professionals, or couples who are downsizing." In the past decade the housing industry, like all industries, has seen significant improvements in technology. It's a little like the difference between buying a 2007 car and a 2017 car. The older car may be fine, but the new car is much better in technology and materials. "We have some good ideas of how to make this the next generation of residential product," Frampton said. Rolling in a roundabout The project still has lots of moving parts, many of them automobiles. Besides on-site infrastructure such as utilities, East West Partners has to build a roundabout, possibly at the entrance of The Eagle River Preserve. The location depends on input from the county and the Colorado Department of Transportation. However, so far neither the county nor Colorado Department of Transportation are estimating prices for the roundabout they're requiring. For now, the ambitious timetable targets the end of 2017 to begin construction, with the first phase coming to market in 2018. "We're trying to keep the prices as low as we can and still have it be a free market unit," Telling said. Instead of building affordable housing, East West will contribute to the county's housing fund. The county's housing regulations require that 25 percent of the total residential units be designated as affordable housing, or that the developer pay a fee based on the square footage. In West End, 25 percent of 56 units is 14 units, or 14,545 square feet. New tax source When this project is finished, perhaps in 2019, the homes will generate $144,448 in new property taxes. It's expected to be 80 percent owned by full-time residents, who will also generate approximately $540,225 in new sales taxes, according to the plan filed with the county's community development department. Staff Writer Randy Wyrick can be reached at 970-748-2935 and rwyrick@vaildaily.com.

Vail police get stimulus funds

VAIL, Colorado – Colorado is getting $5 million in federal stimulus money to pay for police officers in 13 communities including Vail. Vail police will get $258,970. The largest recipient in Colorado is Grand Junction, which is receiving $1.3 million for five police officers. Other departments getting Community Oriented Policing Services, or COPS money include Commerce City, which is receiving $872,612 for four police officers, and Englewood, which is receiving $697,146 for three police officers. Under the COPS program, the federal government pays the officers’ salary and benefits for three years, after which the local government is responsible for the costs. About 7,000 state and local agencies applied for aid under the program that is part of the $787 billion stimulus package passed earlier this year. Of those, only about 1,000 were approved. The $5 million that Colorado is receiving is the minimum amount each state is getting through the program. “We feel very fortunate to receive the amount we have received,” said Troy Smith, deputy police chief for Grand Junction, even though the grant will fund only half the number of police they applied for. Smith said the grant will allow them to fill five vacancies that have gone unfilled as the city struggles with declining tax revenue for the first time since 1983 – the year oil companies abandoned their oil shale projects. The city and surrounding county has experienced some growth from the recent oil and gas boom, with the county’s population projected at 153,000 by the end of next year, up from 135,000 this year. Smith said the city has recently experienced a rise in property crimes – shoplifting, burglaries, auto thefts – though it’s not clear whether it’s the economy or population increase. Grand Junction police wanted to add a school resource officer, two criminal investigators, and two officers for their street crime unit, who don’t answer 911 calls but investigate crimes in city hotspots. “It is a very effective deployment of resources in a way that has a dramatic impact in our crime and problem solving and policing,” Smith said of the street crimes unit. Larimer County did not apply for the money out of concern that they won’t be able to continue the positions once the funding ends. Other communities receiving funding are: Alamosa ($163,124), Ault ($152,957), Black Hawk ($262,308), Colorado Springs ($418,560), Florence ($133,881), Idaho Springs ($162,716), Ignacio ($182,183), Steamboat Springs ($204,695) and Telluride ($191,113).

Workers: Buy now, move to Edwards in 2009-10

EDWARDS, Colorado ” Affordable homes in Edward’s newest development will go on sale Jan. 31, and developers said they expect quick sales. The West End, a mix of homes and businesses in the core of Edwards, will have 72 affordable, deed-restricted homes. Another 113 homes will be sold at market rates. An open house will be held Thursday from 4 p.m. to 8 p.m. at Gateway Land and Development in Edwards. Developers, brokers, bank representatives and county officials will be on hand to answer questions about the workforce housing. “This is just to communicate and help the community to better understand the process,” said Brian Bair of Midtown Group, the company developing the West End. Applications for the homes were released last Thursday. Over 125 applications have already been given out, Bair said. “The response has been real positive,” he said. “A lot of people are interested and we expect them to go pretty quickly.” Completed applications and pre-approval letters will be accepted starting at 9:30 a.m. Jan. 31 at Gateway Land and Development. The homes will be sold on a first-come, first-served basis. Applications will be time stamped when they are received, and once the homes are sold, other applications will go on a waiting list. “There will be a line out the door, I’m sure,” said Gateway broker John Nichols. “This is a great opportunity for locals and we’re seeing a lot of really excited residents show interest.” To qualify for a home, applicants need to live and work in Eagle County. There are no income cap restrictions, but the developer reserves the right to restrict income levels for the lower-priced homes. Construction is slated to start this April. Some of the homes will be done in late 2009, but most will be completed in early 2010, Bair said. The homes range from 625 square foot studios for about $180,000 to 3-bedroom, 1,351 square foot for about $460,000. The homes are being sold for 30 percent lower than the market rate, Nichols said. The West End will also have 80,000 square feet of stores, restaurants and offices. Developers are still in discussion about what businesses will be there, but most will be locally owned, Bair said. Staff Writer Melanie Wong can be reached at 748-2928 or mwong@vaildaily.com.