Avon asks development to ‘pay its own way’ | VailDaily.com

Avon asks development to ‘pay its own way’

Nicole Frey
Dominique Taylor/Vail DailyConstruction workers work on the ceiling of a new The Village at Avon building.

AVON- Inviting developers into the town of Avon is a tricky business. On one hand, the town needs the money to provide its citizens services to which they’ve become accustomed. On the other hand, newcomers, whether in the form of tourists or people moving to the valley, may change the quality of life Avon residents cherish. Avon residents take for granted their recreation center, manicured parks, public transportation and plowed roads, but town leaders say it’s their responsibility to ensure those services will be there tomorrow, next year and for the next generation.To keep the money flowing into town, Avon officials constantly seek new sources of cash, and one lucrative source is bringing in developments — buildings that may house apartments, hotels, restaurants and retail businesses.New developments boost Avon’s economy during construction through for building permits and other fees paid to the town, and hopefully, they continue to earn revenue when the structures are completed, whether it’s in the form of sales or property taxes or other ways. While trying to find a balance between locals and tourists, Avon is first and foremost protecting the natives, said town manager Larry Brooks.Avoiding ‘monkey business’

With locals in mind, the town developed a new way of accepting development in Avon about seven years ago, which ensures the town will come out on top or at least break even financially, said Avon Mayor Ron Wolfe. Despite the touted benefits of this model, so far, surrounding towns haven’t caught on, he said. “It’s not fair for the town to take the financial burden,” Wolfe said. “We want the development to come in and at least be revenue neutral.”To ensure the deal makes sense, the town enlists the help of a financial analyst who models the development proposal to calculate the costs and revenues the project will generate. For example, if a developer proposes a hotel, the analyst would weigh the impact of more people staying in town – who will require transportation and police – versus the money they will spend and how much the developer will pay Avon to build the structure. “We want growth to pay it’s own way, or at least come as close to paying it’s own way as possible,” Councilman Brian Sipes said. Although former councilman Pete Buckley said he takes issue with several Avon’s practices, he acknowledged this way of dealing with growth “keeps everyone from any monkey business.”An added bonus of the getting a financial analysis is it doesn’t cost taxpayers a dime. The developer picks up the bill that usually runs about $4,000 to $5,000, but can be more with larger developments.

Informal meetingsBut despite its attractiveness, the method isn’t foolproof.”It’s tough. It’s not exact, and there’s a lot of guesswork,” Sipes said. “Like with a hotel how many (tourists) are going to eat here in Avon as opposed to going to Edwards or Vail? “We know new people coming in will spend a certain percentage of their money in town, and we know what the cost of providing services to them is, but there’s still some guesswork,” Sipes said. Still, the benefits far outweigh the risks, Brooks said.”The risk of not doing it is worse,” Brooks said. “This is just due diligence. It’s a more responsive way to respond to the community.”In addition to a financial analysis, the town and developers talk a lot, Community Development Director Tambi Katieb said. “We have more informal meetings so (the developer) can become aware of what the concerns are,” Katieb said. “We find a lot of value in being very honest to those applicants. “I think we face the same growth pressures as any resort community, so some of the things we’ve done to end up with a better process,” Katieb said.

Katieb said The Confluence, a proposed development of shops, restaurants and lodging, was discussed for six months — a discussion that included an open house for the public — before an application was submitted. The financial analysis hasn’t been completed yet.Building a better projectAnd town officials aren’t the only ones who think they’re on the right track. Despite having to endure a more grueling process, Chuck Madison, a partner at East West Partners, developer of The Confluence, said it’s the right way to go about planning for The Confluence. Unlike other towns he’s dealt with, Madison said, he’s had to produce much more information, detail and studies early in the game for Avon. “I think for the most part, it’s turning out to benefit both parties because we’re answering more questions up front and making sure that all the issues are being fully vented and discussed and resolved, instead of waiting to resolve them after the project is approved,” Madison said. “I think it’ll be a better project because of that.”But Madison isn’t convinced every development proposal should have to put up with Avon’s procedure. “Depending on the type of project, it’s a huge hardship on the developer to spend hundreds of thousands of dollars to do the work prior to knowing whether he’s got a project at all,” he said.

The anomaly Using the model, Avon crafted a unique plan for The Village at Avon, Brooks said. In 1998, the town agreed to allow The Village at Avon to keep all the sales tax it collected for about 26 years. In return, the developer built and will continue to build all necessary infrastructure, including roads and sewer and water lines. The developer also agreed to pay Avon $2 million for in-town improvements, such as road repairs, and is obligated to pay a verity of other fees to the town for services, such as road maintenance and lost sales tax from the former, smaller Wal-Mart. While the plan was unconventional, the town and developer believe it will ultimately benefit Avon the most. “There are some people in Avon who say, ‘Hey, we really gave away the farm,’ but I think they made a pretty smart deal,” said Dan Christopherson, spokesman for The Village at Avon. Former Avon mayor and local builder Buz Reynolds agreed it was a “win win” deal saving Avon from spending as much as $50 million in construction that would have doubled property taxes. Setting Avon apartWhile Wolfe said using this model is putting Avon “well ahead of the curve,” contractor and real estate agent Buz Didier said Avon needs to have a more progressive plan to make up for the town’s mistakes of the past.

“There was no real plan for how the city was laid out,” Didier said. “Everything now is going toward correcting that.”Past mistakes or not, Minturn town planner, Wiley Smith, acknowledged Minturn’s methods “aren’t as sophisticated as that.” Minturn is currently dealing with its own massive development proposal from Ginn Development Company, which wants to build a private ski resort south of town. “We look at the proposals that come in to see how they fit within the town and the zoning code,” Smith said. “But we don’t really look at the economics of it.”Brooks said he’s not sure why other towns aren’t using Avon’s progressive method, but confirmed Avon will continue to use the model for the town’s benefit. “It’s not law, I wouldn’t have to get a financial analysis, but I think our community wants to know why we’re approving something,” Brooks said. “It’s a lot better when I can turn to the community I serve and show them why something makes sense.”Staff Writer Nicole Frey can be reached at 949-0555, ext. 14621, or nfrey@vaildaily.com. Vail, Colorado

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