Basalt approves changes for Whole Foods
BASALT, Colorado – It’s more important to prime the economic pump right now than make developers pay their way, the Basalt Town Council unanimously decided Tuesday night.
The council voted 7-0 to grant the first of two approvals needed to alter the Whole Foods Market building at the Willits Town Center. In a key provision of that approval, the town will commit to spending up to $500,000 to build a roundabout needed at a key intersection at the entrance to Willits. The developer will be on the hook for $600,000.
Town studies have determined the roundabout is needed at Willits Lane and East Valley Road, an intersection that serves City Market as well as Willits Town Center.
Town Manager Bill Kane said the investment was worthwhile because the completion of a Whole Foods will spur greater sales tax revenues for the town. In essence, the funds spent on the roundabout will be paid back many times over.
Town Councilman Glenn Rappaport supported the move because he said the town cannot assume it will remain in a strong financial position.
“I think we need to be focused on our financial stability,” he said. “I’m really concerned about that.”
Bank of America controls Willits Town Center at the moment. The lender foreclosed on the project after Chicago-based developer Joseph Freed (JFA) and Associates allegedly fell behind on payments. Bank of America alleged in court documents filed as part of the foreclosure that JFA owes $36 million.
A foreclosure sale was scheduled for Aug. 25 but has been postponed until Sept. 15.
After the foreclosure was initiated, an Eagle County district judge appointed Cordes and Co. of Denver as receiver of the project. The receiver manages the project with the intent of watching out for its economic well-being. Mike Staheli, project manager for the receiver, has urged town officials in recent months not to make the future developer of the project pay for the entire cost of the roundabout.
JFA representative Tim Belinski is also participating in the land-use debate because the company aims to retain its interest in the project. Belinski and Staheli have stated in a handful of meeting that whoever ends up developing Willits Town Center shouldn’t be saddled with the entire cost of the roundabout. It is too great of an economic burden on one building in a troubled project, they said.
They proposed instead to pay $600,000 for a traffic signal. Town officials said at an earlier meeting a traffic light isn’t adequate at that intersection.
Town staff suggested that the town loan the developer $500,000 to upgrade to a roundabout. The developer and receiver continued to resist.
Only one member of the public spoke on the issue at a public hearing Tuesday night. Michael Meiners of Sopris Village urged the council to stick to its philosophy of making development pay its way. “These gentlemen need to step up,” he said.
The council concluded otherwise and endorsed Kane’s proposal. He suggested taking the $131,000 existing in the town’s Willits Lane impact fee fund, which is dedicated to projects on Willits Lane.
That fund might be replenished with a grant from the Mid Valley Metropolitan District to reimburse pedestrian trail work along Willits Lane, Kane said. The grant could provide another $131,000, which could be used for the roundabout, he said.
The remaining $238,000 could be funded from a real estate transfer assessment, or RETA, applied to sales in Willits, according to Kane. Nearly $500,000 in that fund is available without restrictions on use.
The funds in the RETA could be repaid, if the council desires, through sales tax revenues collected from Whole Foods and other retail shops planned at Willits Town Center.
A second reading on the land-use approvals for the Whole Foods building is scheduled for Aug. 24. Land-use approvals must be finalized by early September or the natural foods grocery chain can opt out of its lease at Willits. Whole Foods was originally inked to a deal for a 44,000-square-foot store. That lease expired when JFA ran out of financing. Construction stalled on the building Labor Day Weekend 2008.
Whole Foods signed a new lease in March for a space reduced to 25,000 square feet. The reduction required amendments to the approvals for the building.