Decision day, again | VailDaily.com

Decision day, again

Pam Boydpboyd@eaglevalleyenteprise.comVail, CO Colorado

Special to the DailyEagle River Station is a commercial/residential project proposed by Trinity RED Development. The 88-acre site is located south of Interstate 70 and north of U.S. Highway 6.

It doesn’t take much more than a quick trip through Eagle to figure out something’s brewing in the community – with dozens and dozens of colorful yard signs popping up all over private property and public rights of way.Eagle River Station is again before the voters.On Tuesday, May 22, Eagle residents will decide the future of the commercial/residential project proposed on the eastern end of town. Eagle currently has 3,977 registered voters and of that number, 1,720 citizens already have their ballots in hand because they have elected to receive them by mail. For those who opt to vote in person, the polls will be open at Eagle Town Hall between 7 a.m. and 7 p.m. Tuesday, May 22.This marks the second time voters will decide the project’s fate.Eagle River Station is a commercial/residential project proposed by Trinity RED Development. The 88-acre site is located south of Interstate 70 and north of U.S. Highway 6. The ERS proposal would include 582,000 square feet of commercial space and 250 rental units in the first phase. The second phase calls for up to 150,000 square feet of additional commercial space and another 300 rental units. If history is any indicator, the ERS vote in two weeks will feature big numbers. In January 2010, 2,200 residents voted in the ERS referendum, about 61 percent of the town’s 3,585 registered voters. The ERS proposal was defeated with 1,175 votes against and 1,091 in favor – a difference of only 156 votes. Here’s the actual ballot question that Eagle voters will decide:SHALL THE VOTERS OF THE TOWN OF EAGLE APPROVE ORDINANCE NO. 7, SERIES OF 2012, AMENDING THE ZONE DISTRICT MAP OF THE TOWN OF EAGLE BY APPROVING A COMMERCIAL AND RESIDENTIAL PLANNED UNIT DEVELOPMENT WITHIN THE TOWN OF EAGLE TO BE KNOWN AS THE EAGLE RIVER STATION PLANNED UNIT DEVELOPMENT AND APPROVING A SITE SPECIFIC DEVELOPMENT PLAN ESTABLISHING A VESTED PROPERTY RIGHT PURSUANT TO ARTICLE 68 OF TITLE 24, C.R.S., AND SECTION 4.17.030 OF THE MUNICIPAL CODE?As citizens ponder the ballot question, the Enterprise gave both the pro campaign (Yes to ERS – directed by project developer Trinity RED Eagle) and the anti campaign (Eagle, CO – Keep it Real) the opportunity to make their case to the voters. Here’s what they had to say:Vote Yes to ERSBy Yes to ERSEagle River Station has the potential to be a wonderful asset for the Town of Eagle both in the near-term and for years to come. It will provide construction and retail jobs in our community for our own residents and for others in the area. It will generate much-needed sales tax revenue for the town so that we can continue to be a wonderful town in which to live. ERS can provide public improvement projects that the town couldn’t otherwise afford. And it can help jump-start our local economy and get Eagle moving forward again.Construction JobsEagle River Station when approved will generate thousands of jobs for Eagle and Eagle County, beginning with up to 1,200 direct and related construction jobs in 2013 and 2014. A lot of people wonder if those jobs will be filled with local contractors. What we can say is that we are committed to hiring as locally as possible. RED’s track record shows 85 percent of the contractors on our last six projects came from a 50-mile radius. As an example of that commitment, our partner, Trinity Development, hired Evans Chaffee to build its latest project, the new Walgreen’s in Avon. Retail, Restaurant and other jobsAt the opening of Eagle River Station in 2014, we will create in excess of 1,739 total jobs in Eagle. When complete, Eagle River Station will create 2,187 jobs with an annual payroll of $76 million. The great thing about these jobs is that there will be a variety of them that will fit many people’s employment needs – high school students needing summer or after-school jobs so they don’t have to drive 30 miles in the winter to work, parents looking for part-time work during school hours and people looking for full-time management jobs close to home so they can work and still spend more time with their families.We’ve been asked what these jobs will pay. Before we answer, let’s be clear that it’s not ERS that will be paying employees: it’s the individual stores, restaurants and other businesses. We can’t dictate what their pay scales will be, but we can say retailers and businesses will have to pay competitive wages and benefits if they expect to attract workers. Pay scales will be similar to or more than what other businesses in town and in Eagle County are paying, so there will be jobs that pay $15 an hour and jobs that pay much more than that. There will also be many opportunities for local businesses to provide services for maintenance, accounting, lawn services, snow removal, leasing, marketing and more.RevenueWe all know Eagle’s budget has been hit hard by current economic conditions. The town’s revenues have dropped by nearly 20 percent since 2007; the town budget has been reduced by 38 percent during the same time. The capital budget has gone from over $7 million in 2007 to just $550,000 this year. The trend is continuing: Eagle was the only community in the county last year to see a sales tax drop; every other area saw sales tax revenue rise from the previous year. What does that mean? People are losing jobs, maintenance projects are going unfunded and they’re doing Band-Aid solutions to sewers and streets instead of needed fixes. Eagle River Station can generate much-needed revenue for the town. It’s estimated that the project will produce approximately $17 million in permit fees, use taxes, tap fees and other fees. And that’s before the project even opens. Once it’s generating revenue, ERS is projected to generate $3 million a year in gross sales tax revenue from retailers that currently don’t exist in Eagle. That would almost double Eagle’s 2010 budget.Sales tax splitThe town of Eagle’s current sales tax rate is 4 percent. It also receives 0.15 percent of Eagle County’s sales tax generated in Eagle. Under the terms of the cost-sharing agreement negotiated between the town and RED, out of that total 4.15 percent, Eagle will receive 1.6 percent from Eagle River Station purchases from day one. That money will go directly into the town’s general fund. The remaining 2.55 percent will be used by the Eagle River Station Metro District to repay the bonds that paid for the public improvements that benefit the entire town. That money then reverts back to the town after 25 years or when infrastructure bonds are fully repaid, whichever occurs first.It’s important to note that RED will not receive any of the sales tax money, and that none of the sales tax revenue will be used for paying off the construction of Eagle River Station itself. Public BenefitsThe Town of Eagle is requiring Trinity/RED to construct millions of dollars of other public improvements as part of the overall project. These include things like a new water tank and water lines, which will help provide better fire protection for businesses on Chambers Avenue. Upsized wastewater lines in the same area will allow for future development of the empty lots on Chambers. And a new interchange, that independent studies have shown will help address the serious traffic issues that already exist in town.All of these improvements, plus a new water treatment plant that ERS will pay $4 million toward, are needed for the town regardless of whether ERS is built. These public improvements, off-site of ERS, will be paid for by bonds issued by the ERS Metro District with absolutely no risk to the town. The risk is on the bond holders and the developer.Other benefits to the TownThe sales tax the town receives will go into the general fund, so the town can spend it as it deems best for the community as a whole. That could be things like expanding the Show DownTown series, putting more money into Flight Days, or improving our parks and playgrounds. It could be curbs, gutters and sidewalks on Capitol Street, a bigger marketing and promotions budget, partnering on more recreation facilities with WECMRD or improving and expanding our bike and trails system. Potential tenantsAs we’ve said many times before, major retailers don’t sign leases on a project until they know the land owner has the legal right to develop the land and that it’s going to happen. RED Development has a long history of providing great tenants to more than 32 projects nationally.We’ve successfully worked with tenants and categories such as Trader Joe’s, Whole Foods and Target as well as other department, home improvement, electronics, clothing, grocery and many, many more stores. Eagle River Station will be no different. Once approved we will be able to actively get these tenants to visit the site and bring retailers like these to the town of Eagle.SizeThere has been a lot of misinformation about the size of ERS, so we wanted to clarify a few things. Is it really 30 percent bigger than before? That is not true at all. The property remains 88 acres with significant height and density restrictions. The allowable retail area grew but it is offset by the loss of residential area and the hotel is no longer on the plan. The overall amount of buildable square footage is approximately 2 percent larger than the last plan. In other words, the overall footprint of the project remains essentially unchanged. So, more retail space – yes. Bigger physical project – no.Second, it’s been asked why ERS has to be the size that it is to begin with. The retailers we are talking to prefer a minimum amount of critical mass to be most successful. Additionally, in order for the project to pay for the public infrastructure items noted above it has to generate a minimum amount of sales tax dollars. That level of sales will only be achieved if ERS is of the size proposed in this application.Strength of RED DevelopmentRED Development is, without a doubt, a successful, financially strong company. Not one of its 32 projects around the country has ever closed for a single day. During the past four years, while other development companies have struggled, RED has actually thrived and increased its portfolio. RED has also entered into several new joint venture partnerships, which have provided them with the financial resources to move forward with future acquisitions and new projects. Opponents point to a $141 million default as a sign of the company’s weakness without giving any accurate details. This was a loan on a project that was strategically defaulted by RED in order to renegotiate the terms with the bank. It is a process used by many companies and individuals when negotiating with banks. Although the details of the negotiation remain confidential between the parties, we can report that the project has been successfully renegotiated with the bank and has been refinanced. The development has now moved forward with the second phase of development with the same bank. The next phase is more than 300,000 SF of exciting new tenants that will open in the fall of 2012.In conclusionThe question of Eagle River Station generates a lot of emotion. We understand and respect that. As people on both sides of the fence have said, ultimately everybody wants what’s best for Eagle; there are differing opinions on how to get there. We, and the more than 1,000 citizens of Eagle who supported ERS last time, believe that this community will benefit from the long-term positive impacts that ERS will bring. We and the businesses and residents of Eagle who support the current proposal believe that Eagle does indeed deserve better than what we currently have and that Eagle River Station can be a part of that “better.”For additional information, please visit the Eagle River Station Facebook page. Vote No to ERS We believe a citizen’s voice should matter. Instead of a smaller project following denial of the project by voters in January 2010, the developer came back with 30 percent more retail and more parking.That being said, as opponents to this project, we want to make it clear that we are not against development, particularly in east Eagle, and we, too, are concerned about the financial future of our town. But we believe if this project is approved we are putting ourselves at financial risk for the next 17 to 30 years, however long it takes to pay back the bonds.Small Town Character• Right now Eagle is real, flaws and all. • Five big boxes will eliminate any marketing power as ‘Classic Colorado.’ • Can 732,000 square feet of more retail ever be small town?• Anywhere, USA entrance – is that character?The town’s 2012 finances:• 3 percent raises for all staff.• $125,000 annual payment is the only debt service fund payment; it ends in 2013. • 2 percent increase in sales tax revenue is budgeted (this fits our size).• $463,743 budgeted as a surplus in the general fund for contingency reserves.• $110,000 estimated for the marketing effort from the lodging fee.• $75,000 for community donations.• $3,473,014 is the contingency reserve for capital improvements.• Comparing Eagle to Vail/Avon is apples to oranges; we are fundamentally different economies.550 rental housing apartments• 250 rental units in Phase I, 300 in Phase II – can be converted to for sale units. • Many of us depend on the extra income from roommates or apartments – what will the competition of those 250 units in Phase I have on that?• Inventory levels have decreased in the last five months – increased inventory will slow that pace.• Rental rates are just starting to increase – what will 250 housing units in Phase I do to that?• This will create difficulty or inability to compete against developer-subsidized apartments.Hard to believe numbers:• 3,660 parking spaces allowed (Home Depot/Walmart Avon has 1,405).• 300 restaurant jobs promised in Phase I alone – how many restaurants is this?• The project has 80 percent more retail space proposed than Glenwood Meadows.• The project allows 59-foot-tall buildings. Brush Creek Saloon is 42 feet tall.• ERS is 70 percent of the total commercial space currently in Eagle (per the County, this is = 1,078,964 square feet).• Cherry Creek Mall has 1,037,000 square feet and pulls from a population of almost 2.4 million. Math that costs citizens:• If ERS is approved, it is likely that the annual revenue sharing agreement with Gypsum ($485,000 for 2012) will change or be eliminated. This should reduce the projected revenue.• Citizens pay taxes to all 10 tax districts – why is the developer only paying to three?• 4 percent public improvement fee that is taxed on every purchase made at Eagle River Station.• If there is a project default (such as Red’s $141 million default in Sparks, Nevada), it will cost us more to bond and make it more difficult for funding future capital projects the town needs. A wise investment?• Per the developer’s own economic impact report by BBC Research & Consulting, at the state level there will be no new revenue (it will only be shifted from other areas). But the state will pay an estimated $800,000 annually to cover the taxes the developer is not paying to the school district; if the state budget is short, the school district will be shorted. • $67 million of public money spent on infrastructure for a return of $55.5 million over 25 years – the taxpayer is left holding the bag.• We as taxpayers will pay subsidies to finance “public improvements” that we do not need (and may not need depending on how and where we grow) without ERS.• Today, we get 4 percent sales tax from every business subject to sales tax. Subsidizing one development that dominates in terms of square feet creates an unfair playing field.• $750,000 estimated annually the developer is not paying tax districts such as Eagle County, library and CMC because of the use of Tax Increment Financing (“TIF”) only available to ERS (school district is an additional $800,000 the developer is not paying). Upfront cash • Upfront fees pay for the developer’s direct impact on the town and should not be considered a windfall. Building permit and inspection fees are collected as each building is being constructed will go towards the town’s expenses for servicing the development.• The developer gets to reimburse itself for the costs invested upfront using our tax subsidies. If it is not successful, we do not get that money back. Alternatives:• Revenue and cost sharing with Gypsum, which benefits us all as a community• Third year of marketing Eagle now with a dedicated funding source• 64-bed senior facility will produce jobs/revenue while helping an existing commercial district.• An open door for citizens, business owners, and ideas. • Marketing West Eagle sub area plan to developers (i.e., infill development where we need it close to the existing businesses and within walking distance for citizens).• Highway 6 bike path improvement near Sylvan Lake roundabout is scheduled for this year.Check out a citizen’s website http://www.yestoeagle.com or the Facebook page Eagle, CO – Keep it real or email eaglecokeepitreal@gmail.com.Money MattersAs of the May 1 deadline, here are the campaign financial reports submitted for committees/interests in the Eagle River Station election:Eagle, CO – Keep it RealSubmitted by Brandi ResaContributions – $1,929Expenditures – $862Largest contribution from Citizens for Eagle’s Future – $1,560Yes to ERSSubmitted by Paul WittContributions – $27,020.14Expenditures – $14,901.45Largest contribution from RED Development – $25,000Vote Yes to EagleSubmitted by Mitch HayneContributions – $3,100Expenditures – $2,089Vote Yes to Eagle describes itself as “a grassroots group of Eagle residents who care about the health of our community. We passionately feel that Eagle is at a critical crossroads and that we must vote yes for the proposed Eagle River Station expansion of our business district or else the town will suffer greatly.”We are your neighbors and your friends, united by the recognition that we desperately need more jobs in town and we desperately need more retail business in town to balance with our residential numbers.”The group’s website is http://www.voteyestoeagle.com