Vail Resorts, Summit County at odds over deal for new apartment project
Following the deal between Summit County and Vail Resorts to build workforce housing at the Village at Wintergreen in Keystone, the county committed to spending $300,000 to bolster the chances of receiving approval for low-income rentals within the project.
The county was aware Vail Resorts’ development partner on the 196-unit site, Gorman & Co., would make a request for the financial backing for the 40 low-income rentals. However, learning of the total, Summit’s three-member Board of County Commissioners approached Vail Resorts about splitting the investment to make the highly competitive low-income application more attractive. Despite previously announcing the availability of $30 million toward employee housing projects, the resort company declined to contribute further to the Wintergreen agreement.
“I don’t know where any of that money has gone,” Summit County Commissioner Karn Stiegelmeier said. “They have talked about it in press releases over and over, but I haven’t seen where they’ve actually put in money.
“I would welcome any greater partnership with them,” she added. “It seems obvious that if we’re putting money in, it would be really great to have more cash to make it a better application.”
The original pledge
Vail Resorts’ original December 2015 housing commitment to the communities where it operates notes many of these projects could take years and that capital, use of its own land and leasing agreements were all in play as part of that total. The Village at Wintergreen is the first project to get off the ground within the intended Colorado, California and Utah mountain communities, and the resort company was comfortable with its pledge of the 28.4-acre property in Keystone for Gorman to build upon as well as the below-market lease.
“We are thrilled that the Wintergreen project has been approved and that it is happening because of our land lease to Gorman and that we have committed to master lease a significant number of units,” Kristin Kenney Williams, Vail Resorts’ vice president of mountain community affairs, said in a statement. “The fact that the county is supporting the (low-income) component of the project is terrific — the entire Wintergreen project is a model example of the creative private-public partnerships we were hoping for.”
According to county documents, the land parcel where the housing development is to be built is valued at approximately $1.5 million, and Vail Resorts paid roughly $21,000 in combined property tax on it in 2016. The leasing agreement with Gorman & Co. is for about $35,000 annually for 100 years.
All parties acknowledge the deal and project would never get done without the land, which under area zoning regulations already required it be reserved for housing. It’s also a major factor in the state’s tax-credit agency awarding the subsidy to such projects throughout Colorado.
“We couldn’t have funded the project and could not make it work financially if we had to make an outright acquisition of that land,” said Kimball Crangle, Gorman’s Colorado market president. “Vail Resorts is bringing quite a bit to the table … and the ground lease of the land is definitely included in the application as well.”
Local aid essential
Another determination in a project receiving the tax-credit for units that range from 30 to 60 percent of the area median income, or AMI, depending on the application request and available funding, is whether there’s local public financial support. The other seasonal and year-round Wintergreen rentals are capped at 120-percent AMI.
“The county has known for some time that we’ve been interested in competing for a tax-credit award at the Wintergreen site,” Crangle said. “It’s a fundamental component to address affordability and the type of rental housing in critical need in the county.”
After a request from Gorman for $350,000 approaching approval of the deal on May 22, the county committed to nearly that amount in housing dollars later that week to give the tax-credit application its best chance to be green-lighted. If the approval is not granted, then the 40 units will transition to the alternative of renting to tenants earning between 100 and 120 percent of AMI and the county will be off the hook for the additional money.
Still, with so many other communities vying for limited number of available tax credits, there’s no sure thing.
“We definitely knew all along there’s no guarantee,” Stiegelmeier said. “It’s the bright, shiny candy bar that you may or may not get, and it made it more appealing. But it’s kind of a gamble — you never know.”
It remains the county’s position, though, that with additional contributions from Vail Resorts, there would be a greater chance the low-income rentals are approved. Gorman believes it has a viable application, even if the resort company’s denial has left the county with a bitter taste in its mouth.
“Would it also be nice if Vail Resorts threw in some money? Sure,” said Thad Noll, assistant county manager. “It’s on their property, and they would be a beneficiary of it. They obviously said no, definitively, and my guess is the board was surprised they said no flatly.
“Sometimes you have to bite your tongue and say OK, because it’s the best thing for the public in the long run,” he added.