Published in the June 18, 2015 edition of the Lyons Recorder.
What’s the future for affordable housing in Lyons?
Board lowers Habitat for Humanity’s water and sewer tap fees to $5,467-per-unit for 6 proposed Valley Bank site homes
by Amy Reinholds
Lyons moved one step closer to 6 Habitat for Humanity homes on the Valley Bank site on Monday night when the Lyons Board of Trustees voted 6-0 to give a bigger break to Habitat for Humanity for water and sewer tap fees than originally requested by developer Craig Ferguson and the special housing committee.
The trustees got the information that was lacking two weeks ago, reviewing detailed reports prepared by staff of all taxes, permit fees, and new construction costs. Also Ferguson provided a copy of his development agreement with Habitat for Humanity of the St. Vrain Valley (HFHSVV). The trustees decided to waive all new construction costs that they are legally allowed to waive for up to 6 homes to be constructed by Habitat for Humanity on the former Valley Bank property: water tap fees, sewer tap fees, and water shares.
The resolution states that HFHSVV must pay the following fees, totaling $5,467.50 per unit, that the Town of Lyons is responsible for collecting but doesn’t have the legal authority to waive:
- $510 per unit for a “fair contribution fee” for the St. Vrain Valley School District
- $4,500 per unit for the “community investment fee” (electric tap)
- $400 per unit for a water meter
- $57.50 per unit for a construction meter
In exchange, HFHSVV commits to a preference policy for Lyons residents who lost their homes in the 2013 floods, and to creating deed restrictions, for the town or another partner to administer, that keeps the homes permanently affordable.
HFHSVV will be billed directly for other fees, such as the Xcel Energy gas tap fee, permit fees, and taxes, all which could add up to close to $5,000 per unit. HFSVV can afford to pay about $15,000 per unit in all permitting taxes and fees and still meet its budget that allows buying land from Ferguson at $50,000 a unit, and foundation costs – while keeping mortgages around $150,000 for families.
The $17,310 in water tap fees that would be required to be paid to the City of Longmont for 6 units will not need to be paid if 6 buyouts in the Confluence neighborhood occur in the same time period (the City of Longmont’s “water year,” a calendar year for water taps, is from Nov. 1 to Oct. 31 ). The net water taps to Longmont would be the same, so there is no change, or at least no increase in taps. The remaining $63,690 in potential water tap fees (which are really licenses to connect or connection charges) that the Town of Lyons would collect for two tri-plexes can be covered by fees that were already collected associated with water taps for 6 to-be-bought-out Confluence neighborhood homes. For water shares, Jim Blankenship provided a formula that the 6 HFHSVV homes in 2 tri-plexes proposed for the Valley Bank site would require a total of 2 water shares, at a total of $50,000. However, the same approach to water taps can apply to water shares: 2 of the water shares that the town will own after buyouts of Confluence neighborhood properties can be applied to the 2 shares that are estimated to be required for HFHSVV homes. There also would be a similar reallocation of sewer tap fees, which would be estimated to be about $42,500 in potential revenue for 6 units.
Also, announced at the June 15 meeting, the final phases for buyouts of pre-flood values are now underway for up to 8 properties, funded by Community Development Block Grant – Disaster Recovery federal money. “It’s good that some buyouts are coming through, so we’re not buying on a credit card,” Trustee Connie Sullivan said.
Trustees said the decision to reallocate connection/tap fees is a one-time decision for this project and not a sustainable way or a model of how to run utilities. Several trustees brought up what was previously discussed as a recommendation from the the Utilities and Engineering Board (UEB) that the town should create a policy for waiving fees for affordable housing to guide decisions in the future.
“This is a very unusual circumstance,” Sullivan said. “I agree that at some point we are going to run out of buyouts to reallocate. There are two very distinct circumstances. The UEB wanted to make sure we created a policy for fees that can be waived for affordable housing. We should still do that.”
The town will be foregoing money that developers pay that funds the maintenance and capital improvements to the water and sewer system for 6 homes. However, the base rates for 6 new homes will be contributing into the monthly payment system (new base rates every month that the water and sewer utilities wouldn’t have without 6 new ratepayers).
Trustee Dan Greenberg moved that the board approve the resolution, and Trustee Dawn Weller seconded it. It was unanimous, 6-0 (Mayor John O’Brien was out of town).
These negotiations wouldn’t have gotten this far if Ferguson wasn’t still under contract on the Valley Bank property with a closing date of June 26, planning to subdivide and sell 6 lots to Habitat for Humanity. When the trustees passed a resolution on June 3 to work in good faith with Habitat for Humanity on reducing tap fees to encourage affordable housing, Ferguson resigned from the special housing committee, and said he was going to terminate the contract with Valley Bank, because the resolution that the trustees passed didn’t commit to a specific flat tap fee of $7,000. Ferguson said he needed a commitment from Habitat for Humanity before his closing date that they would have enough in their budget (planning for other costs like fees) to pay him $50,000 for each lot for 6 homes.
But then, on June 7 and 8, Ferguson said he changed his mind about the Valley Bank project. He decided to keep his closing date of June 26 on the 0.76-acre parcel at 302 Second Avenue, and he started talking with Habitat for Humanity, planners, and others on a solution. Ferguson has not rejoined the housing committee to my knowledge, but he is committed to still working on the Valley Bank project. Ferguson, who owns Planet Bluegrass, is out of town for two weeks for the Telluride Bluegrass Festival, but he worked with the town on providing information needed for the June 15 meeting.
In the meantime, another housing committee member, Tom Delker, announced his resignation on Facebook on June 4 with statements accusing trustees of not wanting affordable housing. The June 3 resolution was clear that the trustees do want to reduce tap fees to encourage Habitat for Humanity, but they weren’t comfortable committing to numbers with a rushed timeline without more information. Now after the June 15 vote, which sets fees lower than the originally requested $7,000 per unit – down to $5,467.50 per unit – it’s even more clear that the Lyons Board of Trustees is committed to affordable housing.
The special housing committee, only appointed about 6 weeks before Delker and Ferguson quit, now has two fewer members, and another member, Nate Mohatt, hasn’t been able to attend meetings this past month because of travel for his job. Ferguson, Delker, and Mohatt are the three people I suggested should volunteer to work on a new Lyons affordable housing group in April, because all had been outspoken against the proposal for about 60 new homes in a new neighborhood in Bohn Park that had been rejected by Lyons voters at the end of March, and they touted ideas they said were new and creative solutions to the need for affordable housing in Lyons. They all took me up on my suggestion and asked the trustees to create a new group, and all three were appointed on April 20. Justin Spencer was recommended and was appointed as chair.
At housing committee meetings last week, Spencer raised the issue of needing new members. Tom Lamz, appointed in March, also has missed the last few meetings, and there are only two other members, Wendy Miller, and Martin Soosloff. What happens next for affordable housing will depend both on whether Ferguson’s closing date is completed, and also whether the special housing committee keeps going with a quorum of members. The proposed development will still be subject to all applicable planning, zoning, and permitting requirements. Ferguson must go through the zoning process and subdivide that parcel so the existing bank building can be sold to a business, and the residential lots sold to HFHSVV. There are still more steps to go. However, I’m still looking forward to the day when I can walk down to the old Valley Bank parking lot on Park Street and join my neighbors in building 6 new Habitat for Humanity homes.
Keep following this weekly column for updates about what has and has not been accomplished. All housing committee meetings are open to the public: regular meetings are the 2nd and 4th Mondays, 5:30-6:30 p.m. at Lyons Town Hall Annex, behind the Barking Dog, and working meetings are every Thursday, 8:30-10 p.m. at the Lyons Valley Village community house.
If anyone is interested in applying to the housing committee, complete the application at http://www.townoflyons.com/images/stories/Advisory_Board_Application_2.pdf (email it to firstname.lastname@example.org).
Amy Reinholds served on the Lyons Housing Recovery Task Force from December 2013 through its end in February 2015. She is currently a member of the Lyons Human Services and Aging Commission and serves as a liaison to the special housing committee. She has lived in Lyons for 11 years and in the surrounding Lyons area since 1995.