Tom Ross

06-09-2009

The annexation process for Steamboat 700 reaches an important juncture tonight as the developers and City Council furrow their brows over $80 million in public capital projects and how to pay for everything from roads to fire trucks to enhanced water rights.

It’s presumed the city of Steamboat Springs would share in some of the costs, but how to divide them and how to plan for the possibility that the city’s excise and use taxes collected on new construction won’t be sufficient to satisfy the project’s thirst for dollars is a complex task. The developers estimate the excise and use taxes will generate between $20 and $28 million after Steamboat 700 build-out in 15 to 20 years. City officials worry those estimates are based on inflationary trends that may not come true.

“The critical part is ensuring that there is a reliable mechanism in place to fund all the public facilities necessary to serve that development” before annexation takes place, Planning Services Manager John Eastman said.

The discussion will be of particular interest to members of the public concerned about traffic generated by the future residents of Steamboat 700.

Steamboat 700, proposed on land just outside the city’s western boundary, could someday result in the development of 2,000 new residences. The planning vision for the neighborhoods in Steamboat 700 is similar to Old Town Steamboat Springs, city planner Jason Peasley said, with houses 10 feet apart on narrow lots with garages facing alleys to the rear.

The city’s list of public capital projects stretches to 27 different projects or equipment purchases.

Financing plan

Steamboat 700 project manager Danny Mulcahy issued a statement Monday claiming the financing plan he will bring forward to a marathon City Council meeting tonight is sufficient to cover all but one of the 26 line items on the city’s list.

The one exception is a new (estimated) $8 million public safety headquarters for the city. It would move the facility out of downtown and into Steamboat 700.

Jean Townsend, a financial consultant working on the capital financing plan for Steamboat 700, confirmed that her clients do not think the development entity should have to fund a full share of the new public safety center because it is replacing an existing facility that serves the entire community.

In addition, there are three other major expense items that would be funded under the plan being put forth, but the developers are asking the city to absolve them of responsibility, Townsend said.

They include the $5 million Slate Creek Connector Road that would connect Steamboat 700 to the northeast at Routt County Road 129. Eastman said Slate Creek would be an important roadway for alleviating traffic at U.S. Highway 40 and C.R. 129. He said it is anticipated in the West of Steamboat Springs Area Plan and that Mulcahy has been aware of it.

Mulcahy responded that the road crosses developable property under separate ownership and that the burden of funding the road should be placed on that landowner at the appropriate time. He thinks his obligation should end at preparing a road junction for Slate Creek on Steamboat 700 land.

Mulcahy also would like to be absolved from paying for a pedestrian underpass at Routt County Road 42 that could someday link to a new K-8 public school. He argues that he is already committed to helping pay for the school.

Finally, Mulcahy does not think he and his partners in Steamboat 700 should have to pay for U.S. Highway 40 improvements closest to downtown Steamboat, like the U.S. 40/13th Street bottleneck.

“These improvements have been a community issue for decades,” Mulcahy wrote in a June 4 memo to City Council. “This road segment is substandard now at today’s peak traffic times, and the need for these improvements is not attributable to (west Steamboat) development. If the city elects to move forward with these improvements, costs should be shared citywide.”

Eastman said both the city and the developers are optimistic that state and federal highway funds will become available several years in the future to help the defray of all of the U.S. 40 improvements Steamboat 700 would require.

New developments

The primary questions planning staff will be asking of City Council tonight, Eastman said include:

*Is the list of capital needs complete and have appropriate triggers for each project been set?

*Are the (dollar) allocations reasonable and appropriate?

*And, is there an adequate plan in place to fund all of the capital needs in the event that the city is unable to fund its share up front?

“The pre-annexation explicitly says (if the city is unable to contribute), Steamboat 700 will fund 100 percent (of the total) and the city will pay its share back if possible,” Eastman said.

A development in the funding strategy that came forward just last week is a Steamboat 700 proposal to impose five mills of property tax within its boundary solely for the purpose of funding the capital for public infrastructure. The tax would sunset when the projects were paid for, Eastman said.

Eastman said the proposal is so new that city staff has not had adequate time to analyze it.

Asked if the property tax would apply to the mandated affordable housing units in Steamboat 700, Townsend said, “To the extent the Housing Authority builds and owns them, they would be exempt. That’s the plan and that’s our understanding.”

Mulcahy expressed confidence in his June 4 memo that the funding plan as put forward will meet all of the development’s capital needs, excluding the public safety headquarters.

“There is no gap” between those amounts, he wrote.

Eastman responded, “There is definitely a gap. There’s an $8 million gap.”

City Council gets to weigh that question and dozens of others during discussions that are estimated to take four hours tonight.