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  • Dylan Anderson

Brown Ranch annexation getting closer to agreement as ballot question deadline looms

A key issue remaining is what performance metrics will be in the agreement, which could reduce or end funding for the project if not met.

Several key developments moved the city of Steamboat Springs and Yampa Valley Housing Authority closer to a Brown Ranch Annexation agreement on Tuesday ahead of an all-important city council meeting on Sept. 5.


Talks on an agreement do not have to be finalized by Sept. 5, but language for a funding question dedicating short-term rental tax revenues toward the project does. The deadline to get a question on the ballot, which still requires approval on second reading, by Sept. 8.


The current plan would have the annexation agreement approved by resolution later in September with an actual annexation ordinance being considered in October, ahead of council elections. Members of the Brown Ranch Annexation Committee said Tuesday would likely not being their last meeting.


The annexation committee honed in on that ballot language, the city dropped its request for a $10.5 million payment from YVHA for water rights and the two sides reviewed a complete draft annexation agreement line-by-line on Tuesday, noting where some additional language massaging is needed.


Still undecided are two issues related to parks and finalizing what YVHA’s performance metrics will be at Brown Ranch.

“I do think we’re close,” said YVHA Executive Director Jason Peasley at the close of Tuesday’s meeting. “There’s obviously some things we need to work out, but we’ll have a really productive conversation on (Sept. 5) and the goal is still to have this document done in September, so the annexation (ordinance) can roll forward in October.”


Performance Metrics

Perhaps the most significant issue left are what performance metrics the housing authority will need to meet to maintain funding from the short-term rental tax. These metrics are referenced in the current ballot language draft, with the commitment of funding “being contingent on YVHA’s timely completion of affordable and attainable housing units, all as set forth in Section 9 of the annexation agreement.”


The city had initially proposed metrics of 450 units in six years and 1,124 units in 10 years. If the first metric was missed, STR tax revenue would be reduced at a prorated share. (If YVHA produces 300 in six years, not 450, they would receive two-thirds of the revenue.) If the second metric is met, that funding would go back up. If the second metric was missed, the funding commitment in the ballot measure would go away and the city could stop supplying STR revenues to the Brown Ranch.


The housing authority has indicated a level of comfort with performance metrics in general, but suggested metrics that were higher and in their mind, more attainable. YVHA’s proposal was 550 units in 8 years and 1,100 units in 15 years. Peasley noted that they would prefer just one metric, but were open to multiple.


Council President Robin Crossan said she was concerned if the metrics were that far out, the project could exhaust STR tax revenues in phase one that we’re meant for later phases. She pointed to a goal that has been mentioned during annexation talks of Brown Ranch adding 120 units per year.


“My concern is putting all the eggs in one basket in 15 years and then not ever getting passed that,” Crossan said, adding that she preferred a shorter time frame of the metrics.


YVHA Board President Leah Wood responded to say the 120 unit/year goal is accurate and what they are pushing for, but that the metric to continue funding the project should have more wiggle room.


“We’re talking about the outside date of when we lose access to the STR revenue, we’re not talking about the housing authority’s goal date for completion,” Wood said. “There is a big cliff to a commitment that goes away and there has to be some type of an appropriate buffer for construction delays, variances in the short-term rental tax dollar amounts, a recession.”


The two sides agreed to explore tying some of these metrics to various pieces of infrastructure, many of which are triggered by a certain number of units in the annexation agreement. Language that would potentially restrict some STR dollars for later phases is also being considered.


Council member West said she felt the first metric would be the most important because if that one was met the community would have more confidence about the project from that point on.


“To me, the early one is the really important one,” West said.


YVHA Board member Kathi Meyer said no matter what the metric is, the housing authority would be open with the city about progress ahead of time. If there are factors complicating their progress to bring units online, they would share that with the city, Meyer said.


“I don’t think we’re going to wait eight years and say oops,” Meyer said. “One, we agree to performance metrics, and two, now we need to figure out what meets your goal and what meets our goal.”


Parks issues

The city has a cryptic plan to buy land near Brown Ranch for a regional park, a move that eliminated the city’s request for such land to be provided by YVHA through annexation.


Council met in executive session last week about the new plan for a park, but shared few specifics that evening. There are still few details about this proposal, though more information was hinted at on Tuesday.


The updated draft annexation agreement would require the housing authority to build utilities to this regional park, implying that it must be adjacent to the Brown Ranch. South of Brown Ranch is U.S. 40 and the Routt County Rifle Club, east is the Overlook Subdivision and areas near Bob Adam’s Airport, north is largely agricultural land and to the west is the Silver Spur Subdivision.


Council member Joella West referred to a “purchase price” when talking about acquiring land for the park Tuesday.

“We are going to develop a regional park at a different site, not on Brown Ranch,” West said.


But the latest version of the draft annexation agreement also included language from the city that would allocate STR revenues as “seed money” to build this regional park each year, a request the housing authority took issue with. West through out the figure of $1 million a year in STR revenues, though the figure itself was not robustly discussed.


Instead the concept was the issue, with YVHA Board President Leah Wood questioning whether that would follow the spirit of the STR tax, which was passed to help fund affordable housing. While a regional park would likely be considered infrastructure needed because of additional housing and be eligible for use by the tax revenue, Peasley noted this provision would prioritize the regional park above all the other infrastructure needed, including the parks that are within the development.


“The short-term rental tax was passed to address affordable and attainable housing,” Wood said. “To make the first allocation of that funding source be for a regional park I think is misaligned with the purpose of the short-term rental tax.”


The other parks issue involves the sports barn aspect of the plan. There are 8.5 acres set aside for the sports barn facility, which would include outdoor park space as well. But the Sports Barn group has said they would rather work directly with the housing authority rather than working with the city. The city agreed to this, but has raised the concern that this park space would not meet the needs typically met by smaller neighborhood parks and shouldn’t be counted. This would leave the development 8.5 acres short of the metrics for neighborhood parks in the city’s parks plan.


Wood suggested the city provide details of features needed to be considered a neighborhood park and the housing authority would insist that it would have those features in their lease agreement with the Sports Barn group. If those couldn’t be incorporated into the park, “then we have to come up with a different solution,” Wood said.


Water rights dedication

The city dropped its request for a fee in lieu of water rights on Tuesday, saying that the most important component needed to develop existing city water rights is an Elk River water treatment plant, a project that will be largely funded through Brown Ranch development.


The city’s ask had been $10.5 million, a number the city had reached by consulting with its water lawyer and presented as the middle ground of a wide landscape of the cost it could have imposed. The analysis of how this number was derived has not been shared with the housing authority or publicly, with the city saying it was subject to attorney-client privilege.


But in reviewing the updated draft agreement Tuesday, the city had added language justifying its decision to waive the fee in lieu.


“Mostly this is based on the city’s conclusion that our most pressing water supply need is the development of Elk River water rights,” Foote said. “We have the raw water available, and we have the storage rights so we just need to be able to treat that water and distribute it.”


Top Photo Caption: An overhead view of Brown Ranch. (Yampa Valley Housing Authority/Courtesy)


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