In its last scheduled meeting, the Brown Ranch Annexation Committee hopes to answer the biggest question: How can they close a $250 million capital funding gap?
The Brown Ranch Annexation Committee will meet Wednesday morning for what is currently the last scheduled meeting. While much of an annexation agreement has been decided on, the issues left to iron out are some of the most important. They are also the most expensive.
Chief among the remaining issues is how to pay for the infrastructure needed for the Brown Ranch, which in total is now projected to cost nearly $590 million through the 20-year build-out. (This is up from an earlier $355 million estimate). With revenues the project is expected to spur and 50% of Short Term Rental tax revenue factored in, the committee has $250 million in costs that lack identified funding.
“Until we get a specific proposal from each side showing what they really feel is best, I think we will just be sitting here spinning our wheels talking about concepts and getting nowhere,” said third-party facilitator Jason Lacy at the June 23 annexation meeting. “Right now, when you look at a negative $250 million number, that doesn’t feel very good.”
The outcome of that June meeting was for the Yampa Valley Housing Authority and the city of Steamboat Springs to come back with specific ideas of how to close that funding gap, either by identifying specific revenues or cutting capital expenses in the current plan. Those ideas will be presented on Wednesday.
“I don’t see any way we’re going to reach perfection on this one,” Lacy said. “I don’t see how either side is going to be able to get everything they want, so there will have to be some compromise.”
The cost analysis includes some staggering numbers, with roads on- and off-site costing nearly $175 million alone. Parks and open space are projected to cost nearly $95 million. Off-site water costs (mainly a new water treatment plant on the Elk River) exceed $60 million. Electricity infrastructure, including a new substation, collectively costs nearly $36 million. Wastewater infrastructure on- and off-site is estimated at nearly $28 million.
This table from the fiscal impact analysis presented on June 23 shows infrastructure costs projected for the Brown Ranch. (Brown Ranch Annexation Committee/Courtesy)
Steamboat Springs City Council has met multiple times in executive session since the June meeting where they presumably worked on concrete funding options. Specific ideas haven’t been mentioned much in annexation meetings yet, though the city could opt to allocate more STR tax revenue toward the project ($140 million has been allocated to Brown Ranch in the agreement, but the Housing Authority is requesting at least $210 million or 75% of total projected revenues).
The Housing Authority has outlined several of its ideas in documents prepared ahead of Wednesday’s meeting, including extending and maybe increasing the Housing Authority’s mill levy, using that revenue to pursue bonding and exploring a metro district to help fund later phases of development. Currently, YVHA imposes a 1 mill property tax within the boundaries of the Steamboat Springs Fire Protection District, which raised nearly $1.1 million last year.
All of these are just the capital costs for the Brown Ranch though. When it comes to ongoing operation costs, the Brown Ranch is expected to be a net negative on the city’s general fund to the tune of $1.5 million to $4.5 million annually at full buildout. Filling this gap is on the agenda for Wednesday as well.
(Note: All housing in Steamboat Springs is a net negative on the city’s general fund, as the sales tax revenue that supports the vast majority of the general fund is buoyed significantly by tourism.)
Wednesday’s meeting is the last currently scheduled for the annexation committee. The housing authority has asked that Council hold a special meeting on Aug. 1 that would feature all of the council and the entire housing authority board coming together to iron out any issues left unresolved on Wednesday. It is unclear at this stage if the city would grant that request, though the Aug. 1 meeting is currently devoted only to Brown Ranch Annexation.
The Annexation Committee will meet from 9 a.m. to 2 p.m. on Wednesday in the Carver Conference Room within Centennial Hall. The meetings are open to the public, live-streamed on YouTube and available virtually using Zoom. Public Comment is scheduled for 11:30 a.m.
Top Photo Caption: A rendering of the Brown Ranch's first neighborhood, which hopes to deliver the first units by the end of 2026. (Yampa Valley Housing Authority/Courtesy)