Wednesday, September 10, 2008
Steamboat Springs The decision to annex the Steamboat 700 property should go to a vote of the people. This is the largest single land use decision of the past 40 years. It's much too big to be trusted to just a small group of people. The public needs to be convinced that the benefits far outweigh the costs.
I have seen many developers roll into town during the past 10 years. Each one sends in a gregarious frontman to "befriend" the community and spin a story. Eventually, we believe the story and not the facts.
It doesn't matter if they are promoting a shopping center, a gravel pit, or, in this case, a whole new town right next to the existing one.
This time it's Steamboat 700 and Danny Mulcahy.
You've read the story. Now, consider the facts.
The Steamboat 700 Prospectus contains the following investment strategy:
"To complete the annexation, entitlement process, and engineering allowing for the property to be developed by a third party. It's anticipated that the land will be sold in an unimproved state within a 3-year period, providing the Class C Members of Steamboat 700, LLC an IRR greater than 20 percent."
The prospectus projects massive profits (more than 20 percent per annum, over a period not to exceed three years, for Class C shareholders) when this property is flipped. The developer's strategy is to promise everything but commit in writing to as little as possible. Their goal is to maximize profits for their 66 investors. Anything that's not in the annexation agreement will not be done. The longer we go without addressing who pays for infrastructure improvements to roads, water and sewage, the more we play into the developer's hands.
Annexation is the most powerful growth management tool a municipality has. It is a contract between the city and the applicant, or, in this case, the applicant's successor, whom we don't even know. The city may ask for anything it wants and can reject the application without cause. Unless the proposed annexation agreement offers substantial net benefit to the city, and legally obligates future developers to deliver the substantial benefits, the application should be rejected.
Don't expect this City Council majority to do it. It already has been bought and paid for by the development community. The president and the president pro-tem clearly appear to have conflicts of interest. Should they even be seated when matters concerning Steamboat 700 are heard?
Omar Campbell is absolutely right. This decision should go to a vote of the people. In order to make this happen, we citizens need to stand up, speak out and be counted.
We need an outstanding deal for the community, not a sweetheart deal for developers.