Housing Authority in Steamboat to address perception

YVHA board plans public information campaign

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— The board of the Yampa Valley Housing Authority spent 30 minutes Thursday talking about how to describe the challenges and opportunities presented by its Elk River Village property and related debt as it prepares to launch a public information campaign about the mission of the Housing Authority.

The board has resolved to go to the voters in November to seek a property tax that would allow the Housing Authority to establish fiscal autonomy and wean itself off subsidies from Steamboat Springs and Routt County governments. However, board member Catherine Carson and Asset/Program Manager Mary Alice Page-Allen said the educational campaign should not be mistaken for an election campaign.

“This is not part of a campaign for the proposed tax,” Carson said. “We need to tell the public our long-term and short-term plans for Elk River (Village). It’s an opportunity for us, and we need to define that opportunity.”

The board voted, 6-1, with several members absent, on Jan. 10 to seek a tax within its district that would raise about $395,000 annually and cost the owner of a home valued for taxes at $500,000 about $22 a year.

Page-Allen said she is repeatedly reminded that members of the public don’t understand the width and breadth of the Housing Authority’s work, from educating prospective homebuyers, to managing low-income rental apartments to owning and managing the Fish Creek Mobile Home Park.

Board member Kristi Brown said members of the Housing Authority’s public relations and strategy committee intentionally sought out members of the public they could predict would not be in favor of a property tax question and discovered that for the most part, those residents were unaware of the role of the Housing Authority.

“We asked them how they feel about the Housing Authority and most said, ‘What is it you do?’ They either didn’t know or think we own the Iron Horse,” Brown said. The Iron Horse is a troubled work force housing project owned by the city of Steamboat.

“They didn’t have a strong opinion one way or another on the Housing Authority,” she said.

Elk River Village is an undeveloped 10.76-acre parcel near U.S. Highway 40 and Routt County Road 129 on Steamboat’s west side. It originally was approved as a private sector neighborhood of small, single-family homes.

The Housing Authority purchased the property in 2006 and makes payments annually of about $110,000 to cover the interest on the $2 million loan.

Board members say they don’t want the community to have the impression that they are seeking the property tax in order to cover the debt.

Board member Ed MacArthur, who is on record as being opposed to seeking the property tax, noted that the property is listed for sale and the board diligently has brought experts in to assess the situation. He said the Housing Authority has plenty of company from developers in the private sector who face a similar dilemma — holding a piece of development ground that is worth less than they paid for it.

“It isn’t like it didn’t have existing approval and an upside” when it was purchased, MacArthur said. “This one’s tough, no question. Elk River is a burden we have to deal with internally.”

— To reach Tom Ross, call 970-871-4205 or e-mail tross@SteamboatToday.com

Comments

Scott Wedel 3 years, 6 months ago

But what is important is that the housing authority is, in theory, an important public service that is supposed to continue on regardless of the state of the economy. But they made the fundamental mistake of being intoxicated by the potential benefits of development and acted like a private developer when purchasing the property. And while a private developer takes the risk of development and can go out of business if they get it wrong, when a housing authority gets it wrong then they have to ask for a tax hike to repair their budget being ripped apart by the debt payments.

For the housing authority to be defending the purchase as having an upside when it was purchased, tells me they still have not figured out why it was wrong. It was wrong because it was an unacceptable risk. Unlike a private developer that can balance the risks of making a lot of money with the risk of losing money or going bankrupt, a housing authority can never accept the risk of losing money that threatens its existence.

Until the housing authority will clearly state that they now recognize they cannot take risks that threatens the future existence of the housing authority then taxpayers should not give them funding.

Also, it is not obvious how their management of Hillside apartments purchased many years ago at a price far lower than current market rates generates so little positive cash flow. Sure they need to maintain the units, but market rent has increased substantially over the past 15 years and they should be able to rent the apartments at what is recognized as an affordable rent and still generate substantial cash flow.

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Scott Ford 3 years, 6 months ago

Scott W - Well said.

It is my understanding that the funding for Hillside Village Apartments was some type of government based loan that places restrictions on how much can be charged based on a residents income. It is this formula that precludes the YVHA from simply charging more.

If YVHA were to dissolve, would the City and the County become responsible for the management of Hillside Village Apartments, Fish Creek Mobile Home Park, and note on Elk River property? My guess the answer is yes because of the intergovernmental agreement that exist that formed the YVHA. Knowing this the City Council and the Routt County Commissioners have to be some of the strongest proponents of having this tax passed.

If YVHA dissolves, it would be a first class mess. The City could likely find themselves being responsible for funding for the administration of the Hillside Village Apartments, Fish Creek and the servicing the debt of the Elk River property. I am pretty sure that the County will view this as primarily a Steamboat Springs problem.

From my perspective, having folks better understand the mission of YVHA through education is not a strong strategy. To put it simply, if folks do not believe the YVHA is necessary, do not spend time trying to convince the inconvincible. - Instead focus on what a mess it will be for the City of Steamboat Springs if YVHA dissolves.

Tell the voters that either way they are going to pay. Having the YVHA administer all these items is likely a far better deal than envisioning having the City be responsible for it. Focus on the FEAR of having the City of Steamboat Springs administer the duties currently being done by YVHA. Do not underestimate the power of FEAR as a voting motivator.

If this tax does not pass, the City and County paying $80,000+ each to YVHA annually for many/many years to come may be getting off cheap compared to the cost of losing the YVHA and having the City do it.

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Fred Duckels 3 years, 6 months ago

We are going to pay one way or the other. If we would disban the YVHA, I would vote to approve the tax. Let's clean up this mess, but not continue to throw good money after bad.

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pitpoodle 3 years, 6 months ago

I don't agree that the fear strategy will work as a way to get voters to agree to providing continuous funding from a new SBS property tax. It is called throwing good money after bad. If the city and county must pay for years to come, perhaps those entities will come up with a solution to minimize the expense. There will be no solutions explored, if voters say yes to a permanent source of income to allow more irresponsible actions by YVHA. Taxpayers will not get off cheap in any of your scenarios.

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Scott Wedel 3 years, 6 months ago

Scott F: I too can play that game: Well said.

I think the fear argument is not going to work for the taxpayer because dissolving YVHA is not that scary to the public. In the scenario you describe, it is mainly the City government that has the fear and so the city might fund YVHA.

I think taxpayer fear would currently work against passing a YVHA tax because the public would fear yet another speculative financial move by YVHA that could require yet another tax to bail them out. When an addict is in dire straits then you don't say they've learned their lesson and give them more money. You make them go through rehab and adopt a lifestyle removed from addiction. YVHA has yet to rehab itself and yet is asking for money.

As for income from Hillside apts, I see the issue to be whether YVHA has been raising rents according to whatever affordability index they use. I know HUD's calculation of affordable rent used for Section 8 assistance has increased notably over the years. I also recall from an earlier article that YVHA said they had a very long waiting list which, in this market, makes me wonder what they are charging for rent. It is also very easy for an organization like YVHA to view their properties as just needing to have slightly positive cash flow and so they only increase rents to cover their costs. If YVHA uses HUD's calculation of affordable rent for Routt County as their baseline rent for Hillside then that would make some sense. But if they are undercharging because they accept just breaking even then they'd be asking the taxpayer to fund what they themselves say isn't important enough to ask their tenants to support.

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jerry carlton 3 years, 6 months ago

NO NEW TAXES. My property taxes increased 93% from 2000 to 2010. My income increased 49%. Look at your own figures before you vote for any kind of tax increase.

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Troutguy 3 years, 6 months ago

How much did your property values increase in the last 10 years? That may have something to do with the property tax increase, don't you think?

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sledneck 3 years, 6 months ago

Is it acceptable that property taxes go only one way?

YVHA, Scarce resources- alternate uses.

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