Former city manager likely to get another loan extension

Alan Lanning unable to sell Steamboat home, repay $133K to city

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Alan Lanning

— Former City Manager Alan Lanning, who resigned in July 2008, has not been able to sell his Steamboat Springs home and thus hasn’t repaid a loan given to him by the city to purchase the house when he first moved here.

City Attorney Tony Lettunich said the city didn’t act on the collection date agreed to when Lanning left the city because of the distressed housing market. He said the city soon will extend that period further because the real estate market issues persist.

“He’d be unable to sell his house at an amount to be able to repay his loan,” Lettunich said. “We’ll hold on and see if the market turns around and he’ll be able to sell his house.”

Lettunich said Lanning has not repaid any of the $133,000 loan given to him when he became city manager in June 2006. The years of 2006 and 2007 represented the height of the real estate market here, when affordable and attainable housing became one of the biggest issues facing the city.

A provision in Lanning’s employment contract read: “Given the difficulty in finding a suitable and affordable housing in the city, the city agrees to loan Mr. Lanning an amount equal to 20 percent of the purchase price of a residence in Steamboat Springs.”

Lettunich said City Manager Jon Roberts didn’t receive a similar loan to help him buy a house when he was first hired. He said Roberts received a rental allowance for several months after becoming city manager in January 2009.

Lanning’s contract required him to sign a promissory note when he closed on the house. The contract stipulated that he repay the loan within six months of resigning or being terminated by the city. That period was extended to May 31, 2009, after he resigned to allow his children to finish the next school year in Steamboat.

When he left, Lanning also received seven months’ severance pay — about $72,000 after deductions.

Reached by phone Friday morning, Lanning said his home hasn’t been for sale.

“It hasn’t been on the market,” he said. “I intend to put it on the market this spring. There hasn’t really been a market for my house.”

Lanning, who has been the city manager for Central City for 1 1/2 years, said he would do whatever his contract with Steamboat required. Lanning said he still lives in Steamboat and commutes to Central City, where he lives during the week.

Lettunich said he was working on an extension of the loan repayment period for Lanning. He said it would go before the City Council for consideration.

To reach Jack Weinstein, call 970-871-4203 or email jweinstein@SteamboatToday.com

Comments

mavis 2 years, 10 months ago

WHAT??? Come on YVB--- read this... clearily NOW you can see that MY problem is that I am paying for .... and this is the nicest way I can word it .. (several others are more accurate but not appropriate) "stuff" like this??

This is why the government is breaking people. Common sense and business practices don't apply to the Government anymore.

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Scott Wedel 2 years, 10 months ago

Or this is a perfect example of the city taking risks of which the city is so ignorant of the situation that the city never understood the risks the city was assuming. When the city made the loan, they never contemplated that market value could decline and the loan was at risk.

Which is why businesses avoid making such loans directly and instead hire relocation services that are not free, but they also are set up to handle the risks in a situation like this.

I consider this as yet another nail in the coffin of the idea that the City of SS has the slightest clue regarding real estate and risk management.

City should get out of this situation. Convert it to a second mortgage and sell the note to an investor via bids/auction for whatever the market says it is worth.

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exduffer 2 years, 10 months ago

Shouldn't the byline read- "Has not tried to sell his home"

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sledneck 2 years, 10 months ago

Governments operating outside their rightful domain have an inverse "Midas Touch". They turn almost everything they touch to crap. They end up being "favor-doers" for their cronies and mob enforcers for their cronies' rivals, mostly in the private sector.

For every person helped with this "free-lance" approach to government there is at least one or two who are harmed. We seldom hear their stories.

That, of course, is in addition to taxpayers who are harmed right down to the last single one.

I wish taxpayers and voters would ask themselves a simple question every time things like this happened: Was this action ( in this case a home loan for an individual that makes over $125,000/ year) such an urgent and pressing concern to ALL TAXPAYERS that it merited the City of Steamboat Springs go to every taxpayer, put a gun to their head, and collect hard-earned funds that otherwise might have been grocery money, rent money, gas money, childrens Christmas presents, medical bills, etc? THAT'S WHAT THOSE FUNDS WERE BEFORE A CITY GOVERNMENT DECIDED IT COULD BETTER USE THAT MONEY THAN THE PERSON WHO EARNED IT !!!!!

If the electorate understood, let alone respected, the proper role of municiple government they would not tolerate 70% of what this government does. The fact that there is little outrage over matters such as this shows not only how commonplace such abuses have become, but what a woefully ignorant and sheepish electorate we have in the shadows behind these culprits.

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sedgemo 2 years, 10 months ago

This is appalling to read, having friends who can't sell their houses and have LOST their jobs (not resigned them) and get absolutely no mercy from their lenders. From the article:

Mr. Lanning was hired in June 2006. He resigned July 2008. He does not have the house on the market. He has paid NOTHING towards the $133k loan to the city. Three and a half years later HE STILL LIVES IN THE HOUSE! In July he will have lived there twice as long as he was employed.

City employees took pay cuts and still operate on reduced wages while he gets another extension? Is this some kind of alternate universe?

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SAMNEWMAN98 2 years, 10 months ago

An extension is fine but he should be charged the same interest and late fees that anyone else in town owing the City of SS gets. If he does not put his house for sale right a way the city should call the loan in and find a way to collect part of his wages from his job he has now. Once again the city govermant has shown double standards and favortism. At least they should require hime to make a monthly payment of some type.

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Scott Wedel 2 years, 10 months ago

Well, since the City financed the down payment then it is probably a second mortgage. So if he sells now then whatever the loss is absorbed by the city. And if he stops paying on the mortgage and allows the property to become foreclosed then the city would be stuck paying off the mortgage and hoping to sell the house to cover both notes.

So City is basically stuck. If it acts then it loses money on the note. Also, if they act then that is bad publicity for the next time they need to hire a city manager or such.

Big trouble is that city officials never learn. The problem is not that a move like this or Iron Horse went bad, but that they are willing to back debt with taxpayers dollars without understanding the risks they are taking. It is simple incompetence the way the city says there is no risk while the bond issuers via their requirements and pricing are most clearly showing there are risks. From the Black Scholes mathematical model the very existence of a pricing difference due to city backing of debt means the buyers of the bonds recognize that there is risk. So while the city is backing debt and claiming there is no risk, the buyers of the bonds are paying as if there is risk.

So whom should we believe? The financial market that is buying the debt or the city officials that are creating the debt?

I think it is probably time for a local citizen's initiative that would require voter's approval of city's issuance or backing of debt issues.

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mtroach 2 years, 10 months ago

Could someone please explain why we paid severence when their was a ballence on this loan?
If Lanning is currently employed why isn't he at least making payments?

I also can't recall why Lanning left, or why severence was paid if he resigned?

I did a search of the pilot and came back with nada, and once again need forum help to fill in the details of a story.

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exduffer 2 years, 10 months ago

Thanks Phoebe. I think it would be fair to say that there are a few things stored in Mr. Lanning's closets that people (in power) would not like to see out by the curb.

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sedgemo 2 years, 10 months ago

Duff, maybe that's why the house isn't listed? ;-)

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exduffer 2 years, 10 months ago

Oh, I am sure he can find a bartender or waitress to take the chance on it{:>)

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jerry carlton 2 years, 10 months ago

Same old problem. City and School board are not smart enough to promote from within or hire locally. All these big wheels come, stay a couple years and are fired or quit. I have been here 14 years and do not remember how many school superintendents there have been. Only 3 city managers I think but who can remember 14 yers ago?

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