Steamboat City Council clears way to lift deed restrictions at Sunray Meadows

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— At its last meeting, the Steamboat Springs City Council paved the way for an easier process to lift deed restrictions from residential properties, but it remains to be seen how wide the application might be.

Instead of just removing the deed restriction for the one Sunray Meadows owner who was before the City Council on March 4, members voted to allow the owner before them and the two remaining deed restricted units in the development to all receive the same deal administratively if requested.

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There were seven original deed-restricted units at Sunray Meadows in a building that the developers of Edgemont purchased to partly fill their community housing requirement. Each owner had the same terms in their deed restriction but received vastly different subsidy amounts, ranging from $60,900 to $165,500.

The first owner to request the restrictions be lifted reached a deal with the city to pay back 11 percent of the subsidy at sale or refinance.

“At that time, we said we’d honor the same terms with anyone else that asked,” Steamboat Springs Planning Director Tyler Gibbs said. “Each one was still being taken through council individually.”

Before March 4, only one other owner had gone through the process to ask City Council to lift the restrictions, and two deed restrictions at Sunray Meadows were lost to foreclosures.

The situation at Sunray Meadows, where multiple deed restrictions were crafted at once, might not present itself for the city in the near future.

Deed restrictions come in many different forms, according to the circumstances they were written under.

There are 96 deed restrictions in Steamboat, according to Steamboat Springs Planning Director Tyler Gibbs, and about a third of those are under the purview of the city.

When the City Council voted to suspend the city’s community housing requirements, unsold units had deed restrictions lifted if they were subject to the ordinance, but units that went through a different process, such as the planned unit development process, had to go to City Council to request those deed restrictions be lifted.

If, in the future, multiple deed-restricted units created under the same terms request relief, the city could follow the same path as Sunray Meadows by crafting a deal for all affected owners that could be approved for each administratively.

“We don’t have anything proceeding along those lines,” Gibbs said.

In West End Village, where there were more than 40 deed restricted lots, owners were allowed to buy out of certain deed restrictions after negotiations involving the city of Steamboat Springs and the Yampa Valley Housing Authority.

The Yampa Valley Housing Authority recently has seen a request by a Fox Creek Village owner to lift a deed restriction, according to Executive Director Jason Peasley.

The first question, Peasley said, is whether the organization and its board are open to the idea of lifting deed restrictions.

“We as a community invested a lot of money to make sure those units were affordable,” he said. “As stewards of that resource for the community, how does the community benefit from” lifting the restrictions?

The second question is what a potential deal to lift restrictions at Fox Creek Village would look like.

If a deal was struck that mirrored what was done at West End Village, Peasley said, the buyout cost would be significantly higher and practically unaffordable.

The housing authority has lost two deed restrictions in Fox Creek Village to foreclosures.

To reach Michael Schrantz, call 970-871-4206, email mschrantz@SteamboatToday.com or follow him on Twitter @MLSchrantz

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Comments

Fred Duckels 9 months, 1 week ago

We need to erect a monument on the court house lawn for all the do gooders that championed this debacle, or used it to go on to higher office. I was mostly alone in denouncing this political pawn for what it was. Sometimes gloating feels good.

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Scott Ford 9 months, 1 week ago

Hi Fred – I am glad you have a long memory!

One of the biggest challenges is that if those who forget or ignore history are doomed to repeat it. We are just a little over a year away before the suspension of the “affordable housing” requirements are re-instated. During the summer sometime the City Planning Department is going to hold a series of forums to discuss the housing issues in Steamboat Springs. COME!!!

I am a data guy and I could not get anyone to define for me what the scope of the problem was, other than it is expensive to live here – and the number of households that were spending 35% on housing expense. The percentage a household spends on housing maybe a problem but I am n not too sure it is a problem local government is any good at fixing. Believe me we tried!

The outcomes or the attempts includes inclusionary zoning – payment in-lieu and deed restrictions. All sounded like good ideas to some and totally goofy to others at the time. Adventures like the Iron Horse should serve as a reminder as a community we are capable of doing some goofy things.

Local Government does play a role in the housing policy of a community. The role it plays is in the area of zoning/land use. Although messy market forces are likely the best strategy for working this out. Without question there will be winners and losers.

(Although I am a member of City Council, I want to stress that the views expressed in this posting are my own and may or may not be shared by other members of City Council or staff.)

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jerry carlton 9 months, 1 week ago

Scott Currently 83 degrees and sunny. See you in early May. Jerry and Mona

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Scott Wedel 9 months, 1 week ago

Well, even I was critical of the city's affordable housing plan.

It is a fact that developments have an impact upon the local workforce. Since developments are asked to cover the costs of upgrading roads and such, it isn't bizarre to suggest they should mitigate their impact upon the availability of lower paid service workers so needed by some in our local economy. (The counter argument that we want a shortage of those workers so that their pay increases is also plausible.)

But the rest of the city's plan was a complete disaster.

First, deed restrictions are a nightmare because they create artificial incentives to comply with the restrictions. Resale restrictions create incentives to not move or not to do maintenance (put the repair expense on the buyer) and so on. Income restrictions create incentives to have only some reported income and a larger amount of unreported income. The false assumption made when creating deed restrictions is that the deed restrictions don't affect people's financial decision making process.

Second, inclusionary zoning within a development is just wrong. How can you have a development with luxury services along with affordable units that cannot afford those services? The claimed impact of the development is a need for additional service employees and so, at most, the developers could be asked to create some housing for the additional workers. Which could mean kicking in some money to build modest homes, condos or apts in the region. But when we know that not every SB service employee lives in SB then it was just economically stupid to say the housing must be created in the new SB development.

The right way to make some affordable housing units is by smaller lots with smaller houses.and allow more multi-family housing.

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john bailey 9 months, 1 week ago

but Scott, nobody wanted to hear about that carp years ago, they just wanted a piece of the action....it was all about the big xitty.....county folks don't matter.

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Scott Wedel 9 months, 1 week ago

John,

Their argument was that a 30 minute commute isn't desirable so only units conforming to their plan of ideal urban design counted as mitigation.

It was that sort of ignoring the economic reality of where current workers are choosing to live that explains why the city's plans failed so miserably.

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john bailey 9 months, 1 week ago

Scott ,that's too bad, my 30 minute commute here beats anything I ever experienced when I lived down on the front range. nothing like slowing down to a cattle drive ahhhhh. but then to each his own, no need to overpopulate the county , we like it just fine how it is....more room for hulaing....~;0)

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Scott Ford 9 months, 1 week ago

Scott W – You nailed it! –Smaller homes on small lots. (This comes down to zoning.) The link below is to a development in Breckenridge I believe you and I have discussed before.
http://www.poplarhouse.com/index.php This is The Wellington Neighborhood in Breckenridge. These are single family homes ranging in size from 1,250 to 1,995. Homes typically face a central common area and many have a front porch. It was built on the remains of an old gold dredging operation. A contractor from the front-range essentially had set floor plans and a majority of the home was built in sections I think in Brighton and the pieces of the home were assembled at the construction site. I think they have well over 100 homes on small lots that are .15 acre. The homes sell in the low $300K range.
I am not saying that something of the same scale is necessary – but something involving small homes on small lots works and this is an example.

(Although I am a member of City Council, I want to stress that the views expressed in this posting are my own and may or may not be shared by other members of City Council or staff.)

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Scott Wedel 9 months, 1 week ago

Tamarack Point near the corner of Tamarack and Hillside was an affordable development when it was built. So it can be done locally.

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