Aspen might bail on bond question
August 8, 2008
ASPEN ” It appears city officials are backing off on their push to put a $50 million bond question on the November ballot, which would borrow money against future tax revenues in order to finish building hundreds of units of affordable housing at Burlingame Ranch.
The decision likely will be made next week when the Aspen City Council will discuss the future of Burlingame and how it should be built to completion.
“I’ll be making a recommendation to not do a Burlingame construction bond on the November ballot,” said City Manager Steve Barwick, adding he is preparing a memo to the City Council for next Tuesday’s meeting.
He said recent conversations with council members indicate they are leaning toward backing off on a bond question.
“I believe that is the sense of the council,” Barwick said.
That’s because the City Council last week decided to rethink how to build the final phases of Burlingame, which includes adding another 64 units, as well as building them apartment-style and with modular construction methods.
Recommended Stories For You
And without a finalized plan that specifies how much it will cost and what it will look like, asking voters to approve borrowing against future tax revenues to pay for it is premature, officials said.
City Councilman Dwayne Romero said it would be irresponsible to ask for money without a business plan in place first.
“It’s tantamount to going into a bank and asking for a $4 million construction loan without a plan,” he said. “We will need to have a business plan, and be able to defend it and own it.”
City Councilman Jack Johnson said he doubts there will be support for a November bond question and Mayor Mick Ireland said he hasn’t made up his mind yet.
For the past few months, city officials and elected leaders have been working on a tight timeline to get the details on phases two and three at Burlingame hammered out in order to make the Sept. 5 deadline to finalize a ballot question.
An exorbitant amount of energy has been spent by government officials to diffuse the controversy surrounding the escalating costs of Burlingame and to rebuild voter confidence. Meanwhile, the project’s future has been called into question by government critics.
An opposition group was formed last month in anticipation of the bond question, arguing that the Burlingame project requires more study and more information needs to be presented to the public. About a dozen citizens planned to rally more people in an effort to shoot down the bond if it was put on the fall ballot.
“That makes me pleased,” said group member Marilyn Marks of the bond question back-off. “Now we don’t have to come up with a name for our group.”
Cost escalations and misleading voter information in 2005 led to the formation of a citizen budget task force, which recommended outside audits be done on the city’s performance as a developer and the financial controls of the project. Those results came back last week and found that the city didn’t have the resource capacity to manage a large-scale project like Burlingame. A recommendation was made to create a separate development department staffed with asset managers experienced in architecture and construction.
The Burlingame controversy also led to the establishment of a construction experts group, a committee made up of citizens who work in related fields. That group has recommended that Burlingame’s original build-out of 236 units be increased to 300. Building more units at Burlingame would increase the overall taxpayer cost of the project but decrease the per-unit subsidy.
Members of the construction experts group have indicated to Barwick that they are no where near putting cost estimates to a new design-and-build model, which is still being hashed out.
“We are just not that far along in that and the pricing,” Barwick said.
But adding more density also will need the approval of the residents there, who have said they are leery of more people, more traffic and more cars in their neighborhood, which is located across from Buttermilk on the north side of Highway 82.
So far, there have been 84 units and one single-family home built as part of phase one at Burlingame. Those homeowners will be able to vote on more density, as part of the covenants written into the condo association’s bylaws.
Barwick said the construction experts group generally supports putting an advisory question on the November ballot that asks voters to approve more units at Burlingame.
The other ballot question that relates to the future of Burlingame is asking voters to renew the Real Estate Transfer Tax (RETT), which funds the affordable housing program and its revenue would pay to finish Burlingame. That question also could be posed to voters this fall.
A bond is necessary to finish Burlingame because the City Council depleted the housing fund last year by authorizing more than $31 million in land acquisitions as future sites for more affordable housing.