Interest in Burlingame II the topic for Aspen council
July 18, 2011
ASPEN – The Aspen City Council will take up various facets of a proposed expansion to the Burlingame Ranch affordable-housing area Monday during a work session beginning at 5 p.m.
Burlingame’s first phase, completed in December 2008, consists of 91 units. It already has been constructed, sold and occupied. Plans call for 167 units at Burlingame II, but the project, if ever initiated, might be tackled in phases. Both phases are in same area, about 2.5 miles north of downtown Aspen off Highway 82 and Harmony Road, across the highway from Buttermilk.
Discussion is likely to center on pre-sales interest in the project, ways of financing construction and whether to complete the land-use process and design plans. In recent years, officials have discussed the possibility of asking voters for a $50 million bond issue to jump start construction, which would run somewhere between $90 million and $103 million if estimates obtained late last year are still accurate.
Now it appears the city is looking at different financing scenarios that would not involve such a hefty bond issue, as well as phasing construction in a way that would reduce costs while still meeting the expected demand for affordable housing.
“Staff recommends that council forego a November 2011 public vote on debt financing and utilize a pre-sales program to make future decisions on whether or not construction might be pursued with no debt via [a phased] plan,” affordable housing project manager Chris Everson said in a Friday memorandum to council members.
“This approach would postpone construction start, and thus realization of housing goals, by an additional year,” Everson said.
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The council could opt for a plan that would reduce or eliminate the use of debt financing for the project by allocating money from the portion of the real estate transfer tax (RETT) that’s dedicated to housing. For the past 18 months, the RETT has outperformed the city’s conservative budget estimates, Everson said.
“At one time, it was estimated the city would need to issue $50 million in debt to finance the development of Burlingame Phase II, but because of the RETT’s recent resiliency, staff sees the opportunity to significantly lower or eliminate the use of debt financing,” Everson said. Put simply, RETT revenue could be a direct way of financing construction.
An alternative suggestion, mentioned in Everson’s memo, states that the council could start the project – and the creation of local jobs – sooner by moving ahead with a November 2011 vote on debt financing. The amount of financing necessary to get started would be significantly reduced from the earlier $50 million if the project is broken into two or three phases, he said.
At a March work session, council members suggested that Everson move forward with a pre-sales effort at minimal cost. Potential Burlingame II buyers sign up on a “reservation list” and pay a $40 fee to determine potential eligibility under Aspen/Pitkin County Housing Authority guidelines. Under that step, the potential buyer’s local work history and detailed financial information is documented.
So far, of 167 total applicants, 58 have become APCHA-qualified. Eleven of the 58 currently own deed-restricted housing. Of the 167 total applicants, 101 are renters. Most of the demand is for Category 2, 3 and 4 housing.
The pre-sales effort kicked off on April 20. So far, about $18,000 has been spent to advertise it, the memo states.