City official calls housing board extortionists for its financial ask | AspenTimes.com

City official calls housing board extortionists for its financial ask

A deal has been struck for the Aspen-Pitkin County Housing Authority to receive $410,000 to be a partner in a public-private development, city officials confirmed Monday.

Jason Bradshaw, who represents Aspen Housing Partners and is developing three properties owned by the city of Aspen, has offered to front load the money out of his development fee and be reimbursed from unspent money in the project budget.

The housing board, which will vote on the deal Wednesday, asked for a financial contribution last week from the developer to cover APCHA's costs for being an operating partner and taking on 45 more units into the inventory.

It was an ask that prompted outgoing Assistant City Manager Barry Crook to call the all-volunteer citizen board "mother-f—ing extortionists."

Several sources confirmed Crook said that after he learned of the board's decision to table Bradshaw and the city's request for APCHA to be a partner so they can benefit in tax breaks as a result of having nonprofit tax-exempt status.

Crook made the statement Dec. 11 in a room where elected officials from the city and Pitkin County had convened as part of a meeting to discuss how APCHA should be governed.

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Crook resigned three days later.

On Monday, Crook further explained his position via email.

"This fee request has never been made before for APCHA's limited role in securing tax-exempt status. It was never suggested to me or to our development team that it would be a requirement of their limited participation in the LLCs in order to extend tax-exempt status to the project," he wrote. "It was given to us at the eleventh hour and we could either accept or the project closing would be shifted to 2019 — with the resulting higher contract prices from all of the firms who will do the construction work and some small additional expenses from 'soft cost' sources. We feel we have no choice but to accede to APCHA's request or risk paying even more in project costs associated with a delayed closing."

It was housing board members who said they felt that the city and Bradshaw had sprung the partnership request on them at the last minute since they wanted APCHA to commit to being a partner two days before they were to close on construction loans and development agreements.

Board members said it was unfair for them to consider a 289-page document with three separate operating agreements with only one day's notice. They voted to continue the meeting until Wednesday to consider an amended agreement.

Crook said Monday that the concept of APCHA becoming a partner long has been known and that the legal paperwork had been filed late, so that is why it came to the board in a rush.

"The executive director signed a letter in January of 2018 that was included in the tax credit application," he wrote. "We understood that this acknowledged the arrangement … in keeping with the last three deals we have done similar to this with APCHA's participation as a partner — that the formal approval was nothing out of the ordinary."

Crook also explained that the city might wind up paying APCHA in the end anyway because of how the deal is structured. If there are no contingency funds left once the projects are built, Aspen Housing Partners would pay the APCHA fee. If there is any contingency money left in the budget, the city reimburses Aspen Housing Partners up to the amount of the fee he fronts — and the amount of contingency left, according to Crook.

The city is putting in a $16 million subsidy toward the project, which will produce housing rental units at 488 Castle Creek, 802 W. Main St., and 517 Park Circle.

To create the 45 units across the three properties, the city will lend approximately $25.2 million in construction loans. When the units become occupied, the city will receive back approximately $9.2 million, thus leaving about $16 million in permanent financing toward the projects.

Crook also said via email that APCHA would not be performing any work it doesn't already do within the affordable-housing system and therefore shouldn't be paid anything over and above what the city and county already subsidize for the program.

Last week was a rough one for Crook, since he is responsible for not only the housing program but also the city's transportation initiatives, which hit a roadblock Dec. 10.

Aspen City Council voted to table an $800,000 contract with Lyft to provide services for the municipal government's mobility lab experiment called SHIFT that's expected to be rolled out in June.

Dozens of people in the ground transportation business railed on council members during public comment for subsidizing a national company and creating competition for them.

Between that and the APCHA meeting, Crook said in a statement Saturday that he no longer feels that he is an effective voice for council.

He sent an email to his fellow city employees Friday saying that he was resigning from the position he's held for 13 years.

He said in his email Monday that he had not planned on retiring for a few more years and his resignation was of his own volition.

City Councilman Bert Myrin, who has long been a critic of the City Manager's Office, said on Monday that he is not opposed to Crook's resignation.

"For 15 years I've watched the city go down one path and the community says it's the wrong path," Myrin said. "They are not involving the community and this APCHA thing and the transportation stuff are just examples of that."

csackariason@aspentimes.com

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