Meadows developers seek public bailout of affordable housing project
July 17, 2006
Developers say rising construction costs may doom their Glenwood Springs affordable housing project unless they receive millions of dollars in financial assistance from the city and Garfield County.
Glenwood Meadows developer Robert Macgregor of Aspen and representatives with Spruce Realty, a partner in the project, plan to make their case to Garfield County commissioners this afternoon. They also have been exploring their options with city officials.
The partners are trying to build a 120-unit rental housing project at Glenwood Meadows, with 84 units restricted to lower-income families. Ultimately, their goal is to build 300 rental units at Glenwood Meadows, and meet what they say is an urgent need for rental housing locally.
“Certainly I’ve learned a lesson why nobody is tackling the low end (of housing),” Macgregor said. “It’s not easy to do. Certainly it requires a lot of cooperation all around.”
The cooperation developers are seeking now comes after they updated their project costs four months ago, said Arny Porath of Spruce Realty.
“To our amazement the costs had just risen beyond anyone’s expectations in the order of $5 million or $6 million above what had been budgeted,” Porath said. “It’s fairly basic, it’s dollars and sense. We have no control over the escalation of material costs and labor costs. Everyone is experiencing that.”
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Garfield County manager Ed Green said developers have proposed that the city and county contribute $2.3 million apiece to save the project.
In the county’s case, it would be a straight contribution out of the county’s general fund.
“The question is, do the (county) commissioners view it as the best way to use that $2.3 million,” Green said.
Macgregor said he is hopeful because of comments commissioners John Martin and Tresi Houpt have made about the need for more affordable housing.
Green said the county has saved up $4 million to $5 million in private activity bond money in hopes of lending it to a housing project such as this one, but the Meadows project isn’t eligible because it already is receiving tax credits.
As for the city, Green said developers are hoping to receive a $1 million public improvement loan, $720,000 in fee waivers allowed under city ordinance, $200,000 in waivers not now allowed by the ordinance, and $360,000 in savings resulting from postponing meeting a park requirement.
Glenwood Mayor Bruce Christensen said he doesn’t know if developers have formally proposed anything to the city, but a number of ideas have been discussed.
Last fall, City Council approved the 120-unit project, and agreed to concessions including a height waiver restriction. However, council members turned down a request for nearly $500,000 in fee waivers, out of concerns about the city’s ability to afford losing the revenue and the appropriateness of subsidizing a private development.
Christensen said developers are welcome to make another presentation to council, but he has no idea how council members would react. He said he probably would be more receptive to making further concessions if the units are made available on a priority basis to people working in town.
Developers are proposing a mix of one-, two- and three-bedroom apartments. Those that are income-restricted would be limited in some cases to residents earning below 40 percent of the area median income, and in other cases to residents earning below 60 percent of the median.