Loss of Lowry and Belmont Proposals

Lowry/Belmont Affordable Housing Development at the Vandaveer Ranch

The Lowry/Belmont proposal turned out badly.

The proposed development involved a major affordable housing project by Belmont Development Corporation of 60 workforce housing units to be built on the Vandaveer property. (See the Packet for the 6/7/2016 Council Meeting, pages 122-159.)  The 60 units were to include 48 low income tax credit units and 12 market rate workforce units for those working in Chaffee county. (See NRCDC minutes, 4/19/2016 and Belmont Letter of Intent.)  The Belmont project was to include government subsidies of over $1.191 million dollars, including $811,654 in federal tax credits and a $380,000 DOLA grant, which would have made the housing units affordable.

For the Belmont development to proceed, it required a commitment for the extension of utilities and the provision of basic infrastructure for the housing units that were to be built. For the infrastructure, Lowry Construction, Inc (LCI) proposed to extend the utilities for the project to the site from across US highway 50 in exchange for a parcel of land on the Vandaveer Ranch. LCI would later offer, in the alternative, to purchase the parcel for $400,000 with the City estimating the cost of extending the utilities at $500,000 if obtained through open bidding. (See YouTube video and transcript of 7/5/2013 council meeting at 1:54:35 to 2:06:30 and partial transcript of meeting.)

After nine months of investments in work, time and money by Lowry Construction, Inc. (LCI), Belmont Development Corporation, the non-profit Salida Natural Resources Development Corporation (NRCDC) which owned the Vandaveer Ranch, and the staff of the city of Salida, the matter came before Salida City Council at its June 7, 2016 meeting (minutes, 6/7/2018, item 6).  Council was asked to approve the Lowry proposal for the infrastructure that was essential to the Belmont development.

With time running out, with LCI saying that after 30 days it would “no longer be a player”, the City Attorney, in response to the Mayor, announced that he had discovered a possible violation of Colorado’s Taxpayers’ Bill of Rights (TABOR) in the existing financing of the Vandaveer property. His announcement threatened to delay and derail the Lowry/Belmont project.  The announcement surprised members of the city council, who asked why they were being told of this at the last minute. (See YouTube Video and transcript of 6/7/2016 Council Meeting 1:54:20 to 3:26:06.)  It was later discovered that Kahn had been given instructions to explore this issue by the mayor over the preceding three months, starting one week before Kahn was hired as city attorney by the City. (See Kahn’s letter to the Mayor of 8/24/2016.)  Had Council been informed of the mayor’s directions when they were given, it would have had time to retain a specialist who could have disposed of the TABOR issue once and for all, allowing the Lowry/Belmont housing proposal to proceed.

To resolve the TABOR issue that he had raised, the City Attorney committed to obtain an expert legal opinion on TABOR. The urgency of this effort required finding and hiring expert counsel and receiving an opinion in time for Council to vote to approve the Lowry proposal within a month.  But the City Attorney added to his mission the objective of finding such an expert lawyer who would give the City the needed advice “for free”.

The unresolved TABOR issue remained an obstacle to action by Council as the City Attorney proceeded unsuccessfully to find an expert willing to work on his terms. Without the support of the Salida City Council, the Lowry infrastructure proposal and the Belmont affordable housing project died.  The Chaffee County Development Corporation instead approved a competing project, which received the subsidies.  This 48 unit 40-60% AMI project is now underway in Buena Vista.

The loss to Buena Vista of the affordable housing much needed by Salida, including the only subsidies likely to be available for the foreseeable future, would cost Salida from 1 to 1-1/2 million dollars to replace. Legal experts later concluded that no TABOR violation existed. (See opinions of Michael Feely of Brownstein Hyatt, of Michael Gray of Sherman & Howard, and of Patrick Wilson of Hoffman, Parker, Wilson and Carberry.)

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