Fili-Baconed
Whomever said, “Don’t put off for tomorrow what you can do today,” definitely never sat on the Mammoth Lakes Town Council.
Council deliberated on the Snowcreek Development Agreement for three hours at its regular meeting Wednesday before brushing up against its mandated 10:30 p.m. adjournment time.
The discussion was scheduled to continue at 5:15 p.m. Thursday.
The tea leaves would appear to suggest Council adoption of the D.A. with votes from Eastman, McCarroll and Sugimura, who arrived on Council in 2006 as a protégé of Andrea Mead Lawrence and departs a protégé of Neil McCarroll.
Councilmember Jo Bacon made a futile attempt to filibuster the whole decision clear into the next millennium. The only real effect this appeared to have was to ensure the developer’s cadre of high-priced attorneys and consultants would have to sit around Mammoth Lakes and get housed and paid for an extra day.
And not just Lande’s cadre, as Old Mammoth Place’s Jim Demetriades also had the Clearwater Specific Plan Amendment on the agenda, a done deal essentially requiring two more public hearings.
Is this what new Councilmember Matthew Lehman had in mind when he talked about the need for increasing visitation?
In Bacon’s defense, the D.A. was, following the Town’s standard operating procedure, crammed full of last-minute changes. As if the 250-page Staff report wasn’t burdensome enough.
As Bacon commented, “We’ve got so many numbers flying around no one knows what we’re talking about.”
In essence, this is what they were talking about.
The Great Recession has changed the economic landscape and the Development Agreement has been modified to reflect current reality.
In short, development and housing fee requirements have been reduced.
In terms of housing for example, Council’s Interim Housing Policy developed last November would have mandated $18.7 million worth of affordable housing mitigation for the project. The revised number is $8.5 million.
The number contemplated in the initial Master Plan was about $45 million according to Mammoth Lakes Housing Exec. Director Pam Hennarty.
But let’s take a closer look.
The $18.7 million number was derived from an estimated “housing gap” of $209,000 per unit. Translation: The difference between what it costs to build a typical unit versus what it can be sold for to an affordable housing applicant is generally agreed to be $209,000.
However, given the mixed success of new affordable housing construction (in the case of Intrawest’s San Joaquin Villas project, many affordable housing deed restrictions were lifted because the units did not sell in a timely fashion), the lack of available land, and the realization that projects such as Meridian Court (24 units on one acre) are too dense, Mammoth Lakes Housing (MLH) has “broadened its toolbox” to aid its mission to provide housing.
What MLH has discovered is that, on average, it is far less expensive to either buy, rehabilitate and sell existing properties, or to simply provide homebuyer’s assistance to help folks get into homes.
The rehab and homebuyer’s assistance options, according to Hennarty, have proven significantly cheaper than new construction. Rehab has required about a $90,000 subsidy, while the average homebuyer’s assistance subsidy has worked out to approximately $80,000 per unit.
Which suggests that Mammoth Lakes Housing is far more effective when it’s in the housing facilitation business as opposed to the housing development business.
Another issue raised at Planning Commission and addressed in D.A. revisions was the subject of COLAs (cost-of-living adjustments). In a final, negotiated compromise, Snowcreek developer Chuck Lande agreed to pay a COLA on both the $8.5 million housing settlement and $10 million *AFC (“Additional Financial Contribution”) if the average retail sales price of market rate residential and private residence club units is greater than $1,000/square foot.
In other words, if Mammoth Lakes again enjoys the stratospheric property values (I say again because John Vereuck noted that at the peak, Westin Monache units sold for $1,100/square foot) that currently exist for many of Mammoth’s peer resorts, Lande has agreed to index his contributions.
Ah, yes. A rising tide lifts all boats.
While our peer resorts, even in the heart of this recession, have retained values of between $1,000 to $1,800 per square foot, said Lande, Mammoth’s stuck at about $410.
*The AFC is a separate developer contribution designed to provide amenities within Snowcreek’s “sphere of influence.”
The issue targeted by Bacon on Wednesday night really boiled down to, “Are we getting a good deal?”
Community Development Director Mark Wardlaw asserted that the Town will potentially receive $39 million in “community benefits” from the project.
The construction of an 18-hole golf course, for example, is considered to be a $17 million value to the Town.
As Lande said at the meeting, “We’re not going to sign anything that’s not fair to all parties.” He added that the Town wants the hotel, the product, the branding, and ultimately, the tax revenue his project will generate.
The ultimate question revolves around whether or not you believe Lande and the Town’s bevy of third-party financial analysts, or whether you agree with Kirk Stapp’s assertion that we have mortgaged our future with vesting fee giveaways which still won’t incentivize a spadeful of dirt being moved in the immediate future.
At the Mammoth Lakes Housing Board meeting on Monday, Stapp lashed out at Town Manager and fellow Board member Rob Clark. “I’m on the side of the community. You’re on the side of the developer.”
Mayor Neil McCarroll, who voted 3-2 at that MLH meeting (with Clark and MMSA’s Jim Smith) to support the $8.5 million housing mitigation option, remarked at that same meeting, “Chuck Lande has a huge burn rate [financing the property] on Snowcreek and is motivated to build.”
