Some rooms with a view

All that’s required: $6 million in public assistance

Kenny Rogers knew when to hold ‘em and knew when to fold ‘em.

Maybe we should hire him as a consultant.

Because no matter what we do in Mammoth, no matter how we try to clarify our building codes or recalibrate DIF (Development Impact Fees), the point is, when a developer wants to do business here, it’s gonna turn into a bazaar, a bizarre, an arm wrestle with Sly Stallone, a medieval joust. You can throw out every rule you’ve ever invented when a guy with deep pockets swings by with a cart full of produce when your cupboards are bare.

Mammoth View is the latest developer to come to the table, in search of a development agreement with the Town.

Mammoth View insists it wishes to build.

The skeptics insist the company is just after entitlements it will ultimately sell to the next guy.

You probably know more about Mammoth View than you think you do. The owner is Britannia Pacific. The project is located on Main Street just up from Norco and encompasses the Swiss Chalet, the former Cervino’s site and the former Ice Creamery site. Brittania Pacific is responsible for the geothermal drilling at Alpine Circle.

The particulars

A 54-room “boutique” hotel, 24 townhouse condos and 28 freestanding condo “cabin” units are planned on the 5.51-acre site.

According to the feasibility study prepared by consultant Walter Kieser, a restaurant, a whopping 1,000-square feet of retail and a small spa featuring two treatment rooms are among the included amenities.

The study contemplates the project fetching $700/square foot for the residential condo units, though the current market price for high-end condos, according to one local expert, tops out at $450/square foot.

The hotel would be situated along Mountain View Blvd., and curl left past Z Bar Ranch up towards Alpine Circle.

The residential units would be located atop the hill.

Total building area: estimated at approximately 170,000-square feet.

Total building cost: estimated at approximately $75 million.

Total estimated profit margin to the developer (calculated by Kieser) if everything goes as planned: 2%.

It’s the last number which prompts the conversation about a Development Agreement. The developer is requesting up to $6.1 million of financial assistance from the Town of Mammoth Lakes in the form of fee reductions and tax credits.

Padding the bottom line by $6 million would increase the developer’s anticipated profit margin from 2% to 10%.

The question Councilmember Jo Bacon asks is “How do you give away money you don’t have?”

Simple. You essentially waive a few million in development fees and grant a “tax holiday” for the rest.

Meaning, the hotel would collect T.O.T. and give it to the Town … but then the Town would just play a neat accounting trick and give it all back.

The hotel is projected to kick off about $630,000/year in room tax.

As part of the deal, mandated off-site improvements (sidewalks, undergrounding of utilities, et. al.) would receive future tax credits

The proposed holiday would be anywhere from three to five years.

Councilmember Matthew Lehman is torn about the D.A. On the one hand, he’s concerned about precedent. Other developers are bound to ask for the same concessions. On the other hand, you have to weigh three-year tax holiday against a future income stream. “If we don’t help them, do we have that income stream three years down the road? They’re all lofty ideas until someone puts a pick in the ground.”

Community Development Director Mark Wardlaw is supportive of a D.A.

As Wardlaw says, our fee structure for construction is entirely backward, as we disincentive the type of projects (hotels) which actually generate revenue for the town by charging higher fees.

“The tax holiday is not a policy … we’re ‘trying to seed the investment pool.’  This [Brittania] is a big-time company. If Mammoth View proceeds, it will establish momentum and show the world that Mammoth Lakes is a good place to conduct business (as opposed to Truckee, Napa, et. al.) … we’re shifting from preparing for investment to attracing investment. ”

Sheet: Would this [a tax holiday] be precedent setting?

Wardlaw: It takes the discipline of the Town to determine if and when tax holidays should be considered.

This type of D.A. deal is not without precedent. A May 4 story in the L.A. Times talked about how the downtown J.W. Marriott, which opened last year, negotiated $270 million in tax breaks through the year 2035 as a condition for building.

The proposed D.A. has provoked skepticism from many in the community, particularly those in the lodging industry.

As Ward Jones said wryly, “Let me think about [building] Holiday Haus if you’ll give me the same terms. Wouldn’t it behoove you to do [pursue] something that’s already entitled?”

“The only way it makes sense is if a shovel gets put in the ground within 12 months.”

The Sheet attempted to reach Eva Hill, President of Brittania Pacific, to ask if Brittania could agree to such a condition, but was unsuccessful.

Other skeptics included Bacon – “I haven’t seen anything in it to say it’s worth what they’re talking about. It looks like a giveaway to me” – and John Walter – “I get tired of fighting projects that are straw dogs.”

One realtor asked, “Have they [Brittania] asked the county for an abatement on property tax? Have they asked the state for an abatement on worker’s compensation?” His point being that when people are out there looking for handouts, they always approach the Town of Mammoth first.

To take you on a trip down memory lane, when Dave Harvey initially got entitlements in 2003 for a Private Residence Club/condo-hotel project situated approximately in the same location (minus the Ice Creamery piece) as part of Kern River Development, the project called for: 23 Private Residence Club units, 48 condo/hotel units, 37 off-site affordbale housing bedroooms, 233 underground parking spaces, a private restaurant/lobby, spa, meeting rooms, office areas, $2.5 million in off-site improvements and no variances.

Incomplete Pass

Caltrans District 9 Supervisor Tom Hallenbeck spoke at the Lions Club luncheon on Wednesday.  The target date for the opening of Tioga pass is June 30. Sonora Pass should be open by Memorial Day weekend.

Hallenbeck also announced that Caltrans is scheduled to widen the road shoulders near Topaz next summer. This will trequire closing 395 for 12-hour periods over a span of several weeks. It’s that or just shut the road down completely for two weeks, which isn’t realistic.

As most taxeaters are wont to do, Hallenbeck couldn’t help but bitch about the Caltrans budget. Caltrans is funded entirely by an .18/gallon gas tax, regardless of whether gas is priced at $1 or $5/gallon. And the higher prices affect consumption, which hurts the bottom line even more. “When you’re at $4 or $5 per gallon, what’s another nickel?” was his reasoning as to why the state gas tax should be increased.

A lot of us would say that extra nickel might cost $75/year. It ain’t chump change.

‘Course, this is the same organization which won’t approve wildlife signage on Highway 203 and claims that only seven deer and one bear have been hit on 203 in the past decade. As Councilman John Eastman said this week, “sometimes, seven deer get hit in a week.”

This just in courtesy of Cheryl Witherill: Darlene Minnie Benson (Lamfers), 63, a resident of Bishop and Mammoth Lakes for 38 years, passed away on May 17 at Bishop Care Center after a battle with cancer. Darlene worked at The 1849 Condominiums for more than 35 years. She moved to Bishop because she loved her flowers and garden more than the snow. Memorial services are TBD. Donations to ESBCA, Bishop Care Center and Mammoth Hospital Cancer Outreach Program would be appreciated. A full obit will run next week.

And from Geisel’s desk …

The Mono County Redistricting Committee, established by the Board of Supervisors earlier this month, held its first meeting on May 16 to establish its methodology for balancing the the county’s five supervisorial districts pas per the new 2010 Census totals. The 10-person committee (two from each district) now plans to launch a series of public meetings to involve the public in the redistricting process, and the first of these are set for this coming week. The first two are on May 23 in Mammoth at Suite Z, and May 25 in Lee Vining at the Community Center. More meetings are scheduled for June. We’ll have those dates in our next issue. Meetings are from 6-9 p.m. Agendas will be published in advance on the County’s site: www.monocounty.ca.gov. Spanish translation will be available. For more information, call C.D. Ritter at the County offices in Mammoth, 760.924.1804.

Those in attendance at Tuesday’s Mono County Board of Supervisors meeting in Mammoth had to duck to avoid the snippy crossfire between Community Development Director Scott Burns and some of the Board members.

Burns took to the podium to pitch reshuffling of the CDD, asking to fill a vacant Permit Technician position, and replace the other four vacant CDD positions (assistant community development director, building official, senior planner, and FTS IV) with a new Permit Manager position (at will), and part-time clerical help (up to 30 hours per week for permit counters), among other changes to the building inspectors roster. He pushed his plan with gusto, but quickly ended up on the defensive against mounting resistance from Supervisors Larry Johnston and Tim Hansen. Supervisor Hansen said he’s flatly against any new hiring, especially given the current hiring freeze and diminished Board reserves. And Supervisor Johnston railed at increasing the Permit division, especially in light of the slow economy. Johnston added that the division was able to handle more than 80 permits a year during better economic times with just a Manager and a Tech.

Burns countered that more hands would allow them take on more tasks, including handling of environmental and other documents, but Johnston stuck to his position that more permitting staff just isn’t needed in a recessed economy with an average of just 1 permit per month being pulled.

As Board Chair Hap Hazard summarized, while the Board was generally sympathetic to where Burns was headed, the raft of items was deemed too complex and missing too many pieces for a simple up-or-down approval. Supervisors want more time to study some of the plans, how they would jibe (or not) with the forthcoming 2011-2012 budget, and what, if any changes would mean in terms of consistency, levels of service and overall efficiency between departments.

“We want to make sure the jobs get done,” Hazard said.

The Planning Department has been at the heart of some controversy since the departures last year of Public Works Director Evan Nikirk and Building Inspector Rick McManis, whose job is being covered by two previously lower-level inspectors splitting north and south county territories. Meanwhile, Interim Director Jeff Walters said he would remain at the post for at least another month or so until the Board can revisit Burns’ proposals.