Sunday, August 18, 2019

Council good with long lease and major donation to Center for Arts

But conflicted over affordable housing fees

by Mark Reaman

The Crested Butte Town Council is ready to commit $1 million in cash and in-kind contributions to the Center for the Arts expansion project.

A formal resolution pledging that amount will be presented to the council at its next meeting on July 6. But the council is now struggling with following an ordinance passed two years ago at the behest of the Center that eliminated affordable housing fees on buildings owned by the town.

The two parties have agreed that town will own the building and lease it to the Center for the Arts under a 99-year lease agreement. An ordinance passed by the council in 2012 eliminated the requirement for ROAH (resident occupied affordable housing) fees for town-owned buildings.

Town manager Todd Crossett estimated ROAH fees would cost about $1.6 million to construct affordable housing units or $800,000 in a payment-in-lieu fee. That is giving some council members heartburn.

Councilman Skip Berkshire stated that the expansion is a Center for the Arts project and wondered if, since the town wouldn’t own the Center outright until completion, the fees should still be in place. While not explicitly stated in the 2012 ordinance, town attorney John Belkin indicated that it would be considered a town building from point of construction.

“The idea at the time was that since the town does a lot for affordable housing, it should be excluded from the fees,” explained councilman Glenn Michel.

“I understand if the project is an affordable housing project like Anthracite Place,” said Berkshire. “But the town hasn’t pussy-footed with these fees and this strikes me as the town bending over backward to accommodate a project. I think it is important to have consistency.

“I believe the studies we have show a nexus between such building and the need for more affordable housing,” Berkshire continued. “This project shows a need. The town hasn’t ducked it in the past.”

“It is a legitimate question whether or not the town should pay the ROAH fees,” said councilman Jim Schmidt.

“But it seems like we would be paying ourselves out of one pocket and into another.”

“If you believe the nexus of the project generates the need for affordable housing then you need to be true to the implementation,” said Berkshire. “I think it is a slippery slope. Otherwise you make a mockery of the ROAH rules. The town should not evade these fees. In this case the town should not be exempt.”

“The affordable housing fund will have some big demands on it,” said councilman Chris Ladoulis.

“It is interesting we are talking about a community art center and artists are generally the ‘starving artist’ types that could use the help,” said Michel. “But the question is whether we are willing to waive a million dollars in ROAH fees to have the benefits of the Center for the Arts in our community.”

“It’s not waiving the fees,” said Crossett. “You have an ordinance that addresses that. It’s not appropriate at this point to discuss rescinding an ordinance.”

“I’m good with the lease and the $1 million contribution, but the fees are another story,” said Berkshire.

The town would split the $1 million between $500,000 in cash coming out of a sales tax interest account and $500,000 in time and supplies from the town. Town finance director Lois Rozman admitted the in-kind contribution would take away from other public works projects. “It will be a balancing act,” she told the council.

“The council has to understand that when this moves ahead there has to be an achievable work load for the staff,” added Crossett. “It’s a game of priorities and the town is saying this is a priority.”

Ladoulis expressed some frustration with the priorities. “We don’t have funding for Christmas lights this December but suddenly we can come up with $1 million out of reserves?” he asked. “That goes against the philosophy of dipping into the reserves.”

“We have always as a staff said we have the reserves in part for one-time opportunities,” responded Crossett. “This is a one-time expense that has great economic benefit to the town. The staff has a very, very strong opinion to not dip into reserves for operational expenses. That’s the difference.”

Rozman said the sales tax interest fund has been building up for many years and it makes sense to tap it for this Center for the Arts expansion project.

“I think we need to be cautious,’ said councilman Shaun Matusewicz. “That money has been waiting for a worthwhile project and the Center is a worthwhile project. So is infrastructure for affordable housing. The big difference is that the Center has some of the best fundraisers around and other projects won’t have that.”

“I’m comfortable with this since the Center is expected to increase its economic impact on town by millions of dollars a year,” said Michel. “That goes directly to the people living here. It’s an investment into the economic vitality of our community.”

“While we have amazing fundraisers, we can’t do it without the town,” said Center for the Arts executive director Jenny Birnie. “Donors need to see a commitment from the town.”

“We are making a large commitment,” responded mayor pro tem Jim Schmidt. “The land donation alone is probably worth $2 million. I hope you make that point to your donors as well.”

“This is not a standard non-profit,” said mayor Aaron Huckstep by phone. “And let’s be careful here because how the council acts could be interpreted differently than intended from people looking to donate. Plus, the Mt. Crested Butte Performing Arts Center and the Center for the Arts are working very well together right now. There is great momentum here.”

“The hardest job of council is deciding how to split up the money we have in town,” said Schmidt. “Does it go to an ice rink or police cars or the Center for the Arts? If everyone is a little mad we probably have done something right. It has been awhile since we made a significant contribution to the Center so this seems appropriate.”

Rozman pointed out that the town contributed about 30 percent of the cost of Big Mine Ice Rink. “At $1 million for a $13 million project this would be less than 8 percent of the project cost,” she noted.

“I think we are supporting the project in a number of ways,” said Matusewicz. “Cash, the land, the waiving of fees. It’s worth millions. I would rather give them $200,000 in cash and everything else.”

“The fees do not apply by code,” retorted Michel. “We’re not waiving fees. I want to go ahead with the original $500,000.”

“We need to keep a balance and be able to sell it to the voters,” said Ladoulis.

Center for the Arts board president Carol May reiterated that the center contributes not only culturally to the community, but monetarily. She said the $500,000 cash pledge is an important element for the overall fundraising effort. She also said the hope was to break ground next year.

“We are asking you and the community to invest in us,” she told the council.

A resolution supporting the $1 million contribution and a 99-year lease will be presented to the council at the July 6 meeting. Another discussion over the affordable housing fees is expected in the future.

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