Town weighs options for Wildhorse

“It could be a slippery slope”

The five unfinished foundations hidden behind a fence in the Wildhorse Subdivision in Mt. Crested Butte aren’t going to turn into houses anytime soon, and the town is still looking for ways to get the property’s prospective owner to the negotiating table.

Mt. Crested Butte community development coordinator Carlos Velado reminded the Town Council on Tuesday, December 6 that while the developer, The Pauls Corp., which is planning to take ownership of the property January 1, had installed the safety fence around the foundations at the council’s request—“which wasn’t a cheap endeavor by any means”—they’ve been reluctant to offer much more.
Velado said he and town attorney Rod Landwehr had been in contact with members of the council and representatives of Denver Wildhorse Partners, a division of The Pauls Corp., to see if there is ground for negotiation.
Velado has also been in contact with a planner from Gypsum, where The Pauls Corp. has a project similar to Wildhorse. He said the developer was in “good standing with the town.”
But he also explained that a breakdown in negotiations could land the town in expensive and time-consuming litigation, defending its classification of the property as a “nuisance,” or force it into concessions that won’t make many of the subdivision’s neighbors happy.
“I’m trying to work out some kind of agreement with the future possessor of the property on a way to mitigate the foundation issue, satisfactorily and also in a timely manner,” he said. “What we’re here to discuss is what we’re trying to work out with the owner to get these problems taken care of.”
The first option Velado put on the table was to encourage the building process by dropping the town’s permit and impact fees as well as the use tax, which could translate to a 2 to 3 percent savings for the developer, he said.
He also thought it was time for the Town Council to revisit the idea of a financial guarantee to get work done on the foundations, which were determined by an engineer to be structurally sound. A financial mechanism like a letter of credit or bond wouldn’t pay for the development if it isn’t started, but it would cover the cost of removing the foundations if they aren’t developed on the town’s timeline.
As Velado worked down his list of options for the council to discuss, each alternative got progressively more confrontational. What started as “incentivize the building process to encourage development” turned into “explore potential penalties for the municipal code violation.”
But Landwehr warned that the town wasn’t guaranteed a victory if the council decided to pursue a legal remedy to the open foundations and even if they were successful, the process might only earn the town a $1,000 fine, which would barely cover the legal expenses accrued in the fight.
To get to court, however, there’s a process that the town would need to follow. Wildhorse Denver Partners would need to be cited for the municipal code violation and then found guilty beyond a reasonable doubt. Landwehr said he felt the town’s provision was too vague to withstand a constitutional challenge.
“Technically it could be a slippery slope if you try to cite them,” he said.
Velado added, “Now we’re just trying to keep dialogue open to see if we can get something done. But in summation, I don’t know if there’s a really easy solution here.”
Another option being considered is the enforcement of the Wildhorse and Prospect homeowners associations bylaws, which apply to the five foundations and could give the town or the HOAs the authority to require some action on the foundations, whether it’s construction or demolition.
Prospect HOA board president Michael Kraatz says the HOA has found its relationship with the developer to be similar to most everyone else, with few available options for recourse against an owner reluctant to commit resources to the properties.
“We’re in the same situation as the Wildhorse HOA, where they can place liens on the property if it’s out of compliance,” he said, adding that the lien is effective only if the property is being marketed or sells.
One couple who own a home in Prospect said they wanted to pursue some legal action against Wildhorse Denver Partners but found that the HOA couldn’t muster the financial backing to put up a legal battle.
“We were hoping our elected officials would do right by us,” the owner said.
The council agreed that it would be appropriate to postpone any more negotiations with The Pauls Corp. until the developer takes ownership of the properties January 1. Velado said, “Nothing is going to happen with these foundations until the building season, so there is a little bit of time to negotiate.”