Wednesday, July 28, 2004

Ketchum gears up for growth

Consultant says city should recoup annexation costs

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By GREGORY FOLEY
Express Staff Writer

Ketchum City Council members last week started the long process of addressing what will likely be the most difficult question they will face this year: Should the city annex more land into its boundaries?

Under a plan put forth earlier this year by Sun Valley Co., about 100 acres of land adjacent to the River Run Lodge could be annexed into the city of Ketchum. Express photo by Willy Cook

With Sun Valley Co. and developer Sun Valley Ventures preparing to file separate applications to annex large parcels of real estate into western Ketchum, council members and city staff conferred at length Friday, July 23, with an expert on annexation processes.

Susan Buxton, a Boise-based attorney with expertise in land-use issues, told city officials they are about to embark on a balancing act, in which they must seek to ensure the city is compensated for the costs of annexing additional land but also must avoid getting greedy while making their demands.

"The idea is that growth should somehow pay for itself," Buxton said.

For the city, the stakes are high.

Sun Valley Co. has indicated it will submit later this summer a plan to annex approximately 100 of some 160 acres of company land at River Run, immediately southwest of downtown Ketchum.

A master development plan for the site calls for a new 200-room luxury hotel, nearly 500 residential units and a new multi-level parking garage, all potentially worth hundreds of millions of dollars.

The Sun Valley Co. land is located in Blaine County but lies within the city’s designated area-of-city-impact boundaries.

Sun Valley Ventures in August plans to submit an application to annex into Ketchum approximately 65 acres of land at Warm Springs Ranch, located north of the city center along Warm Springs Creek.

The development plan for the 77-acre Warm Springs site includes a new luxury hotel and spa, as well as new residences, said Henry Dean, project director.

While most of the Warm Springs property is under the jurisdiction of Blaine County, approximately 10 acres of the site—including the Warm Springs Ranch Restaurant—is already located in the city’s Tourist zoning district.

Buxton said the city will inevitably hold most of the cards while negotiating with the two development groups. In considering annexations, she said, the city does not have to justify any decision it makes to approve or deny an application.

"Basically, you don’t even have to have a reason," she said. "You can just say ‘yes’ or ‘no.’"

However, Buxton noted, if the city decides to negotiate toward the approval of either annexation application, it will have to quantify what the public costs of the project would be and seek to recoup those costs. Costs for annexations are typically associated with providing public services—such as fire protection and emergency response—and building new infrastructure.

The city can assert annexation fees and tightly control what development occurs on an annexed site through a so-called development agreement, which effectively binds the actions of current and future landowners.

"We don’t want to annex something that is going to be a bigger burden to the city," Buxton said.

By annexing the River Run or Warm Springs Ranch properties, the city stands to substantially increase its tax base and could benefit from the creation of new jobs. In addition, the city can negotiate for other, more-tangible public benefits, such as parks, open space, trails and deed-restricted affordable housing.

The city’s powers will be substantial, Buxton said, but legislators nonetheless must be careful to be reasonable in assessing annexation fees.

"You don’t get a windfall."

Dean said a detailed plan of the Warm Springs Ranch project will be presented to the City Council on Aug. 16. An annexation application will likely come the following week, he noted.

Ketchum Mayor Ed Simon said the city expects an annexation application from Sun Valley Co. "soon."

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