Wednesday, February 22, 2006

Sun Valley buys workforce housing

City to acquire three units in Elkhorn Village


By MEGAN THOMAS
Express Staff Writer

Sun Valley Police Chief Cameron Daggett, Councilman Blair Boand and Building Official Eric Adams tour a remodeled affordable housing unit in Elkhorn. Photo by David N. Seelig

The city of Sun Valley last week took a major step toward providing affordable housing for its employees.

After much discussion and a tour of the units Thursday, Feb. 16, the City Council voted unanimously in favor of buying three affordable housing units in Elkhorn Springs. The Elkhorn Springs development is a multi-phase residential and commercial project to redevelop the site of the former Elkhorn Resort.

"It is ideal to have these units at hiring. That is the most critical point, sometimes, in hiring," City Administrator Virginia Egger said.

Developer CG-Elkhorn, a Connecticut- and Chicago-based investment group that includes Ketchum-based partner David Hennessy, agreed to develop 15 affordable housing units in the project. Nine will be released this spring.

Before deciding which units to purchase, the City Council and city staff toured the property Thursday with CG-Elkhorn representatives. During the tour, the group saw two new two-bedroom units under construction in the Hillside Terrace North building, a new multi-story residential building on the north side of the property. According to Craig Knight, CG-Elkhorn development associate, the units are identical to Elkhorn Springs' market-rate units.

The group also toured one-bedroom, two-bedroom and studio units that were remodeled in existing buildings of the Elkhorn Condominiums. CG-Elkhorn remodeled six units for affordable housing purposes in the existing buildings. A complete overhaul of the units transformed the interior spaces.

At the meeting following the tour, the City Council—except Councilwoman Ann Agnew, who is on medical leave—considered a recommendation from Sun Valley City Administrator Virginia Egger to buy two, two-bedroom units in the new building, and one renovated one-bedroom unit.

"I do favor having a mix of units," Egger said.

The recommendation stemmed from the city's intent to provide some of its employees with affordable housing units. Government agencies throughout Blaine County have complained that high housing costs are driving away public servants.

The first phase of affordable housing in Elkhorn includes all of the smaller units, which will not be offered in future phases. Future phases will include other two-bedroom affordable housing units in the new buildings.

"I seem to be more intrigued with the other ones that are being remodeled now, because that has the mix ... that we won't see again," Councilman Nils Ribi said. "I see an opportunity to pick up more two-bedroom units in the future."

Ribi proposed that the city buy four units, with the majority in the older, existing building. He also took issue with the pricing structure of the units.

"You are talking identical units. We should pay identical prices," Ribi said.

Egger explained that the pricing structure was calculated according to income categories assigned by Blaine-Ketchum Housing Authority Executive Director Michael David. The pricing assigns considerably different prices to the identical new two-bedroom units.

"We worked pretty hard with BKHA to come up with the pricing and the mix, I think it is important to kind of stick with that," Knight said.

Ribi argued that examining the pricing structure would enable the city to buy more units and better serve employees.

"But by using this formula we are losing one unit that we could otherwise use for one of our employees," Ribi said.

Addressing the pricing structure, the council agreed they did not want to pay a 3 percent fee to the Blaine-Ketchum Housing Authority on the sale of the units. The council agreed that the city's contribution to the authority for the preparation of an "Affordable Housing Needs Assessment" was sufficient. At the meeting, the council voted in favor of signing an independent contractor agreement with the housing authority, which agrees to pay $20,000 for the needs assessment.

Assessing Sun Valley city employees' current housing needs, Council President Lud Renick made a motion to buy two two-bedroom units in the new building and one one-bedroom unit in the old building, for a total of $598,145. The identical two-bedroom units in the new building cost $244,908 and $206,196. The one-bedroom renovated condominium was priced at $147,041.

"Let's look out for the city of Sun Valley employees, which is in turn looking out for the city of Sun Valley ... our first obligation is to look out for the city employees," Renick said.

The motion found a second from Councilman Blair Boand.

During discussion of the motion, Ribi proposed an alternative to buy an additional one-bedroom unit and reshuffle the proposed buying package, with the majority of units in the old building. With an additional one-bedroom unit, Ribi's package was $74,000 over the $660,000 allocated to the city's Work Force Housing Fund in the 2005-2006 budget. Ribi emphasized the lost opportunity of not buying one-bedroom units upon their release.

"There is pride in where you live and this is not the end of the stream in rental housing that we can acquire for the city," Boand said.

In the end, all councilmen voted in favor of buying the three units.

The councilmen also agreed in unanimous votes to establish an employee housing priority policy, with first priority given to the city's fire, police and street department personnel.




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