Wednesday, October 17, 2007

Bellevue annexation stalls mid-course

Developer balks at $44 million price tag

Express Staff Writer

Developer Harry Rinker told the Bellevue City Council on Monday, Oct 15, that the proposed annexation impact-mitigation fees are too high to make his proposed 280-acre Woodbridge Village an affordable project to build. Out of the $44.1 million cost for infrastructure construction, approximately $24 million would go toward the off-site mitigation of the development?s impacts on the city. Photo by David N. Seelig

"The off-site costs far exceeded what we had originally thought."

This was Harry Rinker's conclusion, as he explained to the Bellevue City Council why he won't be able to move forward with his 280-acre annexation proposal, which would add 578 homes just south of Bellevue on the east side of Gannett road.

At a meeting Monday, Oct. 15, Rinker said the engineers for his Woodbridge Village proposal, Galena Engineers, estimated the total cost of infrastructure construction, including roads, water, and sewer, as well as city annexation fees, at $44.1 million. Of this, approximately $24 million would be used to mitigate off-site impacts, such as improvements to Gannett Road and state Highway 75, a 1 million gallon water tank and a fee of $20,000 per unit.

Rinker said that over the past month his development team became alarmed as they began calculating the costs of fulfilling the requested off-site improvements. However, Bellevue planning consultant John Gaeddert countered that these figures could possibly even be lower than what the city had originally determined to be appropriate.

"We would build this out at a loss," Rinker said. "And a developer without very strong financial backing would go broke."

During an interview Tuesday, Rinker said the units, which would range in price from around $125,000 to $250,000 for a variety of home styles, wouldn't be able to support the increase in cost necessary to make the development economically feasible.

However, Rinker was emphatic about not blaming the council for the disparity between what the city wants and what the developer can afford.

"The council has treated us with fairness and is doing its best, and nothing I say should be construed otherwise," Rinker told the council members. He noted that his goal has been to provide the city with a high-quality product. "I had no intention of burdening any of the city's taxpayers."

The council and staff members, however, were left wondering what the developer could afford and what the next step should be in the process, which has so far taken approximately two years and almost a dozen public hearings and council deliberations.

"The city needs to see the developer's idea of the difference in cost in order to discuss and adjust, and see if the council would be willing to negotiate," Planning and Zoning Administrator Craig Eckles said.

While the council members agreed to have city staff look over Galena Engineer's "opinion of probable construction cost" to see if they agree on the numbers, it was unclear what solution could get the project back on track.

Councilwoman Beth Robrahn said it would be unfair to the city to lower any of the improvement standards they have set for the developer, but that perhaps if the size of the development changed then the mitigation costs would decrease.

However, Rinker said he didn't want to reduce the scale of the project, but also neglected to give the council an idea of what dollar amount would make it workable in its current form. This seemingly put the council in a position to look for ways to cut costs if it wishes to proceed with the annexation, a situation that clearly made City Administrator Tom Blanchard leery.

"I would advise against the council negotiating against itself," Blanchard said, explaining that council members shouldn't shoulder the burden of trying to make the development more affordable. "We need Harry to give us guidelines."

Rinker made no mention of any intention to bring the development before Blaine County, which currently has jurisdiction over the land. The land is zoned in the county to have development potential of one unit per six acres.

"What is the answer? I don't know," Rinker said. "Maybe sometime in the future it could come on again or the land could remain as part of my estate."

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