Friday, June 5, 2009

Time to simplify Quigley debate

The Hailey annexation procedure is a

Hailey resident Martin Flannes is an attorney and a principal in Developing Green, a company that offers environmentally friendly building services.


I support annexation of a portion of Quigley Canyon into Hailey and the development of the annexed land with proper conditions and mitigation to the city.

Do I support the "project?" There currently is no "project." Under an annexation procedure adopted by Hailey in 2004, "the city shall not consider any other application ... on the subject property under the city's zoning or subdivision ordinance unless and until the application for annexation has been approved."

So, the current debate on project design and golf course operational issues confuses the core annexation questions: Is the annexation in accord with the Hailey Comprehensive Plan and the city's Area of City Impact Agreement with the county? Is the annexation in the best interests of the city? What is the appropriate initial zoning for the annexed land? What are the infrastructure impacts of development of the annexed land at the maximum initial zoning density? How can Hailey enforce the developer's commitments relating to infrastructure impact mitigation?

The Hailey annexation procedure is a "foot in the door" approach that puts the city at risk of having to provide city services to annexed property at the expense of existing residents unless it obtains sufficient infrastructure mitigation.

Annexation agreements are risky business. In 2002, the Lane Ranch developer sued the city of Sun Valley relating to a 1986 annexation agreement, which resulted in multi-year litigation in which the developer sought $10 million in damages. In 2006, Hailey agreed to annex Old Cutters pursuant to an annexation agreement that provided for $3.8 million in deferred and unsecured annexation fees payable in four installments. The developer apparently defaulted on the second payment, and Hailey agreed to accept an "in-kind" payment of the installment with water rights. Apparently, $1.9 million in fees remains to be paid.

The infrastructure impacts, including water, water delivery system, wastewater treatment and roads, should be quantified without any offsets for assumed new tax revenue, which will—of course—be consumed by corresponding new city expenses.

Furthermore, no weight should be given to projections that the project won't have the "normal impact" on city infrastructure (e.g., that it has plenty of water, will treat its own wastewater, will irrigate with recycled wastewater, and will generate more tax revenue that it costs to provide services to 380 homes and 900 residents). Perhaps. However, Hailey faces a huge unfunded infrastructure cost if these projections are inaccurate.

The golf course could be a valuable community amenity. However, there is no proposal to build a golf course because there is no subdivision application. If there were a subdivision application, Hailey could make sure that it obtained a golf course by having a development agreement requiring that it be built and operational prior to the recording of the plat creating the saleable lots.

Hailey should require that any developer seeking annexation submit applications for the project based on the requested zoning that demonstrate compliance with all of the Hailey subdivision, hillside and stream-alteration standards and any applicable standards of other agencies.

Hailey should also obtain any negotiated mitigation (e.g. cash, deeds for water rights, bonds, security interest in the land, etc.) at the "closing" of the annexation. Otherwise, the city becomes an unsecured lender helping to finance the project.

Finally, I urge the City Council: Open up the "workshops." Listen to all of your residents.

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