Friday, March 26, 2010

Community housing solution was best for city

Although payment is deferred, the city’s interest is secure.


Sam Williams is a developer and member of the Ketchum Planning and Zoning Commission.

By SAM WILLIAMS

Phyllis Shafran is inaccurate and distorts facts in her letter to the editor of March 10 regarding the development at 331 Leadville Ave. and its agreement with the city for community housing.

These are the facts:

We planned the development for the corner of Sun Valley Road and Leadville Avenue in 2006 and completed the approval process the following year. The City Council made the decision that we would pay fees totaling $1,245,000 for housing and community improvements rather than provide a dedicated unit. (At that time, I was not a member of the Planning and Zoning Commission. The request to serve came months later, and was unexpected.)

To date, I have paid $450,000 towards the total obligation, which is a matter of record. Shafran is wrong in stating that only $100,000 was paid. The agreement stipulated that the remainder would come from the sale of each residential penthouse. Based on the market at that time, I expected that the project would likely sell out by the end of 2009. Nothing in all my experience prepared me or anyone else for the lack of consumer confidence and fear following the crash of the housing and credit markets.

While late in 2009 sales activity began to improve, the units did not sell out, and the deadline loomed for funding the remaining housing obligation. For months, I explored various scenarios with my lender, project partners, local employers, the city and ARCH, a nonprofit dedicated to providing community housing. Nothing was "last minute" as Shafran asserts.

The solution reached was to discount a unit by 60 percent ($740,000) and sell it to ARCH. Its cost for the unit represents the difference between the unit's appraised price and my remaining obligation. ARCH will hold the property as our real estate market improves, then sell it, realizing gains that will fund more community housing.

Although payment is deferred, the city's interest is secure. In the short term, a single mother and her two children are the occupants of the unit. I chose not to walk away from my obligation, but sought a viable solution when cash was not available. The end beneficiary remains community housing.

My proposal and the corresponding information was available in advance of the council's meeting for public review, as required. Questions and answers were part of the public hearing. Though it was a unique proposal, and therefore confusing to some, Shafran's comments during the meeting showed that she did not understand it.

Shafran certainly is entitled to criticize, but has demonstrated a reckless disregard for the facts in her letter. She does not have a special status allowing her to malign individuals through that carelessness.




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