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Commissioners Continue to Grapple With Development Agreements

What’s happening? Blackfoot Estates……Spring Hollow Ranch…….Mountain Legends Ranch……Vistas at Waters Edge……Overlook at Fox Creek……West Ridge Ranch……Majestic Mountain Estates…….Targhee Hills Estates. These are some of the many developments that have recently requested development agreement extensions from the county in order to defer the timeline of when they must begin to put in their infrastructure and/or defer the deadline for completing their projects. Naturally, as the demand for subdivision lots and bank financing opportunities continues to decline, extensions have become a common occurrence, but the facts in each situation are all drastically different:

In the some instances, like Spring Hollow Ranch, the project is 90% done, a few lots are sold, but the developer did not want to finish off the project in this market. In other cases like Mountain Legends Ranch, no lots are sold, the project is 0% done, and the developer wants to ride out the depressed market for as long as possible. Then there are complicated situations like West Ridge Ranch, where the project is arguably 90% done, almost all of the 100+ lots are sold, but the developer has struggled to finish the community water system that was part and parcel of the approval of his project. The West Ridge Ranch water system was supposed to also provide water to neighboring Appaloosa Ridge and Trappers Ridge developments, but the current system can only provide water for 25 homes! This situation raises questions about the carrying capacity of the land, and perhaps too many lots were approved in an area of the valley where this simply is not enough water to service them. And finally, in the case of the Overlook at Fox Creek, the applicant sold a few lots, but did not finish off the south end of his project – which, interestingly, was the portion of the project that Idaho Fish & Game recommended be left as open space to protect valuable wildlife habitat along the Fox Creek corridor. The developer of the Overlook said he did not realize that his development agreement contained a deadline for when his infrastructure needed to be complete, and he was also $15,000 delinquent on his property taxes.

Why is there so much inconsistency with each situation?  Until very recently, the county had no system for dealing with these extensions, nor did they have a development agreement template to help protect both the developer and the county in the event of future troubles.  Historically, there was little scrutiny over what was actually contained in the development agreement, and the agreement itself was almost always written by the developer or his attorney.  Naturally, this process resulted in development agreements that were so one-sided in favor of the developer that some did not even have a final deadline for when the project must be finished. Others stipulated that the county would finish off the project if the developer became insolvent!  The previous administrations simply did not require clear and comprehensive development agreements, and they failed to do any due diligence to ensure that they county’s interests were protected. The end result is the present day’s wide variety of poorly written, one-sided development agreements.

Why are these development agreement extensions troubling?  Almost all of these subdivisions and PUDs were approved during the development boom when there was a flood of projects approved with little or no real scrutiny. Many of them in no way reflect the community’s vision for growth, efficient distribution of public services, or protection of our rural landscape. Some include high-density housing out on the far west side where there simply is not enough water to service them. Others are downright harmful to wildlife habitat, or designed around a luxurious gated community concept that the market will simply not support.  Then, there is the fact that we have over 7,000 vacant lots recorded in our valley right now, and a very high vacancy rate amongst the few lots that do have homes on them.

The bottom line is that our real estate market is flooded with a lot of relatively undesirable and poorly planned product that already seems out-dated in light of the community’s vision for growth. As our community goes through the 2011 Comprehensive Plan process, we will develop a further-refined plan for growth, which will make many of these developments even more obsolete. To grant extensions and prolong several of these projects that are simply unsustainable on the landscape, harmful to our rural character, expensive to service, and unsupported by market demands would be irresponsible.

What is the county doing about the situation? When they began their terms in January 2009, the current Board of County Commissioners immediately took action. First, they adopted a development agreement template that provides a high level of clarity and protection for the county in the event of an incomplete project. Then, they established an application process and criteria for granting time extensions for the recording of approved subdivisions and the fulfillment of development agreements.  This process was then formalized when the commissioners adopted a development agreement extension ordinance this last summer.
And yet, the recent wave of extension requests has been complicated and overwhelming. The next step will be to adopt an ordinance addressing what will happen once a development agreement has expired, how the county will handle those development agreements that did not contain a final expiration date, and the rights and remedies that county may exercise in the event of a breach.

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