Driggs City Council Gets No Answers From Shoshoni Plains Developer
May 18 – Driggs City Council gets no answers from Shoshoni Plains developer
After sending a notice of default to Clair Rood, the developer of Shoshoni Plains, Driggs City Council requested that he come meet with them and explain why he is unable to finish his development. At the meeting, several Shoshoni residents also showed up to discuss how the unfinished infrastructure, open trenches, chemicals, debris, and weeds are impacting their daily lives. Many of them paid a premium to buy the lots abutting what was supposed to be the 4-acre park, which is now a field of weeds, rubble, and construction waste.
The situation boils down to this: The original Shoshoni development agreement was secured with a 1.3 million dollar letter of credit – which amounted to 110% of the engineer’s estimate of the infrastructure costs. This 110% financial surety is a city code prerequisite for being able to record a plat and development agreement. This letter of credit required the City’s written authorization before any funds could be withdrawn. The plat was recorded but the infrastructure was only partially built. So what went wrong?
Mr. Rood maintains that at some point in time, he ran out of funds to finish the project, but he did allow that he sold all but 5 of the 141 lots. Most of these lots were sold very quickly, and at the peak of the market with some lots selling for close to $90,000 each. In addition, the 1.3 million dollar letter of credit is now unavailable to the city. However, the city has never provided written authorization for the funds to be withdrawn.
When pressed by City Council, VARD, and the public, Rood explained that as an accountant, he has been busy with tax season and was unable to focus his attention on his financial delinquency. He also did not know what happened to the 1.3 million dollar letter of credit. He did offer to relinquish his right to $480,000 in sewer and water reimbursements. As pointed out by Councilman Jay Mazalewski however, the agreement was to $480,000 in hookup fees or all the fees that accrued by 2017- which ever comes first. It is highly unlikely that in 8 years, there will be enough fees collected to approximate the money needed to finish off this subdivision. In his letter to the city, Mr. Rood also inquired about transferring open space back taxes and Fall River Electric charges to the City.
The meeting ended on uncertain terms. Mr. Rood maintained that he would try really hard to maintain the property, but that he just does not have the funds to finish off his development. The City is now going to weigh their different options for how to proceed. Clearly, some answers are needed here. What happened to the 1.3 million dollar surety? What happened to all the money brought in through lots sales? Even if every lot only sold for $50,000, this would amount to 6.8 million dollars.
We will keep you posted.
Click here to see pictures of Shoshoni Plains