The Durango City Council unanimously approved an agreement with Three Springs Tuesday that will raise money for the city to use on affordable and attainable housing projects and opens the door for 100 units of affordable housing for seniors.
“In several different ways, it addresses our housing needs,” Mayor Dick White said.
The agreement with GRVP, the developer of Three Springs, changes how the developer will meet its obligation to provide affordable and attainable housing.
GRVP was required to sell 25 percent of its homes in Three Springs to income-qualified buyers at affordable prices, a city document said. The requirement was difficult to fulfill because while homes were meeting the price range, income-qualified buyers were difficult to find, the document said.
The old agreement with Three Springs pre-dated the city’s Fair Share requirement that 16 percent of a new subdivision be lower-cost housing.
Developers have the option of paying fees in lieu of providing affordable housing.
Under the new agreement, the Three Springs’ Master Home Owner Association will establish a .5 percent transfer fee on the sale of all homes and land within the subdivision until 2057, and give the money to the city twice a year, Assistant City Manager Kevin Hall said.
The transfer fees will fulfill the developer’s affordable and attainable housing requirements.
The fee is expected to generate $24 million over 40 years for the city to use in an affordable housing program, which has not been established.
Hall plans to present the council with some of the housing program options next month, he said.
GRVP previously levied a .25 percent fee on real estate sales in Three Springs that was given to the HomesFund for mortgage assistance.
As part of the agreement, GRVP is transferring 3.1 acres to the city that could be used to build affordable housing for seniors.
The city agreed to sell the land to the Volunteers of America for $10 if the nonprofit receives the tax credits necessary to build a senior housing project.
The VOA plans to build 46 units in the first phase of the project, Hall said.
If the VOA does not receive its tax credits by the end of 2018, the city could renew the agreement to sell the property or go in a different direction, White said.