RAWLINS — Title 18, a proposed change to how the city governs subdivisions, was debated at the Rawlins City Council Workshop on Tuesday. The course of the debate revealed differences between city officials and construction works may be void, as Rawlins is running low on undeveloped residential space.
Building new residential subdivisions is often a high risk, low reward prospect, according to Carbon County planning and zoning commissioner Jay Grabow. Grabow has spent the last several years struggling through the complicated legal code in an effort to add more homes in the church subdivision.
As the economy of Rawlins and the housing market in particular suffers tremendously with the ebbs of the market, the enormous cost of creating a new housing subdivision can be daunting to the point of foolishness on the part of the contractor. Unlike the Front Range of Colorado, no residential development in Rawlins will net huge profit margins even in the best of markets, but the lows of the economy can destroy the contractor.
As a result of this unpredictable market, Grabow suggested revamping the city’s bonding requirements for new residential subdivisions to get a house to market sooner, which may help circumvent economic decline.
Currently, the city council requires all residential subdivisions be bonded at 125 percent the cost of the project. This level of financial security can often put off contractors, as the millions required to complete the project need months or years. This can leave the contractor’s new housing development extremely vulnerable to market shifts, given the length of time from the first presentation to the first sale.
This scenario has played out, most recently with the development of Highland Hills, where many homes sat empty for years due market changes during construction.
Lowering the bonding requirement may leave the city and taxpayers at risk, according to the PZ’s counterarguments. Citing the same bankruptcies and unsold lots, the city felt lowering the 125 percent bond requirement could put taxpayers at risk to foot the bill, should the market fall out.
Further discussion centered on how to ensure amenities, such as how sewer and water lines are completed even when the market crashes. Grabow suggested placing an encumbrance onto these developments until residential needs are completed; this would prevent the sale of homes to private owners until it was removed.
This suggestion caused fear that, should a contractor go under during the course of construction, the property would never sell due to the encumbrance and the difficulty associated with turning a profit.
This addition may be unnecessary, as the legal code already contains a similar punishment for incomplete developments. This has been poorly enforced in the past, according to the PZ commission, but does allow for developments to be held back from sale if necessary.
As it stands, however, this discussion may be a moot point, according to city manager Scott Hannum, as the city of Rawlins is nearly devoid of unfilled residential space. The major areas left to expand are small, and the majority of those spaces are not open fields, rather these unfilled residential areas are sites of former schools.
“How are we going to develop the properties we already have?” said Hannum.
Improvements to “residential infill” proposed in Title 18 would allow for contractors to more easily and cheaply pursue construction in these regions. The changes would waive the requirement to conduct studies regarding requirements to build roads, storm drainage systems, sewer and water lines, as residential infill often already has these needed amenities.
This would treat these construction projects as upgrading an area already possessing sewer and water, instead of building on an open field, with nothing but sagebrush and prairie dogs to call it home.
Revisions will likely be undertaken between now and the bill’s date with the city council, though the main body of the proposal has likely seen its final draft.
What lies in the future for the changes resulting from Title 18 remains in question, as the city council will vote on the issue during their March 19 meeting.