This morning at 7:30, the Archuleta Board of County Commissioners will hold a special meeting to approve — potentially — $300,000 in County revenues, to support a grant. The grant will reportedly be written and submitted by a private corporation: the Pagosa Springs Community Development Corporation (PSCDC) to support an ongoing housing project.
The County might have to eventually hand the $300,000 over to the PSCDC. Or it might not.
The allocation of taxpayer revenues beyond what was officially specified in the adopted County budget might be legal. Or it might not.
And handing County revenues over to a private business might be legal. Or it might not.
It’s complicated.
The three items on this morning’s special meeting agenda:
A. Consideration And Approval Of Grant Agreement With The Pagosa Springs Community Development Corporation
The Pagosa Springs Community Development Corporation (PSCDC) has applied for multiple grants to assist in the funding for its Affordable Workforce Housing Project. This agenda item is for the Board of County Commissioners to award a grant to the PSCDC in the amount of $300,000.00 to be used only to cover unanticipated costs, budget overruns and other unforeseen circumstances that exceed the current funding available for the Project.
B. Consideration Of Resolution 2024-______ Appropriating Additional Sums Of Money To Defray Expenses In Excess Of Amounts Budgeted For Archuleta County
This resolution dedicates $300,000.00 of Local Assistance and Tribal Consistency Fund (LATCF) money received in 2023 to the Pagosa Springs Community Development Corporation grant award.
C. Consideration And Approval Of A Letter Of Commitment For The Pagosa Springs Community Development Corporation
This letter to the Colorado Department of Local Affairs Division of Housing provides the Board of County Commissioners’ commitment to the PSCDC’s Affordable Workforce Housing Project in the form of a $300,000.00 contingency grant.
Last Tuesday, after the BOCC finished hearing about a draft ‘deed restrictions’ proposal from Pagosa Springs Community Development Corporation (PSCDC) Executive Director Emily Lashbrooke, she changed the subject slightly.
The deed restrictions are related to an ongoing project — a collaboration between the PSCDC and local development company BWD Construction — that will build, and then sell, ten ‘workforce’ homes in the Trails subdivision. The homes are scheduled to be completed, and sold, by the end of 2024. The deed restrictions will hopefully prevent the subsidized homes from becoming ‘unaffordable’ in the future.
But the homes will not be truly ‘affordable’ in the first place, unless the PSCDC can obtain some grant funding from the state government, to subsidize the project.
Over the past year, Colorado has established several new grants, to encourage the construction of affordable homes and apartments. But there are requirements that must be met, when submitting the grant applications.
Ms. Lashbrooke explained one of the requirements to the commissioners.
“I’m going to shift gears for just a second, to my second topic today, which is… the Department of Housing has the grant that I am applying for. It originally started at $890,000, and they are putting some requirements on me, that I have to guarantee a certain amount of funding that I’m currently applying for some grants on. But I won’t hear back on those [other] grants until after this grant application closes…”
The Department of Housing requires a 10% ‘contingency’ in the project budgets, for this particular project. I assume this requirement is meant to prevent a housing project from “running out of money” — should unexpected costs arise — and as as result, never being completed.
And unexpected costs to arise.
The overall budget for the Trails project is about $3 million, so the contingency (which PSCDC did not originally include in their budget) comes to $300,000.
Ms. Lashbrooke:
“If I could reduce the contingency, I wouldn’t be here today. But I can’t. What they are asking is that I have a guaranteed commitment of the contingency amount, to to $300,000. I do have more grants that I’m looking at. More Prop 123 funding will be coming available on July 1, and that could help. And then I’d like to bring in some other stakeholders in the community,,,”
All of which is to say, the PSCDC doesn’t have the $300,000, and they can’t apply for this particular grabnt without the contingency money included in their application. Would the BOCC be willing to post the bail bond? I mean, make a promise to provide “contingency” funding — in the event the project goes over budget? And in the event the PSCDC doesn’t obtain a future grant — Grant B — to cover the contingency required by Grant A?
Ms. Lashbrooke:
“I really don’t foresee us getting into the contingency more than, I’d say, maybe $50,000. I can’t see a reason, yet. And I think it would have showed itself.”
Can the County even make such a promise, legally?
County Attorney Todd Weaver:
“We have to structure this properly, because there’s a constitutional provision that says we can’t provide credit to any person, corporation… or individual.”
He’s talking about the Colorado Constitution. Article 11.
Section 1. Pledging credit of state, county, city, town or school district forbidden. Neither the state, nor any county, city, town, township or school district shall lend or pledge the credit or faith thereof, directly or indirectly, in any manner to, or in aid of, any person, company or corporation, public or private, for any amount, or for any purpose whatever; or become responsible for any debt, contract or liability of any person, company or corporation, public or private, in or out of the state.
In other words, it would appear that PSCDC might be asking the BOCC to pledge credit to cover a grant requirement — something specifically prohibited by the Constitution.
I guess we will find out this morning, at 7:30am, whether the BOCC will agree to move forward with Ms. Lashbrooke’s request.