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HomeMy WebLinkAboutRoad Impact Fee Waiver Request 04.06.2017Int Habitat for Humanity® Roaring ForkValley HABITAT FOR HUMANITY RESTORE REQUEST FOR PARTIAL WAIVER OF ROAD IMPACT FEES 4/6/2017 F,M4Ct F-eiS' 4 BGG WAivM/' rx4 fit/5" Executive Summary Habitat for Humanity of the Roaring Fork Valley has operated a ReStore facility in the area since 2007. The ReStore sells a variety of gently used goods from furniture and housewares to building materials. After many years renting retail space to operate the ReStore, and expanding from 2,000 SF to over 51,000 SF in several rental spaces in the RFV, Habitat finally has the opportunity to build our own "Forever Home" for the ReStore operation. This building, under construction in South Glenwood adjacent to the existing ReStore Boutique and Warehouse locations, will allow the consolidation of operations to one building. Ownership of this building will secure the long term future of the ReStore operation and stabilize key operating expenses with many community benefits. We recently learned of a new impact fee in Garfield County assessed to mitigate the impacts of development on the County's road infrastructure. This fee for the ReStore under construction represents a significant, and unanticipated cost to the project budget- and places a burden on the project which will require deferral of project scope. The ReStore is the engine that drives our entire operation, every dollar earned is put back into the community through our affordable housing program, salaries for our local staff members, and support of local businesses. The ReStore model has helped Habitat become self-sustaining covering all of Habitat's overhead- allowing all financial donations/grants- to flow through directly into our home construction. The more efficient we can be in the ReStore operation - the more families we can help with affordable homes, a critical and ever-present need in the RFV. Background Planning for this new building has been underway for several years starting from the purchase of the land to securing construction and long term financing through the USDA Rural Development program. Habitat has worked closely with Garfield County since 2014 to understand and fulfill the project requirements for the site. The project was designed and issued for public bid in November of 2016, approximately 5 months later than originally anticipated due to approval delays with our financing partner, the USDA. The project was subsequently awarded to a general contractor in December 2016. The nature of the building required a general contractor to be on board, with input from their subcontractors, before we could complete a building permit submittal. With the General Contractor committed, and permit documents in process, Habitat once again reached out to the Garfield County Building Department to schedule a pre -application conference to review the project and pending permit submittal with the Community Development department. This meeting took place in early February 2017 and at that time, Habitat was made aware of the newly implemented Road Impact Fees assessed on all new commercial development within Garfield County. This new fee came as a surprise and major potential impact on the budget, and had not been discussed at prior meetings with Community Development. The impact on the budget and timing of the fee was extremely disappointing considering our original push to submit for permit in late 2016, wherein we should have missed the application of the fee to this project. Fee evolution At the time we became aware of the new fee, the project budget had been finalized and approved by the USDA, our lending partner. The fees included in this budget were based on the typical fee schedule for a building permit submittal in Garfield County and amounted to approximately $20,000 of the project budget. At initial review, the Road Impact fee for this project, categorized as a commercial/retail facility was estimated at approximately $140,000. Based on the significant impact this cost would have on the project budget, Habitat reached out to Garfield County Community Development to review this fee and the approach to the calculation. Community Development Staff (Tamra Allen and Dave Argo) have been exceptionally helpful in reviewing this project and discussing how to best address this unanticipated and significant cost. In these discussions, Habitat and Garfield County agreed the ReStore operation functions differently than a typical retail establishment and would generate significantly less traffic than a retailer of similar size. As a result of this discussion, a portion of the space is allocated as 'warehouse' as opposed to retail. In addition, the spaces which support the retail function, but are not sales floor, were classified appropriately (for example office space or mechanical areas were not calculated as retail SF). The revised classification of square footage from retail to warehouse etc. reduced the road impact fee from $140,000 to $69,527. In an effort be consistent with the potential traffic impact of the building, the code required parking area was also revised to align with the parking that would be required of each individual classification. This reduced the parking requirement by code from approximately 165 to approximately 75 spaces. This approach is appreciated by Habitat as the original parking requirement was significantly more than we have needed at any of our current facilities. 2 Unanticipated cost vs. budget The project represents Habitat's single opportunity to build and operate a quality facility for the community, while also stabilizing our fixed carrying costs. The financing for the project is fixed and was largely established based on appraisals and market comparisons of other commercial properties in the area. Based on a lack of high quality, energy-efficient, new build warehouse space to use as a comparison, the budget for the project was challenged at the start, forcing the prioritization of scope. With these goals and constraints in mind, Habitat has been diligent in allocating dollars towards scope which will benefit the operation in the long term, and add value to the project. We have secured grant funding to assist with the payment of energy efficient features which otherwise could not have been accommodated in the base budget. As with any typical large project, there is a contingency fund held for unanticipated costs which presumably could cover this cost. While the recalculated fee is significantly less than the initial assessment, it is still an unanticipated and unbudgeted cost which will require deferment of other tangible scope on the project and will further challenge the budget of the project as described previously. The reduction of parking on the site, as described above, will result in a savings to the base contract value of approximately $28,000. As such, Habitat for Humanity would propose contributing this amount to Garfield County as payment towards the Road Impact fee since such payment would result in no net change to the project budget. Based on the overall goals of the project to serve the community, and the unanticipated nature of this newly implemented fee, Habitat for Humanity respectfully requests a waiver of the balance of the fee ($41,527) from Garfield County. Community Benefits from the ReStore We understand that impact fees are put into place for good reason by municipalities. As a non- profit developer, we are well aware of the impact of subsidies on the long term sustainability of an organization or community. Some projects however, represent a net benefit to the community and have an impact far greater than site specific metrics can alone measure. Habitat for Humanity's ReStore operation represents a "win-win" for the Roaring Fork Valley and Garfield County. We believe the following points regarding the operation are key to consider when weighing the overall impact of the requested fee waiver on the community at Targe. The ReStore offers the following community benefit, to Garfield County and our entire service area: 1. Sparing landfill- The ReStore is diverting tons of waste from the local landfills, more than 1 million pounds annually. This number will only continue to grow as the remodeling and general construction industry remains strong in our valley. Garfield County's Strategic Solid Waste program identified the repurposing and re -sale of gently used materials as an opportunity to minimize materials entering the landfill. At the time, the BOCC did not wish to undertake operating a facility which would re -sell those goods. The ReStore, along with a number of other community re -sale facilities, provide 3 this service to Garfield County residents without the operational impact of self- operating this type of facility. 2. Easy re -purposing- The ReStore is providing a place for residents who are unsure where to re -purpose things they no longer want, and we make the donation process easy for donors by offering free pick-up. 3. Low-cost Great value items- We are providing a low cost, environmentally conscious solution for community members to make upgrades to their current living conditions — often with unique results unavailable at any standard retailer. We have multiple customers who frequent our stores, or keep in touch with inventory posted on line to use in properties located outside the RFV simply because the quality of the donations we receive is typically of high quality and with interesting style. 4. inspiring year-round fobs- Habitat provides stable jobs to residents who otherwise have difficulty finding year-round, steady employment in our agricultural and tourism area. We currently employ 18 full-time and 8 part-time staff members in the ReStores, (plus another 10 when you include the operations it funds with our construction team, and program teams.) Many employees are the lead breadwinners in their families. Further, Habitat RFV offers subsidized health care insurance benefits to our staff. And, on top of this our staff are inspired and gratified by their opportunity to serve the community with our resulting affordable homes for locals in need of a hand -up, not a hand-out. 5. Community engagement and service- Our ReStores and homebuilding construction sites also engage a wide swath of our community, and we expect to better serve these stakeholders with the new facility. In 2016, over 40 unique groups and 800 different volunteers assisted Habitat in our operation. Further, we provide work and training opportunities for high school and college students, Rifle Correctional Facility inmates, clients of Mountain Valley Developmental Services, and court -mandated community service workers as well Jaywalker Lodge residents in their substance abuse rehabilitation program. All gain valuable job and life skills, and some of these opportunities have led to full-time employment on the Habitat team. 6. Generating significant sales tax- Through our sales of re -purposed items, we are generating significant sales tax for the city, county and state on items that otherwise would have been disposed of in local landfills, specifically $101,095 in 2016. 7. Property taxes are generated too- Most importantly, the ReStore proceeds are raising money for our affordable housing building fund every day! (Which then turns into an estimated $20,000 in property tax dollars for the county through our 23 homeowners in 2017). After building one home ever 2-3 years, Habitat has grown to complete 3-4 homes annually to families in need of a hand -up, not a hand-out. We currently have four homes under construction in Silt, with four more slated to begin this summer. Most of our families are the first in their families to property taxes. 4 8. Economic engine- The ReStore is the engine that drives our entire operation. Every dollar earned is put to valuable community use. The ReStore helps Habitat become self- sustaining, covering all of Habitat's overhead such that all financial donations/grants flow through directly into our home construction. The more efficient we can be in the ReStore operation- the more families we can help with housing, a critical and ever- present need in the RFV. We trust the preceding information serves to provide a broader understanding of the ReStore operation and the benefits it offers to Garfield County. It's difficult to specify exactly how the savings in the impact fee will be allocated to the project, but we hope this information will demonstrate by relief from this extra impact fee will represent a benefit to your constituents several times over. Thank you to both the Community Development staff and the Board of County Commissioners for the consideration of this request. We appreciate what you have done to date and look forward to your continued support of Habitat's efforts in the community. We are excited about the positive impact this new facility will have starting at the end of this year and well into the future (on top of the positive contribution of the actual construction spending that is happening already). 5 David Argo From: Dana Dalla Betta <habitat.dana@gmail.com> Sent: Thursday, April 06, 2017 3:44 PM To: Tamra Allen Cc: habitat.scottG@gmail.com; David Argo; Andy Schwailer; 'Kristen Wilmes'; 'Steve Novy'; Sheryl Bower Subject: RE: ReStore project Attachments: Habitat for Humanity ReStore_Request for Road Impact Fee waiver.pdf Hi Tamra, Thanks for your time earlier this week. Attached please find the formal request for partial waiver of the road impact fee as applicable to the new ReStore building. Please let me know if this should be modified in any way to provide to the BOCC. We greatly appreciate the time and effort on our behalf to reach what is hopefully an amenable solution for both parties. Look forward to hearing confirmation of the BOCC agenda for 4/17. Thanks, Dana Dana Dalla Betta Construction Manager (970) 456-6601 https://urldefense.proofpoint.com/v2/url?u=http- 3A_HabitatRoaringFork.org&d=DQICAg&c=euGZstcaTDIlvimEN8b7jXrwgOf- v5A_CdpgnVfiiMM&r=0fOC3mIUEg WeEh5mPYffVUYgsICNatw4b21ch4HQwdE&m=edE443fjMvBafduBC998vP0Xamj1w7N 3 adkwQrEQFE&s=37bO214i0N5nsXrYgGrSQmGnET9zmentNIPuBHDFjY8&e= Original Message From: Tamra Allen [mailto:tallen@garfield-county.com] Sent: Tuesday, February 28, 2017 1:46 PM To: Dana Dalla Betta <habitat.dana@gmail.com> Cc: habitat.scottG@gmail.com; David Argo <dargo@garfield-county.com>; Andy Schwaller <aschwaller@garfield- county.com>; 'Kristen Wilmes' <habitatrfv@gmail.com>; 'Steve Novy'<snovy@greenlinearchitects.com>; Sheryl Bower <sbower@garfield-county.com> Subject: RE: ReStore project Dana - Thank you for this correspondence and your efforts to redesign your site plan which may result in some additional cost savings for your important project. The path you have outlined going forward is a path is very appropriate and we really appreciate your time and thoughtfulness in working with us on this topic. Should you end up in place where you would still like to make a request to the Board to grant you monies to cover the road impact fees, please let me know and we can work together to make sure the Board has a complete package of information for them to review prior to this being scheduled on their agenda. As we discussed, the Board meets the first, second and third Monday of each month. It appears that Andy has already gotten back to you on the issue of addressing. Please do not hesitate to contact me as you continue to work through project design or if you would like to further discuss the issue of road impact fees. 1 Respectfully, Tamra Allen, Planning Manager Community Development Department Garfield County, Colorado tallen@garfield-county.com (970)945-1377 x1630 Original Message From: Dana Dalla Betta [mailto:habitat.dana@gmail.com] Sent: Tuesday, February 28, 2017 12:51 PM To: Tamra Allen <tallen@garfield-county.com> Cc: habitat.scottG@gmail.com; David Argo <dargo@garfield-county.com>; Andy Schwaller <aschwaller@garfield- county.com>; 'Kristen Wilmes' <habitatrfv@gmail.com>; 'Steve Novy' <snovy@greenlinearchitects.com> Subject: RE: ReStore project Hi Tamra, Thanks for the time yesterday to meet with you, Dave and Cheryl to review the Road impact fee for the ReStore. We really appreciate you working with us to mitigate the impact of this fee to our budget. In concept, we are amenable to the proposal to reduce the pavement area to compensate for some of the Road Impact fee cost. It's still a challenge to fully accept because we are trading actual work and value- for a fee that will not be recaptured in the value of the property at a later date. This said, we know this is a challenge all around. I've sketched out a plan that I think will work- but which I need to run by the Civil design team to see the associated reduction in grading/retaining walls. As we noted yesterday- my main contact with SGM will be out till next week so I do not know if I will be able to gain traction on this until he returns. Once I have his feedback- I can get that over to the contractor to provide an actual savings. So for the time- if it works for you, we will just agree to work towards this approach and finalize actual numbers when we get closer. Once we do reach a dollar amount to request from the BOCC (the difference between our current assessment and the savings of site work)- we'd like to consider whether grant funding from Garfield County could help cover the balance. In the past, we have been awarded grants from the landfill I believe, based on our efforts to deflect waste. That might be a way to work through the remaining waiver request without stressing the County budget. In the meantime, we will continue with a permit submittal, I hope later this week. That submittal will include the current site plan- which we will replace once the pavement revisions are finalized. Al I sound ok? One other question....unrelated to this fee but which I should have raised yesterday. How does Garfield County issue addresses? We've been understanding that the new building has the same address as our existing structures - 7025 Hwy 82. All of the buildings out here now have that same address. We do have a box # but I believe that only applies to mail service. Can you confirm if we should continue to use this same address or should I reach out to GIS to have a new address issued? Thanks again for your time. Dana Dana Dalla Betta Construction Manager (970) 456-6601 2