Economic woes force Village at Wintergreen to request more tax subsidies to complete affordable housing project
The Village at Wintergreen will need more funding to build Wintergreen Ridge, according to county officials.
When the project was planned in 2019, there were supposed to be three phases. Only one has been completed. This next phase would be affordable housing for those who qualify as a part of the Summit County workforce and fall into the 30% to 60% area median income range. Of the 47 units expected to be built during Phase 2, there will be 12 one-bedrooms, 29 two-bedrooms and five three-bedrooms, according to reports from a meeting in April, and the remaining unit will be a two-bedroom space reserved for Gorman and Co. employees.
In May 2021, the Summit Board of County Commissioners analyzed what land in the county it had to create more workforce housing, and county housing director Jason Dietz said one of the bigger tracts of land that officials found during the session was an undeveloped area near the Village of Wintergreen.
Developer Gorman & Co. received about $1.5 million in funding plus $700,000 in tax subsidies from Summit County government last fall to build Phase 2.
At the Board of Summit County Commissioners’ work session Tuesday, July 12, officials updated the board on Wintergreen’s progress and revealed that they will need more funding.
Due to the increase in building costs, inflation and interest rates, Wintergreen Ridge is asking the Summit County Housing Department for an additional $65,000 per unit, which means it could cost approximately $3.06 million more to finish the project. Dietz said it may even be closer to $70,000 per unit.
According to the presentation, Wintergreen is in the process of collecting $525,000 from Community Development Block Grant funds to costs for sewer and water hookup fees.
Dietz said the original estimates Wintergreen calculated are no longer applicable because of how much the economy has changed in the time from when they were made.
“Project estimates from over a year ago — right before lumber pricing and construction pricing went crazy — no longer quite work,” he said.
Another reason the project costs so much is because Wintergreen Ridge’s purpose is to create more affordable housing.
“We unfortunately don’t get breaks on lumber or asphalt or labor when we build affordable housing,” Kimball Crangle, Colorado market President for Gorman & Co., said in an email. “So our costs to build housing are not too different than what it costs anyone to build. However, we are capping our rent levels, which means different subsidy is required to cover the full cost of building.”
Wintergreen is not a unique situation.
At the May 2021 meeting where the county searched for areas to build, Dietz said the county started out with 503 parcels. From that, they removed open space land and parcels that had already been developed, which left them with 242 parcels. They whittled that number down by looking at which areas had wetlands, steep slopes and other building constraints. That decreased the number to just 10 parcels. This means there are only 10 parcels in Summit County that could potentially be used for workforce housing.
Dietz added that a private developer would normally try to make a profit off of housing to make up for the risk of building. However, the workforce in Summit County has such a desperate need for housing that the county is having to build stock that requires a lot of the same financial demands as Wintergreen.
That means the projects take a long time, and to make up for gaps in funding that would normally be covered by rent or sales prices, they often require a lot of money or assistance.
“It’s another layer of complexity,” Dietz said, “to seek out and get those additional funding sources to make those projects work.”
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