On Feb. 17, the Pagosa Springs Town Council directed town staff to begin advertising for developers’ proposals for a potential workforce housing project at a half-acre town-owned property located at the corner of Apache Street and 5th Street.
“This property was originally purchased by the Town for workforce housing as part of the Town and [developer] Servitas’ public-private partnership, prior to the focus on the Enclave property in Aspen Village,” an agenda document on the matter states.
The council’s action starts the request for proposal (RFP) process, where the town can set parameters for potential respondents, such as area median income (AMI) requirements and deed restrictions for the development.
However, the document states that staff recommends “that the RFP is structured to allow for these items as negotiable based on the respondent’s development and project proposals.”
Development Director James Dickhoff explained that the town is looking at a 15-unit development and that “premanufactured units” might be the best course of action.
There’s a “potential opportunity” for the RFP respondents to consider pursuing a premanufactured apartment building of 15 units — originally meant for another project in Colorado — for the town’s Apache Street property, Dickhoff explained.
“This could result in savings that can assist in providing affordability,” the document states, with Dickhoff adding that going this route “could help lower the price.”
He said that the town “would not necessarily tie the RFP” to the premanufactured building, “but we’d like to mention it in the RFP so that the contractor, or whoever comes back with a proposal, is aware that it might help lower the price for a development on that property.”
He added that the goal of this potential project “would be to encourage middle-income housing” in the area, often referred to as “the missing middle” piece of the housing puzzle.
“We are really short on middle-income housing units right now,” he explained.
He explained that staff had not yet completed a draft of the RFP, “but we would like to suggest to town council and get your permission to draft the RFP” to send out to potential developers.
He added, “We’d like to throw out an RFP to see what kind of proposals we get back for workforce housing on that 0.5 acre parcel we own on the corner of 5th and Apache Street.”
Council member Madeline Bergon asked if the existing foundation on that property could be used if the project went forward with the premanufactured building.
Dickhoff responded, “Typically, in my experience, no one is going to want to use somebody else’s foundation, because it doesn’t meet their design, so the answer is no on the premanufactured, because that one is very specific … to a building with under garage parking.”
Council member Matt DeGuise asked if it is the intent of the town to continue to “own it and rent it and manage it” after the development is completed.
Dickhoff responded, “I think we want to leave that open to creativity. We don’t want to put a developer in the corner and say, ‘This is what we want you to bid on.’ We want to kind of hear some of their ideas.”
He added that options could include the town offering “a long-term lease, where we’d continue to own the property, which may have some benefits for the town, or providing the property — looking at the totality of local incentives between the land, sewer exemptions … and what that deed restriction might be, its length of term and the AMIs that it covers.”
Council member Mat deGraaf questioned if there is “any reason that we can’t sell the property as is for market value.”
“There is no reason that we cannot,” Dickhoff replied.
Mayor Shari Pierce stated that she is in favor of going forward with the RFP process, then asked the rest of the council for a “thumbs up or down” vote on the matter, with the council unanimously giving its thumbs up.
This action gave Dickhoff and the Development Department a green light to draft the RFP.
He explained he’d bring back any project proposals to a future town council meeting.
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