Colfax Plan Commission recommends half lots in East View be sold for $8,000

By LeAnn R. Ralph

COLFAX — While one house has been built in Colfax’s East View residential development, other deals have gone by the wayside because developers wanted larger lots.

The Colfax Plan Commission approved a recommendation at the September 6 meeting that the village offer expanded lot sizes by a half for $8,000.

The September 6 meeting was the second time the plan commission has recommended that the village board offer half lots in East View as a way to increase the lot sizes.

During a December 5, 2016, meeting, the plan commission also approved recommending that the village board offer half lots in East View to increase the lot sizes.

Phase 1 of East View has six lots, and the first house was built on Lot 6 by Andy De Moe, owner of Andy’s Custom Concrete.

De Moe has since sold the house.

The East View residential development is located along Dunn Street in Colfax on land that was part of the Jim and Mary Schindler farm.

Lynn Niggemann, village administrator-clerk-treasurer, said at the September 6 meeting she has contacted the homeowner at Lot 6 to find out if he is interested in half of Lot 5 but has not received an answer.

Another potential developer is interested in Lot 5 but wants a larger lot. The builder has the house designed, and the person has plans to move to Colfax after the house in Altoona sells, Niggemann said.

If the Lot 6 owner wants half of Lot 5, then the potential home builder could take Lot 4 and the other half of Lot 5, she said.

If the Lot 6 owner does not want half of Lot 5, the potential builder could put the new house on Lot 5 and then purchase half of Lot 4, Niggemann said.

Two very serious potential home builders for East View purchased houses elsewhere because the village has not done anything about offering larger lot sizes, she said.

The Colfax Village Board approved buying the six lots in Phase 1 and then offering those lots to homebuilders for free.

The six lots are all zoned Residential-1 and are 90 feet wide and a 160 feet deep, with an assessed value of $15,000 each.

The Colfax Plan Commission initially discussed the issue of lot sizes at a meeting in December of 2016 with Patrick Beilfuss, a planner with Cedar Corporation, and Krag Blomberg, a real estate agent with RE/MAX.

The Colfax Village Board approved the sales sheet, developer’s agreement and application form for East View in June of 2015 upon the recommendation of the Colfax Plan Commission.

The developer’s agreement with the village requires that the finished homes, including the lot, have an assessed value of $175,000.

At the December 2016 meeting, the Colfax Plan Commission unanimously approved a motion to recommend that the village board market the lots in East View two ways, as single lots, 90-feet by 160-feet, or as a lot and a half, with the condition that someone who is obtaining one lot for free would pay half of the assessed value for half of the lot next to it.

The plan commission approved a motion at the September 6 meeting to recommend moving forward with offering the person interested in building a house an additional half lot and to also contact the owner of Lot 6 again to offer half of Lot 5.

The plan commission approved a second motion recommending the village board approve offering the half lots for sale at $8,000.

Beilfuss, who attended the December of 2016 meeting and the September 6 meeting, said the lot sizes could easily be altered by the village’s attorney or a title company by redrafting the description to reflect the change in lot size.

Plan commission members include Nancy Hainstock, Dave Hovre, Dave Wolff (village trustee), Jason Johnson, Mike Buchner, and Gary Stene, village president.

Stene was absent from the September 6 meeting.

Pay-as-you-go

While the lots in Phase 1 of East View are intended for single-family residential, the option of additional lot sizes could open up the potential for twin homes or duplexes to be built.

In Phase 1, twin homes would be considered on a case-by-case basis, Niggemann said.

In Phase 2, where the lots are sized for multi-family residential, the issue is how to pay for utilities for residential development, she said.

One solution for funding utilities could be “pay-as-you-go,” Beilfuss said.

Tax Increment Financing District No. 4 is a mixed-use TIF created in 2006 with an expenditure period that ends in 2021 and a maximum life of 2026, he said.

The village could enter into a developer’s agreement that guarantees the value of the improvements by paying back the developer out of the tax increment generated by the TIF, Beilfuss said.

In other words, under pay-as-you-go, the developer would pay for improvements such as installing sewer, water and streets, but the village would use the property taxes generated by the houses built in the development to pay back the developer for the sewer, water and streets.

Colfax currently has a property tax mill rate of $24.50 per $1,000 of property value. If an eight-plex were built with a value of $550,000, the eight-plex would generate $13,475 per year in taxes for the improvement.

If the developer paid $75,000 for improvements, the village would have to pay the tax increment of $13,475 back to the developer for about six years to cover the cost of the improvements, Beilfuss said.

Colfax recently completed street projects several blocks long on Third Avenue and Fourth Avenue that included sewer and water, curb and gutter and resurfacing the street for around $350,000.

The Colfax Plan Commission approved a motion to recommend the village board be open to pay-as-you-go incentives to encourage multi-family residential development that would be reviewed on a case-by-case basis.