Ark Valley News - Park City buys home lots to spur activity

Park City buys home lots to spur activity
By Matt Heilman
Last Updated: August 22, 2013

Overall, the housing market has improved from this time last year, but for the City of Park City, there's still a long way to go to eliminate the debt owed to the city in unpaid special assessments on residential properties.

With the idea of lifting the burden from its tax base, city leaders recently continued a strategy it started last year to see a return on what is owed for infrastructure on a few undeveloped residential lots.

Last August, the Park City council sought to recoup what's owed in infrastructure improvements on undeveloped lots in the Bear Hill and Saddlebrook additions north of the city's limits.

With available reserve funds, representatives from the city attended a sheriff's sale where they were able to obtain 19 vacant lots for less than $40,000.

At the time, the city was owed about $750,000 in unpaid specials. The idea behind bidding on some of the vacant lots was to get the properties caught up with specials and in the hands of builders who have the means and dedication to build homes on the lots, Park City administrator Jack Whitson said.

He explained that while the city doesn't want to get into the land business, temporary ownership of the lots allows the city to stop the frustrating cycle of properties changing hands while thousands of dollars worth of infrastructure work goes unpaid and adds to the city's debt.

"This way, any back specials that we pay, (new lot owners) turn around and give it back to us," Whitson said. "We also get a certain percentage of property taxes. So really, it isn't costing us that much to recoup these lots."

Recently, specials were due on more residential lots in Bear Hill and Saddlebrook. Representatives from the city again bid on properties with the same objective in mind as last year. This time, the city was able to obtain 71 lots for about $140,000 in Bear Hill and was to bid on vacant lots in Saddlebrook on Aug. 20.

In line with bidding on the lots in Bear Hill and Saddlebrook, Park City has implemented a marketing plan to spur progress in the developments. The marketing plan includes requirements for builders and new homeowners to obtain incentives to assure that the city sees a return on its investment in purchasing the lots.

The requirements give a builder who takes ownership of a vacant lot six months to pull a permit to build on the property and a year to start construction. An incentive may be used as a reduction of the lot price or may be received in cash by the homebuyer upon the closing of the new home.

In Bear Hill, there is a $15,000 incentive offered for new homebuyers. A $10,000 incentive is available in Saddlebrook. Beyond recouping what's owed in special assessments, Whitson said construction on the undeveloped lots is crucial for the subdivisions.

"If people just sit on (vacant lots), it can kill the subdivision," Whitson said. "It certainly doesn't help the citizens."