CHEYENNE – After hearing major concerns from the banking community, the Cheyenne City Council indefinitely postponed three ordinances Monday night that would have prioritized the city over mortgage providers when it comes to private property liens.
“I think that it's really important that people understand that in order to maintain our community, we need to have some tools in our toolbox to be able to deal with these issues,” Councilwoman Michelle Aldrich said. “So I'm looking forward to the opportunity to work with our bankers and title company and Realtors and the Chamber of Commerce to see how, as a community, we come together and solve this problem.”
According to City Attorney Mike O’Donnell, the city has run into issues in the past with the current state of lien priorities. He said the city previously fixed up a property that was dangerous for the community, then learned there was a mortgage on the property that was worth more than the property itself, meaning the bank would be paid back first.
“The amount of that mortgage exceeded the value of the property, meaning that the city of Cheyenne would effectively be precluded from ever recovering back, for the citizens of the city, the cost of that demolition,” O’Donnell said.
Still, the majority of the council approved the postponement, except for Councilman Mark Rinne.
A major reason for that was the significant resistance from the banking community, which questioned the legality and how the ordinances could impact lending and mortgages. Bankers at the council's Finance Committee meeting last Monday broke out in applause when Aldrich voted no on the ordinances.
One of the biggest concerns raised by the banking community is the impact it would have on mortgages that investors buy and sell on the secondary market. Big players like Fannie Mae require lenders to list the lien priorities for their properties, and a major requirement is that their company is listed first.
“One of our biggest concerns in Cheyenne is affordable housing, (and) the secondary market is our best way to get affordable housing and maintain the options for buyers in this market,” Jonah Bank vice president of mortgage lending Ward Anderson said. “Risks to the secondary market are priced accordingly. If you pass this, and it is enforceable, you may have set in motion unforeseeable consequences with how risk is priced, in turn affecting affordable housing and interest rates.”
Those who opposed the measure last week included Wyoming Bank and Trust, the Wyoming Bankers Association, Lynn Buys Houses and the Wyoming Association of Realtors.
While the main purpose of the ordinances was to give the city power to address blighted properties, Wyoming Association of Realtors President Max Minnick said it will go beyond that, and that’s where the main issue lies.
“It’s not going to affect just the few properties that we have that are blighted,” Minnick said. “It's going to affect every sale that happens moving forward.”
With that, Mayor Patrick Collins announced that a working committee will seek out the best path forward.
Animal shelter contract
After weeks and weeks of budget discussions with no solution, the council approved a $425,000 short-term contract agreement with the Cheyenne Animal Shelter for a maximum of six months.
That amount equals half of what the shelter originally requested for fiscal year 2022. The shelter board voted to pull the sheltering and animal control contracts with the city if their $850,000 request was denied, and instead of meeting that request, the city decided to create a plan to take on some of those responsibilities itself.
The short-term contract ensures sheltering and animal control services will be available in Cheyenne during the next few coming months.
“It is anticipated by both the Cheyenne Animal Shelter and the city that a resolution will be reached within 90 days to determine what kind of arrangement the city of Cheyenne will be making, if any, with the Cheyenne Animal Shelter for future services,” City Attorney O’Donnell said.
Hyatt Place Hotel and Cheyenne Center
The council approved a resolution expressing support for a new Hyatt Place Hotel and conference center behind Menard’s, which would be located on city land, therefore requiring a public-private partnership.
In May, ERES Capital and 307 Land Development presented the proposal to the council during a work session, outlining plans for a 4,000-seat events center, a Hyatt hotel with about 140 rooms, and the potential for restaurants, retail shops and entertainment – all somewhat comparable to the Budweiser Center in Loveland, Colorado.
The resolution doesn’t hold the city to any obligations, but rather expresses support of the project and the possibility of joining a public-private partnership.
"If we continue to always do business the way we've always done business, we will continue to have limited opportunities," Aldrich said. "I think that this type of forward thinking and exploration is really beneficial to expanding our ability to develop our communities in a way that is responsible and is helpful to our economic diversity."
Thomas Heights flooding work
The council approved a memorandum of agreement with the Wyoming Department of Transportation and two local women to gain access to a stormwater detention pond that contributes to the Thomas Heights drainage problems.
The agreement simply allows the city and WYDOT to survey and study the area to identify possible solutions to the drainage problems.
A number of residents in Laramie County have been facing increased flooding issues since the start of development of Thomas Heights, which is within city limits.
Councilman Richard Johnson said a number of residents near Child's Draw are also wary of the effects any drainage changes could have on them, seeing what's already happened.
"I'm just speaking out to let everyone know that there's still concerns downstream," Johnson said.
Sixth-penny sales tax ballot
The council approved the language of the sixth-penny sales tax ballot that will go before voters Nov. 2, following the Laramie County Board of Commissioners’ approval last week.
To view the ballot in its entirety, head to tinyurl.com/SixthPennyBallot.
Urban Renewal Authority
Though it was not initially on the agenda, the council appointed members to the newly created Urban Renewal Authority, so they could jump on the Hitching Post project, Mayor Collins said. The board members are Katye Brown, Ken Dugas, Chet Halvorson, Ryan Whitehead and Rob Graham, and they bring with them experience from a number of fields, like law and banking.