The former Elks Club property. Photo courtesy of Carla Occaso/The BridgeThis story by Phil Dodd was first published in The Bridge on Oct. 29.A new, expanded growth center approved in Montpelier? Not for long. A city move to ease the way for more housing was deflected this week. On Oct. 28, the state’s Community Investment Board unanimously voted to revoke the board’s recent conditional approval of Montpelier’s growth center expansion application. The city will be required to submit a more complete application if it wants to continue to pursue the expansion, a process that would be quite time-consuming and that the city may choose not to pursue.The Community Investment Board decision — prompted by a conflict between state statutes and the board’s internal policy to which local resident Stephen Whitaker had called attention, along with shortcomings in the application — is a setback for Montpelier’s efforts to develop housing on the Country Club Road property it purchased in 2022.City Manager Bill Fraser said the board’s decision was “not what we expected, and considering the emphasis the state government puts on housing, it was really disappointing.” He said the revocation “could cost us a full year before we get to construction, though I don’t want to raise an alarm before we have a chance to figure out what we will do now.”Local man provokes the revokeWhitaker, who maintains that he supports the idea of building housing on the property but objects to the way the city is handling the project, participated in the first investment board hearing about the growth center application on Sept. 23, and later filed a motion for reconsideration that questioned, among other things, whether the Montpelier application was consistent with the growth center statute.In an Oct. 21 memo posted on the board’s website, Jacob Hemmerick, planning and policy manager at the Department of Housing and Community Affairs, wrote: “In anticipation of a possible reconsideration, staff has provided an additional review of the Growth Center Amendment application requirements. This review notes potential deficiencies in the application based on the required findings of the Five-Year Review Process Amendment Policy and additional potential deficiencies when applying the full breadth of the statute.” The memo said the staff was withdrawing its recommendation for approval of the Montpelier application and instead recommending that the board “revoke its Sept. 23, 2024 boundary amendment approval of the growth center.”A proposed map of the expansion request is shown here and indicates that the growth center would now cover much of the land in Montpelier.Fraser told the board the city’s amendment application was designed to satisfy what the state had requested. “To massively change the rule and revoke a boundary adjustment application in the middle of the game” is something he said he had not seen before, “and I’ve been in government a long time,” he said.Board chair Alex Farrell said that in light of the problems the staff review had turned up, revoking the permit was “the most responsible way forward so we can make sure that everybody’s doing the diligence that’s really required,” and that the decision would allow the board to maintain its “credibility.” He also said he and the board supported the city’s vision for more housing.Growth centers help with housingGrowth centers are meant to promote development in already built-up areas. Development in growth centers is excused from Act 250 review and gets priority consideration for state grants, among other things. A growth center designation also makes it easier to apply to get state approval for a Tax Increment Finance district that helps municipalities pay back bonds used to build infrastructure for new projects.Montpelier currently has a growth center that covers a significant portion of the city, including Sabin’s Pasture, which was added in 2019 through what now appears may have been a flawed state process. The city had recently applied to expand the growth center to cover more properties on the eastern side of town, including the Country Club Road property.At an Oct. 15 board meeting, Hemmerick recommended Montpelier complete its on-going master plan update before the growth center expansion approval could be finalized. The board put the entire application on hold and asked for more information. Staff members conducted a review of the situation that led to recommending the initial amendment approval be revoked.Whitaker had contended that Montpelier needs to submit a more fully developed application with maps, infrastructure design, and a capital budget, not the abbreviated application which the state initially allowed pursuant to a policy passed in 2012 covering five-year growth center reviews.That policy, Whitaker argued, conflicted with the growth center statute, which says amendment requests should be handled “according to the procedures that apply in the case of an original application.” The staff members on the board apparently now agree with Whitaker that a longer application is needed for amendments.The memo also says that the application did not meet the reduced standards outlined in the 2012 policy: “there is no evidence of the adoption of a capital program and budget that identifies investments to implement the ‘actionable [concept] plans’ for the Country Club site.” The lack of a capital plan was something Hemmerick only recognized upon later review, he said later.The Tax Increment Finance district the city wants to help pay for infrastructure bonds on Country Club Road is easier to apply for with a growth center designation, but does not require one. Planning Director Mike Miller has said that without the growth center designation, the Tax Increment Finance application would be more work and more expensive.After the board’s revocation decision, Fraser said city staff members would have to “huddle up” and confer with the state to decide next steps. But Miller said filing a complete application for a growth center boundary amendment would be a “big lift” and might not be worth the effort, especially since growth centers are scheduled to eventually disappear under Act 181, a land use reform law passed earlier this year. The biggest advantage of expanding the growth center would have been the ability to avoid Act 250 review, Miller said. If the city wants to apply again for an expanded growth center, an application must be submitted by August or September 2025, according to the memo.If the city chooses not to apply again for a growth center expansion, the memo states, “the City can work with the regional planning commission to implement its municipal plan and development goals under the modernized framework established by Act 181, which provides a pathway for modernized designation benefits and Act 250 exemption.” Fraser noted that some of Act 181’s changes don’t take effect for a couple of years.Whitaker’s criticism and Fraser’s rebuttleWhitaker’s participation in the investment board process is not the only time he has criticized the city over its approach to the Country Club Road property. Most recently, at the Oct. 23 city council meeting, he said he thinks the city is “barreling forward seeking a developer” for the County Club Road project without doing the proper testing, research and planning.Whitaker, a frequent critic of city government, contended that “the engineering due diligence has not been done … What are the prime ag(riculture) soils? What are the geology issues? What are the water/stream/flood issues? The cost of new roads or bridges?”“We may still have to sell it if you finish that due diligence and show the public what the costs of getting that ready to develop are going to be,” he said. “But my point is that we have run off track on what we need to be doing to get these questions answered.”City Manager Bill Fraser responded to Whitaker’s comments at the meeting, saying his staff is negotiating the final details on contracts to do design work on the property — contracts that could be before the council as soon as its next meeting.“So that is in the works,” he said. “That is designing all the water, sewer line, storm, road — all of that — to get that laid out. So that we will know what it costs. And it will actually be designed, not just estimated.”Fraser told The Bridge that this design work would include road and sewer and water lines going to a location near the old Elks Lodge, not throughout the rest of the property. A second design phase would look at the rest of the property after the city and developers have agreed on what should be built and where it should be built, he said. The city will seek grants that it hopes will pay for some or all of the phase one infrastructure work, he said.If a TIF district is created covering the property, the city would ask voters for bond approval for infrastructure work in phases one and two that is not paid for by grants and hope to see enough development that the bond could be paid off over time through property taxes and water and sewer fees from the new development.The city’s “actionable master plan” for the Country Club Road project includes a preliminary estimate of $15.3 million for new roads, sidewalks, a second access road, water and sewer lines, a new traffic signal, and pump station, on top of the $3 million purchase price and $500,000 for “due diligence.”Read the story on VTDigger here: Montpelier growth center expansion approval revoked by state board.