Wellington looks at metro district for first time

By Cherry Sokoloski
North Forty News

If the Wellington Town Board approves the formation of the Sundance Metro District this summer, it will be the first such district in the community.

A public hearing is planned June 12 for the district during the town board's regular meeting. If the board approves the plan, an election involving property owners in the proposed district must be held.

A metro district, according to Town Administrator Larry Lorentzen, is a mechanism for financing the infrastructure of a subdivision, including water and sewer lines, storm sewer, streets and sidewalks. Rather than going to a bank for a loan, the developer sells bonds to pay for these improvements. Then, as each lot is sold, the homeowner takes over a portion of that debt. All of these improvements become town property once they are completed.

With bank financing, Lorentzen explained, infrastructure costs would be passed on to the homeowner as part of the lot price.

The advantage of a metro district to the developer, Lorentzen pointed out, is that bonds can be floated for a longer period of time than a bank loan. Also, the debt load for that portion of the housing project is gradually shifted from developer to homeowner in the form of a property tax. A disadvantage is that forming a metro district takes longer than arranging for a bank loan.

As far as the town is concerned, he added, there is no advantage or disadvantage with a metro district. "A lot of new developments are using metro districts these days," he said.

Hawthorne Investment Holding Co., LLC, is proposing the Sundance Metro District. Principals in the project include Mark Goldstein and Jeff Donaldson. If approved, the district will finance improvements for Sundance at Daubert Farm, a new subdivision just north of the Buffalo Creek neighborhood on County Road 9. The property was annexed to Wellington last year. The 157-acre subdivision will include 317 single-family homes.