Deal makes millions for Martis Valley
Northstar developers and regional conservationists agreed Wednesday on a plan that will raise tens of millions of dollars for land preservation in the Martis Valley.
In exchange for a development cap and a real estate tax that will channel approximately $30 million to the Truckee Donner Land Trust over 25 years, environmental groups that have battled Martis Valley development pledged to support Northstar-at-Tahoe’s large-scale expansion plans.
“We are in a position now that we look forward to the construction of the Highlands because we know what it means for the overall Martis Valley,” said Tom Mooers, executive director of Sierra Watch, a group that has spearheaded the legal challenge to development plans in the valley. Resort developer East West Partners and Northstar owner Trimont Land Company had been in negotiations with Sierra Watch and Truckee-based Mountain Area Preservation Foundation for months before the agreement became final.
Northstar’s Highlands project, with its 1,450 townhome and condominium units, and the resort’s village, with more than 200 condominium units, are the centerpieces of the agreement that includes all land and development plans for the ski area. Both projects, which are being planned and built by resort developer East West Partners, have been approved by Placer County.
One half of a percent of each sale of a condo or townhome on these projects, known as a transfer fee, will go to the land trust to buy land in and around the Martis Valley. And East West Partners will advance $1 million in future transfer fees to the land trust to use immediately, said East West Partners Managing Partner Roger Lessman.
“We have collectively provided a mechanism to preserve open space in the Martis Valley,” Lessman said.
Northstar land holdings on the east side of Highway 267, which total 233 acres, will be held under a conservation easement that bars development, according to the agreement.
In their overall conservation strategy for the Martis Valley environmentalists say this is a “landmark” agreement, not only because of the amount of money that it will funnel toward the valley’s preservation, but also because it can serve as an example for other development in the valley.
“We think that it can set a good example of how we can work together on a win-win situation,” said Mooers, whose organization has had talks with the Eaglewood developers and the owners of Siller Ranch, two other projects that have been approved in the Martis Valley.
For East West Partners, which had planned a transfer fee on their projects even without the agreement, the compromise is a “big step” toward preserving open space in the valley, Lessman said.
The challenge is now to use that money, as it trickles in, to acquire Martis Valley land on the northeastern side of Highway 267, which environmental groups agree is the priority preservation target in the 70-square-mile valley.
Two large tracts of land make up most of the northeastern side of Highway 267 ” Waddle Ranch, 596 acres, and Sierra Pacific Industries property, 7,343 acres. And that land will be more expensive than anything that the Truckee Donner Land Trust has bought in the past, said Perry Norris, executive director of the land trust.
“For the land trust the Martis Valley presents, in terms of land values, a quantum leap,” said Norris.
The land trust will have to look at ways to translate the steady stream of conservation dollars into a large lump sum to be able to negotiate with Martis Valley land owners.
“We are going to have to look at borrowing or bonding transfer fees in the future,” Norris said.
But the $1 million advanced by East West Partners to the land trust, that will be paid back in future transfer fees, is a huge boost to the organization, he said.
“It will show that we are a viable buyer and establish a solid base of credibility,” Norris said.
The Martis Valley Community Plan, adopted by Placer County in 2003 and sued by a several environmental groups in early 2004, is in limbo, throwing questions over the fate of developments approved under the litigated plan.
A tentative ruling in February supported Sierra Watch’s claims that the plans is illegal, but a formal ruling still has not been issued.
By coming to an agreement with Sierra Watch and Mountain Area Preservation Foundation, two of the litigants in the community plan, East West Partners hopes to avoid any delays that the legal challenge of the plan might bring to their projects in the Martis Valley.
But while the environmental groups have pledged not to sue East West Partners on their Northstar project, and have agreed to work to ensure their litigation against the community plan does not affect the Northstar Highlands and Village, the effect the community plan law suit will have on these projects is still cloudy, said Roger Lessman of East West Partners.
“There is a little bit of a cloud on this because of the judge’s ruling,” said Lessman, referring to the February tentative decision. “We hope that the judge would take into consideration that we have reached an agreement with the litigants.”
Lessman said that he believes East West projects will go forward even if the Martis plan is overturned, since they are compliant with the 1975 plan, the 2003 plan’s predecessor. But Placer County, Martis Valley developers and conservationists are all expectantly waiting for the court’s final ruling, which will follow the conclusion of oral arguments in the case scheduled for March 21.
The $30 million dollars that the Truckee Donner Land Trust is expected to receive over the next 25 years adds to transfer fee agreements on Truckee developments Old Greenwood and Gray’s Crossing that will net the land trust an additional $7 million to $9 million over the next 13 years.
Those numbers, which will be all generated by East West Partners projects, represent huge opportunities to buy open space, said Roger Lessman of East West Partners.
“If you add Old Greenwood and Gray’s Crossing to it, it is a staggering amount of money,” Lessman said.
All this money could transform the Truckee Donner Land Trust into a powerhouse in land conservation in the Sierra Nevada.
“I’d say yes, we are one of the most active land trusts in the Sierra right now,” said land trust Executive Director Perry Norris, whose organization is currently closing in on a $10 million purchase in the Truckee area.
But the millions of dollars in transfer fee amounts are a signal of one of the land trust’s biggest concerns ” the skyrocketing price of land. While rising home and condo prices sends more money to the land trust, the concurrent spike in land values represents a fleeting opportunity to buy large tracts of land before prices rise out of reach.
“It really is, for us, a call to arms,” Norris said. “There is a closing window.”
And the conservation of the Martis Valley is too large of a task to be solved just through transfer fees, he said.
“We are going to have to go to foundations, the Sierra Nevada Conservancy and private individuals and raise millions of dollars if we are going to be successful in conservation in the Martis Valley,” Norris said.