Kanab City establishes PID for Hidden Canyon Subdivision

On October 21, the Kanab City Council met in order to consider a Public Infrastructure District agreement on the (PID) Hidden Can­yon Subdivision in Kanab, located east off Highway 89. The city and development have consistently worked together to plan the infrastructure - espe­cially water and sewer - of Hidden Canyon, and the establishment of this PID is a signifi­cant formalization of that process.

Following the opening procedures, no member of the public stood to comment in the general public comment period. The special meeting proceeded to the first and only item on the evening’s agenda.

The development includes a few hundred residences, both single and multi-family, as well as a hotel and a few acres of commer­cial space, and the PID would facilitate the in­stallment of water and sewer services. Per City Manager Kyler Lud­wig’s summary, “The PID is … a special local government created by the city council to help with the financing of public infrastructure in the area. Jim [Guthrie, the developer] faces quite a few challenges with infrastructure in the development - a water tank he has to put in, some sewer lines to put in - so what he’s proposing is the creation of this PID, a totally separate entity from the city. When this is created, there is no li­ability to the city. They would then follow the governing documents we approve; this would allow the developer to do a special assessment … prior to these lots being sold, he would be paying off the special assessment in bond. This proposal would not pass the burden of this infrastructure to future residents; it would be held by the de­veloper.” The governing documents would establish a board once PID is in place, then once a large portion of the residences are sold and occupied, the board would transition into an elected board. The PID would be able to be reduced in size as the bonds are paid off, but it cannot increase in size. City staff prepared the terms in the governing documents and worked with the developer’s le­gal team to confirm the final document as pre­sented at this meeting. The terms facilitate the development’s infra­structure, by making the bonds tax-free, in­centivizing oversizing for futureproofing and more leeway in regu­lations. Per Ludwig, “There is no liability the city takes on with this approval, but it would give [the developers] ability to take out the debt.” It was confirmed that should the debt default, the properties and developments would return to the city’s ownership. “As long as the infrastruc­ture is built to the city’s specs, we can integrate them.”

Once the item-spe­cific public hearing opened up, a member of the public stood, “I just want to state as a realtor with thirty years’ experience in the area, I really appreciate the way Jim has struc­tured this … the way he has organized it not to pass the burden on to the buyer. I think the way Jim’s doing this is fantastic.” Council member and Mayor Pro Tem Chris Heaton added, “I do agree with that, I second that. I do appreciate how Jim is going about this … it’s a big benefit to our community.” Council member Scott Colson added, “Not just that area either, our whole community.” In the closing portion of the open discussion, coun­cil member Boyd Corry also stated, “I just want to appreciate city staff and legal counsel, this gets to be pretty deep water, pretty thick stuff.”

The developer stood for his apportioned time, stating, “I just want to appreciate you guys coming to support me … this is the way things should be done, I don’t have any burden whatsoever providing that water tank. It’s a big chunk of money, but I benefit, the project benefits and the city benefits, it’s a win-win deal. I look forward to getting the project started. It’s been a great job; we have a great team … and we can’t build a house till a water tank is done. The rules put on us have made sense.”

The motion was made to approve the resolu­tion after discussion and questions with the developer, and confirming with legal counsel, the council unanimously approved the resolution.