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Rent-or-own debate triggers lawsuit in Farmington

Published November 17, 2011 11:26 am

Farmington • Developer says he can't complete homes unless allowed to lease.
This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Rent or own?

That question is a cause for consternation at Farmington Crossing, where developers hope to complete the housing complex with a set of lease-to-own homes.

But the prospect of rentals in an otherwise owner-occupied neighborhood has angered existing homeowners and resulted in a lawsuit against the city.

Garbett Homes created Farmington Crossing at the height of the real-estate boom in 2005. The vision was an expansive residential development with 500-plus town homes, according to CEO Bryson Garbett.

But times have changed. With the downturn in the economy, Garbett Homes has struggled to secure construction financing for the remaining 130 homes. If those homes are required to be owner-occupied, they won't be completed for another decade, Garbett said.

Allowing a lease-to-own option would make it more affordable for families to move in, meaning that construction could be completed in 18 months.

But residents are against opening the development to renters.

"Renting brings in a whole different group of people, usually who are not committed to the community," homeowners association member Rodney Johnson said.

The HOA agreement restricts current owners from renting homes, except in cases of proven hardship such as being unable to sell. Having rental properties join the development will likely lead to lower property values, Johnson said.

Although Garbett has been promising to turn the HOA over to homeowners, Johnson said the developer has retained control because it still owns the largest number of homes.

"This is a little oasis in the middle of urban sprawl," Johnson said. "It has a very unique flavor and ambiance about it."

The City Council is siding with residents, voting unanimously against Garbett's lease-to-own proposal. Garbett has since filed suit, but hopes to be able to settle out of court.

At issue is the project's initial approval, which was given for owner-occupied homes, Farmington City Manager Dave Millheim said. Several council members were on the planning commission at the time the initial agreement was reached, Millheim said, and feel the approvals need to remain consistent through the project's completion.

"I think they are under legitimate pressure to find a way to get their projects completed," Millheim said. "But that doesn't make it the city's problem."

Garbett feels the city has singled Farmington Crossing out, and believes denying his application violates his constitutional right to develop and sell his property. He argues the completed project will actually be beneficial to the city, bringing in more homes to support growing commercial and retail districts in the area.

And the Crossing's clubhouse, swimming pool, nature preserve and miles of trails would be used by families similar to those who already own homes, Garbett said. Renters also would pay into the HOA.

"It would make the community that much stronger," Garbett said. "It would provide a place for families to come and live — something that they can afford."

Both sides hope to settle the matter out of court, in order to avoid a costly legal battle. But the city, and resident supporters, are unlikely to back down.

"We have empathy for the developer in this tough economy," Millheim said. "But we also have empathy for what the residents were promised."

kdrake@sltrib.com