People’s Bank has sweetened its offer to Hanceville in exchange for the city paving residential streets inside failed subdivision Baylor Cove and taking over street maintenance.
But the new proposal to give the city five lots — up from the original offer of three — didn’t seem to sway city officials at Monday’s council meeting. The bank foreclosed on the 28-lot subdivision on Section Line Road after the developer went under, and it has since fronted the development’s maintenance costs. Only five homes have been built, however the bank says it has been successful in selling the remaining lots so that it is no longer the majority owner in the subdivision.
The bank has proposed the city sell the lots as prices increase to help cover the costs of paving — estimated at around $50,000 — and street maintenance. The lots originally were valued around $40,000, but their current value is closer to $10,000 now.
“I just don’t see any advantage to the city with this deal,” said Councilman Doug Batemon. “I went down there and looked at the lots. We’d have to put in a drain pipe and have dirt hauled in at one place. I’m afraid we’d have to spend more than $50,000 out there.”
Councilman Charles Wilson said the city should have required the developer to post a performance bond to cover the public improvements — streets, drainage, utilities and sidewalks — if it went bankrupt before completion. He said the same problem happened at Angel Gate subdivision where the developer apparently wasn’t required to get a bond. City officials are investigating whether the city requires performance bonds as a part of its planning and building regulations.
On Monday, Mayor Kenneth Nail asked City Attorney Dan Willingham about the terms of Baylor Cove’s covenants. Nail said a homebuilder approached him about the subdivision and seemed interested in the possibility of building smaller homes than the existing covenants may require. Willingham said some covenants are set to expire after 20 years or more, but most are perpetual.
“The property owners out there really seem to be without any recourse at this point,” Willingham said. “Essentially this is an illegal subdivision. The lots should have never been sold without the bond.”
Councilman Jimmy Sawyer said the city should still try to meet with property owners at the subdivsion to discuss possible options.
* Tiffeny Owens can be reached by email at email@example.com or by phone at 256-734-2131, ext. 135.