Proposed tribal land lease terms unveiled

The Swinomish Senate has provided Shelter Bay Community with what the community calls the tribe’s “best and final proposal” for its terms to extend the land lease.

Shelter Bay is a gated neighborhood of about 900 homes developed mostly on reservation land leased from the Swinomish Indian Tribal Community.

The original lease signed in 1968 is set to expire in 2044, which according to a tribal attorney would cause the land that people built their homes on to revert back to the original owners.

For the past two years Swinomish and Shelter Bay representatives have been working on a new master lease. Under the terms released on Friday, the new lease would run until 2089.

Should the lease be approved, by all parties, including some individual tribal landowners, the tribal community and the Federal Bureau of Indian Affairs, current homeowners on Shelter Bay’s 870 leased lots won’t see a significant rent hike for eight years — until 2023, when the lease payment will just about double for most residents.

In 2013, the Shelter Bay leases were adjusted upward, and under the terms of the old lease, the rent amount was to be renegotiated after another 10 years.

So the present lease amount will stay in effect until that 10-year window expires in 2023. Starting that year, a new formula for determining the rent rate will apply.

Instead of having the land under the community figured as raw land, the new lease will rent it as a “finished subdivision.”

According to tribal attorney Stephen LeCuyer, the finished subdivision includes the lot platting, streets, sewers and all other infrastructure except the houses and other buildings.

Each year between 2023 and 2059, the lease will ramp up until, in today’s dollars, the rent would be about 300 percent higher than what it is right now on most lots.

The ultimate rental rate will be 7 percent of the “finished subdivision” value each year.

According to a calculation by Shelter Bay Community, the “average” rent for a non-view lot would jump from about $115 per month today to about $218 in 2023 and ultimately go to around $436 in today’s dollars.

View, prime view and waterfront lots go up even more. One waterfront lot with a lease rate of $4,800 this year would have an annual payment of more than $19,600 in today’s dollars 44 years from now, according to Shelter Bay Community figures.

Homeowners pay their lease fees as part of a monthly assessment from the community, which also covers the costs of upkeep for the streets, golf course, marina, pool and other amenities in Shelter Bay.

This year the association will pay more than $1.8 million in rent to the tribe. Calculated in today’s dollars, under the proposed lease terms, the yearly rent would ramp up to more than $6.9 million in 2059, according to the Shelter Bay Company figures.

Other items in the tribe’s proposed lease terms include an option for Swinomish to take over the maintenance and operation of Shelter Bay’s water, sewer and road systems. There would also be a 1.5 percent renewal fee paid to the tribe whenever a Shelter Bay home on leased land is sold.

The bright spot in this is that the tribe has agreed to extend the master lease, which means that Shelter Bay will remain a stable community for decades to come. Because the lease was set to expire in 29 years, home buyers were strapped, because most banks couldn’t grant traditional 30-year mortgages.

Swinomish Chairman Brian Cladoosby said in a prepared statement, “The proposal gives certainty and stability to Shelter Bay residents and to landowners, and it also provides a gradual transition from the current lease to an ongoing relationship after 2044.”

Shelter Bay Community Board President Cheryl Westlake said the tribe’s proposal will be outlined to community members during meetings to be held later this month and next. Then the residents will be asked to weigh in with an advisory vote in mid to late June.

If the homeowners approve the new lease, the detailed new Master Lease will be drawn up and put to a vote again, Westlake said.

Community meetings are set for 7 p.m. on May 26 and May 28 and at 10 a.m. on June 6.