Shelter Bay residents hear lease terms

The Shelter Bay Community held the first of three meetings for homeowners last night to a standing room only crowd.

People arriving at the meeting were met by a group of homeowners wearing T-shirts and carrying signs urging their neighbors to “just say no” to the new lease proposal.

Two more meetings are scheduled on Thursday and on June 6. Residents were also given the option of listening to the meetings over the Internet.

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

Most of the people who spoke at the meeting didn’t like the terms. “We don’t need a lease,” said one homeowner named McKenzie. “We can grow some balls. We cannot accept this, we’ve got to throw this out!” His statement drew loud applause.

Shelter Bay is a gated neighborhood of about 900 homes developed on 400 acres of reservation land, most of it leased from the Swinomish Indian Tribal Community.

The original lease signed in 1968 will expire in 2044. Shelter Bay attorney Phillip Buri told hundreds of residents at the meeting that if the lease is not renewed, everything will revert to tribal ownership in 2044.

The new lease would take effect as soon as it’s signed and would run out in 2089 – adding another 45 years.

Should the lease be approved, current homeowners on Shelter Bay’s 870 leased lots will see their rent go up significantly – about double for most residents – in eight years according to Shelter Bay estimates. For more money, they would be getting more time, Buri explained.

In 2013, the Shelter Bay leases were raised and under the terms of the old lease, the rent amount was to be renegotiated after another 10 years. That 10-year window expires in 2023. Should the new lease go into effect, a new formula for determining the rent rate will apply in 2023.

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 according to the community’s estimates.

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

Instead of having the land under the community figured as raw land as it is now, the new lease would rent it as a “finished subdivision,” meaning the value will go up to include the streets, sewers and all other infrastructure except the houses. Critics of the proposed lease point out that the community members, not the tribe, paid for all the infrastructure.

Before the meeting, resident Jan Henrie said, “this is going to be a financial massacre for about three quarters of the people who live here.”

Her concern was echoed many times during the meeting. “If you look around at the people here, we’re all old,” said one woman. Her point was that people on fixed incomes will not be able to pay huge rent increases.

Resident Linda Barrett said, “it’s an untenable situation for us to go forward with this lease. I believe there will be people in every view category that will have to leave here if this lease passes.”

A count of homes for sale on the Swinomish Reservation show that there were 35 properties listed for sale on leased land in the Shelter Bay and Pull & Be Damned Road neighborhoods on Friday. Also, there were 15 listed for sale on privately owned, or “fee simple” land on the reservation.

There are a dozen distressed properties, including foreclosures and homes that have been turned back to the bank. Local real estate agents have said that a year ago there were only 11 homes for sale on the reservation.

Shelter Bay homeowners pay the lease fees as part of a monthly assessment from the community which also covers the costs of upkeep for the streets, golf course, marina, pools 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.

The proposed terms also 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.

Should the homeowners agree to the terms in a simple majority “advisory vote” scheduled on June 24, a new lease will be drawn up incorporating the terms set out by the tribe and homeowners will have a chance to vote on it again. Shelter Bay board member Hermann Wolz said it would take 6 to 8 weeks to draw up a lease.

If the community turns it down, the attorney Philip Buri said there may be a chance for further negotiations. However, after two years of negotiating a lease extension, “we believe it’s unlikely the tribe will move off this position,” he said.