Like many residents of Summit County, I welcome the legal action undertaken by the county attorney to stop the Dakota Pacific project at the Park City Tech Center. It is unfortunate that such a severe step was necessary, but Dakota Pacific proposed a project that would do little to alleviate the affordable housing issue while adding an unacceptable level of density and traffic to Kimball Junction.
Perhaps worst of all, Dakota Pacific enlisted the help of the Utah legislature to pass Senate Bill 84, which allows it to move ahead with its project without Summit County approval. Summit County is currently seeking an injunction to prevent Dakota Pacific from starting construction immediately as is allowed by S.B. 84. Dakota Pacific has shown itself to be untrustworthy and it is doubtful it would hold off construction until the Summit County lawsuit is settled.
While S.B. 84 is the more pressing issue, another Utah Senate bill passed during the last legislative session also has negative implications for Park City, Summit County, and the entire state. Senate Bill 271 prohibits municipalities and counties from enacting measures to prohibit co-owned or fractional ownership of property.
S.B. 271 was heavily lobbied and funded by Pacaso, the California based company that is in the forefront of fractional ownership sales. Pacaso is absolutely gloating regarding this development as is evident by the following statement on their website: “This is the first time state legislators have passed co-ownership legislation, but won’t be the last,” said Austin Allison, Pacaso CEO and co-founder. “We are grateful to the Utah legislature for recognizing the value and legality of co-ownership. This bill reaffirms that individuals, friends, and families have the right to co-own and enjoy a home together without interference.”
It should be noted that the Park City ordinance and any HOA attempts to limit fractional ownership never intended to ban co-ownership by friends and family. Rather, such attempts are clearly aimed at Pacaso’s business model which sells eight to 12 shares of a single-family home in areas where short-term rentals are prohibited. These properties are then run like a business. The owners are unaffiliated and have access to the property in 14-day increments. This results in as many as 26 turnovers each year.
In October of last year, Park City passed an ordinance that prohibited fractional ownership in certain zoning areas. On its website, Park City states, “As a result (of S.B. 271), Park City will not proceed with Fractional Use Land Management Code amendments.” However, it goes on to note that S.B. 271 “allows for homeowner associations to address fractional co-ownership in their [covenants, conditions and restrictions], so homeowner associations should consult with their membership and legal counsel as appropriate.”
This is good advice and my HOA board is moving forward to address fractional ownership in our community. It should be noted that to enact such policies, an HOA must engage legal counsel and obtain approval from a majority of the homeowners to insert pertinent language into their covenants, conditions and restrictions. Nonetheless, I strongly suggest that every HOA look into this issue and take immediate action to address it for its community.
Like S.B. 84, S.B. 271 appears to be a severe overreach by the Utah Legislature. Municipalities and counties have always restricted land uses in various zoning areas. It is my hope that Park City, Summit County, and other municipalities and counties throughout Utah will mount legal challenges to S.B. 271 to protect our single-family neighborhoods from commercial exploitation.