Thursday, February 9, 2023

Growing pains in Pender County are putting local politicians and multi-family developers at an impasse

A school bus traverses the roads in Maple Hill. Eleven of 18 schools in Pender County have populations either approaching or over the capacity limits. Such congestion has made securing rezoning approvals for multi-family housing a difficult game. (Port City Daily/File)

PENDER COUNTY — Developers looking to capitalize on population growth in Pender County are finding obstacles on their journey. Coastal areas that adorn the Highway 17 corridor are potential jackpots for builders with a penchant for townhomes and apartments, but recent attempts to create such projects have been fruitless.

Two developers in recent months proposed multi-family projects on land zoned for other purposes, then subsequently withdrew those applications in the face of sturdy opposition from county planning staff. 

Seeking to avoid a denial in a board of commissioners vote — a scarlet letter that typically makes it impossible to re-submit the application for a six-month window — the developers walked away in both cases. 

The warnings from planning staff put the projects and their backers in a defensive mode from the beginning.

Tribute Companies, helmed by Wilmington developer Mark Maynard, took a liking to Corbett family land in Scotts Hill, just north of the New Hanover County line. The developer submitted a proposal for over 100 townhome units and a sprinkling of single-family homes. 

READ MORE: Scotts Hill attracts development application on Pender County side, school capacity an issue

Planning staff responded that “the school system does not currently have the capacity to serve the proposed development, nor are there any plans currently adopted to increase capacity in the system at this time.”

Tribute went back to the drawing board, and returned with a proposal to make the development a 55-and-older community for the first 10 years after buildout, which presumably would stunt impacts to the school system. Planning staff still recommended it be denied. 

Evolve Companies, the North Carolina group associated with the Hawthorne Apartments brand, wanted to put nearly 300 apartments on the coveted vertical corridor between Highway 17 and the coastline. To bolster their application, they designed the stormwater system to be far more robust than the minimum requirements and added beautification elements around the site plans. 

RELATED: 300-unit apartment complex in Hampstead faces uphill battle, planning staff recommend denial

Planning staff gave the same retort: “[T]he school system does not currently have the capacity to serve the proposed development, nor are there any plans currently adopted to increase capacity in the system at this time.”

These circumstances are leaving developers pessimistic about the fate of any proposal that would increase density in Pender County. 

“We have to have a facilitated conversation,” said Cameron Moore. “We need to sit down and have a conversation with both sides to figure out how we move forward.”

Moore is the executive officer of the Wilmington-Cape Fear Homebuilders Association, representing thousands of members from firms across southeastern N.C. His group is the largest trade association in the region. 

Developers specializing in townhomes and apartments are now running up against the reality that many Pender County schools are heavily congested and many of them cannot afford to take in new students, according to county staff. Still, as planning staff note, no plans exist to expand the school system. 

Projects like Tribute Company and Evolve’s proposal requiring conditional rezonings — where a site plan is provided and the county can leverage demands on the builder — are getting no love from planning officials, if the project will increase density. 

That’s an issue, Moore said, because projects done “by right” — in which no regulatory adaptations are needed and builders can make moves without bureaucratic go-aheads — are not being burdened with the schools issue. 

Further, developers seeking conditional rezoning requests often include quality of life and infrastructure items in the site plan, like sidewalks or stormwater measures, to boost the favorability of their application and draw approval from county officials. In by right projects, none of the frills and extra tidings are needed.

One attorney who is familiar with representing development proposals in Pender said the message from county leaders is clear: Builders are free to build by right projects, but anything that ramps up the density will be denied. 

At a May 17 board of commissioners meeting, in which Evolve’s application was considered, commissioner David Williams echoed that energy. 

“I just don’t see a scenario — and as soon as I say that one will come up — where I would be voting to increase density,” he told the crowd. “At least until the first leg of the bypass is complete.” 

The audience broke into applause after Williams’ comments, which showed another sticking point in the quest to mitigate growth in the county. The Hampstead Bypass, which will allow Highway 17 travelers to escape the traffic clutches of northern Wilmington, is an N.C. Department of Transportation project with a budget of nearly $300 million and a target completion date of 2030. 

“I go back to, we have to have a facilitated conversation,” said Moore. “Pender County is going to grow. The commissioners understand that. They have come out and said that.”

Tyler Newman, the president of Business Alliance for a Sound Economy, wrote in an email that he reached out to the commissioners to discuss the infrastructure needs of the county. 

“We have heard some significant questions from landowners and the development community following the discussion surrounding the project withdrawals,” Newman wrote. “We work daily to facilitate regional business growth and infrastructure investment. Frustrating investment in one of our major corridors impacts the region as a whole.” 

In the case of Evolve Companies, not even the power-boost of adding a sitting state senator to the legal team brought them success. 

Read More: Another hefty slate of development proposals en route to Brunswick County

Continuance denied 

State Senator Michael Lee (R-New Hanover) addresses the board of commissioners in Pender County as a private attorney, seeking to obtain a regulatory victory for his client. (Port City Daily/Courtesy Pender County)

On May 17, developers behind the proposed “Hawthorne at Headwaters” — a continuation of the well-known apartment chain that dots major corridors in Wilmington and other cities — were slim on options. It was the day of the board of commissioners hearing; standing between Evolve Companies and a license to construct 300 apartments was a spirited crowd of Hampstead residents, a wary board of commissioners and a stinging negative opinion from planning staff. 

At around 7 p.m. the commissioners invited Travis Henley, Pender’s planning director, to make an overview on Evolve’s application before the public hearing began. 

“Thank you, Mr. Chairman. Members of the board, good evening,” Henley said after arriving at the podium. “Before I dive into my presentation, I’m going to kick it over to the applicant very briefly.” 

With that short introduction, Henley stepped aside. A man wearing a blue-gray suit with silver hair approached the podium and introduced himself. 

“Good evening, Mr. Chairman, members of the county commission,” said the man. “My name is Michael Lee and I represent the applicant on the first item on the agenda this evening.”

Michael Lee is New Hanover County’s state senator, whose day trade is private law practice. Lee Kaess, PLLC works in commercial real estate, zoning and land use, commercial litigation and trusts and estates. 

Lee’s firm has gone to bat for projects like another Hawthorne Apartments endeavor on Wilmington’s Oleander Drive, and the Landing at Lewis Creek subdivision on Gordon Road. Amy Schaefer, a former assistant city attorney for Wilmington, now works at Lee’s firm. 

During 2018-2020, the period of time where Lee was unseated by Harper Peterson, he was active in the land-use regulatory scene, but since recapturing office, he has not made public appearances on behalf of developer clients in New Hanover County. Though members of his firm continue to be involved in local ventures. 

“And this evening we’re going to ask the board for a continuance,” Lee said at the meeting. 

He proclaimed that highly consequential research on the traffic impacts of this development had yet to be procured, and without it, he could not effectively substantiate his presentation. 

With some more time, the data could be compiled, and Evolve could return to make a complete argument, Lee said. The board was not swayed. 

In a 4-1 vote, with only commissioner Jackie Newton siding with Lee, the board denied the request for a continuance and told Lee the time was here and now to present Evolve’s application. Lee did not respond to an email seeking comment for this story.

Lee, unfazed, repeated to the commissioners that without the traffic study completed, such a presentation was impossible. He told the board Evolve will withdraw the application. In silence, Lee and the Evolve entourage then walked out of the room. At least two people affiliated with Evolve Companies contributed at least $5,000 to Lee’s senate campaign during last year’s election cycle.

A school system with little room to grow 

Topsail High School has a capacity of 1,400 students, but the population is 1,460. With similar realities of overcrowding at nearby schools, the situation has become a sticking point for development applications. (Port City Daily/File)

According to Alex Riley, communications official for Pender County Schools, 11 schools out of the 18 in the county “are at 80 percent or higher capacity at this time with more growth expected for the 2021-22 school year.”

The most drastic examples are the Topsail schools: Topsail High has an enrollment of 1,460 students with a capacity of 1,400. North Topsail Elementary has 519 students with a capacity of 511. Topsail Elementary, with a capacity of 506 students, has an enrollment of 653 students.

“While our county as a whole continues to see sustained growth, there certainly has been a rapid population increase on the eastern side,” Riley wrote in an email. “What we are seeing is a mix of longtime residents blending with families who are moving here from across the country for a number of reasons.” 

Pender County Schools is in the midst of generating a demographic study that will define the short- and long-term needs of the district. 

“In an area that is seeing as much growth as we have, it’s not as simple as buying property and building a school,” Riley wrote. “Prior to construction on the Surf City campus, significant work had to be done to the land to make it viable for a school to be built. At this time, we’re actively engaged in talks to acquire property, but we all know time is of the essence.”

After Tribute Companies withdrew its application, board of commissioners chairman George Brown told the StarNews, “The county has not hindered the growth. If anything, we have allowed quite a bit of growth,” he said. “We’re at the point now where we have to control things a little better.” 

Brown did not respond to Port City Daily’s requests for comment on this story. Henley, the planning director, acknowledged emailed questions sent by Port City Daily, but did not respond to those questions.

Some developers have said the formulas used to calculate impact to school systems do not consistently yield good data. Often, the projected student count for new projects is an overestimate, a phenomenon increasingly identified by planning staff in New Hanover County. 

“While other systems throughout the state have seen numbers stabilize or even dip in terms of student population, Pender County is seeing a growth trend,” Riley wrote. “It’s certainly a challenge as a facility can only hold a certain number of people, but we are committed to making sure we meet that challenge head on.” 

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