City benefits from oil boom: Growth possible here but infrastructure costs a challenge in residential development

Talk about it

Officials in Jamestown agree that the city is poised to receive positive economic growth from those struggling with life in the Oil Patch. But can the city handle it?

Jamestown has the room for business but first the city needs to address residential infrastructure needs that are hindering housing development, said Connie Ova, CEO of the Jamestown/ Stutsman Development Corp.

“We’re hearing several different things that it’s not as easy to build here as it is in other communities at the present time,” Ova said. “We (the city) don’t offer assistance for infrastructure development and other communities do.”

Dean Hafner is a residential home builder in the area, and right now his biggest obstacle is paying the city upfront costs for sewer, water and bringing the road to grade and gravel for it.

Hafner said that could cost about $25,000 per lot, and the cost to develop 30 lots could cost as much as $750,000 up front out of the developer’s pocket.

“I can’t justify spending $600,000 to $1 million in infrastructure and hope I get a return on it,” Hafner said. “That infrastructure is just killing us.”

Jeff Fuchs, city administrator, said Jamestown used to offer infrastructure costs on residential development up front and have homeowners pay back the costs over a special assessment in the 1970s. But the market fell apart and the city was forced to cover the costs on about 600 lots.

The developers didn’t have the finances to cover the special assessments, so the lots went back to the Stutsman County for delinquent taxes and special assessment, Fuchs said.

In the meantime the city sold bonds to finance construction but with no special assessments coming in there was no money to finance the bonds, he said. The cost for the infrastructure was then placed back on the taxpayers in Jamestown.

“If the need is there I think you’ll find the developers that will do that type of thing,” Fuchs said of developers paying upfront infrastructure costs.

One thing that’s different now is that the housing situation is tighter in Jamestown.

Currently there are about 60 houses on the market here, that’s between 10 and 15 fewer homes than a year ago at this time, said Candace Dempsey, broker and owner of Reuben Liechty Realtors in Jamestown.

“Unless there’s some change in the city, I see the development to be out of the city, and Jamestown saying, ‘I don’t want to stay status quo, but gosh, how are we going to get out of this?’” Dempsey said.

Officials here say residential building permits during the past couple of years have been between three and five a year.

But there’s need for jobs and businesses are interested in moving from the Oil Patch to Jamestown, Ova said.

“We’ve had several calls from companies that are out in that area and they’re either frustrated because they can’t find employees or frustrated because of the traffic or they can’t find housing or things like that,” she said. “So they’re basically shopping their businesses out to all of us in the eastern part of the state.”

Ova said 70 percent of the core businesses here — manufacturing, construction and value-added agriculture processing, to name a few — are already doing business in the Oil Patch.

JSDC is currently looking into an advertising campaign with the goal of workforce recruitment while focusing on the quality of life in Jamestown versus the western part of the state, said Lindsey Larson, marketing/business development specialist with JSDC.

“The objective would be to promote and create awareness that Stutsman County is an ideal situation for living and our ultimate goal would be to recruit individuals and families to the area,” Larson said.

She said local employers are buying advertising and having a difficult time filling positions.

Still, it comes back to housing the workers who decide to relocate here, if any do.

“If you look what is on the market, it’s terrible,” Hafner said. “There’s no, I guess, starter homes for young people — there’s just none out there new.”

Jamestown has also established a direct link with Williston, N.D., as Jamestown Regional Airport now offers a direct flight to and from Williston once a day. Round-trip airfare is $149.

Few passengers took advantage of the flight with only 10 April boardings going to Williston, said Matt Leitner, Jamestown Regional Airport manager. The flights to Williston started March 18.

But at some point in the future Oil Patch workers could live here with their families and commute to and from for extended shifts via air travel, Leitner said.

“The word is just kind of getting out there right now and the people we did see in April were primarily at the end of the month, so that would indicate to me it’s just starting to catch,” he said.

Sun reporter Ben Rodgers can be reached at 701-952-8455 or by email at brodgers@jamestownsun.com

Tags: local news, news, development