Alamogordo commission backs county-led MRA, approves 7-year tax abatement for Patriot Point housing

The Alamogordo City Commission on Sept. 9 voted 6-1 to approve a resolution expressing the city’s intent to cooperate with Otero County in designating a proposed redevelopment area as a metropolitan redevelopment area under the Metropolitan Redevelopment Code and to authorize a seven-year tax abatement tied to the Patriot Point housing development.

The resolution (Resolution 2025-29) was amended on the floor before the vote to (1) change the stated number of units from “approximately 228” to 114 and (2) revise a liability clause so the county, not the city, would be responsible for defending challenges to designation or the subsequent redevelopment plan. “Should the designation of the proposed metropolitan redevelopment area or subsequent metropolitan redevelopment plan be challenged in litigation or administrative proceedings, it shall be the duty of the county to defend such actions,” the amended language states, read for the record by city staff.

Why it matters: city staff said the action does not itself designate any parcel as blighted or adopt a redevelopment plan; rather, it signals the city’s support so the county can proceed with the Metropolitan Redevelopment Act process and the developer can demonstrate local buy-in while seeking financing, including federal backing.

Key discussion points: - Liability and process: City staff, after consulting with county counsel and the city’s contract attorneys, told commissioners the exposure to the city would be limited and that the county would carry defense responsibility if litigation ensued. Staff said final designation of blight and the metropolitan redevelopment plan would be the county’s responsibility and require separate public hearings. - HUD financing and project economics: Developer Eddie Valencia told the commission HUD had issued a $21,000,000 loan commitment for the project, which he said requires roughly $3,000,000 in developer equity. Valencia described HUD’s commitment as an insurance policy the Department of Housing provides, not an obligation to close, and said the HUD approval is a critical step for the financing to go to market. - Tax abatement and revenue: City staff explained the abatement would “freeze” taxable value at current levels for the seven-year abatement period; the city’s share of property tax revenue is a smaller percentage of the total tax bill than the schools’. Staff said the city’s expected foregone incremental tax revenue during the abatement would be minimal but did not provide a firm city‑revenue dollar figure in the meeting record.

Commission action and vote: Commissioner Crystal Guthrie moved approval of the resolution as amended; Commissioner Josh Reardon seconded. The amended resolution passed 6-1.

Next steps: Staff and the county will proceed with the county’s public hearings and statutory process to draft a metropolitan redevelopment plan for the designated area; any future ordinance designating blight, tax abatement ordinances, or project approvals would come back to the appropriate governing bodies for separate votes.