Fruita boards approve agreements to redevelop Family Health West into 62-unit Oaks housing project

The Fruita Housing Authority and the Fruita City Council on unanimous 6-0 votes approved a package of agreements to move the Oaks project from term sheet to construction-ready redevelopment. The agreements approve the redevelopment contract, a restrictive covenant to preserve affordability and a loan-default/assignment agreement that gives the city options to protect long-term affordability.

City and housing authority officials said the plan will convert the former Family Health West property into 62 multifamily rental units restricted to households at 100% of area median income or lower. Dalton Kelly, special counsel to the Housing Authority, summarized the package as “3 agreements” and described how the financing and use restrictions are structured to keep the units affordable so long as the city makes specified future appropriations.

Why it matters: The approvals set concrete steps to add 62 rental units restricted at 100% AMI and create enforcement and contingency tools the city can use if the project’s construction lender faces default. Council members and Housing Authority commissioners said the deal is intended to preserve long-term affordability while allowing limited flexibility if the city cannot deliver future appropriations.

Under the redevelopment agreement,…