Lake County commissioners table consideration of Oakwood construction agreement pending buyer, legal and pricing checks

The Lake County Board of County Commissioners on an announced special meeting tabled consideration of a draft construction agreement with Clayton Properties Group Incorporated, doing business as Oakwood Homes, until 3:00 p.m. tomorrow after staff said they needed more time to confirm buyer commitments, legal exposure and a factory price hold.

County housing program manager Jackie Wellahan and rural planner Michael Yerman briefed commissioners on the status of a modular housing project (referred to in materials as the "10 2" project) that Oakwood proposes to build using factory-produced units from Bonavilla. Wellahan said 17 prospective buyers entered a February lottery and 10 remain under contract or otherwise pursuing purchases; she and others on the call said staff hope targeted outreach will increase that number to 14 or more for the second lottery.

"We are down now to 10 moving forward," Wellahan said. She added Oakwood has expanded marketing (housingwoodcounty.com and social media) and contracted a website manager to improve outreach.

Yerman described contract milestones and the county's potential financial exposure tied to Oakwood's required deposit with the factory. He initially stated a larger figure during the briefing, and staff later clarified the specific escrow figure to the board. "The down payment or the escrow funds that Oakwood needs to give Bonavilla is $350,000," said Yerman, rural planner. County staff also referenced a separate line in the materials identifying the construction contract value at about $8.7 million.

Amy Tate, who said she will assist with preparing buyer contracts on short notice, told the board Bonavilla negotiated a price hold through June 1. "They negotiated a price hold until June 1," Tate said, noting the county and developer were working against that window to avoid a factory price increase.

Staff outlined the near-term timeline for buyer qualification and procurement: applications for the second lottery are due June 13, the next lottery is scheduled for July 23, and staff said they expect to return to the board with updates in the BOCC's June and July meetings. Yerman said Oakwood will place an initial order with Bonavilla to reserve 24 units, but the county and developer retain the ability to reduce that order after the second lottery to limit exposure.

Commissioners said they needed time to review the draft agreement and, at least in one speaker's view, to obtain an outside legal opinion about the county's liabilities if buyers drop out. One commissioner expressed concern about the county being held responsible for unsold units that the developer might lease in the interim. "It's risky. There's a lot of risk involved," the commissioner said (speaker not identified by name in the transcript).

To allow additional review, a commissioner moved to table the item until 3:00 p.m. tomorrow; another commissioner seconded the motion. The motion carried on a voice vote with two commissioners recorded as "aye." The board instructed staff to schedule the special meeting and come prepared with answers to outstanding contract and legal questions.

Next steps identified by staff include completing and attaching exhibits to the draft agreement, finalizing buyer contracts for the 10 buyers currently engaged, monitoring interest for the second lottery (staff noted an interest list of roughly 80 people and about 35 who had indicated intent to apply), and updating the BOCC after the June 13 application deadline and after the July 23 lottery.

The special meeting was scheduled for 3:00 p.m. tomorrow to revisit the agreement; the BOCC tabled formal action until that meeting.