Aspen couple investigated for breaking deed restricted housing rules
Whether a couple who own a restricted deed home in the Aspen-Pitkin County Housing Authority’s inventory violated the rule not to own other real estate in the valley is now between the hands of a hearing officer.
Cameron and Tricia McIntyre, who own a resident-occupied home in the North 40 subdivision, also have an interest in a single-family home in Park Circle that was purchased for $1.2 million by an LLC with Tricia’s name associated with it. , according to APCHA.
This violates the deed restriction attached to the North 40 property, which prohibits owners from owning “any other residential property developed in those portions of Eagle, Garfield, Gunnison, or Pitkin counties that are part of the Roaring Fork drainage”, according to a notice of violation addressed to the McIntyres on March 11.
The McIntyres, through their Aspen lawyer, Michael Hoffman, appealed APCHA’s Notice of Violation and their case was heard Thursday before Compliance Hearing Officer Mick Ireland.
APCHA alleges that a company, CMTR, LLC, formed in 2017, which purchased the Park Circle property, was managed and funded in part by Tricia McIntyre.
This is despite the fact that the company’s two executives are identified as the McIntyres’ children, Laughlin McIntyre and Keenan McIntyre, who were minors at the time the LLC acquired the property.
Tricia McIntyre and Hoffman testified Thursday that the purpose of buying the house was for her children after they got home from college.
“If you’re not a multi-millionaire or have a large trust fund, it’s next to impossible for you to come back to Aspen,” Hoffman said Thursday during the hearing. “So the motivation wasn’t to increase their balance sheet, the goal was to have a place for Keenan and his brother Laughlin to go back to.”
Tricia McIntyre said CMTR, LLC leases the three-bedroom, two-bathroom home to long-term tenants and charges $1,800 per month for the studio apartment and $4,800 for the two-bedroom unit.
McIntyre told Ireland that with the current market, she could rent the two-bedroom monthly for between $15,000 and $20,000, but chooses not to.
Keenan McIntyre, who was present at the hearing and a recent graduate of Colorado State University, said he plans to move into the home this fall, and Laughlin will graduate in August from the University of Colorado Boulder.
Hoffman said in his April 15 letter to APCHA that the eldest McIntyres originally purchased the property from Park Circle with the proceeds of an advance on his home equity line of credit and the debt was repaid by a conventional loan, which is funded by rental income.
During Thursday’s hearing under direct questioning from Ireland, Tricia McIntyre could not recall precisely how the property was purchased and often replied that she ‘don’t know’, ‘don’t remember’ , “don’t understand” or “good question”. Asked about the financial and tax details surrounding the acquisition and ownership of the Park Circle home.
Ireland said he was skeptical of the McIntyres showing.
“I’m really disturbed that no one remembers anything…it’s all disturbing,” he said. “I think it was a ploy, unless otherwise noted, to get around the North 40 act restriction.”
Hoffman said that was not true and that it was up to Ireland and perhaps the courts to rule against APCHA’s claim that there was a need to ‘pierce the corporate veil’ of CMTR , LLC.
APCHA’s position is that CMTR, LLC is acting as the alter ego of Tricia McIntyre, and that the corporate structure formally in place for the ownership and management of Park Circle’s property has been used to perpetuate wrong , namely the violation of the North 40 act restriction.
“If the McIntyres simply intend to acquire the Park Circle property for the future housing of the children, there is no need to form the LLC for that purpose,” said Bethany Spitz, chief compliance officer of the APCHA. “Purpose does not explain or justify corporate ownership of this property and the McIntyres could have purchased the Park Circle property in their own name and not through an LLC if that was their sole intention.”
Hoffman said it’s important to note that the Park Circle property was purchased two months after the LLC was formed.
“The LLC has its own separate existence as income and expense and the McIntyres took care to manage it in a particular way,” he said at Thursday’s hearing. “There was no commingling of the LLC’s funds with those of Mr. and Mrs. McIntyre.”
Hoffman said every account of the prohibition on owning other real estate in the Roaring Fork River watershed found in the deed restriction and APCHA guidelines apply to unit owners. restricted access, not to members of their household or family.
Under these documents, Keenan and Laughlin are allowed to own real estate in Aspen without the restraints that bind their parents.
“In other words, whether CMTR, LLC is Ms. McIntyre’s ‘alter ego’ is only the first of several questions that the hearing officer must consider in determining whether ‘breakthrough’ the corporate veil” is appropriate in this case. Hoffman wrote in his letter to Ireland and Spitz. “…Piercing is not appropriate here. More immediately, however, the facts of this case do not support the conclusion that CMTR, LLC is Ms. McIntyre’s “alter ego”.
“The LLC is governed by a written operating agreement, which identifies Laughlin McIntyre and Keenan McIntyre as the sole members of the partnership.”
Hoffman went on to explain that in law, the concept of piercing the corporate veil is generally used to determine whether the officer of a corporation or other legal entity should be stripped of the liability protections granted to corporations and similar entities in order to that the director of the company is personally liable for the debts of the company.
“In the present case, APCHA seeks to deny the existence of CMTR, LLC and to treat it as if it were Mr. and Mrs. McIntyre, or simply Mrs. McIntyre,” Hoffman’s letter reads. .
As a remedy in the case, APCHA requests that one of the properties, either at 0005 Riverdown Drive, which has a estimated value of $1.7 million, or 409 Park Circle, with a estimated value at $1.5 million, to be sold.
Ireland has asked both parties to comment in writing on the appeal and on any outstanding issues that were not answered or addressed at the hearing.
“I will not be applying any consequences today because I want everyone to have the opportunity to discuss in writing with me why they think the property should or should not be sold,” Ireland said. “But it cannot continue with a paper ownership interest that suggests the owners of Lot 72 in North 40 contain some sort of interest (in the Park Circle property) or had some interest.”
Tim Andrulaitis, a neighbor of the McIntyre Park Circle property who attended Thursday’s hearing, warned Ireland of the consequences its decision could have.
“If this is the priority APCHA wants to establish, sign me up and I will buy a North 40 home, put all my property in my child’s name and continue to earn money with open market property , ” he said.