{"id":47920,"date":"2021-03-18T12:02:21","date_gmt":"2021-03-18T18:02:21","guid":{"rendered":"https:\/\/dh.durangoherald.com\/tj\/colorado-bill-would-allow-cities-and-counties-to-require-affordable-housing\/"},"modified":"2021-03-18T18:02:21","modified_gmt":"2021-03-18T18:02:21","slug":"colorado-bill-would-allow-cities-and-counties-to-require-affordable-housing","status":"publish","type":"post","link":"https:\/\/dh.durangoherald.com\/tj\/colorado-bill-would-allow-cities-and-counties-to-require-affordable-housing\/","title":{"rendered":"Colorado bill would allow cities and counties to require affordable housing"},"content":{"rendered":"\n

\"Homes
Homes sales in Telluride and Mountain Village will surpass $1 billion in 2020, an all-time high. Colorado\u2019s resort communities are seeing a surge of home buyers who are shattering real estate records.<\/span>Jesse Paul\/The Colorado Sun<\/span><\/figcaption><\/figure>\n<\/p>

More than two decades ago, Telluride\u2019s leaders were grappling with the growing pains of a booming resort industry. Housing prices shot up, forcing many workers to live outside of San Miguel County.<\/p>\n

The town responded by passing an ordinance in 1994 requiring developers to create affordable housing for a portion of the new workers generated by their projects. The idea was for builders to take responsibility for the new workers a larger community demands, but who might not earn enough working as a teacher, cop or retail clerk to live there.<\/p>\n

A developer sued, and in 2000 the Colorado Supreme Court ruled that requiring developers to include affordable housing in new projects is illegal because it\u2019s a form of rent control prohibited by a 1981 state law.<\/p>\n

In the years following the ruling, cities and counties looking to boost their affordable housing stock have passed policies to navigate around the Telluride decision or, in the eyes of developers, have walked right up to the legal line. Now state Democratic lawmakers want to seize on an opening left by the Supreme Court to reverse the decision entirely.<\/p>\n

House Bill 1117 would modify state land use statutes so that local governments can require affordable housing in new or redeveloped projects without running afoul of the rent-control prohibition.<\/p>\n

Colorado\u2019s housing crisis has worsened in recent decades, from communities in the Denver metro area to mountain resort towns like Telluride. Colorado has added nearly 1.5 million people in the past two decades, and as more demand drives up housing prices and new construction lags, it\u2019s largely low- and moderate-income workers who are priced out of housing.<\/p>\n

About 22% of renter households in Colorado are extremely low-income, with 74% of those households paying more than half their income toward housing, according to the National Low Income Housing Coalition.<\/p>\n

Cities and counties need all the tools they can get to increase their affordable housing supply, said state Rep. Susan Lontine, a prime sponsor of the legislation along with fellow Denver Democratic state Rep. Serena Gonzales-Gutierrez.<\/p>\n

\u201cThese are the people that keep our society healthy and educated and moving, and they can\u2019t afford to live where they work,\u201d Lontine said. \u201cAnd this is a piece of the puzzle to help us address affordable housing for folks who desperately need it.\u201d<\/p>\n

Democratic lawmakers have introduced versions of this legislation unsuccessfully before, with the proposal dying last year after the coronavirus pandemic reshuffled the legislature\u2019s priorities. Now, with Democratic majorities in both the House and Senate, the proposal has a solid chance of passing.<\/p>\n

Under House Bill 1117, developers must be given alternatives to building affordable units on-site. For example, they could trade those for affordable units built elsewhere, pay a fee into an affordable housing fund, or any number of other options. The bill leaves it up to local governments to decide if they want to adopt such policies and what that menu of options for developers would be.<\/p>\n

\"The
The inside of the Colorado Capitol&#x2019;s dome.<\/span>Jesse Paul\/The Colorado Sun<\/span><\/figcaption><\/figure>\n<\/p>

Housing advocates argue policies that allow local governments to require affordable housing as a condition of development \u2014 known as inclusionary housing \u2014 isn\u2019t a silver bullet, but an important supply-side solution to getting more units built.<\/p>\n

\u201cYou might hear that if we just allowed more density, more growth, then we wouldn\u2019t need this bill,\u201d Robin Kniech, a Denver city councilwoman, testified at a House Transportation and Local Government committee meeting earlier this month. \u201c\u2026In the last 20 years since this court decision, Denver has built 62,000 new apartments, the vast majority are luxury, they are not priced anywhere close to what these families can afford.\u201d<\/p>\n

Prioritizing affordable housing is also crucial to maintaining public support for the state\u2019s economic growth, especially as it continues to draw new residents, bill sponsors say.<\/p>\n

\u201cThe best way to keep our communities supportive of growth is to show them that housing for our existing workforce will be included in it,\u201d Gonzales-Gutierrez said.<\/p>\n

Inclusionary housing policies have grown in popularity nationwide, with more than 900 local governments adopting such programs, according to the Grounded Solutions Network, an advocacy group that has promoted inclusionary policies.<\/p>\n

Research is mixed on how inclusionary policies \u2014 which vary widely \u2014 affect private housing markets, and their success in getting new affordable units built depends on location, the market, how long policies have been in place and other factors, according to an Urban Land Institute report.<\/p>\n

A number of industry groups, including the Colorado Apartment Association, Colorado Association of Home Builders and Colorado Association of Realtors, are against the bill and want to see specific \u201cguardrails\u201d for cities on what affordable housing requirements should look like.<\/p>\n

\u201cThe development community needs predictability, we need a clear understanding of what opportunities exist to help subsidize and afford to build this affordable unit,\u201d said Caitlin Quandre of NAIOP Colorado, which represents commercial real estate developers. \u201cIt really creates a patchwork quilt that can be really unpredictable for development.\u201d<\/p>\n

Developers have raised concerns that cities will introduce requirements that could jeopardize the financial viability of projects, or that the cost of affordable units would be passed on to other renters in the same complex.<\/p>\n

Andrew Hamrick, general counsel for the Colorado Apartment Association, said the bill should require governments to pitch in \u2014 either through subsidies or other measures \u2014 to fill that gap.<\/p>\n

\u201cInclusionary zoning affordable housing projects can work, but they require that the local government contribute to their fair share of affordable housing. And this bill removes all obligation or all incentive for a local government to do just that,\u201d Hamrick said.<\/p>\n

Some cities move ahead with similar affordable housing policies<\/p>\n

A number of Colorado cities, including Boulder, Durango, Longmont, Aspen, Crested Butte and Vail, have implemented policies since the Telluride ruling to incentivize more affordable housing construction.<\/p>\n

Many of those programs ask developers to set aside a percentage of units in new developments, typically between 10% and 20%, for affordable housing, although developers are also given options to fulfill those requirements. Cities generally justify these policies as voluntary agreements, not illegal mandates, by pitching in subsidies, offering increased density or other incentives. In Denver, for example, developers can build higher in exchange for agreeing to a certain percentage of income-restricted units.<\/p>\n

Aspen, Denver, Boulder and Eagle County have also implemented \u201clinkage fee\u201d programs, according to the Colorado Real Estate Journal. Those programs charge developers a per-square-foot fee that goes toward a fund for affordable housing projects, and aren\u2019t limited by the Telluride ruling.<\/p>\n

At the House Transportation and Local Government Committee meeting earlier this month, some local government officials testified that policies requiring developers to build affordable units is necessary to make any dent in the housing crisis.<\/p>\n

\u201cThe market will never produce enough housing in Clear Creek County to bring market rate prices into the affordability range,\u201d Clear Creek County Commissioner George Marlin said. \u201cOur recent needs assessment calls for the production of 300 rental units below 60% (area median income), and it will take nearly every square foot of buildable space for us to accomplish that goal using mixed-price developments.\u201d<\/p>\n

Requiring affordable housing be included in projects also allows cities to create mixed-income communities, advocates argue.<\/p>\n

\u201cThat is really important, because you want complete communities. You don\u2019t want affordable housing away from towns and away from grocery stores,\u201d said Kniech, the Denver city councilwoman.<\/p>\n

Meghan Dollar, a lobbyist for the influential Colorado Municipal League which helped draft the bill, said many cities represented by the organization have voiced concerns about housing costs but have avoided introducing such policies for fear of violating the Telluride ruling.<\/p>\n

\u201cSo what we\u2019re trying to do is clear the air, get rid of the gray area, and make it black and white,\u201d Dollar said.<\/p>\n

The bill doesn\u2019t change the state\u2019s existing prohibition on rent control. But it seizes on an opening left by the Colorado Supreme Court in the Telluride ruling: While policies requiring affordable housing in developments \u2014 known as inclusionary housing \u2014 constitute rent control, the General Assembly still has the power to change or clarify state statute.<\/p>\n

The bill\u2019s sponsors say they are leaving it up to local governments to decide whether inclusionary housing policies are right for them.<\/p>\n

\u201cIt is narrowly tailored to allow local governments the authority to promote affordable housing in their communities,\u201d Gonzales-Gutierrez said. \u201cThe state is not mandating local governments to make decisions that are right for their community.\u201d<\/p>\n

Colorado Apartment Association argues that as written, House Bill 1117 gives cities and counties broad latitude to impose onerous requirements on developers without requiring local governments to pitch in.<\/p>\n

Hamrick said the bill should require local governments to pitch in funding, waive development requirements or offer other incentives, such as increased density, that are \u201ceconomically equivalent\u201d to the financial cost of setting aside affordable units.<\/p>\n

\u201cBut if you don\u2019t do anything, all you\u2019re doing is giving local governments the tool to act as a de facto, anti-growth limitation, or a de facto system of benefits where the other residents pay for the reduced rent that they mandate,\u201d he added.<\/p>\n

Opponents also want to see more specific guidelines for cities as part of the legislation. The Colorado Apartment Association has suggested an amendment to cap the percentage of units in a development that can be subject to affordable requirements at 20%, and to limit the affordability to 80% of average area rent.<\/p>\n

That change was requested by Rep. Kevin Van Winkle, a Highlands Ranch Republican, during the meeting of the House Transportation and Local Government committee. It was rejected by the Democratic-controlled panel.<\/p>\n

Lontine said local officials, not state legislators, should make those judgment calls. She pointed to a program in the city of Boulder, which requires residential developers to set aside 25% of units in a project for affordable housing, although in many cases, the city contributes funds, developers can pay fees or build some of those units off-site to meet the requirement.<\/p>\n

\u201cIf we put a cap that\u2019s lower than 25%, then we\u2019d make Boulder\u2019s program illegal,\u201d Lontine said. \u201cWe just think it needs to be a local decision.\u201d<\/p>\n

Advocates argue the problems cited by opponents haven\u2019t materialized in the growing number of cities turning to inclusionary policies across the United States. Cities and counties won\u2019t impose project-killing requirements, because it\u2019s also in their best interest to get projects built, said Dollar of the Colorado Municipal League.<\/p>\n

\u201cWhat this bill does is it creates a direct line for local governments to work with developers \u2026 to increase and promote affordable housing,\u201d Dollar said. \u201cIt doesn\u2019t do a service to anyone to require so much affordable housing that there is no development.\u201d<\/p>\n

So far, the bill has not drawn any support from Republicans, Lontine said, and has no GOP co-sponsors.<\/p>\n

Rep. Andy Pico, a Colorado Springs Republican, said while affordable housing is an urgent problem in Colorado, he opposes requiring developers to build affordable units.<\/p>\n

\u201cWhat you\u2019re going to do is you\u2019re going to undermine the construction of a new housing,\u201d Pico said. \u201cIt is not rent-controlled by the strict definition of the term. But it is rent control in effect because you\u2019re requiring percentages within the construction.\u201d<\/p>\n

House Bill 1117 is slated to be debated on the House floor later this week.<\/p>\n

Read more at The Colorado Sun<\/em><\/p>\n

The Colorado Sun is a reader-supported, nonpartisan news organization dedicated to covering Colorado issues. To learn more, go to coloradosun.com.<\/a><\/em><\/p>\n

Read more at The Colorado Sun<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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