The ‘Make Colorado Affordable’ initiative could create unintentional consequences for rural resort towns
A “Make Colorado Affordable” initiative on the ballot this year to address the need to create affordable housing statewide could bring unintended consequences to the Western Slope.
“It is not a new tax, it just impacts the potential refund of TABOR,” Glenwood Springs Mayor Jonathan Godes said. “That would have to go back anyway, and it’s significant: $200 million, it’s a lot of money.”
The initiative proposes that the funds will be take out of the TABOR refund checks. TABOR refunds are decided by the amount of surplus the state receives in taxes at the end of the year. This could mean smaller checks that the $750 received by each Colorado tax payer this year, if not all of TABOR surplus revenue would go to affordable housing needs.
If passed by voters, the initiative requires that the state will have to spend almost $270 million on affordable housing in the first year. Supporters were able to collect more than 200,000 signatures to have the initiative added to this year’s ballot.
Town and city economies throughout the state vary, with most rural mountain communities being more expensive and more limited on space than rural and urban Front Range communities. Holding these communities to the same standard using one economic scale could cause uneven disparities in affordable housing throughout the state.
“I appreciate the sentiment and what they’re trying to do, and I think it’s smart,” Summit County Commissioner Elisabeth Lawrence said. “I just don’t agree with the details of the funding because it leaves out a significant portion of our state. It really hurts some of our rural resort communities.”
Lawrence has been working in Summit County to generate as much affordable housing as possible, and although these are her personal opinions and not the county’s opinions, she has some concerns about how the initiative might affect the Western Slope.
“I want to say first and foremost anything we can do to solve affordability and workforce housing and housing prices across the state is important,” Lawrence said. “I just believe this is not the right mechanism right now.”
Lawrence’s concerns are mostly around the initiative language that states that affordable rentals are considered to be at or below 60% of the Area Median Income.
For Summit County, 60% AMI is almost $44,000 for a single person but varies depending on how many people are in the household. For example 60% AMI for a two person household in Summit County is $46,080, according to the Colorado Department of Local Affairs.
“That’s nearly impossible for us to build in the mountains in smaller communities,” she said. “You can do that in a large urban metro area where you have a lot of land to build something very, very dense and tall. You can build a lot of housing at that 60% because you get an economy of scale.”
Half of the state sits closer to a $30,000 AMI at 60% for a single person. Denver has a higher 60% AMI at $44,016, but many of the other communities statewide have much more space to develop on than Summit or Garfield counties.
Garfield County AMI at 60% for 2022 is almost $40,000 for a single person — an increase from $37,140 for a single person in 2021.
The initiative also requires each town and city increase the number of affordable housing units by 3% annually. This number can be really high in a small resort community if they have already created a large amount of affordable housing units.
“There’s also a rule that you have to add 3% of housing each year for fund availability,” Lawrence said. “Well, 3% sometimes can be a lot in a small community.”
Councilmember Paula Stepp also noted concern about the 3% annual increase while at the Glenwood Springs City Council meeting on Thursday.
During that discussion, Godes said that if the city has 100 affordable units existing, then over the course of three years the city would only be required to add 10 new units.
“I think that if we’re getting a million or $2 million or even a half million dollars from the state to do that, I think that’s something that is actually a pretty low bar,” Godes said.
While that 3% increase might appear small for Glenwood Springs, 3% for Summit County can be a lot. Currently, Summit County has projects to build almost 450 new units, and 3% of that 450 is 13 new units. Summit County as a whole has tens of thousands affordable housing units, which would make that 3% increase a high number to keep up with.
The city has needed more funding and planning for workforce housing and Godes is hoping that additional state and federal funding can help bridge some of that gap.
“It is critical that there are locally dedicated workforce housing funds available. With congress committing $170 billion through Building Back Better legislation and this $270 million state ballot question, Glenwood needs to be positioned to match and leverage these opportunities,” Godes said.
The ballot language for Initiative 108 is not completely finalized and there will need to be more clarification leading up to the election and after, if it passes.
“The devil is always in the details,” Lawrence said. “Again, at face value, that sounds amazing, more money in a way that doesn’t raise taxes that would go toward affordable housing. But again, you have to dig in the details and understand how it translates to one’s own community, and so when I translate it to my community that’s where I realized it really doesn’t work.”
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