Yampa Valley Housing Authority explores means to address rental housing shortage in Routt County
December 16, 2014
Steamboat Springs — The Yampa Valley Housing Authority is seeking interest from private developers in a tentative plan to leverage federal tax credits to build affordable rental apartments on 10 acres it owns on the west side of Steamboat Springs.
The Low Income Housing Tax Credits are the U.S. government's longstanding method of supporting creation of affordable housing. The federal income tax credits are sold through brokers to people who have income they would like to shelter from taxes. In that way, the tax credits serve as a means for housing authorities like YVHA to bring equity to a new affordable housing project.
The awarding of the tax credits to housing authorities like YVHA is administered by the Colorado Housing and Finance Authority.
As recently as 2012, YVHA was seeking to sell land it owns on Elk River Road in order to get out from under about $2 million in debt associated with the 2006 purchase of the property. The authority bought the land on Elk River Road, just north of the intersection with U.S. Highway 40, near the peak of the market when community concerns about workforce housing were heightened. The land appraised for just $1.5 million in 2011.
The city of Steamboat Springs at one time had approved a development plan for Elk River Village that would have created 13 small-footprint single-family homes and 54 affordable condominiums. But that permit has expired, and postrecession demand has shifted.
Now, with the recognition that there is an acute shortage of rental apartments in Steamboat, there is renewed hope that the land could be used for community housing.
Recommended Stories For You
"We're seeing a tremendous need for rental housing right now," YVHA board member Kathi Meyer said. "We are looking to see if there's a better use of that property."
YVHA has issued a request for proposals from "qualified" developers and consultants to partner in the development of apartments on the property, and responses are due this week. The full RFP can be viewed at http://www.yvha.org.
There is significant need for rental housing by households earning 40 to 60 percent of the median average income here, YVHA Executive Director Jason Peasley said. In 2014, a Routt County household of two making $37,200 annually was bringing home 60 percent of the average median income here, according to the Colorado Housing and Finance Authority. Peasley added that YVHA would like to be the managing entity of new apartments.
Meyer said the new direction came about after a developer approached the authority to express interest in taking on an affordable housing project that would involve the authority applying for the federal income tax credits administered by the Colorado Housing and Finance Authority.
The housing authority decided to seek a range of proposals.
Meyer cautioned that the level of debt YVHA has at the Elk River Road property won't make it easy to work out a development agreement for a new housing project.
"Our basis in the land is still $2 million," she said. "The numbers have to work, and that's the challenge."
Peasley said the planned Anthracite Place apartments in Crested Butte serve as a current example of an affordable housing project that has been awarded Low Income Housing Tax Credits financing.
The Colorado Housing and Finance Authority announced in May 2014 that Anthracite Place (formerly known as Caddis Flats) was one of seven projects among 26 applicants to be extended Low Income Housing Tax Credits in the first round of funding for the year. The project is to receive $539,000 in tax credits annually for 10 years. The development partner, Housing Resources of Western Colorado, is continuing to work through the town of Crested Butte approval process this winter.
The project would create 30 apartments composed of 24 one-bedrooms and six two-bedrooms. Of the total, 13 units would be made available to households earning 50 percent of the average median income in the community and 17 to people making 60 percent of Gunnison County’s average median income ($28,860, or about $14 per hour for a single person).
Gunnison County, the Gunnison Valley Housing Foundation, the town of Crested Butte, town of Mount Crested Butte, city of Gunnison and Crested Butte Mountain Resort contributed a total of just more than $1 million in grant funds toward the project.
Peasley said there is no shortage of people in Routt County whose income fits the range of 40 to 60 percent of average median income and can't find rental housing they can afford.
According to Housing and Finance Authority's 2014 income guidelines, for a one-person household making 50 percent of the average median income in Routt County ($27,150), the maximum rent allowable for a one-bedroom apartment built using Low Income Housing Tax Credits would have been $726 this year. For someone earning $35,295, the maximum rent would have been $944 this year.
"There's a population out there that makes a wage that would qualify, but (rental apartments) are not available, so they are overstretching on a mobile home or something," Peasley said. "We believe we have demand for another 50 apartments now, but I would believe there is probably demand for more."