Thursday, October 26, 2000
Steamboat Springs After hearing the opening statements from Rob Dick and Steve Cavanagh at an election 2000 forum Thursday afternoon, it wasn't especially difficult to understand what the possible implications would be if Referendum 2A, the excise tax, passes.
But if it doesn't pass, as two audience members asked, what will the community of Steamboat Springs do about affordable housing?
Cavanagh, a local developer, was prepared for the question, explaining that he is in favor of charging impact fees on development or a head tax, which could be levied on employers who have not been paying their employees adequate wages. That solution would go along with an idea that Cavanagh had expressed at an earlier excise tax debate that low wages, not housing, is the real problem.
Cavanagh also wants to meet with other interested parties to come up with a more feasible plan, he said.
"The idea of buying land is a good one," he said. "This is just the wrong way to do it." Cavanagh also expressed his desire to have the Regional Affordable Living Foundation control the money for affordable housing, not the city. He believes his head tax proposal would give funds directly to RALF to go toward affordable housing.
Dick, the executive director of RALF, said waiting to come up with another solution for the affordable housing shortage in Steamboat Springs would prove extremely costly. With land prices rising 49 percent in the past year, if the community doesn't act now, funding affordable housing will just get harder, he said.
"It would be foolish for this community not to obtain funds and buy land now," he said. Dick added that an impact fee could be imposed without the input of voters, whereas the excise tax had to undergo scrutiny from the public in its passage and implementation. He also noted that a Real Estate Transfer Tax might be the best method of financing affordable housing but that tax is forbidden by the Taxpayer Bill of Rights (TABOR).
Dick added that if the tax proves to be ineffective or too costly, it can be improved upon through a city ordinance.
After the debate, City Councilman Jim Engelken voiced his support for the tax.
"This is unquestionably the best solution," Engelken said. "The cost of land is escalating so fast, the community cannot wait any longer."
The board of RALF initially proposed the excise tax, or Referendum 2A, to the City Council, which voted July 11 to begin drafting language for a ballot question on the matter. An excise tax would be levied on new construction on a per-square-foot basis with the revenues dedicated to purchasing land and leveraging loans for affordable housing projects. Homes of less than 1,300 square feet would be exempt from the tax, while larger homes or commercial developments would be taxed on a graduated scale, with the limit being $2 per square foot. RALF expects the city to take in about $600,000 a year from the tax, based on recent building levels.
The maximum income limit to qualify for affordable housing is 120 percent of the average median income of Routt County, which would come to about $64,000 for a family with two workers, based on statistics from the Colorado Department of Labor and Employment.
At the debate, Cavanagh pointed out the referendum would allow a tax to be levied on everything from apartment buildings to senior-citizen facilities. He noted, too, that based on the language in the referendum, even affordable housing projects would be taxed.
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