Part 6: Barriers to affordable housing

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— Richard Wille remembers a time when he could ride down the middle of Lincoln Avenue on his bicycle. Steamboat Springs had four stoplights, and he gave no thought to that ever changing .

He never thought of leaving either.

Wille is a fourth-generation local, the great-grandson of William Joseph Werner and the grandson of Christina Cullen, names that are etched in Steamboat history. Cullen's Corner and Christina Park still exist today. The Werner name is attached to the ski area.

Wille is proud of his heritage, and he wants to stay close to his family.

But he and his wife, Deanna Wille, also want to buy a home, something they haven't been able to do in Steamboat Springs, where the median price of a house is more than $350,000.

"We've talked about leaving," Deanna Wille said. "But I can't make him go."

The Willes have tradition and family ties on their side, but they might as well be newcomers to Steamboat when it comes to buying a house. Like many Steamboat families, the Willes have yet to figure out how to overcome the city's housing barriers scarce and expensive lots, high construction costs and a housing market that has appreciated at more than twice the rate of wages.

Development is not easy in Steamboat, surrounded as it is by mountains and land that is protected from development. To the north is Mount Werner. To the east is the Routt National Forest. To the south is Emerald Mountain and 177 acres of preserved land adjacent to Howelsen Hill where new trails now reside.

While Kevin Bennett was City Council president from 1995 to 2001, the city increased the amount of usable open space from 230 acres to around 1,000 acres. Because the preservation of open space shrinks land available for the development of more housing, it has an indirect effect on home prices.

Still, former City Councilman Jim Engelken said, "No one will ever thank (Bennett) enough" for his work to increase the amount of open space. That's because the recent community survey showed residents consider the preservation of open space to be a higher priority than the development of affordable housing .

In the survey conducted last spring, 50 percent of respondents listed environmental resource protection and growth management as very high priorities. Just19 percent of those responding listed the development of housing opportunities for a broad range of residents as their highest priority.

"Without making a judgment, the community has made decisions that have made (building affordable housing) harder to do," attorney Bob Weiss said. "Wanting open space means less land is available.

"It's not wrong. It's true."

The bottom line is that housing lots in Steamboat Springs are not cheap.

According to the Steamboat Multiple Listing Service, there were 133 single-family lots for sale within the city limits as of Aug. 2. The lowest-priced single-family lot was listed for $99,000.

Of the 133 lots listed, nearly half 62 were in The Sanctuary. The median price for a lot in that upscale subdivision is $499,000.

"There are very few parcels in the city limits left that you would look at as affordable housing areas," said Nick Metzler of Steamboat Village Brokers. "When you limit the amount of land that can be developed, you create a high demand on low supply."

Paying the fees

Using the most affordable $99,000 lot as an example and the criteria set forward by the Routt County Regional Building Department, it becomes apparent how quickly the cost of a home built in town can multiply.

Assuming a family constructed a 1,500-square-foot home at $100 per square foot, the initial cost is $150,000. Tack on a garage that is 576 square feet at $32 a square foot and a small deck 100-square-feet in size at $15 per square foot, the price jumps to nearly $170,000.

The prospective homebuilder also must pay permit fees, plan check fees, county use tax and a city fee exclusively for those building within city limits. The total county fees are about $2,200 and the total city fees are $3,800 based on formulas.

The total home cost is up to $176,000.

Add in the land price and the homeowner will need $275,000 to purchase a small home on the most affordable lot in Steamboat.

Metzler has been a first-time homebuyer. He moved here right out of college 14 years ago. He and his wife, Tracy, started off as the couple struggling to make it in Steamboat. He has had one ski pass. His wife has never had one. They quickly learned playing hard equivocates to hard luck in house hunting.

"I still feel it's one of the best communities available anywhere," Metzler said. "The only downside is the cost of living. Housing is a major factor in that. You get here and find out later that if you're going to make a life in this place, you have to work more than the average citizen in the United States."

It's different today

But as home prices continue to rise Steamboat has seen a 157 percent increase in the market since 1990 there is a danger that they will reach a point where many newcomers simply can't get into housing here, no matter how many jobs they work and how much they save.

Engelken moved here from Denver in 1979, worked a couple of jobs while buying and selling himself up from a mobile home, to a condo, to the house he now owns on Pamela Lane. He made a down payment on the $175,000 home five years ago. Today it's worth $250,000.

"Had I not done that when I did, I never could have done it," Engelken said. "There's an attitude from longtime residents, among my peers, that 'I've made it. I've worked two jobs or three jobs. I finally got my house.'

"They won't admit the economics that allowed them to save don't exist anymore."

The city of Steamboat Springs, concerned about managing growth, has made it more expensive and more difficult to build affordable housing. And residents who already own homes have little incentive to support the development of affordable housing.

Many homeowners fear affordable housing developments could cause the value of their own homes to decrease.

Such attitudes can be frustrating for Rob Dick, executive director of the Regional Affordable Living Foundation, the organization that has launched the city's first deed-restricted affordable housing project in which residents will own their homes.

"People do want affordable housing," Dick said. "They just don't want it in their backyards, and they don't want to pay for it.

"The greatest barrier is the community's will to create it. If this community wanted to create it, it would create it."

Dick said many people have preconceived images of affordable housing cheaply built homes and run-down complexes.

"People's fears are not misplaced," Dick said. "Affordable housing has to be designed and integrated into the community and should be an asset, not a detriment."

Engelken agrees. A City Council member from 1995 to 2001, he is frustrated the city's residents haven't been willing to do more to address the problem before now. In the fall of 2000, voters turned down a $2 excise tax on new development that would have gone toward affordable housing. Without funding in place to support an affordable housing program, Engelken said, residents and workers who can't afford to live here leave, and an integral part of town life disappears.

"The community has to pay the bill," he said. "It has to realize (housing) is an infrastructure issue. They think it's something they don't have to pay for. I disagree because without classes, the community diminishes.

"If you want a small, elite place with rich residents and those that don't live here for more than a couple of months a year move to Aspen."

Dick estimates around 80 percent of Steamboat's population not already owning a home qualifies for affordable housing by making 120 percent or less than the median income adjusted for family size by the Department of Housing and Urban Development.

For a household of two, that income is $59,040. For a family of four, it's $73,800.

City Councilman Bud Romberg understands the problems with the housing market. When he moved here 36 years ago to become a chemistry and physics teacher, he made $4,800 a year. His home cost around $16,000.

Today the starting salary for a teacher in Steamboat is around $29,000, which is a six-fold increase from 1966. Sticking with that formula, a house in Steamboat should cost around $96,000.

"The price of houses has gone up so much more than the salaries," Romberg said. "Primarily that has to do with the cost of the land. That has a lot to do with people coming in with disposable income that are looking primarily at paying enough to keep the market up so the Joe Six-Packs can't afford the land and the house on that land.

"For crying out loud, when you talk about a house that's affordable at $180,000, that sounds like an awful lot of money to me."

Romberg sees land costs and second-home owners as two barriers preventing local workers from getting into the housing market. But he said the problem is much more complex than that.

"Unfortunately there are a lot of people pointing fingers at other people," he said. "I think there are a multitude of causes."

West of Steamboat

West End Village, the affordable housing project undertaken by RALF with the assistance of Connell LLC and Crystal Peak Combined, will offer 24 single-family homes, seven duplexes and the potential for 26 multifamily units on a former gravel pit west of Steamboat.

The West End Village homes will mix subsidized residencies, ranging from $120,000 to $200,000, with homes projected to sell at market prices.

When a lottery was held to determine chances at a West End Village home, some residents wept with relief and joy. Many said it was their only shot at housing here.

But Dick said the project is simply a start down the right path. It falls far short of a solution.

"The project is affordable to some but not others," he said. "It's the best we could do with the resources we could put together. We're doing the best we can."

And others question if West End Village an arduous project that took years to put together can be duplicated.

"It's the last time you'll see something like that," Engelken said. "The land isn't available. If it did become available, it will be higher priced because the West End Village was purchased at market value and that price has gone up."

Which is another stickler in developing the land set aside in the West of Steamboat Area Plan of 2000.

According to the plan, one-third of the land developed as part of the West of Steamboat Area Plan must be of the affordable nature for the city to annex the land. However, the plan includes a General Improvement District tax on those lots to reimburse the city for the cost of extending services to the area.

The 2-Plus Housing Committee delivered a letter to the Board of County Commissioners and the City Council in January stating the tax needed to be removed from the plan to foster the development of affordable housing.

So far, the plan hasn't changed, and no efforts to develop that land have surfaced.

"The West of Steamboat thing is tough enough," Weiss said. "That made it more difficult."

It goes back to the debate over how much of a priority affordable housing is for the community. Romberg said he went to a housing meeting last month where the people in attendance couldn't agree whether Steamboat had a housing problem or an income problem.

"There are two sides," Romberg said. "One side says you have to lower the price of housing. Another says you have to raise the incomes.

"One approach says the responsibility lies with the employers to raise salaries to afford the housing here. The other side says you have to provide incentives so the developer will build housing that can be sold at a price that people working for the wages paid in Steamboat can afford."

Hanging in

Deanna Wille is 36 and a customer service manager at Smartwool. Richard Wille, 32, is a painter with Spiegel & Son during the days, but he does odd jobs on the side to generate more money that all goes toward a future home. Except on Tuesday nights. That's his night off to play softball.

The Willes love their jobs, but according to RALF's standards, they make too much money to qualify for affordable housing. But they also don't make enough to buy a home.

They have found their dream home and would like to move it here.

"We have a great opportunity to make an offer on a house to move it," Deanna said. "But we can't afford to buy the land to put it on. Some people wouldn't want to put the two years into the remodeling that it's going to take, but we would. With this house, we could live in it a long time. We want that house. It's a house people dream of having."

They've looked into buying a condo, but the association fees are high, and they ultimately want to have a family.

They need new cars. Richard's 1988 truck is reaching the 100,000-mark in mileage. Deanna's car is already at 180,000, but they've been told any debt, especially car payments, makes it tougher to get a loan.

They don't have boats, jet skis or other expensive toys. They don't ski.

Deanna thinks about other jobs, about ways to earn more money.

"Everything extra at the end of the month goes toward our home or into our savings account, which is also going toward our home," Deanna said. "Every extra dollar goes toward that."

Richard remains optimistic. Somehow, he thinks, the couple will find a way to buy a home here. They just have to work hard, be creative, he said.

"It's like it's on your fingertips," Richard said. "But you can't curl your fingertips over it."

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