Housing plan takes shape

Council to review draft ordinance tonight

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Work continued Monday on a new warehouse in Copper Ridge Business Park. The City Council will discuss a proposal tonight that would require developers of commercial properties to provide residential units based on the number of jobs the commercial development would create.

— A draft ordinance to amend Steamboat's housing policies includes many ideas but few specifics - for now.

Prepared by Crested Butte-based housing consultant Melanie Rees and staff from Boulder consulting firm RRC Associates, the draft ordinance is an outline of possible amendments to the city's affordable housing policies and describes several funding tools that, if implemented, would increase requirements for developers and boost affordable housing resources in Steamboat Springs.

But the draft ordinance does not yet include the numbers behind the concepts - for example, exactly how much housing construction or financial payments to require of commercial developers.

The Steamboat Springs City Council will attempt to decide on details tonight during its third formal work session with Rees. The council is conducting the work sessions to create a new, comprehensive affordable housing plan for the city.

"Filling in some of those blanks will hopefully be one of the outcomes of this meeting," Rees said Monday.

Rees said one blank that needs filling involves commercial "linkage," a housing tool that would require commercial developers to provide housing for a percentage of the employees created by their new development.

Tonight, the City Council is scheduled to again discuss the amount of that percentage, a number also known as the "mitigation rate."

"I don't have a sense of where that mitigation rate is going to fall," Rees said. "I don't believe a consensus has been formed."

Rees has shown the council statistics that state a new 20,000-square-foot building - similar in size to the Sports Authority in Steamboat - would create about 56 new jobs and thus a need for about 26 new housing units.

Requiring the developer to supply 15 percent of those housing units, Rees said, translates to four affordable housing units, or a fee in lieu of $717,822.

On Dec. 12, council members agreed to look at commercial linkage policies with a mitigation rate between 5 and 15 percent, but they have disagreed about the potential effects to local commercial growth.

Rees has helped several resort communities implement housing policies. She said the City Council's debate in Steamboat has been an expected - and warranted - part of the process.

"They're a very knowledgeable and organized group," she said about the council. "I've seen a very consolidated timeline - when we put linkage into inclusionary zoning policies in Sun Valley in a matter of weeks, and that's in comparison to Gunnison County, where it was a matter of years."

Any linkage policy adopted by the city would only apply to new construction. Rees has estimated that Steamboat needs 400 to 500 new residences to catch up with the housing demand created by job growth. To then keep up with continuing demand, Rees said, about 100 new homes could be needed per year in the future.

"I feel that the pace is a good pace," Rees said about the council's work to create a housing plan. "I hope they don't feel too rushed."

Comments

another_local 7 years, 10 months ago

Fee in lieu of 700K for a 20,000' building? What are people smoking?

Fee in lieu is not supposed to provide FREE housing... it is supposed to subsidise the difference between the cost of housing and what the people can afford. That number is a lot smaller.

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id04sp 7 years, 10 months ago

This policy is raising the prices of non-affordable housing to cover the fee in lieu. So, people who can afford to pay huge prices for houses pay them, and the result is that our population swells with people who have no understanding at all of what it feels like to live on a budget, etc. Housing prices rise all around because of the "comparables" considered when making appraisals, and even more people are priced out of the market.

The current inventory of unsold "affordable" housing should send a message to the local social engineers. It ain't gonna work. It never does. There's never been a utopian society that wasn't ruined by corruption in the government.

The thing the utopian socialists never figure out is that you cannot have individual freedom and governmental regulation at the same time. There are NO unselfish politicians, because they seek office to impose their will on other people and gain advantages for themselves and their constituents. You cannot fight human nature with a local "affordable housing" policy.

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another_local 7 years, 10 months ago

"Fee in Lieu Calculation The gap between the cost of housing and the ability of the targeted households to pay for housing defines the subsidy, or fee-in-lieu, required to bring the cost of housing down to affordable levels. Therefore, the fee-in-lieu does not cover construction costs of a project, but rather fills the gap between market rate and the affordable purchase prices for targeted households. The fee-in-lieu amount would be paid in lieu of producing units under certain circumstances. The fee varies by the income level of the targeted household and whether homeownership or rental housing is to be provided."

"Tables showing the calculation methodology are in Appendix A of this report for three potential employee housing mitigation ranges: less than 80% AMI, 80 to 100% AMI and 100 to 120% AMI. The calculations presented in Appendix A are summarized below in Table 11 and shows how the fee-in-lieu varies by AMI affordability range.

Table 11. Summary of Fees in Lieu for Steamboat Springs:

2006 AMI Affordability: Steamboat Springs

<80% AMI (800 sq ft home) $89,812

80 - 100% AMI (950 sq ft home) $43,082

100-120% AMI (1,100 sq ft home) $37,867"

"To determine the final fee-in-lieu payment, the number of units the development is required to provide, as determined from the residential or commercial linkage formula presented in the "linkage mitigation formula" section above, is then multiplied by the respective "payment per unit in lieu" amount presented in the above table (Table 11). Alternatively, if an inclusionary program is used, then the number of units required as calculated from the inclusionary percentage (E.g., 10 percent of a proposed 20-unit development equals 2 units required) will be multiplied by the respective payment per unit in lieu of development for each income range for which units are to be provided (in Table 11, if a development was being built in Steamboat Springs and was required to provide units for 80 to 100 percent AMI households, this would equate to a payment in lieu for 2 units of $86,164)."

. . .

The bottom line: Even with Ms Rees less than objective assumptions, the PIL on a 20,000' building requiring 4 affordable units would be between 150K and 350K not the 700K mentioned in the story.

Of course, that does not address the question of whether the entire concept that people building homes and businesses should have to provide housing is valid in the first place. There is a strong arguement that the competition for good employees created by growth will raise the wages in the valley and that providing housing in an aggressive manner is holding down wages. This makes sense as wages for jobs here are well above what they are most places and rising fast.

All quoted sections are from RRC assoc report Nexus 2006 on Steamboat housing issues.

Let's get realistic here!

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id04sp 7 years, 10 months ago

Realistic?

People who cannot afford to buy in the Steamboat city limits need to live in Milner, Hayden, Craig, Clark, Yampa, Oak Creek, Phippsburg, Walden, etc.

People who want to live on the lower margins of the income scale need to understand that low incomes cannot provide close-in housing in an affluent resort community. It's a fact of life.

Go to college, get a good degree, work hard, save for 20 years, and then go looking for property in the mountains. That's how it works.

The people in their 20s and 30s today have NEVER faced any societal limitation to their income potential. They've never had their lives disrupted by the draft, or lived in a time when there was not equal opportunity for jobs and education. The reason they cannot afford housing in Steamboat is because they didn't bother to work hard enough and sacrifice enough to afford it.

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Brian Smith 7 years, 10 months ago

My wife and I left Steamboat 5 years ago when I decided we did not make enough money to live here. I looked for a job that would provide opportunities, we both went back to school to improve our opportunity to make more money (constantly working towards getting back), and now we are back. The cost of housing has greatly increased since we departed, and I assure you we are not living the life style at what we became accustomed to while away from Steamboat, but it is part of the sacrifice we had to make to live "In" Steamboat, and not on the out skirts of town. id04sp is correct, when they say it is a fact of life, that you can't live in a resort community without making sacrifices to make it happen (or have a nice trust fund, which we don't). I feel bad for those who can't afford to buy, but most of us who have jobs and still have to work to live in Steamboat, have all made sacrifices to make it happen. By the way, if you make the sacrifices, you will never be happier!!

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Hadleyburg_Press 7 years, 10 months ago

In all of this hupla about affordable housing I think the City Council has forgotten about another serious problem that we will all be facing in the Yampa Valley, which is affordable driving! I would like to see all of the gas stations, car dealerships, and auto mechanic shops pay a fee to allow us to have gas at a subsidized rate. Come to think of it, we should all be able to buy luxury SUVs at a discounted cost. Just think how nice a community this would be if we all drove BMWs? Also, let's not forget about affordable feeding and clothing. I think we should all be able to eat steak every night at a discounted, goverment funded rate. Designer clothing would make us all so much more communially sheik don't you think? Thank heaven for government! What would we all do if we had to take care of ourselves at our own expense and labor as opposed to being supported by those more industrious than ourselves??? Just think, the French intend to make it a legal right to be housed by 2010 meaning that a French citizen will be able to sue the goverment to provide housing. We have to keep up with the French must we not? Just look at how successful their society is! http://news.yahoo.com/s/afp/20070103/ts_afp/francepoliticshomeless_070103183244

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another_local 7 years, 10 months ago

id04sp: Do you think you are argueing with me? You and I agree.

I was

1: questioning the need and validity of the program to begin with and

2: pointing out that the calculations being used are not even consistant with the program as discussed.

I am certainly not an advocate for PIL or linkage!

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ThreeJobs 7 years, 10 months ago

Yes, that's what I'm looking for! Someone who will give me something that I really haven't worked for in order to justify paying me less than what a free market would require.

Add restrictions to make sure that any "investment" I might make in real estate will not be possible.

Let me think where else I can get a government mandated deal like this. Oh, yes, I know. Cuba, China, North Korea maybe? Sounds like a deal doesn't it?

No thanks! I'll pass on the "affordable" opportunity close to the mountain and take my chances in the real world in a neighboring area rather than the Utopian Dream of the city council.

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BERKLEY 7 years, 10 months ago

id04sp writes: "People who want to live on the lower margins of the income scale need to understand that low incomes cannot provide close-in housing in an affluent resort community. It's a fact of life. Go to college, get a good degree, work hard, save for 20 years, and then go looking for property in the mountains."

What a great Idea! What about those people that grew up in Steamboat there whole life, WENT TO COLLEGE, returned to the town they grew up in and love?

The fact is that we need a working class in Steamboat, to run the businesses, resorts, and Ski Mountain. What is going to happen if all these people move to Hayden, Craig, Walden (1hour away), and Oak Creek? My guess is that they would start looking for work in those areas in stead of spending there hard earned dollar, commuting back and forth. Maybe that is way we have so many people working here on work Visas. Figures we are creating a bigger problem then we thought. I think low income housing is crucial to the Steamboat area.

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id04sp 7 years, 10 months ago

another_local,

We are in violent agreement. I was keying off your "realistic" comment and extending the argument.

BERKLEY,

"There" whole life? Is this the product of a college education? Did you go to "BERKLEY?" What's it like their?

People are not going to take jobs in all those other places because THE JOBS DON'T EXIST THERE. How many extra jobs can a town of 800 (Oak Creek) support? Not so many, I think. Steamboat is the source of cash flow for most of the jobs in Routt County. Do you really not know that you have to go where the job is, and not the other way around?

Steamboat certainly does need workers, but they will have to live elsewhere and commute to work. Welcome to America. That's what most of the rest of us do.

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another_local 7 years, 10 months ago

I live in a neighborhood that was moderately priced 15 years ago and is now expensive. If it was all second homes or empty condos we would move to another part of town because we want to have neighbors. I would like to see us back away from the inclusionary concept and move toward neighborhoods of people who live here. Putting a dozen "affordable" units in a place like One Steamboat Place is a harebrained idea. Perhaps requiring some variety in the size and type of housing built in areas away from the base area would support a diverse mix of residents.

I would also like to see more emphasis on rental property. Zoning and urban boundary changes might be a good place to start providing incentives for private development of long term rental units with restrictions on short term rentals (month to month or longer only)

Should we take steps to ensure that housing for people who work here exists? Sure. But the solutions that work are private sector solutions with public sector policy support.

The compromise position that would make some sense to me? Have a developer like One Steamboat Place give 500K to the Housing Authority; (NOT THE CITY who have no experience or track record of using money effectively. That is an amount they have already agreed they would do.. I'll bet you could wrap up that deal in a short meeting.

I wonder if developers who tear down an existing building will get "credit" for the reduced housing demand they create?........ Nah, that would never happen.

Linkage fees on construction? Great idea! Let's make it even harder for local small business to get a foothold here. Let's charge people who worked and saved to start a business or to build their own home extra fees to help buy homes for others who did not! Yep. Sounds like a French idea to me too.

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id04sp 7 years, 10 months ago

It's a simple fact of mathematics that you can double the square footage in a house without doubling the building cost. Fixed and sunk costs like land, water and sewer tap fees, electrical service installation, etc., are the same either way.

A house 24 by 40 nets 960 square feet for 128 linear feet of exterior wall framing. 36 x 54 nets 1944 square feet for 180 linear feet of exterior wall. So, only 52 more feet of framing adds more than 960 square feet to the design. It costs a builder more per square foot to build a smaller house than a larger one, so where's the incentive to build smaller? You have to go as big as you can for what people are willing to pay or you're giving away money. That's just plain dumb for a person in business.

Cost per square foot and value per square foot are two different things. Builders will always make more dollars per square foot going large than going small when it comes to spec homes. If this was not true, you'd see lots and lots of smaller homes on the market because they'd be more profitable.

Home prices are really only limited by what people are willing to pay, so the smart builder will aways build to the going price. When you make more profit per square foot as size goes up, it pays to build the biggest thing you can sell quickly.

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thecondoguy1 7 years, 10 months ago

wow, there are a lot of good thinkers posting here, if it's for sale and sombody buys it, it's affordable, I don't care if it was 6.4 million, it was affordable to sombody. This tinkering with the market is going to come back and bite us on the nose for sure, people suckered into this deed restricted social engineered garbage will not be able to unload them, what a way to treat hard working young people starting out. People want a piece of the pie, not just a place to live, this is America. Lord I wish some of you posters were on council.

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another_local 7 years, 10 months ago

id04sp: I agree with your math. One challenge I see is that if you make the housing unit big enough the price will rise to one that many local working people who want to own will not be able to. So if you want "market" homes in the area how do you make it profitable for the builder to build them?

One idea is to allow higher density through multi-unit buildings. Not high-rise condos, but duplexes and four-plexes take advantage of the math you so effectily lay out while providing smaller individual units that will be affordable to more people. Zoning restrictions to keep the property from becoming nightly rental would also be important.

If it is desirable to have more of the local workforce work here, then I would not object to waiving tap fees and such under certain circumstances to reduce cost and incent this kind of use of undeveloped land.

Allowing urban boundary changes where we might otherwise not allow them on condition that the land be used for higher density development of this kind might be more desirable to a developer than not being able to put more than one home on a lot outside the city... Not as profitable as a high-end development perhaps but more profitable than what would be currently allowed.

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Otto_Stader 7 years, 10 months ago

I haven't done the math on duplexes and clusters, but it stands to reason that a common wall between two units may be cheaper than two walls with land in-between. Walls between units must be fire resistive, however, so that increases the cost.

If you zone so that multi-family units are required, that's what builders will put on the available lots so long as it's profitable for them. Land is the ultimate limit on building, and if you don't build, you don't make a profit.

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id04sp 7 years, 10 months ago

There's an article in the Aspen newspaper website about a guy who started as a cook for a few years, figured out he'd never get ahead that way, moved away to CA to save money, and came back to Aspen and started his building business. He builds one house a year. If he has to take a 30% hit (the Aspen proposal) for affordable housing, he makes no money for himself at all. Basically, Aspen is asking this guy to give a house to somebody so they don't have to go through what he did (all that hard work and sacrifice) to live there.

The affordable housing myth assumes that "other people" have money to dump on the problem for the benefit of people who just want to work an hourly wage job in a resort town. Well, "other people" don't have that kind of money to give away, and the only thing that will be accomplished by requiring it will be a smaller supply of more expensive houses.

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