Our View: The 'hows' of housing


Editorial Board, June 2009 to September 2009

  • Suzanne Schlicht, general manager
  • Brent Boyer, editor
  • Mike Lawrence, city editor
  • Tom Ross, reporter
  • Grant Fenton, community representative
  • Paul Strong, community representative

Contact the editorial board at (970) 871-4221 or editor@steamboatpilot.com. Would you like to be a member of the board? Fill out a letter of interest now.

— Many of the proposed changes to Steamboat Springs' community housing ordinance offer the promise of fixing a flawed policy, but such efforts may be premature so long as there is no clarity on what the city hopes to accomplish in the way of affordable housing.

This isn't a new problem for the city. Although affordable housing has been a hot-button issue for years, there has been little consistency in the city's efforts to measure results. Without such consistency, the city and its residents have little clue whether initiatives such as the community housing ordinance are working.

A previous City Council adopted the ordinance in 2007. It mandates that developers build affordable housing, or provide the city a payment in lieu of constructing affordable, deed-restricted units. Many in the community, including this newspaper's Editorial Board, applauded that council's initiative.

But we also recognized the need for flexibility.

City staff and the current council are in the midst of revising the ordinance. Many of the changes are good. Developers, for example, shouldn't be punished for providing affordable housing options beyond the boundaries of their specific development. Compliance methods for the retooled ordinance include developing on-site or off-site units, dedicating on-site or off-site lots, dedicating land or making payments in lieu - including a voluntary real estate transfer fee.

The latter concerns us the most. Real estate transfer fees now are illegal in Colorado, and the questionable legal status of a "voluntary" fee could leave the city - and its residents - out in the cold if challenged in court. Wouldn't it be a shame to return tens of thousands of dollars in real estate transfer fees when the city could have instead collected a sure thing in the form of traditional fee-in-lieu payments?

The council is scheduled to vote on the revised community housing ordinance this month. But this brings us back to the bigger point: Are these efforts somewhat moot without any real affordable housing master plan?

Consider the following:

- How will the money collected via the fee-in-lieu provision be spent?

- Who will administer those funds?

- What is the long-term role of the Yampa Valley Housing Authority?

- How do the city's affordable housing plans mesh with the results of the housing demand analysis?

- Is there a specific revenue goal for the affordable housing fund?

- Are there any affordable housing projects in the works? Plans for future projects?

- How will the city measure the success of its community housing ordinance?

Here's another way to think about it: Five, 10 and 20 years from now, what does the city hope it has accomplished in terms of affordable housing? Until we have an answer for that question, efforts to address an issue we haven't clearly defined may be futile.

Rees Consulting/RRC Associates produced a community housing plan implementation program for the city in December 2006. Among other things, the plan sets affordable housing goals, objectives and an action plan. But nothing in the program suggests how to measure whether the goals, objectives and action plan are being met.

A group of residents, with some city staff involvement, is forming a committee in hopes of establishing a mechanism for measuring desired results. It's worth monitoring their efforts, because without clear direction, we'll never know whether our affordable housing initiatives are on target.


Jeff_Kibler 7 years, 7 months ago

Exactly! I feel entitled to a place on the beach in Malibu, but those greedy Hollywood types won't subsidize my desires. Yet I moved to da 'boat because I could afford it. How? Working hard, often evenings and weekends and many 400 hour months. Saving and investing instead of buying a Porsche.

Times have changed. My company is not doing well. I am out of here simply because it no longer makes financial sense to stay. Boo-frigging-hoo. I'll get over it.


Karen_Dixon 7 years, 6 months ago

You guys are missing the point. Affordable / attainable housing is not about anyone's "right" to live in a ski or beach town. It is not about entitlements.

It is about the town itself; the healthy existence of the town, and in fact, the ability of the town to exist at all. A town is an organism much like the human body. If a body were made up of a bunch of brains, it wouldn't survive. It takes other organs, appendages, and systems to function. If we want a healthy, functioning town, we had better be concerned with socioeconomic diversity, which means we had better be concerned with housing.

However, I for one am not one of the community members who applauds the previous council's initiative. For starters, the author suggests there is no master plan to deal with the questions he posts. It was irresponsible to enact an ordinance in the first place without a master plan & without thinking it through. Secondly, IF, and that's a big IF, government intervention with a Robin Hood program is necessary, municipal governments that choose the route of incentives vs. the route of mandates, imo, are not only smarter and more realistic, they serve the greater good of the entire community - the rich, the poor, and everybody in between.


JLM 7 years, 6 months ago

The real problem is that "affordable housing" is actually a code word for home "ownership". The concept of affordable housing has been manipulated to suggest that owning the residence is the only worthy measure of affordability. There is absolutely no reason that rental housing could not and should not be part of the affordable housing mix.


Scott Ford 7 years, 6 months ago

JLM - I have felt that I have been a voice crying in the wilderness and you are a breath of fresh air. In Steamboat Springs the term "affordable housing" somehow now means home ownership. This is such a limited focus. In addition, the focus on "ownership" with direct government support makes the problem likely too complex to solve on any meaningful scale.

When it comes to housing we are going to need many options. There is no single solution that will fit every individual situation. Home ownership is nice, but not everybody can or should buy a home. There needs to be options. The housing demand analysis was clear about this.

I am puzzled why there is not more discussion about apartment complexes and mobile home parks. I believe mobile home parks are a valuable often overlooked affordable option that could work very well if the lease on the lots were long term or better yet the park residents owned the land as a cooperative. Am I missing something in my thinking?


JLM 7 years, 6 months ago

I am at this instant visiting in Highlands-Cashiers, NC which in many ways is strikingly similar to SBS --- resort mountain community, huge outdoors environment appreciation, real estate driven economy, proximity to large cities, (great restaurants, well, OK, that is probably only important to me), friendly folks and just a wonderful place --- and they have solved the problem of affordable housing by providing affordable apartment and entry level housing options including mobile homes.

H-C, NC is to Atlanta what SBS is to Denver. It is not hugely accessible by air and the roads are very bad to get here. It is however about 25F cooler than Atlanta.

Perhaps the only substantive difference is that H-C has a 50-75 year head start on SBS, a bit of hardscrabble Southern entrepreneurial work ethic (the locals were here first by a long shot) and has not fallen into the trap of attempting to penalize the productive elements in its micro-economic engine to pay for what is essentially social engineering. Further the beneficiaries do not project a sense of entitlement but rather a sense of letting them EARN a slice of the pie.

It is interesting to see the slight but meaningful difference in the approach to the issue of housing.

They have also harnessed the power of the marketplace by providing inclusionary zoning which allows affordable housing to be developed in concentrated areas in which neighborhoods have sprung up.

There is a huge difference in the dialogue of the folks with this area being a bit more "grown up" than the SBS angry crowd who sees success as something to be diminished or penalized rather than using it as a catalyst to spawn further growth.

Restrictions v incentives --- always go w/ incentives.


Karen_Dixon 7 years, 6 months ago

You are on the mark with rentals v. home ownership... for certain scenarios. Please pardon me, but I am going to share. I can speak from personal experience, as there was a time in my life....recently divorced, 8 year old son, no alimony, no child support, small retail business owner, nice desirable small town outside (suburb) of Wichita, KS.... when I desperately needed assistance to provide shelter for myself and my son. I could not have qualified for a mortgage loan. But the point is, that I did not need one, nor did I want one. Even the slightest maintenance issue - like a furnace problem - would have been impossible for me to deal with at the time. More philosophically important however, I did not see my situation as permanent. I was in a funk, and knew that with the work ethic my father taught me, I would come out of it. I simply needed a little time & a slight break in C.O.L. so that I could get on my feet. A rental, in that situation, was the best option b/c a) the cost was fixed and predictable, b) the term was relatively short (1 year lease at a time) so that I could respond to changing conditions in my life quickly and easily.

That is only 1 scenario, and though it is a common one, it is probably not the most pressing in a gentrified small resort town. Scenario #2 is the story of a successful core service provider not being able to earn enough in their successful business or gainful employment to afford the cost of housing - either in rent or in mortgage pymt. The gap between wages earned & cost of living grows rapidly. The value of a job well done will likely never catch up. These are not your single 20-something ski bums who just want to earn enough busing tables or bartending so they can ski and kayak. (not that there's anything wrong with that!) I am talking about career oriented professionals, entrepreneurs, and hard-working valuable employees - school teachers, college professors, bookkeepers, accountants, architects, draftsmen, engineers, scientists, computer programmers, technicians, journalists, reporters, chefs, restauranteurs, small retail shop owners, mechanics, repairmen, landscapers, plumbers, electricians, carpenters, handymen, managers, social workers, therapists, janitors, firemen, police officers, healthcare professionals, insurance salesmen, bankers, brokers, city and county employees - on and on and on. These are the people that make a town tick - they are community assets. For many of these people, home ownership is a goal for obvious reasons. For those who are already here and bought their homes before gentrification set in, no sweat. But Planning is NOT about the past or the present. Joe & Mary will move on at some point, and when they do, who will take their place and how will it be possible for them to do so on the salary they can earn?


Karen_Dixon 7 years, 6 months ago

While I agree with rentals being valid alternatives, it is foolish not to recognize that smart and successful people (in this country) have the goal of home ownership. I do not see that changing in the foreseeable future, if ever. If we want to continue to keep & indeed attract these types of people in & to this community, we must acknowledge that home ownership is a critical component. JLM, you hit the nail on the head with your H-C observation & comment about letting them EARN their own slice. I don't believe these types of people, myself included, really want it any other way. Mentality: Handouts = Control & Power Over = Not in My Best Interest.

We must also, however, acknowledge that land values are a huge component to affordability. The higher the value of land, the more dwelling units you need per acre to keep the unit cost down. We have areas of town where this value has already exceeded the threshold and to attempt or force AH in those locations doesn't pencil and requires subsidy. The Haves will pay for the HaveNots, and this is objectionable, imo.

Enter WSSAP.


aichempty 7 years, 6 months ago

I have posted here several times before regarding the reasons why rental housing is not a viable investement in Steamboat. It comes down to the cold hard fact that building costs are high, land prices are high, wages are low, and the risk involved with building an apartment complex is not worth it. An investor with $10,000,000 to spend on an apartment complex can get a better return on tax-free municipal bonds. Why take the risk when you can get the same return for no risk at all?

An 800 sq. ft. apartment would cost as least $150 per square foot to build. Ten units like that add up to $1,200,000 in cost, and supposing you have the project financed at even 7% (commercial rates are higher than home rates) the interest on the loan is $70,000 per year. Supposing you get $1000 per month for each unit, and you never miss a month of rent, your income over the interest you owe is only $4,166.66 per month.

On top of the interest cost, you have maintenance, utilities, insurance, legal fees, repairs, etc. If you have to pay a manager, your profit is out the window already.

So, the problem is that if you charge enough rent to make a decent return, nobody can afford it anyway. That's exactly why nobody is building rental units around here.

HUD subsidized apartments in other areas are the usual solution to the problem of low-cost rentals for those with limited income. You don't find HUD units around here because we just don't qualify; too much income. It's a self-defeating situation.

There's HUD housing available elsewhere, and that's the whole point. People live here in voluntary underemployment, and HUD isn't about to build housing to serve lift operators and ski instructors. That's not the purpose of the program.

So, nobody in business to make a profit is going to invest in rental housing in a place like Steamboat to serve the wage earners because it does not make good business sense.

Cheap land is not available. Building costs are high because of snow loads and all the other local restrictions. Water and sewer service, tap fees, etc., all add up.

It's easy to say that rental housing is the solution, but finding someone to build it and basically give the residents a gift every month is the hard part.


Scott Ford 7 years, 6 months ago

aichempty - You are correct. There is a big difference of saying rental housing is part of the solution rhetoric and actually making it a part of the solution on the scale needed. Without some form of governmental assistance to make apartments happen - it is very unlikely that it will happen.

I would much rather that the 12.5 acres that will be deeded to the city in association with Steamboat 700 be used for an apartment complex - rather than units for ownership. Take the land cost out of the apartment complex calculation does it begins to work? I like apartments as a part of the solution because it keeps the number of "affordable" units in the needed inventory mix.

What are your thoughts about owner occupied mobile home parks?


Scott Wedel 7 years, 6 months ago

Karen, Renting is not just for people not currently in a position to do home repair.

It is rarely a good financial move to buy a house unless you are going to live in for several years. Buying a house involves costs of getting a mortgage includes fees and points. Selling a house involves costs, primarily the real estate broker's fees.

In a normal world where property appreciates at close to the rate of inflation then it takes at least a couple of years before it is better to pay those costs than it is to rent.

In a resort place such as Steamboat, so many people here have no intent of staying more than a few years. They are here for a while until going back to the real world where there are far more good paying jobs and the cost of living is less.

And it is not just economics that make it hard to provide rentals - when someone proposes providing rentals then all too often they face one of the regional planning boards that then says the plan includes NO affordable housing.

And what about SB's secondary unit ordinance? Yes a person tragically died, but it had everything to do with a residence not having a smoke detector, not it being an unlicensed rental. But the result was to blame the rental and now require inspecting of rentals instead of requiring inspections of all residences. Having the inspection as part of change of residential occupant would cover both and protect all residents from safety issues. But now the situation is that the City is inspecting for safety issues that can just as easily exist in anyone's residence.


carlyle 7 years, 6 months ago

Today's Washington Post has an excellent article on conditions in the US mortgage market. http://www.washingtonpost.com/wp-dyn/content/article/2009/09/06/AR2009090602033.html?hpid=topnews Currently the government via FNMA, FHLMC and FHA is underwriting or guaranteeing ~86% of all mortgages being created. I don't think the government is interested in creating second home ownership in a ski town at the moment. I don't think the government is interested in creating primary residence ownership in a ski town at the moment. Denver or Fort Collins or Grand Junction, maybe, but not Aspen, Vail or Steamboat Springs. Unless something dramatic occurs, the real estate market here can't get better until financing opportunities get better.


aichempty 7 years, 6 months ago


Land cost is a big part of it. One alternative would be for a long-term land lease. This happens all the time with commercial property where the structures are not intended to last forever. The real question is whether it's appropriate for the government to provide land for housing to benefit private citizens using taxpayer dollars. Sticky subject.

Privately owned manufactured homes are a good alternative to apartments. Again, there's the land cost, plus infrastructure to provide water and sewer service. And, again, there's the question of whether it's appropriate for the government to be involved in providing housing for private citizens.

One of the obvious drawbacks is that affordable housing intended for workers can also be rented by retirees, those who just want to live here for a while, etc. People with a paid-for home in another area might want to live here for a year just to see what it's like before selling out and moving, and there go the affordable units.

It all comes down to whether the city and county can justify subsidizing such housing at taxpayer expense, and then how do you discriminate against everybody except "working" families. Define "working." Put limits on income, and you exclude those who really need the housing to live in this area and work at a job.

Finally, the city and county are both in dire straits financially. Can they recapture the expense of providing land for affordable housing? Probably not. A losing proposition out of the gate is not going to look better later on.

Affordable housing is available within a reasonable commute, and that's why we have a viable economy. People all over the country commute more than 20 miles to work, and there's no reason that Steamboat should be any different. People want affordable housing close to their jobs, but that doesn't make it happen.

I lived in a town in California that served a military base. After the cutbacks of the 90s, there were lots of vacant houses in town because people lost their jobs when defense dollars were cut. I rented a nice little house in town, five miles from work. It was great except that the town was tiny, isolated and had lost half its population. That's the other side of the affordable housing coin.

People need to realize that nobody is going to give them housing below the market rates, and adjust to it. Is living here worth the cost? That's the decision that needs to be made, and stop counting on somebody else to change it. It's not likely to happen.


Karen_Dixon 7 years, 6 months ago

Scott W. Agreed re: rentals. The point of the example was that those we are trying to help don't always need or want the type of help being offered. A variety of solutions - including rentals & ownership - is necessary. Aich makes a good point with his example. Market rate housing becomes affordable in cities where there are revolving boom and bust cycles. Steamboat doesn't & likely will not have a bust area of town....current economic blip aside.... because of it's size and because it is a resort. As soon as the national economy turns around, the whole city will boom again....not just parts of the city... and we will be having the same conversations about what to do with the rising cost of housing. So for those who say we need to put this conversation on hold b/c we have plenty of inventory now, I say that is short-sighted. Do not get me wrong.... I believe in the free market. I also believe the government has tools that they can and sometimes should use to encourage (rather than force) the market to move in one direction or another. (When rent becomes a tax write-off, you might see more people choosing to rent v. buy.)

In our microcosm, I DO believe that it is necessary for our local government to be a part of the solution. I believe it should look at the tools at its disposal to pull the market into submission with incentives vs. pushing with mandates. We need to understand what federal programs are available to both developers and end users, educate and assist with utilization of those programs, and fill in the gap with local programs or incentives.

I completely understand the commuter argument. That is a reality that has existed since the days of walled cities & shanty towns. There are all sorts of problems with choosing this as the preferred alternative vs. recognizing that it will exist, not the least of which is traffic - from an economic perspective, from an environmental perspective, from a community character perspective and from a social perspective.

As mentioned in a blog above, land costs are indeed the problem. I believe we have a development here in town that took the land cost out of the equation and put homes in; appreciating modulars on foundations vs. depreciating trailers. The sales price of these homes is significantly less than the sales price of a home that includes the land. As I understand it, a not-so-small hurdle for buyers is financing. If lending practices were more favorable toward this model - and perhaps they already are (I'm not a finance person) - then I believe this is a very good solution for Steamboat - whether they are offered for rent through a nonprofit such as YVHA or whether they are offered for sale on the open market.


aichempty 7 years, 6 months ago


You make a lot of good points. One of the problems, however, is that people don't behave reasonably anymore. The foreclosures prove it. People bought things they were never going to be able to afford. Lenders made moronic decisions which mostly served to put fees in the pockets of the mortgage brokers without regard to the risk being taken. We all know how that turned out.

The modular on a foundation I bought in Steamboat II in the 90s had almost doubled in price twice by a couple of years ago. I guess that's because it was only 5 miles or so from the Gondola. One thing for sure is that the house wasn't getting more valuable; it was the location and the land that made it desirable. I couldn't buy it again if I wanted to.

The federal programs available to developers don't fit us; we don't have an impoverished population to serve, no matter what the people struggling to survive may think.

Development in this town is totally voluntary, based on market demand. That's a fact of life. We don't fit anyone's definition of "need" compared to other cities with depressed economies and displaced popluations. Having the federal government spend money on housing here would be like adding another lane to the "bridge to nowhere" in Alaska.

Atlantic City, NJ is an example of a resort town that got federal funding for HUD housing, and the low-income workers who occupied it worked at low-wage jobs in the casinos. The effect was a federal subsidy for casino owners who were able to pay less for labor. To anyone outside of town, HUD housing around here (even if we qualified) would look like a federal subsidy for Ski Corp. So, it's not going to happen when there are people in Denver and other Colorado cities who actually qualifiy for HUD housing.

So, everything you say makes sense except for the fact that we are in a ski resort town filled with the voluntarily underemployed. There are people with genuine need and limited options, but they also have alternatives that don't include living within 5 miles of Mt. Werner.


Scott Wedel 7 years, 6 months ago

Karen, Aic, But when local planning boards tell someone wanting to build rental housing that they are not providing affordable housing and thus there is no public benefit then the land costs don't really matter. When the developer is told that making condos with a few that are affordable provides public benefit then no one is going to propose apartments.

But if local planning would treat modest rental housing as affordable housing then some might be built.


aichempty 7 years, 6 months ago


You are right. But, if local government requires construction of rental units as a condition of development, it will either drive up prices or drive developers away.

And it occurs to me, if developers are required to build rental units separate from primary residential units (I'm talking about requiring them to build apartments) then guess what? They either have to be able to sell the rental units to someone who wants to run them (again, why invest in apartments in Steamboat . . . ) or set up a property managment company to run them, hire staff, and all that.

The devil is in the details, and the more you delve into the cost-effectiveness of rental apartments for wage earners in Steamboat Springs, the more you realize it's a losing proposition for the party providing the housing.

Some skier-philanthropist may someday decided to build such units and run them at a loss for tax purposes, but I'm not holding my breath.

Maybe allowing individuals to contract for a home with a rental unit included to help offset the costs of second home ownership would be a viable approach, but then there are still extra costs and hassles involved. If you don't need a caretaker or a place for your mother-in-law, having a tenant is just a hassle.

Personally, I don't want to rent to people who may be using drugs, trafficking, having domestic disputes, etc. Why should anybody else? It's a sad fact that wage-earner rental units also bring along the problems that sometimes come from lower economic status, and anyone who causes a problem can cut into your profit margin very quickly and cause other renters to leave. I once lived in an apartment where a murder occurred in the unit directly over my head. I was gone by the end of the week. So were several others. It's a risk that landlords take, and we have to be realistic about why people are reluctant to take those risks to provide rental housing for others. It's a lot of work and a lot of risk for no extra return, and it 's a bad investment.


JLM 7 years, 6 months ago

The entire debate is fouled by no consensus on what exactly consitutes "affordable" housing. In SBS, it is almost too late in the debate to really define the target market and pricing point. Too much water has passed over the dam and too many pre-conceived notions have solidified into irrevocable concepts. A multi-family or apartment community is the most logical solution to the challenge and unfortunately, it is just an after-thought in SBS.

Housing of any type is simply a demand driven economic function constrained by the nature, depth and strength of the demand, the design of the product, the cost to produce the product (including the marketing cost and the cost of capital) and the income stream that can be generated by selling or renting the product.

All of this can be summarized in a clear and logical financial projection --- a proforma.

I have developed or owned tens of thousands of apartments in my former real estate career and can construct such a proforma in my sleep.

There is a naivete amongst the general public as to how the costs work together --- take as an example the issue of land cost. It is not the land cost which is paramount but rather the allowable density per acre of land. This translates into a "land cost per unit" rather than a land cost per acre.

Which is cheaper in reality --- $2/SF at 5 units per acre or $6/SF at 24 units per acre?

($2/SF x 43,560 SF per acre)/5 units per acre = $17,424/unit land cost

($6/SF x 45,560 SF per acre)/24 units per acre = $10,890/unit land cost

One has a land cost of $17,424 per unit while the other has a land cost of $10,890 per unit. So, the determinate factor in this example is not really the raw land cost but the authorized density which is a function of local governance and zoning.


JLM 7 years, 6 months ago

Affordable housing implies some type of "subsidy" whether in the form of a "tax" which is after all what is being done now, isn't it; and/or, a public subsidy of some form.

Isn't it really this subsidy which artificially makes the housing "affordable" in the first place? Am I wrong on this?

I suspect that if the City of SBS really got serious and considered donating the land adjacent to Haymaker, waived all development and building fees, allowed 28 units per acre, kicked in 15% of the cost (funded by other projects' affordable housing requirement) and got the local employers to stand behind no less than 75% of the units as employee housing --- a developer could be convinced to undertake such a project.

The resultant cost structure would then be leveraged with 25% equity and 75% debt with a targeted return of 3% in excess of the cost of capital. If you assumed a ROI (return on investment) of 8% (remember the cost has been artificially constrained) and a cost of capital of 5%, you would be looking at a ROE (return on equity) of 17% --- more than enough to attract instititional equity investment capital (pension funds and insurance companies).

In addition, the time value of money related to the value of the depreciation and interest deductions (which are of no use to a pension fund as an example) would be available to attract a splash of private capital.

These returns would attract institutional capital --- only if they could get over how goofy SBS really is. LOL

The deal structure could be set in such a way that the City of SBS would be entitled to a tail end "profits" interest for their investment.

The City could issue Certificates of Participation thereby lowering the cost of capital considerably.

The magnitude of the subsidy would have to be sufficient to make the market rents support the return thresholds. This is all just simple financial analysis and folks do this on every apartment deal ever undertaken. It is not rocket science.


carlyle 7 years, 6 months ago

You are all missing the point. Who is going to lend you the money for any of these projects? FNMA and FHLMC are the overwhelming ultimate lenders. None of our local banks will lend you the money unless what they lend can be packaged and sold to FNMA or FHLMC. We are returning to an environment which will require 20% down and the financed balance equal to twice annual income. The interest deduction on second home mortgages will become history. Nobody in Washington DC gives a flying falafel for Steamboat Springs.


aichempty 7 years, 6 months ago


Okay, I'm impressed. Really. Thank goodness somebody with actual experience has weighed in on this subject.

I think what you said is that the only way to have apartments in this town is for the city to donate the land, allow high-density development, and attract investors.

Would you want the city of Steamboat Springs to be your landlord? Not me. Besides, by the time the high-density development is finished and you've got families in there, with both parents working, you're talking about a parking lot full of Big Wheels and ghetto-style drug trafficking by the teenagers. I lived in a big development in Florida for a couple of months where roaming gangs of teens openly traded drugs -- well, okay, they'd look around, sneak into the bushes, and come back in a couple of minutes like nothing was going on -- and that's what you get with high density, low rent housing. My neighbor upstairs was a single mother of two, on welfare, who entertained male visitors who snuck in and out at night and kept their voices low . . . actually I think it was the father of the two kids, who had to keep a low profile because of the welfare connection.

So, I cannot foresee a family apartment development around here that wouldn't be a big mistake if it has to be built to fit the rents local wage earners can afford to pay.


Commercial financing is different from private home financing. However, you are right that money is hard to come by. Would municipal bonds be one way? I don't know. How about you JLM? Would municipal bonds be a viable way to raise money for a city-owned apartment complex? Doesn't sound like a good idea given the current economic times and the shaky financial status of the city and county at this point.

If we create this type of housing, I think we will be creating social problems because they will come to us, seeking the low-cost housing. That's pretty much how it works everywhere else, and I don't see why we would be different.


JLM 7 years, 6 months ago

The City of SBS would NOT be the landlord. The City's role would be purely contractual providing the site, the zoning, waiving the fees --- the deed would be in the hands of a private developer. The City would get a piece of the action on the tail end of the deal when the debt is retired.

The City could issue "certificates of participation" which would, in effect, inject the City's credit as a backstop for the deal thereby earning an interest rate tantamount to a tax free municipal. The City's risk would be mitigated by a pledge of the equity interest held by the developer together with a sinking fund repayment option --- basic financial engineering.

I would also envisage the local employers stepping up to guaranty rental of 75% of the units for their seasonal employees. While that sounds a bit aggressive, these employers have to have employees and these employees have to have a place to live. At the end of the day, the employer is just providing a "conduit" certificate --- a paycheck which is part cash and part a housing voucher. Think about it, that's what a college dorm is, isn't it?

One of the beautiful things about capitalism is that "experience" is free. That's why you want an experienced hand on the tiller. You want someone who has crafted a deal before, managed an architect, bid the construction, hired a contractor, overseen the construction, understands apartment marketing & management and who has raised the money. Get the right guy and you get all this expertise for free. This is why combat experienced units fight better than virgins. Nothing against virgins, mind you.

I could find at least 50 guys who could do this deal while shaving 5 strokes off their handicaps.

This is also why the Iron Whorse deal was such a fiasco --- all virgins. Nobody had ever been near the real estate pay window and didn't understand the underlying economics.

One of the best nuggets of wisdom ever --- stick to what you really know!

Now is actually a very, very good time for the City of SBS to try to do something like this because the jobs would be good and the market is depressed.

Hey, why doesn't somebody go get $25MM of Stimulus $$$ and make this happen?

Well, cause really SBS is only a bunch of talkers when it comes to "affordable" housing, now isn't that right? Isn't it? Really, isn't it? LOL

SBS and folks like the CAYV and City Council would much prefer to stand around and pee on your leg and tell you it's raining rather than letting an experienced professional developer make a $$$. So what do we get? Nothing!

All show and no go! Courage is rising to take action when everybody else is frozen and unable to act. Leadership is taking folks to a place they would never otherwise get by themselves.

We need a smidgen of courage and leadership!


4genlocal 7 years, 6 months ago

JLM I agree just look at the buildings the city has done. Let's start with howelsen hill lodge. The roof caved in. lets look at the planning building the snow slides and water drips making ice in the stair wells. The fire station was how far over budget? The transit center can't even have a decent accel lane for the busses to get back on 40. The entry had two options to be across from another road and they split the difference and put a stop light in the middle boy that helps the citizens. The list goes on and on. The city gov should be to provide needed services. Police, fire department, water, sewer, road maintenance. Beyond that there are a few nice things they do like parks and rec. they do not belong in housing. They don't belong being a developer. The free market will take care of its self it the gov stays out. Current studies show the houses that are being built in this economy are not the show homes of the past. They are more affordable and realistic.


Scott Wedel 7 years, 6 months ago

The City might could encourage the building of apts inside City limits by classifying apts as affordable housing if tenants satisfy the same current income limits for affordable housing. And then see what else an apt developer might request.

I was at an early county meeting for cabins at the Riverbend and besides all of the other issues, he had to overcome the County saying there was no public benefit to providing rental housing. But then a couple years ago when he asked for some more cabins, officially there was still no public benefit, but the County Commissioners talked of the importance of the rental housing being provided and how it was a public benefit to have teachers and so on able to live close to SB. So reality overcame official policy, but still official policy denies that reality.


JLM 7 years, 6 months ago

The challenge calls for a "regional" solution as the most likely location for apartments will be places like Hayden and Craig. Political subdivisions are not meaningful or relevant distinctions when dealing with economic issues.


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