Rob Douglas: Time to right a wrong
July 11, 2013
Steamboat Springs — By proposing to suspend the city's community housing ordinance for one year, the Steamboat Springs City Council took a half-step toward correcting the misdeeds of a previous council that unwisely passed a law that, among other faults, places the financial burden for the artificial creation of "affordable housing" on the backs of real estate developers.
The suspension amounts to only a half-step because the City Council could repeal the ordinance. Repealing the law would allow a robust public policy debate about the propriety of local government involvement in the housing market to unfold without the current ordinance hanging like an anvil over the head of next year's council. That new council — along with the real estate community, affordable housing advocates and, perhaps, the city's electorate — should be handed a clean slate. That way, no one will feel pressured to draft and pass a new law out of fear of the current monstrosity awakening from hibernation.
When discussing housing policy, there are too many facets to address within the confines of one column. That is particularly true when attempting to traverse Steamboat's affordable housing web, one that ensnares everyone who touches it in a way that has resulted in near universal condemnation of the policy.
That broad recognition of the unfeasible nature of the city's housing policy is what makes the council's timidity all the more disturbing. Apparently, like almost every elected body in this country, the council lacks the fortitude to right a wrong by explicitly striking down a law that has proven unworkable.
Leaving many of the intricacies of government-enforced affordable housing policies for another day, let's examine the two primary questions that must be answered before any discussion of those details is warranted. Should the city of Steamboat Springs mandate that builders provide city-defined affordable housing units, and if so, who should bear the financial burden of subsidizing that housing?
Among other reasons, the city shouldn't dictate that builders construct city-defined affordable housing units because city officials can't predict global, national, regional and local economic forces that will impact the real estate market in ways that will make city housing mandates obsolete before the ink is dry on the legislation.
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Anyone who doesn't understand that reality — especially after the Great Recession that was sparked by elected officials in Washington, D.C., who thought they could social engineer the housing market — is either delusional or hopelessly blinded by political ideology saturated with the belief that the government can make markets bend to its whim.
In Steamboat, the failure of the current community housing ordinance is a glaring example of the foolish notion that seven part-time legislators can conjure up a law that will alter the real estate market in a manner that provides anyone with the house of their fancy within the city's boundaries. Contrary to that fantasy, the reality is that after builders were forced to finance and construct units that met the council's dictates, only a relative few regional residents were qualified to buy the "affordable" units. Given the supply of affordable homes that aren't deed restricted in communities that are within commuting distance, a number of qualified buyers wisely chose to turn away from the city-mandated units.
Unfortunately, it's a safe bet a majority of the council will ignore the lessons of the recent past and forge ahead under the misguided belief that it can rejigger the housing law as a means of solving a problem that objective metrics prove is nonexistent.
In that case, the council at least should remove the financial burden from real estate developers and take the equitable path of asking the electorate to support an affordable housing tax. As developer Jon Peddie told the Steamboat Today this week:
"The reason this got brought up in the first place wasn't anything to do with being for or against community housing. It was just the whole fairness issue. If we really as a community feel we want to support community housing, it should be a grass-roots, community-based effort to figure out how to fund it and to fairly spread the cost."
Arguably, that's the fair approach. Let the voters decide whether affordable housing is a problem worthy of communitywide taxation.
To reach Rob Douglas, email rdouglas@SteamboatToday.com.