Aspen’s Centennial banking on taxing district |

Aspen’s Centennial banking on taxing district

Carolyn Sackariason
The Aspen Times
Aspen, CO Colorado

ASPEN ” Centennial homeowners plan to meet with city officials next month to discuss setting up a special taxing district that would pay for $3 million in repairs.

Centennial Condominium homeowners association president Ed Cross said he has asked for a meeting in June with the new Aspen City Council. The association plans to ask for assistance in establishing a special taxing district that would acquire a loan through a local bank at a municipal bond rate. That loan would be paid back through property taxes.

Wells Fargo representatives last month met with Centennial residents, as well as officials from the Aspen-Pitkin County Housing Authority, to hash out details on the special taxing district scenario.

“Essentially it was an exploration meeting,” Cross said, adding if all goes as planned, the taxing district could be placed on the November ballot. Only residents at Centennial would vote on the measure.

The homeowners association at Centennial has about $60,000 in its capital reserve fund, but that won’t even come close to covering all the repairs needed at the aging affordable housing complex near the base of Smuggler Mountain.

To increase the fund to $90,000, monthly dues for the 92 condo owners have been raised an average of $80 a month. Cross’ monthly dues have increased $132 ” from $340 to $472 for a three-bedroom unit.

If homeowners were to pay out of pocket for the necessary repairs, their dues would be more than their mortgages. And it’s not as though homeowners haven’t been socking away money in anticipation of future repairs.

“We’ve been conscientious about our direction,” Cross said, adding the association has followed the direction of its auditor regarding the capital reserve fund.

“It appears to be a perfect storm for us,” he said of the aging building and the association’s lack of funds.

There are dozens of other HOAs that are facing the same types of problems, according to a six-member citizen task force that has been researching how to address issues within the housing program.

In the minds of task force members, the biggest issue facing the housing program is the lack of capital reserves accumulated in the 84 HOAs that are regulated by Housing Authority. As their buildings deteriorate, homeowners will have to rely heavily on their capital reserves.

“It’s an issue on a lot of projects,” said Housing authority board chair Marcia Goshorn.

The board is working on requiring all new affordable housing projects to have condominium declarations that mandate capital reserve funds, Goshorn said.

Under the authority’s old guidelines, homeowners didn’t receive credit for payments made into capital reserve funds so they had no incentive to contribute if they planned to move in a short period of time, Goshorn said.

Goshorn was instrumental in bringing Wells Fargo and Centennial to the table to discuss the potential taxing district.

The benefit of a district is that the loan would be attached to the property, not the homeowner. Also, the loan would be at a significantly lower rate, the payments are tax deductible, and the local government wouldn’t have to step in for financial assistance.

“It means that it wouldn’t cost the city and the housing authority, who have no money, anything,” Goshorn said. “This allows them to help themselves.”