City of Aspen to weigh survey on housing mitigation fees
September 15, 2014
As city leaders consider changes to affordable-housing-mitigation rates for residential projects, a survey being distributed to local homeowners figures to weigh in on the decision.
Currently, the mitigation rate for developers of residential construction is $76 per square foot if the developer chooses to pay a fee to the city in lieu of building affordable housing. Community Development Director Chris Bendon as well as members of the Aspen City Council have said in the past that the rate is unrealistically low when considering high construction costs in Aspen.
According to Affordable Housing Project Manager Chris Everson, construction costs at Burlingame Phase II were about $509 per square foot of liveable area, which includes construction of land, roads, access and other amenities. Peter Fornell's affordable-housing project on Main Street cost $350 per square foot to build, but Everson said the total cost was $5.2 million, and if you divide that by Fornell's approximate 10,000 square feet of liveable area, the total comes out to $520 per square foot. Costs for other developers to build affordable housing vary by location, Everson said.
How the city proceeds will be based largely on data submitted by Boulder firm RRC Associates, an independent researcher the city hired to conduct a $33,000 study, which includes a review of the survey responses. David Becher, director of research at RRC Associates, said he expects results in October or November and encouraged residents to complete the survey.
Also urging residents to complete the survey is Karen Toth, president of the Aspen Board of Realtors. In an email to the board, she relayed the message that some council members believe the mitigation rate for residential projects should be approximatey $500 per square foot.
On Friday, Councilman Adam Frisch said that whether the rate should be raised, and how high it should go, is open for discussion and will be brought before the council at a future date.
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"Even people that don't want more mitigation understand that $76 is a ridiculously low number," he said. "The city can do anything from zero to whatever some kind of third-party authority says."
He pointed out that the vast majority of affordable-housing mitigation currently comes from commercial projects. The upcoming discussion figures to be a sensitive one, as this will not affect professional developers leading multimillion-dollar projects but Aspen's homeowners and their property values.
"Many of them, their entire asset is wrapped up in their home in Aspen," Frisch said. "It's a wide variety of people who are concerned that we have an appropriate level of affordable-housing mitigation because it affects individual people, our friends and our neighbors."
In February, Mayor Steve Skadron opined that the city should consider weighing primary versus secondary homeowners. As he said during the meeting, not all single-family homes are necessarily equal. He asked if trying to define occupants in primary and second homes could cause legal or community issues, while Frisch questioned the city's ability to charge different fees based on the criteria they discussed: voting records and length of yearly residency.
"We could probably go down that path," Bendon said. "I don't think we want to be in the position where we're trying to ask at the building-permit-submission table, 'What do you do here in town? And do you take out your own trash?' We don't want to get to that point, but I think there are some valid points that have been brought up that we can ask RRC to help us with."
Also in question is how many full-time employees residential projects create, based on square footage, as well as the question of double taxation associated with Aspen's real estate transfer tax levied on transactions.