City of Aspen increases affordable housing fees for developers
The Aspen Times
Aspen City Council made a move Monday night that will make it more expensive for developers to provide affordable housing.
When a private developer builds a new project, the amount of employees it will generate has to be mitigated for — either through actual new housing or by paying cash to the city.
Developers who elect to pay into the city’s housing fund instead of building new employee housing do so based on a formula that takes into account development costs and assumptions.
Council agreed that the affordable-housing fee-in-lieu rates are too low, so they raised them 7 percent, which reflects the national average using the Construction Cost Index.
The city last updated the fee amounts in 2015, following a detailed study about construction costs for the creation of affordable housing, according to a memo to council from Community Development Director Jessica Garrow.
Developers pay based on income categories. With the new rates, the cash-in-lieu fees range from $111,438 to $381,383 for each full-time employee created by a development.
Payments are collected by the city’s building department and are a condition before getting a building permit.
Some council members want to explore eliminating the entire program in the near future, which would force developers to actually build affordable housing.
Councilman Adam Frisch said the money collected sits in an account for when the city is ready to build an affordable-housing project. Housing could come online a lot sooner if the onus is on the developer.
“There’s something to be said about getting out of this business and let the private sector figure it out,” he said.