Pitkin County cool on housing loan idea
October 21, 2009
ASPEN – A request for $3.15 million in Pitkin County housing dollars to be loaned out for worker housing projects got a cool reception Tuesday from county commissioners.
The Aspen Community Foundation proposed creation of a revolving loan fund to help with the pre-construction costs of housing development. Maximum loans of $500,000, with a payback of two years or less, would allow the county to put its money toward multiple projects rather than spending it to build units, said Paul Menter, finance director for the foundation. The nonprofit would raise $150,000 for a total of $3.3 million, he said.
The money would go to developers of qualifying projects to cover up-front costs.
“It’s the hardest kind of funding to get, particularly for affordable housing projects; so the development community tells me,” Menter said.
If demand for the loans dries up, the county would get its investment back, he said.
The county is looking for options to spend almost $10 million in housing money, but commissioners weren’t convinced the foundation’s proposal is the best bang for their buck, or even a legal one.
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The county attorney is investigating whether the funds can be used for the proposed purpose, Menter said.
Commissioner Michael Owsley questioned the need to partner with the foundation, even if the county wants to create the loan fund.
“Why do we need to partner with you?” he said. “What is the advantage to the county?”
The foundation would handle administration of the program, with a seven-person, jointly appointed board to review applications, and it would bring in the $150,000, Menter said.
“I’m hesitant right from the get-go,” said Commissioner Jack Hatfield. “I think it creates another layer of bureaucracy that we possibly don’t need.”
Though commissioners weren’t overly enthusiastic, they agreed to further investigate the idea, including the legality of using dedicated housing funds for the loans.
“I think we need to look at all options that are out there,” said Commissioner Patti Clapper.