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State Senate bill threatens future worker housing

Janet Urquhart
Aspen Times Staff Writer

Legislation that could hamper affordable housing programs in Aspen and elsewhere across Colorado will face considerable opposition from a coalition of resort towns and other municipalities when it goes to a Senate committee on Monday.

State Senate Bill 154 would prohibit the imposition of price controls on privately owned housing by counties and municipalities. It jeopardizes a local government’s ability to require that developers provide deed-restricted housing that is sold at below-market prices.

“If this passes, we’ve lost a significant tool at the local level to provide affordable housing,” said Sam Mamet, associate director of the Colorado Municipal League. “We will do our darnedest to kill the bill. I think when the dust settles, we will.”

The municipal league, a statewide lobbying organization representing 264 towns and cities, including every municipality in Pitkin County, has made defeat of the bill a top priority, according to Mamet.

The Colorado Association of Ski Towns (CAST) has joined the fight, as well, according to Jacque Whitsitt, who serves as its director and is also a town councilwoman in Basalt.

“Yes, CAST is up in arms,” she said Thursday. “It’s of special concern to the resort communities. We probably use deed restrictions to a greater extent than anyone else in the state. It’s huge to us.”

“It’s an effective way for a lot of resort communities, not just us, to provide ownership opportunities to people with less than six-figure incomes,” agreed Mick Ireland, a Pitkin County commissioner. “We think that’s important.”

Ireland will be among a number of Western Slope representatives on hand Monday in Denver to testify, when the bill is scheduled to go before the Senate State Affairs Committee.

“I’m expecting a few people from your neck of the woods to come down and speak as witnesses,” Mamet said.

But ski resorts aren’t the only places with affordable housing programs that would be impacted by the bill. Front Range cities such as Denver, Boulder and Longmont also have ordinances in place that require the provision of low-cost housing, he said.

Mamet predicts the committee will send the bill on to the Senate floor with a 4-3 vote that splits along party lines, with the Republicans prevailing.

The bill is sponsored by Sen. Mark Hillman, a Republican from Burlington, located on the far eastern plains of Colorado. He could not be reached for comment.

The bill does not yet have a sponsor in the House, according to Mamet.

Mamet anticipates strong backing for the bill from the Colorado Association of Homebuilders and the real estate industry, though local developers could provide another perspective. They agree to build deed-restricted housing that is sold at below-market prices to workers in exchange for rezonings and development approvals for broader projects.

“I have some developers who are going to come in on Monday and oppose the bill,” Mamet said. “They’re just as concerned about this.”

If the bill becomes law, local developers could find it difficult to get anything approved that doesn’t comply with the existing zoning on a property, predicted John Worcester, city attorney in Aspen.

The planned unit developments that have often come before the city usually contain a combination of free-market residences and deed-restricted units, or some other commercial venture, like a hotel, in combination with worker housing. If the city has no ability to require the worker housing and have some confidence that its affordability will withstand a court challenge, it may take a dim view of such projects, Worcester said.

The deed-restricted housing, he noted, is a community benefit developers choose to provide in order to win an approval.

“The quid pro quo of that is, you’re going build affordable housing and deed-restrict it, but we’re not forcing anybody to do that,” he said.

The U.S. and state constitutions already protect property owners from “takings” – losing their property without fair compensation, Worcester added.

“You can’t take property without due process of law. That’s not what we’re doing and that’s not what anybody that I know of is doing,” he said.

There must be a more “nefarious” reason for the proposed legislation – “to kill all the affordable housing projects,” Worcester concluded.

The bill would amend the section of state statutes that already prohibits rent controls – an issue that added a new wrinkle to affordable housing programs a few years ago.

@ATD Sub heds:The Telluride case

@ATD body copy: The state has had a prohibition on government-imposed rent controls on its books since 1981. In 2000, the Colorado Supreme Court ruled the statute applies to rental units built privately to comply with local affordable housing requirements.

The state’s high court struck down a Telluride ordinance that required builders to provide affordable housing for 40 percent of the employees generated by new development.

A year later, Senate Bill 31 was introduced with the backing of various resort areas, including Aspen and Pitkin County. It attempted to carve out an exemption to the definition of government-imposed rent control to allow jurisdictions to require deed-restricted rental units as part of new development.

The measure passed in the House, but died in a Senate committee.

The Aspen-Pitkin County Housing Authority has dealt with the Telluride ruling by requiring that it hold a small, undivided ownership interest in new deed-restricted rental units that are built privately. The government ownership makes rent control on the units legal.

That avenue may be available for deed-restricted sale units, as well, in the event Senate Bill 154 passes, Worcester said.

“We might go that route. That opening is still there,” he said. “That’s something that needs to be analyzed.”

Affordable housing that is built by Aspen or Pitkin County is unaffected by the proposed legislation. However, hundreds of the approximately 1,300 sale units in the Housing Authority’s inventory were built by private developers and sold to qualified local workers. Appreciation on the units is capped to keep them affordable with each resale; the bill jeopardizes the community’s ability to institute and maintain the price caps.

[Janet Urquhart’s e-mail address is janet@aspentimes.com]


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