Government Affairs Update10-24-2019

October 24, 2019

In this issue…

Boulder County
Additional Height Approved as Community Benefit
Partnership Creates Longmont Mobile Home Co-op
City Adopting New Flood Maps
Council Adopts Sustainability Evaluation System
Larimer County

Fierros Withdraws From Council Race
402 Plan Adopted
Weld County

Energy Plan Approved
CAR Takes Positions on State Ballot Issues
Legislative Preview
State To Apply Stricter Drilling Rules
NAR, Allies Set Record Straight
CFPB Director Testifies


Boulder County

Additional Height Approved as Community Benefit:
Recently Boulder’s City Council approved an exemption to building height limits by requiring more affordable housing units in exchange for allowing fourth and fifth stories above 35 or 38 feet. Those height limits were imposed by the City Council in 2017, when it adopted a moratorium on granting exceptions to allow structures up to 55 feet, the citywide limit approved by voters in 1971.
The Council was responding to more frequent requests for buildings above 35 or 38 feet, except for the neighborhoods where height exemptions may still be granted under the moratorium. Those areas include University Hill, 29th Street Mall, Boulder Junction, Gunbarrel, a small block on north Broadway, a block west of Foothills Parkway just south of Baseline Road and an area on the north side of Arapahoe Avenue.

Under the new regulations, developers would have to make 36 percent of a project’s housing units (that are above the height limit in a fourth or fifth story) affordable to low or middle-income households, which is more than the current 25 percent requirement. For non-residential projects, developers would be subject to affordable housing linkage fees that are 43 percent more than standard rates for the square footage above the zoning district height limits. Those fees for office space are currently $18.27 per square foot but will increase to $24.14 in 2020 and $30 in 2021.

The City Council decided to retain the regulation allowing height exemptions to be granted only in select areas of the City through May 2021, adding the City-owned Alpine-Balsam site and a residential high-density zone off of 28th Street and Colorado Avenue to the list of areas that can be considered.

Councilman Aaron Brockett unsuccessfully attempted to convince his colleagues to allow greater heights in more neighborhoods. “I was surprised when I saw the proposal, and continue to be surprised that we’re only still allowing it in such limited areas,” Brockett said. City staff has proposed limits to the eligible neighborhoods until the second phase of the project is complete, in May 2021. Phase 2 will focus on other identified community benefits (e.g., below-market rate commercial space, space for the arts etc.) and updated Site Review criteria for a greater level of predictability in projects and better implementation of City goals.


Partnership Creates Longmont Mobile Home Co-op:
Colorado Housing and Finance Authority (CHFA) announced its partnership with a capital development fund to support the preservation of the Longmont Mobile Home Community (Longmont MHC) by converting its structure to a resident-owned cooperative. This co-op eliminates the homeowners’ risk of displacement, gives them more control over lot rent fluctuations, and preserves affordable homeownership in Longmont. The Longmont MHC has 36 individually owned manufactured homes.

CHFA made a $1.19 million purchase for participation in an existing acquisition loan made by ROC USA Capital. Impact Development Fund (IDF) purchased a $1.34 million participation interest in the loan. ROC USA Capital remains the loan servicer. The loan was used by the Longmont MHC’s homeowner cooperative to purchase the community’s land. The City of Longmont also supported the transaction with a no-interest, deferred-payment $300,000 loan from its Affordable Housing Fund.

While this type of affordable housing finance may be emerging in Colorado, it’s a model ROC USA has used in multiple states across the U.S. Thistle Communities, ROC USA Network’s affiliate in Colorado, provides technical assistance for board training, loan compliance, and community development. Longmont MHC worked with Thistle through the purchase process and will continue to do so for at least the next decade.

City Adopting New Flood Maps:

On October 15 the City Council got an update on the adoption process for new flood plain maps. After the catastrophic 2013 flood, the legislature passed a bill to reanalyze potential flood hazards and that information was submitted to FEMA (Federal Emergency Management Agency) for review. FEMA is now in the process of revising its maps, which are known as FIRMs. The FIRMs are important to Longmont because they will determine flood insurance rates in the included areas.

According to Longmont’s Floodplain Administrator, Monica Bortolini, the new maps are not expected to become official until early 2021, pending any appeals. Once the maps are in effect flood insurance requirements will change.

The City will hold multiple public meetings to present the new maps to the public after the beginning of the year. In addition, specific meetings with owners of property within the flood plains of the St. Vrain and Left Hand Creeks are also being planned.

Council Adopts Sustainability Evaluation System:

On October 22 the City Council approved an ordinance instituting a new requirement for development applications along Longmont’s river corridors. Currently, any development proposal that is adjacent to a river requires a variance if the project is within a 150-foot setback. The new ordinance will require that the applicant use a Sustainability Evaluation System (SES) to evaluate and score the “economic, environment and societal impacts and benefits of development in the river/stream corridors, riparian areas, and wetlands.”

However, some members of the Council made it clear that their goal is to broaden the use of the SES and require its use for properties that are not within the setback. Aaron Rodriguez, Polly Christensen and Joan Peck attempted to amend the ordinance to require the SES for any development proposal for property that is adjacent to a river corridor. However, the City doesn’t have a definition for what “directly contiguous or adjacent to a river corridor” means.

Tim Waters, Marcia Martin, Bonnie Finley and Mayor Bagley opposed the amendment due to legal concerns. Waters said it is important that the SES is “legally defensible” to avoid potential takings lawsuits. Joni Marsh, Longmont’s Community Development Director, suggested it was important to tackle the topic step by step and reminded the Council that staff plans to come back next month with the definition of adjacent as well as suggested language to include additional waterways that are listed as “areas of concern” in the newly adopted Wildlife Plan.

The Council voted unanimously to adopt the ordinance as written. Staff will continue its research on how broadening the use of the SES would affect new applications and draft additional language to define adjacent and contiguous. More discussion scheduled for the November 19 Council meeting.

Larimer County

Fierros Withdraws From Council Race:
Ryan Fierros officially withdrew from the Loveland City Council race on October 21, citing “family commitments.” Unfortunately, his name still appears on the ballot since he withdrew after ballots were printed. Any voter who has not submitted their ballot can request a replacement by contacting the Loveland City Clerk or by visiting any polling center beginning October 28.

402 Plan Adopted:
The City Council approved the Highway 402 Corridor Plan, which is the result of a planning process that began in the summer of 2018. Highway 402 is the southern gateway into Loveland needs to provide a good first impression of Loveland through well planned, thoughtful development.

Additionally, staff explained that the new improvements to the I-25 and 402 interchange will make this area more attractive to developers. Without a corridor specific policy document developed in collaboration with the community and local government partners, Highway 402 would run the risk of haphazard, unattractive development patterns that are inappropriate and do not function well. This plan was developed with input from community stakeholders, including residents, businesses, large property owners and oil and gas industry representatives, as well as city, county and state government partners.

In essence, it provides a framework for future development along the corridor in the next 20 years. It calls for focused development around major “activity nodes,” the development of corridor-specific development standards and coordination with Larimer County and landowners on annexation and minimal intrusion of new development into existing neighborhoods. 402 is envisioned as a “gateway employment corridor.”

The plan notes that the estimated cost to provide water and wastewater services to the corridor is $25 million and power upgrades would also be required. Staff told the Council that developers would be required to finance the installation of utilities. Now the City’s comprehensive plan (Create Loveland) and the new Unified Development Code will require amendments. In addition, staff will draft corridor-specific development guidelines.

Weld County

Energy Plan Approved:
The City Council approved a new Energy Action Plan on October 15. The plan was funded by an Xcel Energy grant and will be considered a “Sub-Element” of Imagine Greeley, the City’s recently adopted long-range comprehensive plan. A group of over a dozen community stakeholders was formed as an Energy Action Team, consisting of members of industry, housing, and institutions such as UNC and School District 6. The Energy Action Team developed draft goals and strategies for residences, businesses, institutions, and the City.

The Energy Action Plan has three goals: create an affordable and reliable energy future, increase residential, commercial, and industrial energy efficiency and alternative energy opportunities, and improve economic health and stimulate growth.

Staff explained that the residential sector in Greeley accounts for 87 percent of Xcel Energy premises, and 36 percent of electricity consumption. The aging housing stock in Greeley also represents a significant opportunity, as many homes are likely able to realize savings through efficiency upgrades.

It was also noted that programs like Xcel’s Home Energy Squad present opportunities for residents to learn about energy efficiency improvements. For $50, the Home Energy Squad will visit homes and make recommendations. Program offerings include swapping out traditional bulbs for LEDs, installing a programmable thermostat, weather-stripping a drafty door, and installing energy-efficient showerheads and faucet aerators. Installation, labor, and materials are valued at $200. Spanish-speaking technicians are available.

Greeley’s residential goal is for 2,700 households to implement one energy efficiency or renewable energy measure annually. This equates to approximately 7.5 percent of residential premises or Greeley households participating in a residential or renewable energy program through Xcel Energy.

The City plans outreach campaigns for three different sectors of the community, including (1) cost-burdened homes including Spanish-speaking households, (2) students and rental households, and (3) households looking to fix up their homes and/or “green” their energy choices through renewable energy options. The outreach campaigns will highlight how the sector can engage in different energy programs and benefit from various energy efficiency and renewable energy activities.


CAR Takes Positions on State Ballot Issues:
On October 16 CAR’s Board of Directors ratified recommendations from the CAR Political Action Committee on two questions referred to the voters by the Colorado General Assembly.

Ballot Issue CC “Retain State Government Revenue”
CAR Position – Oppose

This question asks voters to allow the State to retain Taxpayer Bill of Rights (TABOR) surplus revenue permanently rather than refunding it to taxpayers. The revenues would be split evenly between transportation (including transit), K-12 and higher education. The State has not issued a refund in 10 years.

While CAR agrees that transportation, K-12 and higher education are crucial, this measure will not provide reliable, adequate funding streams because TABOR refunds are small and infrequent. For example, there may be a TABOR refund in fiscal year 2020 but estimates of the refund vary between $150 million and roughly $348 million. To give one example of why this amount would not go very far, according to the Colorado Department of Transportation, an additional $9 billion is needed to fund all the projects on its list. In addition, because this is a statutory measure, future legislators could decide to use the revenue to fund other priorities.

Ballot Issue DD “Taxation of Sports Betting to Fund Water Projects and Obligations”
CAR Position – Support

This question asks voters to legalize sports betting in Colorado. A 10 percent tax on casino profits from those bets would be used to fund state water projects and pay for the regulation of sports betting.

Although sports betting is clearly not a REALTOR® issue, water is vitally important in order to fund the growth that Colorado will see in the near future. This measure will help implement the Colorado Water Plan, which was released in 2015 and identifies actions by which our State will address future statewide water needs.

Legislative Preview:

Recently CAR staff and lobbyists provided their thoughts on issues that are likely to come up during the 2020 legislative session. Because it is a major election year, it is likely we’ll see a lot of “statement” bills, said Jason Hopfer, CAR’s contract lobbyist.

Given the make-up of the legislature, we can expect more bills focused on rent control, landlord/tenant responsibilities and short-term rentals. There are rumors that inclusionary zoning may be a new focus of interest, along with condominium conversion legislation.

The Department of Regulatory Affairs (DORA) just released its sunset report on home inspections. Unfortunately, the report does not recommend legislation to regulate home inspectors, so it is unlikely we will see any bills related to that topic in 2020.


State To Apply Stricter Drilling Rules:
The Colorado Oil and Gas Conservation Commission (COGCC) is expanding the range of oil-well permits subject to additional scrutiny after it and state health officials released a study on the health impacts from emissions. In a press conference, COGCC director Jeff Robbins said the agency will immediately begin applying the stricter rules for any drilling operator that wants to dig a well within 2,000 feet of a home. The current range for additional scrutiny is 1,500 feet from an occupied home.

The new regulations will apply to 39 permits awaiting approval, including 27 in Weld County, two in both Larimer and Boulder counties, and one in Adams County. However, the new rules do not apply to wells currently operating within range of a home.

The new rules come with the release of a modeling study from the COGCC and Colorado Department of Public Health and Environment to measure volatile organic compound emissions from wells in Northern Colorado and Garfield County in the far west section of the state using emissions samples and weather data from 2016.

It determined that there are short-term health risks such as headaches, nausea and nosebleeds for people breathing air near an active well, especially if the well is in a backflow or there are adverse weather conditions. However, the study said the risk of long-term health effects from VOC-specific emissions is low and the chance of cancer falls within the U.S. Environmental Protection Agency’s current acceptable risk range.

The study will be used in the current rulemaking round for Senate Bill 181, and will be used for additional rulemaking in 2020 to reduce oil and gas emissions. Robbins also said agencies will start more real-time monitoring of active drilling sites within the next several months.


NAR, Allies Set Record Straight:
To counter a growing narrative that the Federal government has expanded its exposure to risky mortgages, NAR recently published an op-ed with the Mortgage Bankers Association, the American Bankers Association, and the National Home Builders Association in the American Banker to set the record straight. The op-ed describes how comprehensive characteristics, along with new laws passed in the wake of the crisis, have ensured a greater focus on sustainable mortgage lending. The article also detailed how rates of serious delinquency and foreclosure remain at or near-historic lows across both GSE and FHA mortgages.

CFPB Director Testifies:
Last week, Consumer Financial Protection Bureau (CFPB) Director Kraninger provided her semi-annual report to Congress. Director Kraninger testified before the House Financial Services Committee and the Senate Banking, Housing, and Urban Affairs Committee to discuss current updates and developments at the Bureau.

Director Kraninger provided testimony on the CFPB’s new innovation policies that were recently announced and symposiums hosted by the Bureau on behavior economics, and defining “abusive practices or acts” under the Dodd-Frank Act. Additionally, Director Kraninger provided some insight on the qualified mortgage (QM) patch. She explained that the QM patch will expire in January 2021 and that the Bureau is working on a plan as the transition to end the QM patch is forthcoming. Director Kraninger also expressed that the Bureau is working to increase access to mortgages. One of the major topics also discussed was whether the Bureau is constitutional based upon its structure, and recently the Supreme Court has agreed to hear a case on the matter.
NAR is continuing to monitor updates and new developments from the CFPB.

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