Regional Government Affairs Update June 7, 2021 🌺

Housing affordability remains a top concern for Colorado residents according to polling. In response, governments are proposing various policies to reduce prices for rental and for-sale units.

Can governments create affordability in the real estate market? What are the unintended consequences of such legislation? To learn more about how local governments and the State are addressing affordability, keep reading.

Best Regards, 
Barbara Koelzer
Regional Government Director


LOCAL
Boulder County Boulder
Council Considers New Taxes: The City Council discussed ideas to generate additional revenue for the City at its May 28 meeting. While the Council agreed now is not the time to add a new tax, they all concurred that any tax considered for the future should not be regressive. There was consensus about pursuing a transportation/utility tax, if not this year, then in the near future. 

Sam Weaver, Mark Wallach, Rachel Friend and Adam Swetlik were also interested in reviving the discussion on an employee aka “head tax.” Several councilors want to pursue a tax on services, although they didn’t specify what services they would include. However, it is important to note that such a tax could affect the real estate industry (as has been done in other cities around the country). No other city in Colorado currently taxes services Staff will return on June 22 with suggestions for further consideration.

Longmont
City to Pursue Rental Licensing: The City Council voted 4-2 to direct staff to draft an ordinance requiring rental properties to be licensed and inspected. Mayor Brian Bagley was absent.

Polly Christensen was adamant about the need to inspect rental properties. She suggested any property that is at least eight years old should be inspected, including single-family homes and short-term rentals as well as multi-family units.

The cost of the program is unknown; however, it will cost the City at least $300,000 a year. Staff said a minimum of two additional full-time employees will be needed. City Manager Harold Dominguez asked, “Do you want it to be fully supported by fees and licenses or partially supported by the general fund?” While the Council’s preference is a self-supporting program, general fund money was not ruled out. 

Marcia Martin, Joan Peck and Polly Christensen argued the program is necessary because renters are afraid to ask landlords to repair their rentals.  They said they receive many complaints from residents about sub-standard housing. Joan Peck explained, “For me this isn’t about one side or the other (meaning landlords or renters), it’s about equity.”

Tim Waters said he hasn’t heard from any renters about problems and suggested the City’s current complaint-based system is adequate. “I didn’t realize our complaint-based system is broken…. We keep talking about keep costs down, but this will increase costs for renters…. 
This feels like a huge, huge hammer for a not so big nail.”

Christensen countered, “This is tax-deductible for the landlords. They don’t need to pass it along to residents.” …. We need to not ignore this anymore. They don’t complain because they’re afraid they’ll be kicked out.” She then made a motion to direct staff to proceed with an ordinance to license rentals.”

When asked to comment Susan Spaulding, a Community Relations Specialist for the City, said, “I don’t perceive a great fear among tenants, and I’ve spoken to thousands of them. We have the basic set-up to create a mediation-centered approach to the landlord-tenant relationship. I’m not sure I perceive the problem.”

Mayor Pro Tem Aren Rodriguez said the motion was premature. “There’s too much uncertainty right now. We need to do more research.” Waters agreed, saying he didn’t think the Council had explored any options. The motion to create an ordinance passed with Christensen, Martin, Peck and Hildalgo-Fahring voting in favor.

Note: The Realtors® will provide feedback before the ordinance is considered by the City Council. Staff expects it could be months before the proposal is ready for review.

Broomfield
Mayor Resigns: In a surprise move, Mayor Patrick Quinn, who has been a fixture in Broomfield politics for decades, resigned his office as of May 23. He said the decision was the right choice for his family but did not offer any specifics. 

Mayor Pro Tem Guyleen Castriotta, will fill in as mayor until a new one is appointed. City Council has 30 days to fill the vacancy by a majority vote, according to the Broomfield Charter. The selected individual will finish out the remainder of Quinn’s term, which ends Nov. 9. Should a current council member be selected as mayor, then their seat will be filled by a majority vote of City Council for the remainder of their term. Castriotta and Ward 4 City Councilmember Kimberly Groom already have announced their intention to run for mayor in November.

Larimer County
Commissioners Discuss Affordable Housing Recommendations: The Larimer County Commissioners reviewed measures to increase affordable housing on May 24. Staff identified the top housing needs as affordable rentals for residents earning less than $25,000 a year, starter homes priced near or below $300,00, diverse housing options such as missing middle housing, cooperative living, and accessory dwelling units (ADUs) and housing for special interest populations including those with accessibility or mobility needs, older adults, manufactured housing and people experiencing homelessness.
 
Recommendations from residents and the stakeholder committee included a variety of options. These groups suggested the County should serve as a repository for best practices and educate local officials, as well as convene regional discussions on the issue. Other ideas included providing housing for emergency housing relief and encouraging creative and non-traditional housing options. The County should also incentivize affordable housing development and promote flexibility in land use. 
 
Staff offered a list of specific recommendations for the Commissioners’ consideration, including the following: 

  • The County should continue to collaborate with NoCo Housing Now and increase awareness of existing programs such as the Metro DPA Loan Program.
  • Land Use Code updates could encourage housing diversity and affordability. 
  • Manufactured housing policies should be aligned with Fort Collins and Loveland regulations. 
  • A pilot program could encourage modular and prefab housing manufacturing. 

Towards the bottom of the list, staff included the idea of a dedicated local funding source for affordable housing activities via a property or sales tax, bonding, a linkage/impact fee or the general fund. 

The Commissioners were generally supportive of the recommendations. They focused on the concept of a dedicated housing fee. Commissioner Kristin Stephens encouraged a conversation with local municipalities to discuss a county-wide tax.

Loveland
Council Decides Against Sales Tax Increase Proposal: On May 25 the Loveland City Council decided not to ask voters for a sales tax increase this fall. The City’s most pressing need is for fire station funding. Stations 3 and 5 require renovation at an estimated cost of nearly $17 million. 

John Fogle said without consensus, the City shouldn’t move forward. He also said it would be disastrous for the City to try and fail for a third time. Andrea Samson suggested the City could find money in the budget for the fire stations. In response, City Manager Steve Adams said the City has already cut millions over the past few years. He added that there’s no hidden money in the budget to solve the City’s budget woes without making some sacrifices.

Voters have not supported initiatives to fund public safety or other capital improvements in recent years and that, coupled with concerns regarding the economic impact of the COVID epidemic on residents, convinced a majority of the Council to delay a sales tax measure in November, regardless of their concerns about the fire stations. The City Manager will come back to Council soon with ideas on how to fund Station 3.

Weld County
Thornton Sues Weld Over Water Pipeline: BizWest reported that the City of Thornton has filed a suit against Weld County over the County’s denial of a special review permit for a water line through unincorporated portions of the County.

In the 1980s Thornton bought several farms and their associated water rights, intending move the water by pipeline. Larimer County has already denied the 1041 permit to authorize the pipeline route through its jurisdiction. Thornton sued the County, but Larimer District Court sided with the County in its denial. Thornton appealed that ruling, and a decision from the Colorado Court of Appeals is pending. 

Meanwhile, Thornton has sought pipeline agreements with several Northern Colorado cities. Windsor, Johnstown and Timnath have agreed to Thornton’s routing plans, and work is underway in those areas to bury the large pipeline. Thornton also needs approval from Weld and Adams County.

Commissioner Scott James, who made the motion to deny, told BizWest that he made the motion “because the pipeline isn’t in the best interests of Weld County,” and he represents Weld County not Thornton. He said its impact on future development in the county “was a breach too far.” Thornton’s alleges that the Board exceeded its authority and acted arbitrarily and capriciously. It seeks court approval of the permit or an order requiring the Commissioners to approve the permit.

Greeley
Keep Greeley Moving Reauthorization to go on November Ballot: The City Council directed staff to draft an ordinance to place the Keep Greeley Moving (KGM) sales tax reauthorization on the fall ballot. According to a resident survey 71 of respondents agree the City probably or definitely needs more funding. 

However, a large of majority of respondents opposed the idea of increasing the KGM tax from .65 percent to .95 percent. After reviewing the polling data, the Council unanimously agreed the tax reauthorization should move forward. Mayor John Gates noted the staff has done a good job showing residents how the money has been spent so far, saying, “This is a huge tribute to the City staff.” 

Council Denies Changes to Occupancy Standards: An ordinance to change Greeley’s occupancy standards was pulled off the Consent Agenda June 1 at the request of Councilmember Kristin Zasada. At the heart of the occupancy issue is the Code’s definition of family. 

In its current form a family is defined as “an individual living alone, or any number of persons living together as a single household who are interrelated by blood, marriage, adoption or other legal custodial relationship; or not more than two unrelated adults and any number of persons related to those unrelated adults by blood, adoption, guardianship or other legal custodial relationship. 

The Planning Commission suggested changing that definition to “Family shall mean an individual or group living together as a single household comprised of any number of persons who are interrelated by blood, marriage, civil union, adoption, or other legal custodial relationship, plus a number of unrelated adults …” The change would have allowed more occupants than the current code allows based on the number of bedrooms in the home in most zoning districts.

One of the issues with the current code is that a married couple can’t rent a room to an unrelated adult, said Caleb Jackson. After staff answered questions about current and proposed definitions, Kristin Zasada said,  “Kill this thing. Protect the integrity of our neighborhoods.”  John Gates agreed explaining, “I almost always agree with staff and the Planning Commission.  I’m ready to let this thing go hoping it comes back sometime in a different form. Most of the feedback I’ve received is from Realtors. I believe Realtors get this.” 

Other members of Council voiced similar opinions with the exception of Tommy Butler. He argued, “Increasing supply reduces home price pressure. I would like to see us revisit the family definition at the least.”

The Council voted 6-1 to deny the ordinance. Dale Hall was absent. The Council did support a proposal from Zasada to ask staff to review enforcement issues regarding current zoning complaints, including over-occupancy.

STATE
Legislature to Adjourn: Depending on how much work the legislature gets done, it looks like the legislative session could end Tuesday, June 8. Most of the Democratic Majority’s key bills have already been approved. Here’s an update on two of the most significant bills. 

Senate Bill 260 “Sustainability of the Transportation System” will add a “fee” to the price of gasoline and diesel as well as a number of other new fees. The bill increases traditional transportation funding marginally, but it also aims to put millions of dollars into transit and infrastructure for electric vehicles. 

House Bill 1117 “Local Government Authority Promote Affordable Housing Units” gives cities the ability to use inclusionary zoning more broadly, including applying it to new rental developments. Until now, the State’s Supreme Court’s Telluride decision kept local governments from requiring developers to comply with inclusionary zoning requirements for rental projects.

Governor Polis supported both bills. When he signed HB-1117 he said inclusionary housing could create higher overall housing costs, even if it leads to more affordable units. He argued higher prices would be offset by the law’s other components, which would encourage cities to allow more housing construction in general. 

The Colorado Association of REALTORS® supported neither bill. CAR worked hard to amend HB-1117, requiring municipalities to offer developers at least one option to provide a percentage of affordable units, as well as offering other policies to make it easier to build housing, such as increasing density and promoting mixed-use developments.

NATION
Court Maintains CDC Eviction Moratorium Pending Appeal: Ongoing litigation regarding the Center for Disease Control’s (CDC’s) nationwide eviction moratorium has resulted in a recent stay issued by the U.S. District Court for the District of Columbia, which means the CDC order remains in place nationwide pending further appeals.

On June 2 the emergency stay was upheld. Plaintiffs, including the Alabama and Georgia Associations of REALTORS®, filed an application with the U.S. Supreme Court to vacate the stay before the CDC order expires at the end of June.

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