Housing Divided, Part 6: Government’s hand remains pronounced in housing efforts
October 26, 2016
5A: Countywide ballot measure this November for a sales tax to establish a construction fund granting the county and its municipalities the ability to purchase land and/or build workforce housing
AMI (Area median income): Set of calculations commonly used nationwide to determine what a household, based on size, can afford on a lease or mortgage per person
Cost burdened: Families or individuals who pay more than 30 percent of their income for housing
Deed restriction: Set of rules attached to a unit that specifies how the property can be used and how much it can be resold for over time. May also set requirements such as the tenant being a full-time employee, and how much the property’s value can appreciate
Market-rate: Fair market price or value for a property based on whatever the market will bear
Master-lease program: Program that converts short-term, vacation units previously available to the local workforce into long-term rentals. Provides property management services and financial assurances to the owner, and offers housing options to qualified, low-risk tenants
Editor's note: This is the sixth in a 13-part series. Installments will appear each Thursday in the Summit Daily.
Summit County Commissioner Thomas Davidson's mission to provide housing for the local workforce began more than three decades ago, he just didn't know it then.
The idea was only just starting to formulate in the young Kansan's mind when he arrived to the region in the 1980s for a lone winter of swinging lift chairs at Arapahoe Basin Ski Area. Despite the challenges of rural mountain living, Davidson fell for the people, the experiences and the natural beauty of his new surroundings, and soon had intentions of never leaving.
It's a story not unlike countless others who still journey to the region today with ideas of blazing a trail for themselves in the Colorado Rockies — a post-college 20-something with a longing to ski and a willingness to throw caution to the wind. Eventually, the story goes, these so-called ski bums mature into the leading lights of the Summit community, if only they can hang on long enough.
However, that dream is getting harder to realize by the season. Real estate costs continue to put long-term housing arrangements out of reach for many members of the area's workforce.
Same as it's ever been, according to county officials.
"I lived it," said Davidson, "I understand firsthand what it meant to be in employee housing. Those days were absolutely paycheck-to-paycheck making minimum wage, and the housing was an incredible struggle, even back then. It always has been, it always will be."
Eric Mamula, a mid-'80s transplant himself and now mayor of Breckenridge, is another prominent member of the community committed to the cause of providing workforce housing solutions.
"I don't think there was ever a time from the time I got on council that there was a question about whether we should do housing or not," said Mamula, who also served on Breckenridge Town Council from 2004-12. "This goes along hand-in-hand with childcare and has to do with making our community livable. It's something that we talk about all the time."
For Mamula and Davidson, and any number of other elected leaders, intense government involvement in housing development is an essential component in building an enduring Summit County community.
I'm from the Government and I'm here To Help
Breckenridge has been on the front lines in constructing workforce housing, helping to build a dozen developments since 1999, with at least six others at various stages of planning or completion. Without the same tax revenue muscle, the other towns — Dillon, Frisco and Silverthorne — have been slower to adopt Breckenridge's approach, fostering a smattering of deed-restricted or low-income residences here and there in their necks of the woods. However, momentum and mounting need around workforce housing is changing that.
For Breckenridge, the course was set decades ago.
For Mamula, that means following in footsteps of his father Sam, who served as Breckenridge's mayor from 2000-04, and on town council for eight years before it starting in 1992.
"Once those councils decided that this is really an issue," said the present-day mayor, "there really hasn't been any pushback. This is a priority for everybody."
Since 2007 when the town established a housing fund, Breckenridge has spent approaching $17 million on land and workforce developments. As of the same January 2016 data, it projected devoting $32 million more on additional sites and construction through 2020. Davidson, meanwhile, estimated the county has spent roughly $8 million on housing projects and land parcels for the future, including Lake Hill northeast of Frisco town limits.
Such levels of governmental intervention are not unprecedented. Officials said it remains noteworthy, however, in its effectiveness here in the community.
"If you don't have the government on board, your efforts are really going to be piecemeal and not nearly as effective," said Wendy Sullivan, principal at community planning firm WSW Consulting. "You're going to be kind of dabbling in the pie rather than helping to produce the pie. The strongest aspect in getting housing done is having the political will and wherewithal to get the housing that's needed."
Sullivan led a group this summer that completed an update to the county's workforce housing needs assessment. The study stated the region is in need of 1,685 units of housing split between for-sale and rentals by the end of 2020 to meet current demands. She said Summit County, with its full-scale buy in from the town and county governments, and voters, is a model for other resort communities.
And yet, this strategy to get locals housed still receives sporadic challenges from those who believe government should leave construction solely to the private sector. Occasionally, they suggest, the county shouldn't be in the landlord business, as with Huron Landing, the 26-apartment complex just east of the 7-Eleven in Breckenridge, that it partnered on with the town to provide affordable rentals beginning in summer 2017.
"There are so many places where you would never see local government involved in providing housing the way that we've gotten ourselves involved," said Davidson, acknowledging such a hefty public hand is far from ideal. "You would hope you would be able to rely upon the free market, but it is so very clear to me — and many other elected officials, and many other business owners and taxpayers in this community — that we are going to have to be involved if we want the people who work here to be able to live here in the future. And we crossed that threshold well over a decade ago."
Voters have repeatedly agreed with the approach. In 1999, they approved 1A open space dollars to allow the county to acquire wilderness areas for protection, in addition to future housing needs. The first 5A measure in 2006 followed, creating a sales tax to help fund the Summit Combined Housing Authority and build on those lands. Continued support of the open space program in 2008, earmarking some money for housing, and the renewal of 5A in November 2015, has extended the green light to local government intervention.
"The way the tourist economy works," said Mamula, who's been an area restaurateur for nearly 30 years, "you can still only charge so much for a hamburger, so you can still only pay so much for employees. That's a real disparity between that housing cost and what you can charge for everything else. That's why the government has to get involved in a place like this, otherwise people have to live elsewhere to work here. That's not sustainable, that's not good for the soul of the community."
Models of Success
Further partnerships with developers willing to accept less lucrative contracts remain key to this blueprint. Because building multi-million-dollar mountain escapes and market-rate residences are significantly more profitable than multi-unit, income-based dwellings, the municipalities often entice builders into deals by offering a mix of benefits such as land, waivers for planning and inspection fees, and discounted access to utilities.
Perhaps Breckenridge's most notable venture — the granddaddy of affordable housing projects in Summit County — has been the Wellington Neighborhood, built in partnership with developer David O'Neil and his real estate company Brynn Grey Partners, Ltd. The swath of 230 market-rate and deed-restricted homes is still under construction with another phase called Lincoln Park, but won a national award in 2002 from the Environmental Protection Agency for smart growth because it repurposed land formerly comprised of only mine tailings from the era of panning for riches. And for many today, it remains a gold standard others have attempted to replicate, and one Frisco enlisted O'Neil's services on for the 69 for-sale homes completed in 2016 in the Peak One Neighborhood.
Collaborations with regional employers and nonprofits are also a growing part of the conversation to help resolve the present housing crisis. Discussions with Vail Resorts, Inc., and Copper Mountain Resort on how to add to the thousands of seasonal beds already in the county are perpetual. The Housing Works Initiative, a cooperative master-lease enterprise through the Family & Intercultural Resource Center (FIRC) and the housing authority, is another creative method for contributing to the area's housing supply.
"FIRC decided whatever we could do to try and be part of the solution, we needed to do," said Tamara Drangstveit, FIRC's executive director. "It threatens the very foundation and fabric of our community when families have to weigh leaving the community or working even more hours and spending even less time with their kids. It starts a downward spiral."
The Summit School District also just embarked on the second phase of its master planning process for both the north and south ends to examine present land and assets, and the possibility of playing a role in solving this countywide problem. Despite all this, a considerable shortage persists throughout the county.
That's led the governmental coalition back to voters this election cycle to ask for another 5A sales tax stream over the next decade to fund further housing. If approved, an estimated $7-to-$8 million annually from a .6-percent tax would be proportionally divided among the county and four towns, with small shares for both Blue River and Montezuma, to develop existing and future lands owned by each jurisdiction. The county, for instance, would primarily intend for its chunk of the purse to go toward infrastructure and eventual buildout of Lake Hill.
Officials say the new 5A fund should not be seen as a panacea, however. And while it polled favorably before hitting this year's ballot, they're still holding their breath until after Nov. 8 in case voters rebuff the request for additional tax revenues.
"If 5A doesn't pass," said Davidson, "… it means, quite frankly, that some of these sites that we've acquired amongst the county and the towns will probably sit there waiting until we eventually would come up with some way to be able to fund even a first phase. So none of it's good, and it's not good for business, it's not good for ski areas, it's not good for the fabric of the community, if people who work here don't get to live here."
It would substantially hinder local leaders' ability to put a dent in the prevailing housing predicament, likely letting the crisis linger for even more years to come. It doesn't mean they'll give up though, even if the housing dilemma in the mountains is one that may never have a final solution.
"I think for the town of Breck," said Mamula of the prospects 5A could be rejected, "we just push on like we have. I worry about the rest of the county though, I worry about what will they do. We'll continue with what we're doing, but the need is massive. It's good to have a community that's supportive of this issue, and sometimes they're not. Sometimes people don't understand why and say, 'Nobody gave me housing.' Well, we're not giving anybody housing, it's still really expensive. It's just not as expensive as it could be — it is more attainable."