As Breckenridge continues to work on solving its shortage of affordable housing, the town is looking into the effects caused by a rule created four years ago that puts some of the burden on businesses to help build workforce housing. 

Breckenridge’s employee mitigation policy requires all new businesses or expanding businesses to provide housing for a certain percentage of their employees. Currently, the town code mandates these entities provide housing for 35% of their employees and requires 350 square feet of housing per employee.

While the effort is meant to boost affordable housing options for the workforce, some Breckenridge officials shared concerns that it could be a barrier preventing new businesses from coming to town. 

Council member Todd Rankin said he was “philosophically” struggling with the policy, noting he is all for boosting the inventory of attainable housing but wasn’t sure this was the way to do it. He worried the policy “stifles” some of the members of the business community, especially small business owners. 

“Does this foster creativity when we are comparing our competitive advantage in these other communities?” he asked at a Sept. 24 meeting. “Does that help talent want to come here instead of (somewhere else)? I don’t think it does.”

He added maybe there was an opportunity to simplify the policy to have the parameters based on something like square footage of the business or how much visitation is being generated by a business. 

Council member Marika Page said she shared many of the concerns Rankin had. 

Mayor Kelly Owens said simplifying the policy too much could lead to some unfairness and could complicate the system, adding she was for “some of those smaller businesses shouldering less.”

This sentiment has been shared by the council for months. Officials have long toyed with making this requirement lesser for small businesses or exempting them from it entirely.

While there’s been intentions of potentially refining the town’s employee mitigation policy, town staffers first had to analyze a new data set on the workforce that just came in this year.

When Breckenridge introduced this policy, it used data from Vail’s workforce that was gathered in 2016 because at the time it didn’t have its own that officials felt was accurate.

Breckenridge nailed down its own workforce data and realized the data it was using from Vail was not representative of the workforce. Staffers found key differences in the data like Breckenridge having two-thirds fewer employees working in hotel and lodging than Vail did.

The town brought on Economic and Planning Systems to collect workforce data and help provide more context ahead of solidifying changes to the policy. Yet, quantifying things like what is considered a full-time employee and how many more employees are needed to staff a restaurant’s outdoor space it utilizes in the summer months can convolute determining how many employees a new business generates. Aspects such as how large a restaurant’s outdoor space is even impacts the calculation for employee generation. Part of Economic and Planning Systems’s work with the town is figuring out how to best navigate these nuances.

The nature of the business also impacts its calculation for how many employees it generates. The town has recently been contemplating adding more business categories such as tap house/brewery/bar that don’t serve food because these micro-industries have fewer employees than others in the current restaurant category.

Assistant Community Development Director Julia Puester said according to industry standards and input from Economic and Planning Systems, 35% is a “comfortable” number. She added certain communities, such as Aspen, require a new business provide housing for 65% of its employees. 

“When you hear people say it’s so hard to open a business in Breckenridge, it’s not just this policy … It’s actually more water and parking,” she said. 

She said businesses have complained in the past about a water plant investment fee and parking fees for those located in the conservation district downtown. Stats included in the Sept. 24 staff meeting memo show sit-down table service restaurants can pay up to $16,000 for water fees and around $47,500 for parking fees in the conservation district.

Owens said she had also been hearing about the parking fees being a struggle for business and said she would like to revisit that policy at a later date. 

Council discussed the town’s goal of having 47% of its workforce live in the Upper Blue Basin, which includes areas near Breckenridge and Blue River, and if the employee mitigation rate should match that. Yet, it was determined requiring businesses to provide housing for 47% was too much of an ask. 

Council informally agreed 35% was a good place to stay at for now, with many committing to that number “in pencil” as opposed to fully committing to it. 

In future meetings staff members and council plan to discuss a potential small-business exemption for the requirement, the ability for business to challenge the employee mitigation requirement and a dicussing the fee-in-lieu option.

The town code currently does include that option and states a “fee in-lieu for each employee required to be housed by this policy shall be established periodically by resolution of the town council.”

For more information on the town’s current code and how it calculates employee generation from businesses visit Breckenridge.Town.Codes/Code/9-1-19-24A.